
                   U.S. SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549

                                 FORM 10-KSB

[X]   Annual report under Section 13 or 15(d) of the Securities  Exchange Act of
      1934 for the fiscal year ended December 31, 2000.

Commission file number: 0-20033
                        -------

                       AmeriResource Technologies, Inc.
                       --------------------------------
                (Name of Small Business Issuer in Its Charter)

      Delaware                                           84-1084784
      --------                                           ----------
(State or Other Jurisdiction of                       (I.R.S. Employer
Incorporation or Organization)                        Identification Number)

              4445 South Jones, Suite 2, Las Vegas, Nevada 89103
              --------------------------------------------------
             (Address of Principal Executive Offices) (Zip Code)

                                (702) 362-9284
                                --------------
               (Issuer's Telephone Number, Including Area Code)

Securities registered under Section 12(b) of the ExchaNoneAct:

Securities registered under Section 12(g) of the Exchange Act:

       Title of Each Class          Name of each Exchange on Which Registered
       -------------------          -----------------------------------------
Common Stock ($0.0001 Par Value)

      Check  whether the issuer:  (1) filed all reports  required to be filed by
Section 13 or 15(d) of the  Exchange  Act during the past 12 months (or for such
shorter period that the  registrant was required to file such reports),  and (2)
has been subject to such filing requirements for the past 90 days.
      No [  ]                      Yes [ X ]

      Check if there is no disclosure  of delinquent  filers in response to Item
405 of  Regulation  S-B not contained in this form,  and no  disclosure  will be
contained,  to the  best of  registrant's  knowledge,  in  definitive  proxy  or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB [ ].

      The issuer's total  consolidated  revenues for the year ended December 31,
2000, were $0.

      The aggregate market value of the registrant's  Common Stock,  $0.0001 par
value held by non-affiliates was approximately $7,735,095,  based on the average
closing bid and asked prices for the Common  Stock on March 29,  2001.  On March
29, 2001,  the number of shares  outstanding of the  registrant's  Common Stock,
$0.0001 par value (the only class of voting stock), was 762,162,093.


<PAGE>


                              TABLE OF CONTENTS

PART I.......................................................................1
      ITEM 1.  DESCRIPTION OF BUSINESS.......................................1
      ITEM 2.  DESCRIPTION OF PROPERTY.......................................3
      ITEM 3.  LEGAL PROCEEDINGS.............................................3
      ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS...........6

PART II......................................................................7
      ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER
               MATTERS.......................................................7
      ITEM 6.  MANAGEMENT'S  DISCUSSION  AND ANALYSIS OR PLAN OF
               OPERATION.....................................................8
      ITEM 7.  FINANCIAL STATEMENTS..........................................9
      ITEM 8.  CHANGES IN AND  DISAGREEMENTS  WITH  ACCOUNTANTS ON
               ACCOUNTING AND FINANCIAL DISCLOSURE..........................10

PART III....................................................................10
      ITEM  9. DIRECTORS,  EXECUTIVE  OFFICERS,  PROMOTERS  AND CONTROL
               PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE
               ACT..........................................................10
      ITEM 10. EXECUTIVE COMPENSATION.......................................11
      ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
               MANAGEMENT...................................................12
      ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS...............12
      ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K.............................13

INDEX TO EXHIBITS...........................................................15


<PAGE>

                                    PART I

ITEM 1.     DESCRIPTION OF BUSINESS

      As used herein,  the term "Company" refers to AmeriResource  Technologies,
Inc., a Delaware corporation, and its subsidiaries and predecessors,  unless the
context indicates  otherwise.  The Company was formerly known as KLH Engineering
Group,  Inc. ("KLH  Engineering"),  which was  incorporated  on March 3, 1989 to
provide  diversified  engineering  services  throughout the United  States.  KLH
Engineering  changed its name to  AmeriResource  Technologies,  Inc. on July 16,
1996. Although the Company's operations have historically consisted of providing
engineering and  construction  services,  in 1996 the Company closed and/or sold
off its engineering subsidiaries due to continued losses.

