As filed with the Securities and Exchange Commission on November 6, 1996.

                                                         File No. 333-_______

================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

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

                                    FORM S-8
                             REGISTRATION STATEMENT
                                      UNDER
                           THE SECURITIES ACT OF 1933

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

                           WHITESTONE INDUSTRIES, INC.
               (Exact name of issuer as specified in its charter)

               Delaware                                   75-2228828
     (State or other jurisdiction                      (I.R.S. Employer
   of incorporation or organization)                  Identification No.)

        19200 Von Karman Avenue
              Suite 550
             Irvine, CA                                     92715
(Address of principal executive offices)                  (Zip Code)

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

                              CONSULTING AGREEMENT
                                WITH SPIRO PAPPAS

                           AGREEMENT WITH ESHOO CORP.
              AGREEMENT WITH ATLAS, PEARLMAN, TROP & BORKSON, P.A.
                            (Full title of the plan)

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

                              Donald Yu, President
                           Whitestone Industries, Inc.
                       19200 Von Karman Avenue - Suite 500
                                Irvine, CA 92715
                          Telephone No.: (714) 622-5565
                     (Name and address of agent for service)

                                    Copy to:

                            James M. Schneider, Esq.
                      Atlas, Pearlman, Trop & Borkson, P.A.
                     200 East Las Olas Boulevard, Suite 1900
                            Fort Lauderdale, FL 33301
                                 (954) 763-1200

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



<PAGE>



                         CALCULATION OF REGISTRATION FEE

================================================================================
                                       Proposed    Proposed
                                       maximum     maximum
                                       offering    aggregate    Amount of
Title of securities   Amount to be     price per   offering   registration
 to be registered     registered(1)    share(1)    price(1)      fee (1)
================================================================================

Common Stock           300,000
(no par value)          shares         $.875       $262,500      $100.00

================================================================================

(1)   Pursuant to Rule 457(h),  the maximum  offering price was calculated based
      upon the  average of the bid and asked  prices of the Common  Stock of the
      Company on the OTC Bulletin  Board on October 29, 1996.  The  registration
      fee represents the minimum  registration fee payable for this Registration
      Statement.

































                                        2


<PAGE>



                           WHITESTONE INDUSTRIES, INC.

         CROSS REFERENCE SHEET REQUIRED BY ITEM 501(b) OF REGULATION S-K

            Form S-8 Item Number
                and Caption                     Caption in Prospectus
            --------------------                ---------------------
 1.   Forepart of Registration State-           Facing Page of Registration
      ment and Outside Front Cover              Statement and Cover Page of
      Page of Prospectus                        Prospectus

 2.   Inside Front and Outside Back             Inside Cover Page of Pro-
      Cover Pages of Prospectus                 spectus and Outside Cover
                                                Page of Prospectus

 3.   Summary Information, Risk Fac-            Not Applicable
      tors and Ratio of Earnings to
      Fixed Charges

 4.   Use of Proceeds                           Not Applicable

 5.   Determination of Offering Price           Not Applicable

 6.   Dilution                                  Not Applicable

 7.   Selling Security Holders                  Sales by Selling Security
                                                Holders

 8.   Plan of Distribution                      Cover Page of Prospectus
                                                and Sales by Selling
                                                Security Holders

 9.   Description of Securities to be           Description of Securities;
      Registered                                Consulting Agreements

10.   Interests of Named Experts and            Legal Matters
      Counsel

11.   Material Changes                          Not Applicable

12.   Incorporation of Certain Infor-           Incorporation of Certain
      mation by Reference                       Documents by Reference

13.   Disclosure of Commission Posi-            Indemnification of Direc-
      tion on Indemnification for               tors and Officers; Under-
      Securities Act Liabilities                takings







                                        3


<PAGE>



PROSPECTUS

                           WHITESTONE INDUSTRIES, INC.

                         300,000 Shares of Common Stock
                               ($.0001 par value)

                             Issued Pursuant to the
                         Company's Consulting Agreement
                                with Spiro Pappas
                       and Agreements with Eshoo Corp. and
                      Atlas, Pearlman, Trop & Borkson, P.A.

      This  Prospectus is part of a Registration  Statement  which  registers an
aggregate of 300,000 shares of Common Stock, $.0001 par value (such shares being
referred to as the "Shares"),  of Whitestone Industries,  Inc. (the "Company" or
"Whitestone")  which have been  issued,  as set forth  herein,  to (i) Mr. Spiro
Pappas  ("Pappas")  pursuant to a Consulting  Agreement dated July 17, 1996 (the
"Consulting  Agreement"),  providing  for the issuance of 200,000  Shares;  (ii)
Eshoo Corp., whose sole shareholder is George Eshoo, who serves as Secretary and
Director of the Company,  pursuant to agreement dated October 24, 1996 providing
for the issuance of 50,000  shares of Common Stock;  and (iii) Atlas,  Pearlman,
Trop &  Borkson,  P.A.,  securities  counsel  for the  Company,  pursuant  to an
agreement  dated October 1, 1996  providing for the issuance of 50,000 shares of
Common  Stock (the  agreements  with Eshoo  Corp.  and  Atlas,  Pearlman  Trop &
Borkson,  P.A. being individually  referred to as an "Agreement" or collectively
as the "Agreements"). Mr. Spiro Pappas may sometimes hereafter be referred to as
the "Consultant." In addition, the Consultant,  Eshoo Corp. and Atlas, Pearlman,
Trop &  Borkson,  in their  capacity  as  selling  shareholders,  may  sometimes
hereafter be collectively  referred to as the "Selling Security Holders." All of
the Shares are being issued to the Consultant,  Eshoo Corp. and Atlas, Pearlman,
Trop & Borkson,  P.A. pursuant to written  consulting or other  agreements.  The
Company has been advised by the Selling  Security Holders that they may sell all
or a portion of their Shares from time to time in the  over-the-counter  market,
in negotiated  transactions,  directly or through brokers or otherwise, and that
such Shares will be sold at market  prices  prevailing at the time of such sales
or at negotiated prices, and the Company will not receive any proceeds from such
sales.

      THESE  SECURITIES  HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND  EXCHANGE  COMMISSION  NOR HAS THE  COMMISSION  PASSED  ON THE  ACCURACY  OR
ADEQUACY OF THIS PROSPECTUS.  ANY  REPRESENTATION  TO THE CONTRARY IS A CRIMINAL
OFFENSE.
                                ----------------

      THIS  PROSPECTUS  DOES NOT  CONSTITUTE AN OFFER TO SELL  SECURITIES IN ANY
STATE TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER IN SUCH STATE.

                The date of this Prospectus is November 6, 1996.



                                        4


<PAGE>



      No person has been authorized by the Company to give any information or to
make any representation other than as contained in this Prospectus, and if given
or made, such  information or  representation  must not be relied upon as having
been authorized by the Company.  Neither the delivery of this Prospectus nor any
distribution of the Shares issuable under the terms of the Consulting  Agreement
or the Agreements shall,  under any  circumstances,  create any implication that
there has been no change in the affairs of the Company since the date hereof.

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

                             AVAILABLE INFORMATION

      The Company is subject to the informational requirements of the Securities
Exchange  Act of 1934,  as amended  (the  "Exchange  Act"),  and, in  accordance
therewith,  files  reports,  proxy  statements  and other  information  with the
Securities and Exchange Commission (the "Commission"). Reports, proxy statements
and other  information  filed with the Commission can be inspected and copied at
the public  reference  facilities of the  Commission at 450 Fifth Street,  N.W.,
Washington,  D.C.  20549.  Copies  of this  material  can  also be  obtained  at
prescribed  rates from the Public  Reference  Section of the  Commission  at its
principal  office  at 450  Fifth  Street,  N.W.,  Washington,  D.C.  20549.  The
Commission  also  maintains  a  web  site  that  contains  reports,   proxy  and
information  statements and other  information  regarding  registrants that file
electronically with the Commission at  http://www.sec.gov.  The Company's Common
Stock is traded on the OTC Bulletin Board under the symbol "WHSN."

      The Company has filed with the Commission a Registration Statement on Form
S-8 (the "Registration  Statement") under the Securities Act of 1933, as amended
(the  "Act"),  with respect to the resale of up to an aggregate of up to 300,000
of the Company's  Common Stock, to be issued to the Consultant,  Eshoo Corp. and
Atlas, Pearlman, Trop & Borkson, P.A. pursuant to a written Consulting Agreement
or other Agreements with the Company.  This  Prospectus,  which is Part I of the
Registration Statement,  omits certain information contained in the Registration
Statement. For further information with respect to the Company and the shares of
the  Common  Stock  offered  by  this  Prospectus,  reference  is  made  to  the
Registration  Statement,  including  the exhibits  thereto.  Statements  in this
Prospectus as to any document are not necessarily  complete,  and where any such
document  is an exhibit to the  Registration  Statement  or is  incorporated  by
reference  herein,  each such  statement  is  qualified  in all  respects by the
provisions of such exhibit or other document, to which reference is hereby made,
for a full  statement  of the  provisions  thereof.  A copy of the  Registration
Statement,  with  exhibits,  may be  obtained  from the  Commission's  office in
Washington,  D.C. (at the above address) upon payment of the fees  prescribed by
the rules and regulations of the Commission, or examined there without charge.







                                        5


<PAGE>


                INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

      The  following  documents  filed by the Company  with the  Securities  and
Exchange Commission are incorporated herein by reference and made a part hereof:

      1.    The  Company's  Annual  Report  on  Form 10-KSB  for the  year ended
December 31, 1996.

      2.    The Company's Quarterly Report on Form 10-QSB for the  quarter ended
March 31, 1996.

      3.    The Company's Quarterly Report on Form 10-QSB for the  quarter ended
June 30, 1996.

      4. All reports and documents filed by the Company  pursuant to Section 13,
14 or  15(d)  of the  Exchange  Act,  prior to the  filing  of a  post-effective
amendment which  indicates that all securities  offered hereby have been sold or
which  deregisters all securities then remaining  unsold,  shall be deemed to be
incorporated  by  reference  herein and to be a part hereof from the  respective
date of filing of such documents. Any statement incorporated by reference herein
shall be deemed to be modified or superseded for purposes of this  Prospectus to
the extent that a statement  contained herein or in any other subsequently filed
document,  which also is or is deemed to be  incorporated  by reference  herein,
modifies or supersedes  such  statement.  Any  statement  modified or superseded
shall not be deemed, except as so modified or superseded,  to constitute part of
this Prospectus.

      The Company  hereby  undertakes to provide  without charge to each person,
including  any  beneficial  owner,  to whom a copy of the  Prospectus  has  been
delivered,  on the written or oral request of any such person,  a copy of any or
all of the documents referred to above which have been or may be incorporated by
reference in this  Prospectus,  other than exhibits to such  documents.  Written
requests for such copies should be directed to Corporate  Secretary,  Whitestone
Industries, Inc., 19200 Von Karman Avenue - Suite 500 Irvine, California 92715.


















                                        6


<PAGE>



                                  THE COMPANY

General

      Whitestone Industries,  Inc. was incorporated as a Delaware corporation on
April 19, 1988 under the name  "Fortunistics  Inc." as a "blind  pool" or "blank
check" company to seek  acquisition  possibilities,  make  acquisitions or enter
into other business endeavors.  Currently, the Company, through its wholly-owned
subsidiary,  Golden Bear Entertainment Corporation, is engaged in developing and
marketing electronic,  interactive,  pre-school children's games and educational
products.  In particular,  the Company has developed  prototypes of its products
and is negotiating  marketing outlets,  primarily with large, national toy store
chains. Accordingly, the Company is considered to be a development stage company
for accounting purposes.

Business Strategy

      Management believes that currently,  there has been minimal integration of
electronics  into toys,  but the success of Nintendo and SEGA indicates that the
toy market is prime for other  entries to this market.  The Company is currently
engaged in the development and marketing of electronic,  interactive, pre-school
children's games and educational products. The Company's activities to date have
consisted of  developing  prototypes of its products and  negotiating  marketing
outlets,  primarily  with large,  national toy store  chains.  Accordingly,  the
financial statement presentation is that of a development stage enterprise. Upon
reaching a full  operating  stage,  the Company  envisions  contracting  out the
manufacture of its products to third parties.

Products

      The Company's product line currently consists of the following:

      1. Catch the Beat is a  stylized  FM  Radio/Cassette  Tape  Player  with a
      built-in antenna and full stereo ear phones.  On the game-playing  surface
      consists of a 16 raised and lighted (in different colors) buttons (similar
      to raised telephone numbers on a touch-tone  telephone) that light up when
      music is played through the Tape Cassette Play. By  incorporating  certain
      proprietary  technology,  each button is randomly assigned a note or tone.
      The  object  of the game is to listen  to the  beat,  hit  which  flashing
      buttons a player  believes  appears to be assigned  the  various  notes or
      tones and to score  points.  The faster the beat of the music,  the harder
      the game is.

      2.    Smart Fun - Sounds So Real Story Teller is a  moving  picture  story
      system  with   "Wrap-Around"   sound  that   incorporates   a  proprietary
      3-dimensional  stereo  sound  system.  Each Story  Teller  consists  of 16
      





                                        7


<PAGE>



      full-color story frames that advance  automatically,  a built-in backlight
      for nighttime  reading,  and color effects with exclusive story cartridges
      that are easy to load.  The  sound  track  incorporates  technology  using
      "Surround Sound," giving an impression that certain of these sounds may be
      coming from overhead, behind, nearby, or far away or are traveling.

      3. Smart Fun - Musical  Color Disk  Player is a small,  hand held  machine
      that turns colors into music through proprietary technology.  For example,
      red may be  associated  wit the note "C",  blue with "F",  green with "G",
      etc. The user will turn a crank to spin the  turntable  and hear the color
      disk. The machine  senses each color and turns it into music.  In addition
      to pre-colored disks, blank disks will be included so that users can color
      their own songs.

      4. Smart Fun - Talking Show 'n Know is an  interactive  light- up learning
      game that enhances a child's  pre-reading skills. In response to questions
      posed  by a  realistic  electronic  voice  that  also  incorporates  sound
      effects, a child will identify the sounds with certain visual pictures. If
      the  response  is  correct,  the child is praised  and if the  response is
      incorrect,  the  child  is  encouraged  to try  again  or,  after  several
      attempts,  a new  question  is  asked  so  that  a  child  is  not  become
      frustrated.

Manufacturing

      The  Company's  strategy is to  manufacture  the  majority of its products
through  unaffiliated  contract  manufacturers with facilities in Hong Kong, the
People's  Republic of China and other  developing  countries  in the Pacific Rim
region which offers labor cost advantages. Management has significant experience
and contacts in the  subcontracting of toy  manufacturing  and particularly,  in
this  region of the world.  Over the years,  Management  has  established  close
relationships  with  several   subcontractors  and  has  developed  product  and
manufacturing  standards,  production  planning and quality assurance  functions
with  the  ability  to  monitor  costs,   quality  assurance  and  oversight  of
manufacturing  processes.  Some of the Company's  products or components  may be
manufactured in the United States, depending on cost and related matters.

Marketing and Sales

      The Company will sell its products through sales  representatives to major
North American retailers of toys, toy- related and consumer electronic products.
Accounts that the management  has previously  sold to or will make efforts to be
part of its customer base include:









                                        8


<PAGE>




      Toys R Us               Sears                   Walmart
      Kay Bee Toys            K-Mart                  Service Merchandise
      Price Club              Costco                  Hudson Bay
      Target                  Best Buy                Venture
      Caldor                  Ames                    Bradlee's
      Best Products           BJ's Wholesale          AAFES

      At the  international  level, the Company  anticipates that it will set up
exclusive  distribution  agreements  in the  major  international  markets.  The
Company's  strategy is to manufacture  products for  international  distributors
once the Company  has  received a firm order  accompanied  by a letter of credit
issued by the  distributor in favor of the Company.  The Company  believes,  but
there can be no  assurances,  that  this  approach  will  help to  substantially
eliminate  most of the  capital  commitment  that may be required of the Company
prior to the  manufacture of products.  The Company does not intend to carry any
inventory for the  international  market,  thus eliminating all associated costs
including  storage,   overhead,   insurance,  and  inventory  related  expenses.
International  distributors  will be managed from the Company's  headquarters in
Irvine,  California.  The  Company  believes  that  it  is  important  that  its
distributors be local to each country,  based upon the Company's belief that the
propensity  to buy local and this  inclination  will  also help the  Company  to
obtain local input regarding  packaging,  product  positioning,  pricing and new
product  ideas which would appeal to a specific  country.  The  Company's  local
distributor  will be responsible  for all of the marketing and selling  expenses
for each of their respective markets.


                            CONSULTING AGREEMENTS

Consulting Agreement with Spiro Pappas

      On July 17, 1996, the Company entered into a Consulting Agreement with Mr.
Spiro  Pappas  pursuant  to which  the  Company  agreed  to issue to  Pappas  an
aggregate of 200,000 shares of Common Stock of the Company in consideration  for
consulting   services  to  be  provided  to  the  Company  over  an  anticipated
twelve-month  period  commencing  as  of  the  date  of  the  Pappas  Consulting
Agreement. Under the terms of the Pappas Consulting Agreement, the Consultant is
to undertake for and consult with the Company concerning  management,  marketing
and  operational  planning  and  consulting,   expansion  of  operations  on  an
international basis,  strategic planning,  corporate organization and structure,
examination of products and services and shareholder relations, and shall review
and advise the Company regarding its overall progress,  needs and condition. The
shares of Common Stock will be issued to the Consultant  following  commencement
of  sufficient  performance  under  this  contract  by  the  Consultant  in  the
reasonable determination of the Company.






                                        9


<PAGE>




      In  particular,  the  Consultant  shall provide the  following  enumerated
services: (i) the implementation of short range and long term strategic planning
to fully  develop and enhance the  Company's  assets,  resources,  products  and
services;  (ii) advise the Company of means to restructure  its  capitalization;
(iii) evaluate expanding the scope of the Company's activities and operations on
an  international  basis;  (iv)  advise  the  Company  on means to  enhance  its
liquidity;  (v) assist the Company in developing its business plan;  (vi) advise
the Company relative to setting  corporate goals and strategic  planning;  (vii)
advise and recommend to the Company additional  services and products to be sold
by the Company and develop new promotional  ideas;  (viii) assist the Company in
the  developing  of its marketing  program for its toy products;  and assist the
Company in its relationship with key stockholders.

      In connection with the Pappas Consulting Agreement, the Company has agreed
to issue  200,000  of Common  Stock,  which  shall be issued  following  initial
performance  of services  hereunder in the  reasonable  judgment of the Company.
This compensation  arrangement is not being  administered by either the Board of
Directors of the Company or any  committee  of the Board of Directors  organized
for that purpose.

Agreements with Eshoo Corp. and Atlas, Pearlman, Trop & Borkson, P.A.

      On October 24,  1996,  the Company  entered into a Letter  Agreement  with
Eshoo Corp.,  whose sole  shareholder  is George  Eshoo,  pursuant to which,  in
consideration  for services rendered to the Company by George Eshoo as Secretary
and Director of the Company, Eshoo Corp. was authorized to receive 50,000 shares
of Common Stock of the Company, in discharge of obligations owing to Eshoo Corp.
for  provision of such  services.  In  addition,  on October 1, 1996 the Company
entered  into a Letter  Agreement  with Atlas,  Pearlman,  Trop & Borkson,  P.A.
pursuant  to which it agreed  to issue  50,000  Shares  of  Common  Stock of the
Company in  consideration  for legal  services  provided  to the  Company  since
December  1995 in  discharge  of  obligations  owed  by the  Company  to  Atlas,
Pearlman, Trop & Borkson for rendering such services.