      The Company did not obtain any construction  contracts during 1999 or 2000
which it believes is related to the Chapter 11  Bankruptcy  of its wholly  owned
subsidiary,  Tomahawk Construction Company ("Tomahawk"),  on September 15, 1994.
Despite Tomahawk's emergence from bankruptcy on August 28, 1995, the Company has
been unable to obtain the  necessary  bonding  capacity  to obtain  construction
contracts.  As a result of Tomahawk's lack of new construction contracts in 1999
and 2000, the Company is currently  exploring  opportunities to combine Tomahawk
with  another  company  through  a merger or  acquisition.  The  Company  is now
searching for a construction company that is interested in being acquired.

      In connection with the Company's operational restructuring,  it executed a
Share  Purchase  Agreement  on December  31,  1999,  with Dustan  Shepherd,  the
Company's  former   President,   whereby  the  Company  sold  its  wholly  owned
subsidiary,  First Americans Mortgage Company ("FAMC"),  to Shepherd for $30,000
payable  pursuant to a promissory note. In connection with this subsidiary sale,
FAMC surrendered to the Company  7,000,000 shares of common stock Kelly's Coffee
which had been  received by FAMC for services FAMC and the Company had rendered.
Pursuant to this Share Purchase  Agreement,  the Company  forgave FAMC's debt to
Tomahawk,  which was secured by a June 30,  1999  promissory  note.  The Company
received  the  first  installment  on or about  January  16,  2001  from  Dustin
Shepherd.

      On June 30, 1999, the Company sold the following subsidiaries to Calbear
LLC in an effort to eliminate certain liabilities from its  balance sheet:
(1) KLH Engineers & Contractors,  Inc., (2) KLH  Engineering of Colorado
Springs,  Inc., (3) KLH  Engineering of Lakewood,  Inc., (4) KLH Engineering of
Grand  Junction,  Inc.,  (5)  KLH  Engineering  of  San  Mateo,  Inc.,  (6)  KLH
Engineering of Greeley, Inc., (7) Morton Technologies, Inc. (8) LBH Engineering,
Inc., (9) Coffee Engineering & Surveying,  Inc., and (10) Scanlon & Associates,
Inc.  The Company sold the subsidiaries for $550.

      THE TRAVEL AGENT'S HOTEL GUIDE, INC. ("TAHG")

      Effective  December 14, 1998, the Company  acquired Gold Coast  Resources,
Inc.  in a  stock  purchase  agreement  which  included  all of the  issued  and
outstanding shares of TAHG common stock in exchange for a convertible  debenture
in the  amount  of  $3,350,000.  TAHG is a  publication  which is used by travel
agents to sell hotel rooms throughout the United States.




                                      1

<PAGE>



      On August 23, 1999,  the Company  sold 50% of TAHG to Staruni  Corporation
("SRUN") for 400,000 shares of SRUN's common stock. Although SRUN has guaranteed
the value these shares at  $1,750,000  for one year,  the price  guarantee  will
lapse if the SRUN stock  reaches a $4.00 price and remains  above that price for
10 consecutive  business  days.  The SRUN stock has been valued at $86,000.  The
Company  discounted  the value of the SRUN common stock based upon the financial
statements of SRUN and its current market price.  The result of this transaction
was a loss of $483,506.  The Company hopes that SRUN's experience as an Internet
company will aid in placing the Guide on the world wide web.

      MAGNOLIA MANORS, INC.

      On December 23, 1999, the Company, Magnolia Manors, Inc. and Krapfcandoit,
Inc. executed a contribution  agreement,  whereby the Company was to acquire the
assets of Magnolia  and  Krapfcandoit  in exchange  for shares of the  Company's
common stock. Shortly after the execution of this agreement, all parties decided
to  modify  its  terms.  The  Company  no longer  has an  intention  to  acquire
Krapfcandoit.  Magnolia  Manors  and the  Company  agreed  to an asset  purchase
agreement whereby the Company was to acquire Magnolia Manors for cash and stock.
Magnolia's assets include approximately 21 assisted living facilities located in
Alabama.  The Company was to acquire Magnolia Manors, Inc. through the
acquisition of Crestwood Villas, Inc. which had contractual rights to purchase
Magnolia's assets.  Magnolia Manors is owned by Krapfcandoit but is operating
under a receiver that has been appointed by Finova.