Federal Income Tax Effects

      The  following  discussion  applies to the Common  Stock  issued under the
Consulting  Agreement and the Agreements and is based on federal income tax laws
and  regulations in effect on December 31, 1995. In connection with the issuance
of Common Stock as compensation  payable to the Selling  Security  Holders under
the  Consulting  Agreement or other  Agreements,  the  Consultant,  Mr. Eshoo or
Atlas, Pearlman, Trop & Borkson, P.A. must include in gross income the excess of
the fair market value of the property  received over the amount, if any, paid or
exchanged  for the  property  in the  first  taxable  year in  which  beneficial







                                       10


<PAGE>


interest  in the  property  either  is  "transferable"  or is not  subject  to a
"substantial  risk of forfeiture." A substantial risk of forfeiture exists where
rights and property  that have been  transferred  are  conditioned,  directly or
indirectly,  upon the future  performance  (or refraining  from  performance) of
substantial  services by any person, or the occurrence of a condition related to
the purpose of the transfer, and the possibility of forfeiture is substantial if
such  condition  is not  satisfied.  Common  Stock  received  by a person who is
subject  to the  short  swing  profit  recovery  rule of  Section  16(b)  of the
Securities  Exchange Act of 1934 is considered  subject to a substantial risk of
forfeiture  so long as the sale of such  property at a profit could  subject the
stockholder  to suit under that  section.  The  rights of the  Selling  Security
Holders are treated as transferable if and when the Selling Security Holders can
sell,  assign,  pledge or otherwise transfer any interest in the Common Stock to
any person.  Inasmuch as the Selling  Security  Holders are not expected,  other
than Mr. Eshoo, to be subject to the short swing profit recovery rule of Section
16(b) of the Securities  Exchange Act of 1934 and the Common Stock, upon receipt
following satisfaction of condition  prerequisites to receipt, will be presently
transferable  and not subject to a substantial  risk of forfeiture,  the Selling
Security  Holders  would be obligated to include in gross income the fair market
value of the Common Stock  received once the conditions to receipt of the Common
Stock are satisfied.

Restrictions Under Securities Laws

      The sale of any shares of Common Stock received must be made in compliance
with federal and state securities laws.  Officers,  directors and 10% or greater
stockholders of the Company, as well as certain other persons or parties who may
be deemed to be "affiliates" of the Company under the Federal  Securities  Laws,
should be aware  that  resales by  affiliates  can only be made  pursuant  to an
effective  Registration  Statement,  Rule 144 or any other applicable exemption.
Officers,  directors  and 10% and greater  stockholders  are also subject to the
"short  swing" profit rule of Section  16(b) of the  Securities  Exchange Act of
1934.  Section 16(b) of the Exchange Act generally  provides that if an officer,
director or 10% and greater  stockholder sold any Common Stock of the Company he
would  generally be required to pay to the Company any "profits"  resulting from
the sale of the stock.

                        SALES BY SELLING SECURITY HOLDERS

      The following table sets forth the name of the Selling  Security  Holders,
the amount of shares of Common Stock held  directly or indirectly by the Selling
Security Holders,  the maximum amount of shares of Common Stock to be offered by
the  Selling  Security  Holders,  the amount of Common  Stock to be owned by the
Selling Security  Holders  following sale of such shares of Common Stock and the








                                       11


<PAGE>


percentage of shares of Common Stock to be owned by the Selling Security Holders
following completion of such offering (based on 4,914,320 shares of Common Stock
of the Company outstanding at September 30, 1996).

                                                                  Percentage
                                                 Shares to be     to be Owned
Name of Selling     Number of      Shares to     Owned After      After
Security Holder   Shares Owned    be Offered       Offering       Offering
---------------   ------------    ----------       --------       --------

Spiro Pappas      200,000          200,000           -0-           --
Eshoo Corp.        50,000           50,000           -0-           --
Atlas, Pearlman    50,000           50,000           -0-           --
Trop & Borkson,
P.A.


                            DESCRIPTION OF SECURITIES

      The Company is currently  authorized to issue up to 20,000,000,000  shares
of Common Stock, $.0001 par value, of which 4,914,320 shares were outstanding as
of September 30, 1996.  The Company is also  authorized to issue up to 3,000,000
shares of Preferred Stock, $.01 par value, of which 100,000 shares are issued or
outstanding as of July 31, 1996.

Common Stock

      Subject to the dividend rights of the holders of preferred stock, upon any
subsequent authorization thereof, holders of shares of Common Stock are entitled
to share, on a ratable basis,  such dividends as may be declared by the Board of
Directors out of funds legally available therefor. Upon liquidation, dissolution
or  winding  up of the  Company,  after  payment  to  creditors  and  holders of
preferred  stock  that may be  outstanding,  the assets of the  Company  will be
divided pro rata on a per share basis among the holders of the Common Stock.

      Each  share of Common  Stock  entitles  the  holders  thereof to one vote.
Holders of Common Stock do not have  cumulative  voting  rights which means that
the holders of more than 50% of the shares  voting for the election of Directors
can elect all of the Directors if they choose to do so, and, in such event,  the
holders of the  remaining  shares will not be able to elect any  Directors.  The
ByLaws of the Company  require that only one-third of the issued and outstanding
shares of Common Stock of the Company need be represented to constitute a quorum
and to transact  business at a  stockholders'  meeting.  The Common Stock has no
preemptive,  subscription  or  conversion  rights and is not  redeemable  by the
Company.

Preferred Stock

      On  December  6,  1995,  the  Company  designated  500,000  shares  of its
Preferred  Stock,  par  value $.01, as "Series A  Convertible  Voting  Preferred



                                       12


<PAGE>



Stock" (the  "Series A Preferred  Stock").  The Series A Preferred  Stock has no
dividend or preemptive  rights and is not be subject to a right of redemption on
the part of the Company at any time.

      Holders of the Series A Preferred  Stock have the right,  at their option,
to convert each share of Series A Preferred Stock into Common Stock,  calculated
as to each conversion to the nearest share at any time at a conversion  ratio of
forty-eight (48) shares of the Common Stock for each share of Series A Preferred
Stock.  No fractional  share or scrip  representing  a fractional  share will be
issued upon  conversion  of the Series A Preferred  Stock.  Through  January 27,
1996, in the event of any reclassification,  merger,  consolidation or change of
shares of the Series A  Preferred  Stock  and/or the Common  Stock,  the Company
shall  make  adjustments  to the  conversion  ratio  which  shall  be as  nearly
equivalent to that stated above as may be  practical.  Subsequent to January 28,
1996,  no  adjustments  to the  conversion  ratio  would occur in the event of a
reverse stock split of the Common Stock

      The Series A Preferred Stock shall be automatically  converted into shares
of the Company's Common Stock at such time as the Company amends its Certificate
of  Incorporation  to  increase  its  authorized  Common  Stock  to  permit  the
conversion  of the Series A  Preferred  Stock into shares of Common  Stock.  The
Company agrees  expeditiously  to secure approval of its  stockholders  for such
amendment to its Certificate of Incorporation.

      The Series A Preferred  Stock is currently  subject  adjustment in certain
events,   including  (i)  the  issuance  of  capital  stock  as  a  dividend  or
distribution  on Common Stock,  (ii)  subdivision,  combinations,  reverse stock
splits and  reclassification  of the Common Stock,  (iii) the fixing of a record
date for the  issuance  to all  holders  of Common  Stock of rights or  warrants
entitling  them (for a period  expiring  within 45 days of such record  date) to
subscribe  for  Common  Stock  and (iv)  the  fixing  of a  record  date for the
distribution  to all  holders of Common  Stock of evidence  of  indebtedness  or
assets (other than cash  dividends) of the Company's or  subscription  rights or
warrants (other than those referred to above).

      In addition to any voting rights provided by law, each share of the Series
A Preferred  Stock shall be entitled to 48 votes on all matters  submitted  to a
vote of the  stockholders  of the  Company.  Unless  the vote or  consent of the
holders of a greater  number of shares is  required  by law,  the consent of the
holders of at least a majority  of all of the  Series A  Preferred  Stock at the
time  outstanding  shall be necessary to change,  alter or revoke the rights and
preferences  conferred  on the Series A Preferred  Stock by the  Certificate  of
Incorporation or these  resolutions or to adopt any amendment to the Certificate
of Incorporation materially adversely affecting the rights of the holders of the
Series A Preferred Stock.









                                       13


<PAGE>





      In the event of the liquidation, dissolution or winding up of the Company,
holders of the Series A Preferred Stock shall be entitled to receive,  after due
payment or  provision  for  payment for the debts and other  liabilities  of the
Company,  a  liquidating  distribution  before any  distribution  may be made to
holders of Common  Stock of the  Company.  The holders of the Series A Preferred
Stock outstanding shall be entitled to receive an amount equal to the greater of
$.01 per share, or the liquidation  payment per share of Common Stock multiplied
by  a  factor  of  48,  plus  declared  dividends  to  the  date  of  the  final
distribution,  whether  or not such  liquidation,  dissolution  or winding up is
voluntary or involuntary on the part of the Company.  Any shares of the Series A
Preferred Stock which at any time have been redeemed or converted,  shall, after
such  redemption  or  conversion,  be  automatically  retired and shall have the
status of authorized but unissued shares of Preferred Stock, without designation
as to class or series,  until such shares are once more  designated as part of a
particular class or series by the Board of Directors.

Over-The-Counter Market

      The Company's Common Stock is traded on the over-the-counter market on the
OTC Bulletin Board of NASDAQ under the symbol "WHSN."

Transfer Agent

      The Company's  Transfer  Agent is Securities  Transfer  Corporation  whose
address is 16910 Dallas Parkway, Suite 10, Dallas, Texas 75248.

                                  LEGAL MATTERS

      Certain  legal  matters in connection  with the  securities  being offered
hereby  will be  passed  upon  for the  Company  by the Law  Offices  of  Atlas,
Pearlman,  Trop & Borkson,  P.A., except with respect to securities being issued
to Atlas, Pearlman, Trop & Borkson, P.A., as to which the law offices of Jeffrey
Klein will render such opinion.  Atlas,  Pearlman,  Trop & Borkson, as reflected
herein, owns 50,000 shares of Common Stock of the Company.


                                 INDEMNIFICATION

Article X of the Articles of Incorporation of the Company provides as follows:

            "The  Corporation   shall  indemnify  to  the  fullest  extent
      permitted  by Delaware  Statute  145, as may be amended from time to
      time, any director or officer of  the  Corporation who is a party or









                                    14


<PAGE>



      or who is threatened to be made a party to any proceeding which is a
      threatened, pending or completed action or suit brought against said
      officer or director in his official capacity. This Corporation shall
      not  indemnify  any  director  or  officer  in any  action  or suit,
      threatened,  pending  or  completed,  brought  by  him  against  the
      Corporation,  in the  event  the  officer  or  director  is not  the
      prevailing  party.  Indemnification  of any other  persons,  such as
      employees or agents of the Corporation, or serving at the request of
      the Corporation as a director, officer, employee or agent of another
      corporation,  partnership, joint venture, trust or other enterprise,
      shall be determined in the sole and absolute discretion of the Board
      of Directors of the Corporation."









































                                       15


<PAGE>



                                     PART II

               INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

Item 3.     Incorporation of Documents by Reference
-------     ---------------------------------------

      The  documents  listed  in (1)  through  (4)  below  are  incorporated  by
reference in the Registration Statement. All documents subsequently filed by the
Company  pursuant  to  Section  13(a),  13(c),  14 and  15(d) of the  Securities
Exchange Act of 1934, as amended (the "Exchange Act"),  prior to the filing of a
post-effective  amendment which indicates that all securities  offered have been
sold or which deregisters all securities then remaining unsold,  shall be deemed
to be  incorporated  by reference in the  Registration  Statement and to be part
thereof from the date of filing of such documents.

      (1) The Company's Annual Report on Form 10-KSB for the year ended December
31, 1996.

      (2) The  Company's  Quarterly  Report on Form 10-QSB for the quarter ended
March 31, 1996.

      (3) The  Company's  Quarterly  Report on Form 10-QSB for the quarter ended
June 30, 1996.

      (4) All reports and documents filed by the Company pursuant to Section 13,
14 or  15(d)  of the  Exchange  Act,  prior to the  filing  of a  post-effective
amendment which  indicates that all securities  offered hereby have been sold or
which  deregisters all securities then remaining  unsold,  shall be deemed to be
incorporated  by  reference  herein and to be a part hereof from the  respective
date of filing of such documents. Any statement incorporated by reference herein
shall be deemed to be modified or superseded for purposes of this  Prospectus to
the extent that a statement  contained herein or in any other subsequently filed
document,  which also is or is deemed to be  incorporated  by reference  herein,
modifies or supersedes  such  statement.  Any  statement  modified or superseded
shall not be deemed, except as so modified or superseded,  to constitute part of
this Prospectus.

Item 4.     Description of Securities
-------     -------------------------

            A  description  of the  Company's  securities  is set  forth  in the
Prospectus incorporated as a part of this Registration Statement.

Item 5.     Interests of Named Experts and Counsel
-------     --------------------------------------

      Not Applicable.





                                       16


<PAGE>



Item 6.     Indemnification of Directors and Officers
-------     -----------------------------------------

      Article X of the  Articles of  Incorporation  of the  Company  provides as
follows:

            "The  Corporation   shall  indemnify  to  the  fullest  extent
      permitted  by Delaware  Statute  145, as may be amended from time to
      time, any director or officer of the  Corporation  who is a party or
      who is  threatened to be made a party to any  proceeding  which is a
      threatened, pending or completed action or suit brought against said
      officer or director in his official capacity. This Corporation shall
      not  indemnify  any  director  or  officer  in any  action  or suit,
      threatened,  pending  or  completed,  brought  by  him  against  the
      Corporation,  in the  event  the  officer  or  director  is not  the
      prevailing  party.  Indemnification  of any other  persons,  such as
      employees or agents of the Corporation, or serving at the request of
      the Corporation as a director, officer, employee or agent of another
      corporation,  partnership, joint venture, trust or other enterprise,
      shall be determined in the sole and absolute discretion of the Board
      of Directors of the Corporation."

      Insofar as  indemnification  for liabilities  arising under the Act may be
permitted to Directors, officers and controlling persons of the Company pursuant
to the foregoing provisions,  or otherwise, the Company has been advised that in
the opinion of the Securities and Exchange  Commission,  such indemnification is
against public policy as expressed in the Act and is, therefore,  unenforceable.
In the event that a claim for  indemnification  against such liabilities  (other
than the  payment by the  Company of  expenses  incurred  or paid by a Director,
officer or controlling  person of the Company in the  successful  defense of any
action, suit or proceeding) is asserted by such Director, officer or controlling
person in connection  with the securities  being  registered,  the Company will,
unless in the opinion of its counsel the matter has been settled by  controlling
precedent,  submit to a court of appropriate  jurisdiction  the question whether
such  indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.

Item 7.     Exemption from Registration Claimed
-------     -----------------------------------

      Inasmuch as the Selling  Security  Holders that received the Shares of the
Company  were  knowledgeable,  sophisticated  and had  access  to  comprehensive
information relevant to the Company, such transaction was undertaken in reliance
on the  exemption  from  registration  provided by Section 4(2) of the Act. As a
condition precedent to such grant, the Selling Security Holders were required to
express an  investment  intent and consent to the  imprinting  of a  restrictive
legend on each stock  certificate  to be received  from the Company  except upon
sale of the shares of Common Stock pursuant to a registration statement.



                                       17


<PAGE>

Item 8.     Exhibits
-------     --------

Exhibit                 Description
-------                 -----------

(4)(a)            Consulting  Agreement  between  the  Company  and Spiro Pappas
                  dated July 17, 1996.

(4)(b)            Letter Agreement with Eshoo Corp. dated October 24, 1996.

(4)(c)            Letter  Agreement  with  Atlas, Pearlman, Trop & Borkson, P.A.
                  dated October 1, 1996.

(5)(a)            Opinion  of Atlas, Pearlman, Trop & Borkson, P.A.  relating to
                  the issuance of securities pursuant to  the  above  Consulting
                  Agreement.

(5)(b)            Opinion  of  Law Office  of  Jeffrey  Klein  relating  to  the
                  issuance  of  shares of  securities  pursuant to the Agreement
                  with Atlas, Pearlman, Trop & Borkson, P.A.

(23.1)            Consents of such counsel are included in the
                  opinions filed as exhibit (5) hereto

(23.2)            Consent of independent certified public accountants

Item 9.     Undertakings
-------     ------------

      (1)   The undersigned Company hereby undertakes:

            (a) To file, during any period in which offerings or sales are being
made, a post-effective  amendment to this Registration  Statement to include any
material  information  with respect to the plan of  distribution  not previously
disclosed  in  the  Registration  Statement  or  any  material  change  to  such
information in the Registration Statement;

            (b) That,  for the purposes of determining  any liability  under the
Act, each such post-effective amendment shall be deemed to be a new Registration
Statement relating to the securities  offered therein,  and the offering of such
securities  at that time shall be deemed to be the  initial  bona fide  offering
thereof; and

            (c)  To  remove  from  registration  by  means  of a  post-effective
amendment  any of the  securities  being  registered  which remain unsold at the
termination of the offering.




                                       18


<PAGE>



      (2) The  undersigned  Company  hereby  undertakes  that,  for  purposes of
determining  any liability  under the Act,  each filing of the Company's  annual
report  pursuant to Section  13(a) or Section  15(d) of the  Exchange  Act (and,
where  applicable,  each  filing of an employee  benefit  plan's  annual  report
pursuant to Section 15(d) of the Exchange Act) that is incorporated by reference
in the Registration Statement shall be deemed to be a new Registration Statement
relating to the securities offered therein,  and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.

      (3) Insofar as indemnification  for liabilities  arising under the Act may
be  permitted to  directors,  officers  and  controlling  persons of the Company
pursuant to the foregoing provisions, or otherwise, the Company has been advised
that  in  the  opinion  of  the   Securities  and  Exchange   Commission,   such
indemnification  is  against  public  policy  as  expressed  in the  Act and is,
therefore,  unenforceable. In the event that a claim for indemnification against
such liabilities  (other than the payment by the Company of expenses incurred or
paid  by a  director,  officer  or  controlling  person  of the  Company  in the
successful  defense of any  action,  suit or  proceeding)  is  asserted  by such
director,  officer or controlling person in connection with the securities being
registered,  the Company  will,  unless in the opinion of its counsel the matter
has been  settled by  controlling  precedent,  submit to a court of  appropriate
jurisdiction the question whether such  indemnification  by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
























                                       19


<PAGE>



                                   SIGNATURES

      Pursuant to the  requirements  of the  Securities Act of 1933, as amended,
the Company  certifies that it has  reasonable  grounds to believe that it meets
all of the  requirements  for  filing  on  Form  S-8 and has  duly  caused  this
Registration Statement to be signed on its behalf by the undersigned,  thereunto
duly authorized, in Irvine, California, on the 29th day of October, 1996.

                                          WHITESTONE INDUSTRIES, INC.



                                          By:  /s/Donald Yu
                                             -----------------------------------
                                               Donald Yu, President and
                                               Chief Executive Officer

      Pursuant to the  requirements  of the  Securities Act of 1933, as amended,
this  Registration  Statement  has been signed by the  following  persons in the
capacities and on the dates indicated.