      Subsequent  to the  December  23,  1999  agreement,  litigation  ensued in
Alabama regarding contractual  obligations.  On February 27, 2001, mediation was
held to  resolve  the  issues.  The  essence  of the  mediation  was to  resolve
litigation  and address the purchase of 11 facilities  owned by Magnolia.  As of
March 29, 2001, no outcome had been reached on this mediation.  Accordingly,  no
assurances  can be given that any business  transaction  between the Company and
Magnolia will ever be consummated.  The Company denies all of the allegations of
such lawsuit and is vigorously defending itself against such claims.

      PHOENIX PARTNERS, LP

      The Company  entered  into a Letter of Intent  dated August 30, 2000 and a
Joint Venture Agreement dated August 31, 2000 with Phoenix Leisure Holdings, LLC
("PLH"),  a  Delaware  limited  liability  company  majority  owned  by  Phoenix
Partners,  LP ("Phoenix").  Pursuant to these  agreements,  Phoenix and PLH have
agreed to allow the Company to  participate in  acquisitions  PLH may make which
satisfy certain financial parameters. For an acquisition to qualify within these
parameters the acquisition  target must have a fair market value of seventy-five
million dollars ($75,000,000).  The amount of participation to which the Company
is   entitled   shall   not  be  less  than  2.5%  nor  more  than  25%  of  the
post-acquisition entity. The actual agreement of participation shall be mutually
determined by Phoenix and the Company.

      WEST TEXAS REAL ESTATE AND RESOURCES, INC.

      Pursuant to a Definitive Agreement dated July 13, 2000 (the "Agreement"),
the Company acquired West Texas Real Estate and Resources, Inc., a Texas
corporation ("WTRER").  The Company acquired all of the outstanding equity of
WTRER from LBI Properties, Inc., a Florida

                                      2

<PAGE>



corporation  ("LBI"), in exchange for $1.7 million secured by a promissory note.
The promissory  note was paid off during the third quarter of 2000. The terms of
the promissory  note extended until the $1.7 million was paid by the Company and
provided  for  interest at seven and  one-half  percent (7 1/2%) per annum.  The
promissory note was secured by Five Million, Two Hundred Seventy-Five  Thousand,
Two Hundred Forty (5,275,240)  shares of WTRER's common stock, which constitutes
the outstanding equity of WTRER acquired by the Company under the Agreement.

      As a result of the acquisition of WTRER,  the Company acquired an oil, gas
and mineral lease on approximately  800 acres in Pecos County,  Texas. The lease
is described by appraisers as "proved  undeveloped  petroleum  reserves that are
recoverable  from  additional  wells yet to be drilled."  Production  from these
reserves  will  require the  drilling of  additional  wells,  the  deepening  of
existing wells or the installation of enhanced recovery facilities.  The Company
intends to utilize all acquired assets  described herein in the manner they were
previously used and intend to continue the operations of all businesses acquired
in the same manner as prior to its acquisition.

      As of March 29, 2001, the Company had a total of three (3)  employees,  of
which two (2) were employed full-time.

ITEM 2.     DESCRIPTION OF PROPERTY

      The Company owns no real property.  The Company's operations are conducted
through  one office  located at 4445 South  Jones,  Suite 2, Las Vegas,  Nevada,
89103, which is leased. It is a five (5) year lease of approximately 3100 square
feet with three (3) two (2) year  options at $1.70 per square foot a month.  The
Company plans on subleasing a portion of the space.

      By acquiring WTRER, the Company was assigned an oil, gas and mineral lease
which is called the Glass  Mountains  "PilaresA111"  and consists of  contiguous
acreage of  approximately  +/- 800 acres  comprising a portion of Glass Mountain
acreage located in Pecos County,  Texas. The Company's interest in this property
is subject to a twenty percent (20%) royalty interest due the lessor. This lease
was entered into on October 6, 1999 and has a five (5) year term.

ITEM 3.     LEGAL PROCEEDINGS

      The following  are pending  material  cases  involving the Company and its
subsidiaries.  The  Company  and its  subsidiaries  are  subject to a variety of
claims  and suits that  arise  from time to time out of the  ordinary  course of
business, most commonly contract disputes. The Company believes that the pending
claims are adequately covered by insurance.  However,  there can be no guarantee
that  such  insurance  will be  adequate,  will  be  renewable,  or will  remain
available in the future.