Signature                     Title                            Date
---------                     -----                            ----

                              President, Principal
                              Executive Officer,
                              Principal Financial
                              and Accounting Offi-
                              cer, Treasurer and
/s/Donald Yu                  Director                         October 29, 1996
--------------------------
Donald Yu



/s/George Eshoo               Director                         October 29, 1996
--------------------------
George Eshoo









                                      20
[{"type": "S-8", "sequence": "1", "description": "WHITESTONE INDUSTIES, INC.           FORM S-8", "secsgml_size_bytes": 49182}]
{"company-data": {"conformed-name": "WHITESTONE INDUSTRIES INC", "cik": "0000838796", "assigned-sic": "1311", "irs-number": "752228828", "state-of-incorporation": "DE", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "S-8", "act": "33", "file-number": "333-15617", "film-number": "96655106"}, "business-address": {"street1": "702 MARSHALL STREET", "city": "REDWOOD CITY", "state": "CA", "zip": "94063", "phone": "4153647030"}, "former-company": {"former-conformed-name": "FORTUNISTICS INC", "date-changed": "19920703"}}
As filed with the Securities and Exchange Commission on November 6, 1996.

                                                         File No. 333-_______

================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

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

                                    FORM S-8
                             REGISTRATION STATEMENT
                                      UNDER
                           THE SECURITIES ACT OF 1933

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

                           WHITESTONE INDUSTRIES, INC.
               (Exact name of issuer as specified in its charter)

               Delaware                                   75-2228828
     (State or other jurisdiction                      (I.R.S. Employer
   of incorporation or organization)                  Identification No.)

        19200 Von Karman Avenue
              Suite 550
             Irvine, CA                                     92715
(Address of principal executive offices)                  (Zip Code)

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

                              CONSULTING AGREEMENT
                                WITH SPIRO PAPPAS

                           AGREEMENT WITH ESHOO CORP.
              AGREEMENT WITH ATLAS, PEARLMAN, TROP & BORKSON, P.A.
                            (Full title of the plan)

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

                              Donald Yu, President
                           Whitestone Industries, Inc.
                       19200 Von Karman Avenue - Suite 500
                                Irvine, CA 92715
                          Telephone No.: (714) 622-5565
                     (Name and address of agent for service)

                                    Copy to:

                            James M. Schneider, Esq.
                      Atlas, Pearlman, Trop & Borkson, P.A.
                     200 East Las Olas Boulevard, Suite 1900
                            Fort Lauderdale, FL 33301
                                 (954) 763-1200

                                ----------------
CALCULATION OF REGISTRATION FEE

================================================================================
                                       Proposed    Proposed
                                       maximum     maximum
                                       offering    aggregate    Amount of
Title of securities   Amount to be     price per   offering   registration
 to be registered     registered(1)    share(1)    price(1)      fee (1)
================================================================================

Common Stock           300,000
(no par value)          shares         $.875       $262,500      $100.00

================================================================================

(1)   Pursuant to Rule 457(h),  the maximum  offering price was calculated based
      upon the  average of the bid and asked  prices of the Common  Stock of the
      Company on the OTC Bulletin  Board on October 29, 1996.  The  registration
      fee represents the minimum  registration fee payable for this Registration
      Statement.

                                        2
WHITESTONE INDUSTRIES, INC.

         CROSS REFERENCE SHEET REQUIRED BY ITEM 501(b) OF REGULATION S-K

            Form S-8 Item Number
                and Caption                     Caption in Prospectus
            --------------------                ---------------------
 1.   Forepart of Registration State-           Facing Page of Registration
      ment and Outside Front Cover              Statement and Cover Page of
      Page of Prospectus                        Prospectus

 2.   Inside Front and Outside Back             Inside Cover Page of Pro-
      Cover Pages of Prospectus                 spectus and Outside Cover
                                                Page of Prospectus

 3.   Summary Information, Risk Fac-            Not Applicable
      tors and Ratio of Earnings to
      Fixed Charges

 4.   Use of Proceeds                           Not Applicable

 5.   Determination of Offering Price           Not Applicable

 6.   Dilution                                  Not Applicable

 7.   Selling Security Holders                  Sales by Selling Security
                                                Holders

 8.   Plan of Distribution                      Cover Page of Prospectus
                                                and Sales by Selling
                                                Security Holders

 9.   Description of Securities to be           Description of Securities;
      Registered                                Consulting Agreements

10.   Interests of Named Experts and            Legal Matters
      Counsel

11.   Material Changes                          Not Applicable

12.   Incorporation of Certain Infor-           Incorporation of Certain
      mation by Reference                       Documents by Reference

13.   Disclosure of Commission Posi-            Indemnification of Direc-
      tion on Indemnification for               tors and Officers; Under-
      Securities Act Liabilities                takings

                                        3
PROSPECTUS

                           WHITESTONE INDUSTRIES, INC.

                         300,000 Shares of Common Stock
                               ($.0001 par value)

                             Issued Pursuant to the
                         Company's Consulting Agreement
                                with Spiro Pappas
                       and Agreements with Eshoo Corp. and
                      Atlas, Pearlman, Trop & Borkson, P.A.

      This  Prospectus is part of a Registration  Statement  which  registers an
aggregate of 300,000 shares of Common Stock, $.0001 par value (such shares being
referred to as the "Shares"),  of Whitestone Industries,  Inc. (the "Company" or
"Whitestone")  which have been  issued,  as set forth  herein,  to (i) Mr. Spiro
Pappas  ("Pappas")  pursuant to a Consulting  Agreement dated July 17, 1996 (the
"Consulting  Agreement"),  providing  for the issuance of 200,000  Shares;  (ii)
Eshoo Corp., whose sole shareholder is George Eshoo, who serves as Secretary and
Director of the Company,  pursuant to agreement dated October 24, 1996 providing
for the issuance of 50,000  shares of Common Stock;  and (iii) Atlas,  Pearlman,
Trop &  Borkson,  P.A.,  securities  counsel  for the  Company,  pursuant  to an
agreement  dated October 1, 1996  providing for the issuance of 50,000 shares of
Common  Stock (the  agreements  with Eshoo  Corp.  and  Atlas,  Pearlman  Trop &
Borkson,  P.A. being individually  referred to as an "Agreement" or collectively
as the "Agreements"). Mr. Spiro Pappas may sometimes hereafter be referred to as
the "Consultant." In addition, the Consultant,  Eshoo Corp. and Atlas, Pearlman,
Trop &  Borkson,  in their  capacity  as  selling  shareholders,  may  sometimes
hereafter be collectively  referred to as the "Selling Security Holders." All of
the Shares are being issued to the Consultant,  Eshoo Corp. and Atlas, Pearlman,
Trop & Borkson,  P.A. pursuant to written  consulting or other  agreements.  The
Company has been advised by the Selling  Security Holders that they may sell all
or a portion of their Shares from time to time in the  over-the-counter  market,
in negotiated  transactions,  directly or through brokers or otherwise, and that
such Shares will be sold at market  prices  prevailing at the time of such sales
or at negotiated prices, and the Company will not receive any proceeds from such
sales.

      THESE  SECURITIES  HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND  EXCHANGE  COMMISSION  NOR HAS THE  COMMISSION  PASSED  ON THE  ACCURACY  OR
ADEQUACY OF THIS PROSPECTUS.  ANY  REPRESENTATION  TO THE CONTRARY IS A CRIMINAL
OFFENSE.
                                ----------------

      THIS  PROSPECTUS  DOES NOT  CONSTITUTE AN OFFER TO SELL  SECURITIES IN ANY
STATE TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER IN SUCH STATE.

                The date of this Prospectus is November 6, 1996.

                                        4
No person has been authorized by the Company to give any information or to
make any representation other than as contained in this Prospectus, and if given
or made, such  information or  representation  must not be relied upon as having
been authorized by the Company.  Neither the delivery of this Prospectus nor any
distribution of the Shares issuable under the terms of the Consulting  Agreement
or the Agreements shall,  under any  circumstances,  create any implication that
there has been no change in the affairs of the Company since the date hereof.

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

                             AVAILABLE INFORMATION

      The Company is subject to the informational requirements of the Securities
Exchange  Act of 1934,  as amended  (the  "Exchange  Act"),  and, in  accordance
therewith,  files  reports,  proxy  statements  and other  information  with the
Securities and Exchange Commission (the "Commission"). Reports, proxy statements
and other  information  filed with the Commission can be inspected and copied at
the public  reference  facilities of the  Commission at 450 Fifth Street,  N.W.,
Washington,  D.C.  20549.  Copies  of this  material  can  also be  obtained  at
prescribed  rates from the Public  Reference  Section of the  Commission  at its
principal  office  at 450  Fifth  Street,  N.W.,  Washington,  D.C.  20549.  The
Commission  also  maintains  a  web  site  that  contains  reports,   proxy  and
information  statements and other  information  regarding  registrants that file
electronically with the Commission at  http://www.sec.gov.  The Company's Common
Stock is traded on the OTC Bulletin Board under the symbol "WHSN."

      The Company has filed with the Commission a Registration Statement on Form
S-8 (the "Registration  Statement") under the Securities Act of 1933, as amended
(the  "Act"),  with respect to the resale of up to an aggregate of up to 300,000
of the Company's  Common Stock, to be issued to the Consultant,  Eshoo Corp. and
Atlas, Pearlman, Trop & Borkson, P.A. pursuant to a written Consulting Agreement
or other Agreements with the Company.  This  Prospectus,  which is Part I of the
Registration Statement,  omits certain information contained in the Registration
Statement. For further information with respect to the Company and the shares of
the  Common  Stock  offered  by  this  Prospectus,  reference  is  made  to  the
Registration  Statement,  including  the exhibits  thereto.  Statements  in this
Prospectus as to any document are not necessarily  complete,  and where any such
document  is an exhibit to the  Registration  Statement  or is  incorporated  by
reference  herein,  each such  statement  is  qualified  in all  respects by the
provisions of such exhibit or other document, to which reference is hereby made,
for a full  statement  of the  provisions  thereof.  A copy of the  Registration
Statement,  with  exhibits,  may be  obtained  from the  Commission's  office in
Washington,  D.C. (at the above address) upon payment of the fees  prescribed by
the rules and regulations of the Commission, or examined there without charge.