      Internal  Revenue Service Issue.  The IRS and the Company have been trying
to resolve  outstanding  issues  through an appointed  agent during 2000 for the
taxes  created by the previous  engineering  subsidiaries  during the close down
phases of the offices and was not  successful in reaching a resolution  with the
IRS. On or about January 16, 2001,  the IRS notified Rod Clawson,  a director of
the Company and the former President of the engineering  subsidiaries,  that the
IRS was  filing a lien  against  him,  personally,  for the  payment  of  taxes.
Subsequently,  several  meetings  were held and an  agreement  was reached on or
about March 22, 2001 with the IRS.  Clawson was able to reach a resolution  with
the IRS whereby Clawson will pay $50,000 per month until approximately $282,000,
constituting principal and interest, is paid off in its entirety.


                                      3

<PAGE>



      Orix Real Estate Capital Markets, LLC , as the Special Servicer for Finova
Realty  Capital,  Inc.  (AMRESCO MS CAPITAL 1999,  FNV-1 Loan  #04000333342)  v.
Magnolia Manors Properties, LLC, et al. Orix Real Estate Capital Markets, LLC in
May 2000 filed a lawsuit in Walker County,  Alabama, as the Special Servicer for
Finova  Realty  Capital,  Inc.  alleging that Magnolia  Manors  Properties,  LLC
defaulted on the provisions of a promissory note to Finova Realty Capital,  Inc.
by  which  it  promised  to  repay  $9,280,000.  ORIX  is the  servicer  in this
transaction and is seeking to enforce the provisions of the loan documents which
are secured by  mortgages  on the real  properties  owned,  administered  and/or
operated by Magnolia Manors  Properties,  LLC. This lawsuit alleges that because
the Company has been in  negotiations to merge or acquire the assets of Magnolia
Manors  Properties,  LLC that it has bound itself to certain provisions of these
loan documents. The Company denies all of the allegations in this lawsuit and is
vigorously defending itself against such allegations.

      John C. Barry v. ARET and Delmar Janovec was filed in 1996. Mr. Barry sued
the Company and Delmar Janovec for breach of contract  regarding  vacation funds
that had been accrued but never paid. A judgment was entered on January 21, 1997
in the Superior Court of the State of California,  San Mateo County. This matter
was settled in the Fall of 2000 for a total of $44,151.17. On January 5, 2001 an
Acknowledgment  of  Satisfaction  of  Judgment  was  filed  which  reflects  the
settlement has been paid-in-full.

      Craft, Fridkin & Rhyne, L.L.C. vs. AmeriResource Technologies, Inc. Craft,
Fridkin & Rhyne,  L.L.C.  ("CFR")  alleged that on August 26, 1998,  the Company
executed  a  Consulting  Agreement  with  CFR  whereby  the  Company  agreed  to
compensate  CFR for legal  services  rendered  through May 31, 1998,  with Forty
Million  (40,000,000)  shares of the  Company's  common  stock  which were to be
registered  with the SEC on Form  S-8  under  the  Securities  Act of  1933,  as
amended. CRR also alleged that the Company agreed to issue additional stock upon
receipt of CFR's monthly billing statements valued at one cent ($.01) per share.
The Company  retained  counsel to represent it in this  proceeding,  although it
believes CFR has been paid in full for all services rendered.

      CFR  filed  a  Demand  for  Arbitration  with  the  American   Arbitration
Association on March 24, 2000,  whereby CFR demanded  "compensation for services
rendered   pursuant  to  Consulting   Agreement  dated  August  26,  1998."  The
arbitration  hearing was heard on or about July 11, 2000,  and a settlement  was
thereafter  agreed upon,  whereby the Company issued 32,000,000 shares of common
stock in exchange for legal services of $445,000  allegedly owed by the Company.
The matter and alleged debt have now been full settled in full.

      Scar I Group vs.  AmeriResource  Technologies,  Inc., Delmar Janovec,  and
Tomahawk  Construction.  This case was filed on January 26, 2000 in the Court of
Common Pleas in Cuyahoga County,  Ohio, Case Number  00-400551-CV.  Scar I Group
("Scar I") filed suit against the Company, its President, Delmar Janovec and its
subsidiary,  Tomahawk Construction,  for fraudulent misrepresentation and breach
of contract.  The Company denied all liability and will vigorously defend itself
against  the claims  asserted  in the lawsuit  which  management  believes to be
groundless.

      The lawsuit alleges that on April 29, 1997, Scar I signed a Loan Agreement
with  Delmar  Janovec  and  Tomahawk  Construction  agreeing  to lend them Fifty
Thousand Dollars  ($50,000) for a period not to exceed sixty (60) days.  Shortly
after this Loan Agreement was signed, Janovec and Tomahawk accepted a $1,851,444
settlement  from M.K.  Ferguson  and the  Department  of Energy in an  unrelated
lawsuit, which was to be finalized coincident with the Scar I loan. Janovec,

                                      4

<PAGE>



Tomahawk and Scar I agreed that $100,000 of these  settlement  proceeds would be
paid on or before July 2, 1997,  to Scar I and  constitute  total payment of the
loan's principal plus $50,000  interest.  As security for the loan,  Janovec and
Tomahawk executed a promissory note for the $100,000 and placed an estimated Ten
Million  (10,000,000) shares of the Company's common stock in escrow with Surety
Title.

      On July 16,  1997,  Janovec and Tomahawk  notified  Scar I in writing that
Industrial State Bank had a blanket lien on the settlement  proceeds and that no
portion of such could be  transferred,  and therefore the Company could not meet
the loan's terms. Janovec and Tomahawk requested that the stock certificates and
related  documents  be  released  from  escrow  in Scar  I's  name.  On or about
September  17, 1997,  Scar I agreed to cancel the Loan  Agreement and to release
the stock and related documents from escrow. On September 17, 1997,  Janovec and
Tomahawk  sent a  certified  check in the amount of  $200.00 to Surety  Title as
payment for escrow  services.  Also on September 17, 1997,  Janovec and Tomahawk
sent a certified check in the amount of $1,000.00 to Chuck  Scaravelli at Scar I
as payment in full for its  services  in  connection  with the  negotiation  and
structuring of the loan documents.

      Scar I is claiming that Janovec and Tomahawk  fraudulently  misrepresented
that the  settlement  funds were not going to be paid and that they  relied upon
that  misrepresentation  in canceling the Loan  Agreement.  Janovec and Tomahawk
contend  that the  settlement  was not reached  within  sixty (60) days from the
execution of the Loan  Agreement,  and that not only has the Loan Agreement been
effectively  canceled  by Scar I but that they have  accepted  payment for their
services.  Management  denies the  allegations  in this suit and will defend its
position in seeking and out-of-court settlement.

      Industrial State Bank vs. AmeriResource Technologies, Inc., Delmar Janovec
and  Marilyn  Janovec.  This case was  filed in the  District  Court of  Johnson
County,  Kansas, Case Number 98-C- 14923. On July 9, 1999, Industrial State Bank
agreed to accept from the  Company,  Delmar and Marilyn  Janovec  $200,000  plus
2,760,000  shares of the  Company's  common  stock in  exchange  for the  bank's
forgiveness of the Company's  $1,071,214 debt, which included accrued  interest.
The first cash  payment of $100,000  was paid on July 16,  1999,  and the second
payment was due on August 30, 1999.  The note  securing  the second  payment was
extended to December 15, 1999 for an additional payment of $20,000.  Mr. Janovec
transferred  shares of Series A and Series B Preferred  Stock  convertible  into
2,760,000 shares of the Company's common stock to the Industrial State Bank. The
Company intends to reimburse  Janovec.  The Company made additional  payments of
$40,000 during the third quarter and was granted an extension until December 15,
1999,  to pay the remaining  $60,000.  This  settlement  amount has been paid in
full.

      Double K Marketing, Inc. vs. Delmar A. Janovec.  This case was filed in
the Jefferson Circuit Court, Division Twelve, Kentucky, Case Number 99-CI-03105.
On November 12, 1999, the Court set aside the Default Judgment against Delmar
Janovec and dismissed the case without prejudice.  To date, no further pleadings
have been filed in this matter.