                                        5
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

      The  following  documents  filed by the Company  with the  Securities  and
Exchange Commission are incorporated herein by reference and made a part hereof:

      1.    The  Company's  Annual  Report  on  Form 10-KSB  for the  year ended
December 31, 1996.

      2.    The Company's Quarterly Report on Form 10-QSB for the  quarter ended
March 31, 1996.

      3.    The Company's Quarterly Report on Form 10-QSB for the  quarter ended
June 30, 1996.

      4. All reports and documents filed by the Company  pursuant to Section 13,
14 or  15(d)  of the  Exchange  Act,  prior to the  filing  of a  post-effective
amendment which  indicates that all securities  offered hereby have been sold or
which  deregisters all securities then remaining  unsold,  shall be deemed to be
incorporated  by  reference  herein and to be a part hereof from the  respective
date of filing of such documents. Any statement incorporated by reference herein
shall be deemed to be modified or superseded for purposes of this  Prospectus to
the extent that a statement  contained herein or in any other subsequently filed
document,  which also is or is deemed to be  incorporated  by reference  herein,
modifies or supersedes  such  statement.  Any  statement  modified or superseded
shall not be deemed, except as so modified or superseded,  to constitute part of
this Prospectus.

      The Company  hereby  undertakes to provide  without charge to each person,
including  any  beneficial  owner,  to whom a copy of the  Prospectus  has  been
delivered,  on the written or oral request of any such person,  a copy of any or
all of the documents referred to above which have been or may be incorporated by
reference in this  Prospectus,  other than exhibits to such  documents.  Written
requests for such copies should be directed to Corporate  Secretary,  Whitestone
Industries, Inc., 19200 Von Karman Avenue - Suite 500 Irvine, California 92715.

                                        6
THE COMPANY

General

      Whitestone Industries,  Inc. was incorporated as a Delaware corporation on
April 19, 1988 under the name  "Fortunistics  Inc." as a "blind  pool" or "blank
check" company to seek  acquisition  possibilities,  make  acquisitions or enter
into other business endeavors.  Currently, the Company, through its wholly-owned
subsidiary,  Golden Bear Entertainment Corporation, is engaged in developing and
marketing electronic,  interactive,  pre-school children's games and educational
products.  In particular,  the Company has developed  prototypes of its products
and is negotiating  marketing outlets,  primarily with large, national toy store
chains. Accordingly, the Company is considered to be a development stage company
for accounting purposes.

Business Strategy

      Management believes that currently,  there has been minimal integration of
electronics  into toys,  but the success of Nintendo and SEGA indicates that the
toy market is prime for other  entries to this market.  The Company is currently
engaged in the development and marketing of electronic,  interactive, pre-school
children's games and educational products. The Company's activities to date have
consisted of  developing  prototypes of its products and  negotiating  marketing
outlets,  primarily  with large,  national toy store  chains.  Accordingly,  the
financial statement presentation is that of a development stage enterprise. Upon
reaching a full  operating  stage,  the Company  envisions  contracting  out the
manufacture of its products to third parties.

Products

      The Company's product line currently consists of the following:

      1. Catch the Beat is a  stylized  FM  Radio/Cassette  Tape  Player  with a
      built-in antenna and full stereo ear phones.  On the game-playing  surface
      consists of a 16 raised and lighted (in different colors) buttons (similar
      to raised telephone numbers on a touch-tone  telephone) that light up when
      music is played through the Tape Cassette Play. By  incorporating  certain
      proprietary  technology,  each button is randomly assigned a note or tone.
      The  object  of the game is to listen  to the  beat,  hit  which  flashing
      buttons a player  believes  appears to be assigned  the  various  notes or
      tones and to score  points.  The faster the beat of the music,  the harder
      the game is.

      2.    Smart Fun - Sounds So Real Story Teller is a  moving  picture  story
      system  with   "Wrap-Around"   sound  that   incorporates   a  proprietary
      3-dimensional  stereo  sound  system.  Each Story  Teller  consists  of 16
      

                                        7
full-color story frames that advance  automatically,  a built-in backlight
      for nighttime  reading,  and color effects with exclusive story cartridges
      that are easy to load.  The  sound  track  incorporates  technology  using
      "Surround Sound," giving an impression that certain of these sounds may be
      coming from overhead, behind, nearby, or far away or are traveling.

      3. Smart Fun - Musical  Color Disk  Player is a small,  hand held  machine
      that turns colors into music through proprietary technology.  For example,
      red may be  associated  wit the note "C",  blue with "F",  green with "G",
      etc. The user will turn a crank to spin the  turntable  and hear the color
      disk. The machine  senses each color and turns it into music.  In addition
      to pre-colored disks, blank disks will be included so that users can color
      their own songs.

      4. Smart Fun - Talking Show 'n Know is an  interactive  light- up learning
      game that enhances a child's  pre-reading skills. In response to questions
      posed  by a  realistic  electronic  voice  that  also  incorporates  sound
      effects, a child will identify the sounds with certain visual pictures. If
      the  response  is  correct,  the child is praised  and if the  response is
      incorrect,  the  child  is  encouraged  to try  again  or,  after  several
      attempts,  a new  question  is  asked  so  that  a  child  is  not  become
      frustrated.

Manufacturing

      The  Company's  strategy is to  manufacture  the  majority of its products
through  unaffiliated  contract  manufacturers with facilities in Hong Kong, the
People's  Republic of China and other  developing  countries  in the Pacific Rim
region which offers labor cost advantages. Management has significant experience
and contacts in the  subcontracting of toy  manufacturing  and particularly,  in
this  region of the world.  Over the years,  Management  has  established  close
relationships  with  several   subcontractors  and  has  developed  product  and
manufacturing  standards,  production  planning and quality assurance  functions
with  the  ability  to  monitor  costs,   quality  assurance  and  oversight  of
manufacturing  processes.  Some of the Company's  products or components  may be
manufactured in the United States, depending on cost and related matters.

Marketing and Sales

      The Company will sell its products through sales  representatives to major
North American retailers of toys, toy- related and consumer electronic products.
Accounts that the management  has previously  sold to or will make efforts to be
part of its customer base include:

                                        8
Toys R Us               Sears                   Walmart
      Kay Bee Toys            K-Mart                  Service Merchandise
      Price Club              Costco                  Hudson Bay
      Target                  Best Buy                Venture
      Caldor                  Ames                    Bradlee's
      Best Products           BJ's Wholesale          AAFES

      At the  international  level, the Company  anticipates that it will set up
exclusive  distribution  agreements  in the  major  international  markets.  The
Company's  strategy is to manufacture  products for  international  distributors
once the Company  has  received a firm order  accompanied  by a letter of credit
issued by the  distributor in favor of the Company.  The Company  believes,  but
there can be no  assurances,  that  this  approach  will  help to  substantially
eliminate  most of the  capital  commitment  that may be required of the Company
prior to the  manufacture of products.  The Company does not intend to carry any
inventory for the  international  market,  thus eliminating all associated costs
including  storage,   overhead,   insurance,  and  inventory  related  expenses.
International  distributors  will be managed from the Company's  headquarters in
Irvine,  California.  The  Company  believes  that  it  is  important  that  its
distributors be local to each country,  based upon the Company's belief that the
propensity  to buy local and this  inclination  will  also help the  Company  to
obtain local input regarding  packaging,  product  positioning,  pricing and new
product  ideas which would appeal to a specific  country.  The  Company's  local
distributor  will be responsible  for all of the marketing and selling  expenses
for each of their respective markets.

                            CONSULTING AGREEMENTS

Consulting Agreement with Spiro Pappas

      On July 17, 1996, the Company entered into a Consulting Agreement with Mr.
Spiro  Pappas  pursuant  to which  the  Company  agreed  to issue to  Pappas  an
aggregate of 200,000 shares of Common Stock of the Company in consideration  for
consulting   services  to  be  provided  to  the  Company  over  an  anticipated
twelve-month  period  commencing  as  of  the  date  of  the  Pappas  Consulting
Agreement. Under the terms of the Pappas Consulting Agreement, the Consultant is
to undertake for and consult with the Company concerning  management,  marketing
and  operational  planning  and  consulting,   expansion  of  operations  on  an
international basis,  strategic planning,  corporate organization and structure,
examination of products and services and shareholder relations, and shall review
and advise the Company regarding its overall progress,  needs and condition. The
shares of Common Stock will be issued to the Consultant  following  commencement
of  sufficient  performance  under  this  contract  by  the  Consultant  in  the
reasonable determination of the Company.

                                        9
In  particular,  the  Consultant  shall provide the  following  enumerated
services: (i) the implementation of short range and long term strategic planning
to fully  develop and enhance the  Company's  assets,  resources,  products  and
services;  (ii) advise the Company of means to restructure  its  capitalization;
(iii) evaluate expanding the scope of the Company's activities and operations on
an  international  basis;  (iv)  advise  the  Company  on means to  enhance  its
liquidity;  (v) assist the Company in developing its business plan;  (vi) advise
the Company relative to setting  corporate goals and strategic  planning;  (vii)
advise and recommend to the Company additional  services and products to be sold
by the Company and develop new promotional  ideas;  (viii) assist the Company in
the  developing  of its marketing  program for its toy products;  and assist the
Company in its relationship with key stockholders.

      In connection with the Pappas Consulting Agreement, the Company has agreed
to issue  200,000  of Common  Stock,  which  shall be issued  following  initial
performance  of services  hereunder in the  reasonable  judgment of the Company.
This compensation  arrangement is not being  administered by either the Board of
Directors of the Company or any  committee  of the Board of Directors  organized
for that purpose.

Agreements with Eshoo Corp. and Atlas, Pearlman, Trop & Borkson, P.A.

      On October 24,  1996,  the Company  entered into a Letter  Agreement  with
Eshoo Corp.,  whose sole  shareholder  is George  Eshoo,  pursuant to which,  in
consideration  for services rendered to the Company by George Eshoo as Secretary
and Director of the Company, Eshoo Corp. was authorized to receive 50,000 shares
of Common Stock of the Company, in discharge of obligations owing to Eshoo Corp.
for  provision of such  services.  In  addition,  on October 1, 1996 the Company
entered  into a Letter  Agreement  with Atlas,  Pearlman,  Trop & Borkson,  P.A.
pursuant  to which it agreed  to issue  50,000  Shares  of  Common  Stock of the
Company in  consideration  for legal  services  provided  to the  Company  since
December  1995 in  discharge  of  obligations  owed  by the  Company  to  Atlas,
Pearlman, Trop & Borkson for rendering such services.

Federal Income Tax Effects

      The  following  discussion  applies to the Common  Stock  issued under the
Consulting  Agreement and the Agreements and is based on federal income tax laws
and  regulations in effect on December 31, 1995. In connection with the issuance
of Common Stock as compensation  payable to the Selling  Security  Holders under
the  Consulting  Agreement or other  Agreements,  the  Consultant,  Mr. Eshoo or
Atlas, Pearlman, Trop & Borkson, P.A. must include in gross income the excess of
the fair market value of the property  received over the amount, if any, paid or
exchanged  for the  property  in the  first  taxable  year in  which  beneficial

                                       10
interest  in the  property  either  is  "transferable"  or is not  subject  to a
"substantial  risk of forfeiture." A substantial risk of forfeiture exists where
rights and property  that have been  transferred  are  conditioned,  directly or
indirectly,  upon the future  performance  (or refraining  from  performance) of
substantial  services by any person, or the occurrence of a condition related to
the purpose of the transfer, and the possibility of forfeiture is substantial if
such  condition  is not  satisfied.  Common  Stock  received  by a person who is
subject  to the  short  swing  profit  recovery  rule of  Section  16(b)  of the
Securities  Exchange Act of 1934 is considered  subject to a substantial risk of
forfeiture  so long as the sale of such  property at a profit could  subject the
stockholder  to suit under that  section.  The  rights of the  Selling  Security
Holders are treated as transferable if and when the Selling Security Holders can
sell,  assign,  pledge or otherwise transfer any interest in the Common Stock to
any person.  Inasmuch as the Selling  Security  Holders are not expected,  other
than Mr. Eshoo, to be subject to the short swing profit recovery rule of Section
16(b) of the Securities  Exchange Act of 1934 and the Common Stock, upon receipt
following satisfaction of condition  prerequisites to receipt, will be presently
transferable  and not subject to a substantial  risk of forfeiture,  the Selling
Security  Holders  would be obligated to include in gross income the fair market
value of the Common Stock  received once the conditions to receipt of the Common
Stock are satisfied.

Restrictions Under Securities Laws

      The sale of any shares of Common Stock received must be made in compliance
with federal and state securities laws.  Officers,  directors and 10% or greater
stockholders of the Company, as well as certain other persons or parties who may
be deemed to be "affiliates" of the Company under the Federal  Securities  Laws,
should be aware  that  resales by  affiliates  can only be made  pursuant  to an
effective  Registration  Statement,  Rule 144 or any other applicable exemption.
Officers,  directors  and 10% and greater  stockholders  are also subject to the
"short  swing" profit rule of Section  16(b) of the  Securities  Exchange Act of
1934.  Section 16(b) of the Exchange Act generally  provides that if an officer,
director or 10% and greater  stockholder sold any Common Stock of the Company he
would  generally be required to pay to the Company any "profits"  resulting from
the sale of the stock.

                        SALES BY SELLING SECURITY HOLDERS

      The following table sets forth the name of the Selling  Security  Holders,
the amount of shares of Common Stock held  directly or indirectly by the Selling
Security Holders,  the maximum amount of shares of Common Stock to be offered by
the  Selling  Security  Holders,  the amount of Common  Stock to be owned by the
Selling Security  Holders  following sale of such shares of Common Stock and the

                                       11
percentage of shares of Common Stock to be owned by the Selling Security Holders
following completion of such offering (based on 4,914,320 shares of Common Stock
of the Company outstanding at September 30, 1996).

                                                                  Percentage
                                                 Shares to be     to be Owned
Name of Selling     Number of      Shares to     Owned After      After
Security Holder   Shares Owned    be Offered       Offering       Offering
---------------   ------------    ----------       --------       --------

Spiro Pappas      200,000          200,000           -0-           --
Eshoo Corp.        50,000           50,000           -0-           --
Atlas, Pearlman    50,000           50,000           -0-           --
Trop & Borkson,
P.A.

                            DESCRIPTION OF SECURITIES

      The Company is currently  authorized to issue up to 20,000,000,000  shares
of Common Stock, $.0001 par value, of which 4,914,320 shares were outstanding as
of September 30, 1996.  The Company is also  authorized to issue up to 3,000,000
shares of Preferred Stock, $.01 par value, of which 100,000 shares are issued or
outstanding as of July 31, 1996.

Common Stock

      Subject to the dividend rights of the holders of preferred stock, upon any
subsequent authorization thereof, holders of shares of Common Stock are entitled
to share, on a ratable basis,  such dividends as may be declared by the Board of
Directors out of funds legally available therefor. Upon liquidation, dissolution
or  winding  up of the  Company,  after  payment  to  creditors  and  holders of
preferred  stock  that may be  outstanding,  the assets of the  Company  will be
divided pro rata on a per share basis among the holders of the Common Stock.

      Each  share of Common  Stock  entitles  the  holders  thereof to one vote.
Holders of Common Stock do not have  cumulative  voting  rights which means that
the holders of more than 50% of the shares  voting for the election of Directors
can elect all of the Directors if they choose to do so, and, in such event,  the
holders of the  remaining  shares will not be able to elect any  Directors.  The
ByLaws of the Company  require that only one-third of the issued and outstanding
shares of Common Stock of the Company need be represented to constitute a quorum
and to transact  business at a  stockholders'  meeting.  The Common Stock has no
preemptive,  subscription  or  conversion  rights and is not  redeemable  by the
Company.

Preferred Stock

      On  December  6,  1995,  the  Company  designated  500,000  shares  of its
Preferred  Stock,  par  value $.01, as "Series A  Convertible  Voting  Preferred

                                       12
Stock" (the  "Series A Preferred  Stock").  The Series A Preferred  Stock has no
dividend or preemptive  rights and is not be subject to a right of redemption on
the part of the Company at any time.

      Holders of the Series A Preferred  Stock have the right,  at their option,
to convert each share of Series A Preferred Stock into Common Stock,  calculated
as to each conversion to the nearest share at any time at a conversion  ratio of
forty-eight (48) shares of the Common Stock for each share of Series A Preferred
Stock.  No fractional  share or scrip  representing  a fractional  share will be
issued upon  conversion  of the Series A Preferred  Stock.  Through  January 27,
1996, in the event of any reclassification,  merger,  consolidation or change of
shares of the Series A  Preferred  Stock  and/or the Common  Stock,  the Company
shall  make  adjustments  to the  conversion  ratio  which  shall  be as  nearly
equivalent to that stated above as may be  practical.  Subsequent to January 28,
1996,  no  adjustments  to the  conversion  ratio  would occur in the event of a
reverse stock split of the Common Stock

      The Series A Preferred Stock shall be automatically  converted into shares
of the Company's Common Stock at such time as the Company amends its Certificate
of  Incorporation  to  increase  its  authorized  Common  Stock  to  permit  the
conversion  of the Series A  Preferred  Stock into shares of Common  Stock.  The
Company agrees  expeditiously  to secure approval of its  stockholders  for such
amendment to its Certificate of Incorporation.

      The Series A Preferred  Stock is currently  subject  adjustment in certain
events,   including  (i)  the  issuance  of  capital  stock  as  a  dividend  or
distribution  on Common Stock,  (ii)  subdivision,  combinations,  reverse stock
splits and  reclassification  of the Common Stock,  (iii) the fixing of a record
date for the  issuance  to all  holders  of Common  Stock of rights or  warrants
entitling  them (for a period  expiring  within 45 days of such record  date) to
subscribe  for  Common  Stock  and (iv)  the  fixing  of a  record  date for the
distribution  to all  holders of Common  Stock of evidence  of  indebtedness  or
assets (other than cash  dividends) of the Company's or  subscription  rights or
warrants (other than those referred to above).

      In addition to any voting rights provided by law, each share of the Series
A Preferred  Stock shall be entitled to 48 votes on all matters  submitted  to a
vote of the  stockholders  of the  Company.  Unless  the vote or  consent of the
holders of a greater  number of shares is  required  by law,  the consent of the
holders of at least a majority  of all of the  Series A  Preferred  Stock at the
time  outstanding  shall be necessary to change,  alter or revoke the rights and
preferences  conferred  on the Series A Preferred  Stock by the  Certificate  of
Incorporation or these  resolutions or to adopt any amendment to the Certificate
of Incorporation materially adversely affecting the rights of the holders of the
Series A Preferred Stock.

                                       13
In the event of the liquidation, dissolution or winding up of the Company,
holders of the Series A Preferred Stock shall be entitled to receive,  after due
payment or  provision  for  payment for the debts and other  liabilities  of the
Company,  a  liquidating  distribution  before any  distribution  may be made to
holders of Common  Stock of the  Company.  The holders of the Series A Preferred
Stock outstanding shall be entitled to receive an amount equal to the greater of
$.01 per share, or the liquidation  payment per share of Common Stock multiplied
by  a  factor  of  48,  plus  declared  dividends  to  the  date  of  the  final
distribution,  whether  or not such  liquidation,  dissolution  or winding up is
voluntary or involuntary on the part of the Company.  Any shares of the Series A
Preferred Stock which at any time have been redeemed or converted,  shall, after
such  redemption  or  conversion,  be  automatically  retired and shall have the
status of authorized but unissued shares of Preferred Stock, without designation
as to class or series,  until such shares are once more  designated as part of a
particular class or series by the Board of Directors.

Over-The-Counter Market

      The Company's Common Stock is traded on the over-the-counter market on the
OTC Bulletin Board of NASDAQ under the symbol "WHSN."

Transfer Agent

      The Company's  Transfer  Agent is Securities  Transfer  Corporation  whose
address is 16910 Dallas Parkway, Suite 10, Dallas, Texas 75248.