      Liberty Systems, Inc. vs. Tomahawk Construction Corporation and Delmar
Janovec.  This action is pending in the District Court of Johnson County,
Kansas, Case Number 99C10488. Liberty is suing Tomahawk and Delmar Janovec for
nonpayment of a note for $32,917.00 executed by and between Delmar Janovec and/
or Tomahawk and Liberty on July 31, 1997.



                                      5

<PAGE>



      American Factors Group, L.L.C. vs.  AmeriResource  Technologies,  Inc., et
al. This case was filed in the United  States  District  Court,  District of New
Jersey, Case Number  3:97cv01094(GEB).  In February 2000, the parties stipulated
to the dismissal of certain claims in this suit with prejudice. This stipulation
dismissed  all of the  claims  in  this  suit  except  for  the  claims  against
defendants  Rod Clawson,  Michael  Cederstrom and Tim Masters.  These  remaining
claims were settled on or about July 6, 2000 pursuant to a settlement  agreement
which is more fully  described  below and has been  verbally  amended to require
payments of no less than $20,000 per month with a goal of $40,000 per month.

      Q Capital Corporation and American Factors Group, L.L.C. vs. AmeriResource
Technologies, Inc. and Delmar Janovec.  These parties have entered into a
multiparty settlement agreement.  The parties have agreed upon the specific
settlement terms outlined in an Original Settlement Agreement and a Supplemental
Settlement Agreement. Although all of the terms in both documents have been
orally agreed to by all parties, neither document has yet been executed.

      On February  15,  2000,  a  Settlement  and Release  Agreement  ("Original
Settlement  Agreement")  was  negotiated  and orally  agreed to by and between Q
Capital  Corporation  ("Q"),  American  Factors  Group  ("AFG"),   AmeriResource
Technologies,  Inc.  ("ARET")  and  Delmar  Janovec  ("Janovec").  The  Original
Settlement  Agreement  provided  for the  payment by ARET and Janovec of certain
obligations and judgments  entered in favor of Q and AFG against ARET,  Janovec,
and the  defendants in the above  referenced  action,  American  Factors  Group,
L.L.C. V. AmeriResource  Technologies,  Inc. et al, Case Number 3:97cv01094(GEB)
("Pending Action").

      In  April  2000,  a  Supplemental   Settlement  Agreement   ("Supplemental
Settlement  Agreement")  was  negotiated  and orally agreed to by and between Q,
AFG, the Company and Janovec.  The Company  believes this agreement will require
it and Janovec to:

      1.    Pay Q and AFG Four Hundred Ninety Thousand Dollars ($490,000) on or
            before April 10, 2000;

      2.    Deliver to Q and AFG all of the shares of common stock in Staruni,
            Inc.; and

      3.    Release and forever discharge Q and AFG from any and all claims or
            causes of action arising out of or related to those which were, or
            could have been, alleged in the Pending Action,

Under the terms of the agreement,  which has been finalized in writing,  the
Company believes that AFG and Q will:

      1.    File a Satisfaction of Judgment and Order of Dismissal with
            Prejudice as to all defendants in the Pending Action;

      2.    File with the appropriate courts a Satisfaction of Judgment against
            any and all parties for whom AFG or Q received a judgment in
            connection with the obligations and judgments against ARET and
            Janovec;

      3.    Void the Original Settlement Agreement; and



                                      6

<PAGE>



      4.    Release and forever discharge ARET, Janovec and all other defendants
            named in the  Pending  Action  from any and all  claims or causes of
            action  arising  out of or related to those  which were set forth in
            any of the  Judgments  or were,  or could have been,  alleged in the
            Pending  Action or any of the other lawsuits for which they obtained
            a judgment.

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

      During the fourth  quarter of the fiscal year ended December 31, 2000, the
Company  did not submit any matters to a vote of  security  holders  through the
solicitation of proxies or otherwise.