                                  LEGAL MATTERS

      Certain  legal  matters in connection  with the  securities  being offered
hereby  will be  passed  upon  for the  Company  by the Law  Offices  of  Atlas,
Pearlman,  Trop & Borkson,  P.A., except with respect to securities being issued
to Atlas, Pearlman, Trop & Borkson, P.A., as to which the law offices of Jeffrey
Klein will render such opinion.  Atlas,  Pearlman,  Trop & Borkson, as reflected
herein, owns 50,000 shares of Common Stock of the Company.

                                 INDEMNIFICATION

Article X of the Articles of Incorporation of the Company provides as follows:

            "The  Corporation   shall  indemnify  to  the  fullest  extent
      permitted  by Delaware  Statute  145, as may be amended from time to
      time, any director or officer of  the  Corporation who is a party or

                                    14
or who is threatened to be made a party to any proceeding which is a
      threatened, pending or completed action or suit brought against said
      officer or director in his official capacity. This Corporation shall
      not  indemnify  any  director  or  officer  in any  action  or suit,
      threatened,  pending  or  completed,  brought  by  him  against  the
      Corporation,  in the  event  the  officer  or  director  is not  the
      prevailing  party.  Indemnification  of any other  persons,  such as
      employees or agents of the Corporation, or serving at the request of
      the Corporation as a director, officer, employee or agent of another
      corporation,  partnership, joint venture, trust or other enterprise,
      shall be determined in the sole and absolute discretion of the Board
      of Directors of the Corporation."

                                       15
PART II

               INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

Item 3.     Incorporation of Documents by Reference
-------     ---------------------------------------

      The  documents  listed  in (1)  through  (4)  below  are  incorporated  by
reference in the Registration Statement. All documents subsequently filed by the
Company  pursuant  to  Section  13(a),  13(c),  14 and  15(d) of the  Securities
Exchange Act of 1934, as amended (the "Exchange Act"),  prior to the filing of a
post-effective  amendment which indicates that all securities  offered have been
sold or which deregisters all securities then remaining unsold,  shall be deemed
to be  incorporated  by reference in the  Registration  Statement and to be part
thereof from the date of filing of such documents.

      (1) The Company's Annual Report on Form 10-KSB for the year ended December
31, 1996.

      (2) The  Company's  Quarterly  Report on Form 10-QSB for the quarter ended
March 31, 1996.

      (3) The  Company's  Quarterly  Report on Form 10-QSB for the quarter ended
June 30, 1996.

      (4) All reports and documents filed by the Company pursuant to Section 13,
14 or  15(d)  of the  Exchange  Act,  prior to the  filing  of a  post-effective
amendment which  indicates that all securities  offered hereby have been sold or
which  deregisters all securities then remaining  unsold,  shall be deemed to be
incorporated  by  reference  herein and to be a part hereof from the  respective
date of filing of such documents. Any statement incorporated by reference herein
shall be deemed to be modified or superseded for purposes of this  Prospectus to
the extent that a statement  contained herein or in any other subsequently filed
document,  which also is or is deemed to be  incorporated  by reference  herein,
modifies or supersedes  such  statement.  Any  statement  modified or superseded
shall not be deemed, except as so modified or superseded,  to constitute part of
this Prospectus.

Item 4.     Description of Securities
-------     -------------------------

            A  description  of the  Company's  securities  is set  forth  in the
Prospectus incorporated as a part of this Registration Statement.

Item 5.     Interests of Named Experts and Counsel
-------     --------------------------------------

      Not Applicable.

                                       16
Item 6.     Indemnification of Directors and Officers
-------     -----------------------------------------

      Article X of the  Articles of  Incorporation  of the  Company  provides as
follows:

            "The  Corporation   shall  indemnify  to  the  fullest  extent
      permitted  by Delaware  Statute  145, as may be amended from time to
      time, any director or officer of the  Corporation  who is a party or
      who is  threatened to be made a party to any  proceeding  which is a
      threatened, pending or completed action or suit brought against said
      officer or director in his official capacity. This Corporation shall
      not  indemnify  any  director  or  officer  in any  action  or suit,
      threatened,  pending  or  completed,  brought  by  him  against  the
      Corporation,  in the  event  the  officer  or  director  is not  the
      prevailing  party.  Indemnification  of any other  persons,  such as
      employees or agents of the Corporation, or serving at the request of
      the Corporation as a director, officer, employee or agent of another
      corporation,  partnership, joint venture, trust or other enterprise,
      shall be determined in the sole and absolute discretion of the Board
      of Directors of the Corporation."

      Insofar as  indemnification  for liabilities  arising under the Act may be
permitted to Directors, officers and controlling persons of the Company pursuant
to the foregoing provisions,  or otherwise, the Company has been advised that in
the opinion of the Securities and Exchange  Commission,  such indemnification is
against public policy as expressed in the Act and is, therefore,  unenforceable.
In the event that a claim for  indemnification  against such liabilities  (other
than the  payment by the  Company of  expenses  incurred  or paid by a Director,
officer or controlling  person of the Company in the  successful  defense of any
action, suit or proceeding) is asserted by such Director, officer or controlling
person in connection  with the securities  being  registered,  the Company will,
unless in the opinion of its counsel the matter has been settled by  controlling
precedent,  submit to a court of appropriate  jurisdiction  the question whether
such  indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.

Item 7.     Exemption from Registration Claimed
-------     -----------------------------------

      Inasmuch as the Selling  Security  Holders that received the Shares of the
Company  were  knowledgeable,  sophisticated  and had  access  to  comprehensive
information relevant to the Company, such transaction was undertaken in reliance
on the  exemption  from  registration  provided by Section 4(2) of the Act. As a
condition precedent to such grant, the Selling Security Holders were required to
express an  investment  intent and consent to the  imprinting  of a  restrictive
legend on each stock  certificate  to be received  from the Company  except upon
sale of the shares of Common Stock pursuant to a registration statement.

                                       17
Item 8.     Exhibits
-------     --------

Exhibit                 Description
-------                 -----------

(4)(a)            Consulting  Agreement  between  the  Company  and Spiro Pappas
                  dated July 17, 1996.

(4)(b)            Letter Agreement with Eshoo Corp. dated October 24, 1996.

(4)(c)            Letter  Agreement  with  Atlas, Pearlman, Trop & Borkson, P.A.
                  dated October 1, 1996.

(5)(a)            Opinion  of Atlas, Pearlman, Trop & Borkson, P.A.  relating to
                  the issuance of securities pursuant to  the  above  Consulting
                  Agreement.

(5)(b)            Opinion  of  Law Office  of  Jeffrey  Klein  relating  to  the
                  issuance  of  shares of  securities  pursuant to the Agreement
                  with Atlas, Pearlman, Trop & Borkson, P.A.

(23.1)            Consents of such counsel are included in the
                  opinions filed as exhibit (5) hereto

(23.2)            Consent of independent certified public accountants

Item 9.     Undertakings
-------     ------------

      (1)   The undersigned Company hereby undertakes:

            (a) To file, during any period in which offerings or sales are being
made, a post-effective  amendment to this Registration  Statement to include any
material  information  with respect to the plan of  distribution  not previously
disclosed  in  the  Registration  Statement  or  any  material  change  to  such
information in the Registration Statement;

            (b) That,  for the purposes of determining  any liability  under the
Act, each such post-effective amendment shall be deemed to be a new Registration
Statement relating to the securities  offered therein,  and the offering of such
securities  at that time shall be deemed to be the  initial  bona fide  offering
thereof; and

            (c)  To  remove  from  registration  by  means  of a  post-effective
amendment  any of the  securities  being  registered  which remain unsold at the
termination of the offering.

                                       18
(2) The  undersigned  Company  hereby  undertakes  that,  for  purposes of
determining  any liability  under the Act,  each filing of the Company's  annual
report  pursuant to Section  13(a) or Section  15(d) of the  Exchange  Act (and,
where  applicable,  each  filing of an employee  benefit  plan's  annual  report
pursuant to Section 15(d) of the Exchange Act) that is incorporated by reference
in the Registration Statement shall be deemed to be a new Registration Statement
relating to the securities offered therein,  and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.

      (3) Insofar as indemnification  for liabilities  arising under the Act may
be  permitted to  directors,  officers  and  controlling  persons of the Company
pursuant to the foregoing provisions, or otherwise, the Company has been advised
that  in  the  opinion  of  the   Securities  and  Exchange   Commission,   such
indemnification  is  against  public  policy  as  expressed  in the  Act and is,
therefore,  unenforceable. In the event that a claim for indemnification against
such liabilities  (other than the payment by the Company of expenses incurred or
paid  by a  director,  officer  or  controlling  person  of the  Company  in the
successful  defense of any  action,  suit or  proceeding)  is  asserted  by such
director,  officer or controlling person in connection with the securities being
registered,  the Company  will,  unless in the opinion of its counsel the matter
has been  settled by  controlling  precedent,  submit to a court of  appropriate
jurisdiction the question whether such  indemnification  by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.

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SIGNATURES

      Pursuant to the  requirements  of the  Securities Act of 1933, as amended,
the Company  certifies that it has  reasonable  grounds to believe that it meets
all of the  requirements  for  filing  on  Form  S-8 and has  duly  caused  this
Registration Statement to be signed on its behalf by the undersigned,  thereunto
duly authorized, in Irvine, California, on the 29th day of October, 1996.

                                          WHITESTONE INDUSTRIES, INC.

                                          By:  /s/Donald Yu
                                             -----------------------------------
                                               Donald Yu, President and
                                               Chief Executive Officer

      Pursuant to the  requirements  of the  Securities Act of 1933, as amended,
this  Registration  Statement  has been signed by the  following  persons in the
capacities and on the dates indicated.

Signature                     Title                            Date
---------                     -----                            ----

                              President, Principal
                              Executive Officer,
                              Principal Financial
                              and Accounting Offi-
                              cer, Treasurer and
/s/Donald Yu                  Director                         October 29, 1996
--------------------------
Donald Yu

/s/George Eshoo               Director                         October 29, 1996
--------------------------
George Eshoo

                                      20