                                    PART II

ITEM 5.     MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER
            MATTERS

      The  Company's  Common  Stock is traded on OTC  Bulletin  Board  under the
symbol  "ARET." The table below sets forth the high and low sales prices for the
Company's  Common Stock for each quarter of 1998 and 1999 and the first  quarter
of 2000.  The  quotations  below reflect  inter-dealer  prices,  without  retail
markup, markdown or commission and may not represent actual transactions:


      Year     Quarter        High        Low
      1998     First          $ 0.031     $ 0.016
               Second         $ 0.050     $ 0.011
               Third          $ 0.030     $ 0.009
               Fourth         $ 0.010     $ 0.009

      Year     Quarter        High        Low
      1999     First          $ 0.019     $ 0.008
               Second         $ 0.530     $ 0.007
               Third          $ 0.070     $ 0.015
               Fourth         $ 0.550     $ 0.014

      Year     Quarter        High        Low
      2000     First          $ 0.770     $ 0.036
               Second         $0.199      $0.042
               Third          $0.063      $0.0324
               Fourth         $0.034      $0.0152

      Year     Quarter        High        Low
      2001     First          $0.021      $0.011

Shareholders

      As of March 29, 2001, there were  approximately 806 shareholders of record
holding a total of 762,162,093 shares of Common Stock.


                                      7

<PAGE>



Dividends on the Common Stock

      The Company has not  declared a cash  dividend on its Common  Stock in the
last two fiscal years and the Company does not  anticipate the payment of future
dividends.  The Company may not pay  dividends on its Common Stock without first
paying dividends on its Preferred Stock.  There are no other  restrictions  that
currently limit the Company's ability to pay dividends on its Common Stock other
than those generally imposed by applicable state law.

Preferred Stock

      No market currently exists for the Company's  preferred stock. The Company
has two  classes  of  preferred  stock,  a Series  A class  and a Series B class
("Preferred  Stock").  Each share of the Preferred Stock may be converted by the
holder into one share of common  stock.  The  Preferred  Stock has a liquidation
value of $1.25 per share and has voting rights equivalent to one share of Common
Stock.  Dividends on the Preferred  Stock accrue  quarterly at an annual rate of
$0.125 per share.  The  Company  has never  declared  or paid  dividends  on its
Preferred Stock.

      As of March 29, 2001, there were 15 shareholders of record holding a total
of 131,275 shares of the Company's  Series A Preferred Stock. On March 29, 2001,
there was 1  shareholder  of record  holding  a total of  177,012  shares of the
Company's Series B Preferred Stock.

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

      The following  discussion and analysis should be read in conjunction  with
the financial  statements and notes thereto appearing  elsewhere herein.  Except
for historical  information  contained  herein,  certain  statements  herein are
forward-looking  statements that are made pursuant to the safe harbor provisions
of the private securities litigation reform act of 1995.

      Forward-looking  statements  involve estimates of the Company's  financial
position,   business   strategy  and  other  plans  and  objectives  for  future
operations.   Although  the  Company   believes  that  these   expectations  are
reasonable,  there can be no assurance that the actual  results or  developments
anticipated by the Company will be realized or, even if substantially  realized,
that they will have the expected effects on its business or operations.

GENERAL

      The  Company's  operations  for 2000  consisted  of  estimating  costs for
conceptual  projects in the  hospitality  industry to assist in the  securing of
financing for the projects.  The projects were never realized due to the lack of
funding commitments.

      The Company pursued and is still pursuing financing for the NevStar Gaming
and Entertainment  transaction and to date still has not procured financing. The
Company  entered into several  letters of intent to either  acquire or merge the
Company into an operating private company with revenues and assets.  The Company
is still aggressively pursuing these transactions.

      The Company's  operations for 2000  consisted of bidding for  construction
projects and  formulating  a plan of  operation  or sale for The Travel  Agent's
Hotel Guide, Inc.  ("TAHG"),  which was acquired from  GlobaldataTel in exchange
for a convertible debenture. A continuing condition

                                      8

<PAGE>



to the Company's  acquisition of TAHG was TAHG's net value exceeding $3,000,000.
Because TAHG's liabilities exceed its assets, TAHG has a negative net value. The
Company  therefore  believes it's payment  obligations  under the  GlobaldataTel
debenture are not enforceable,  and the Company intends to amicably resolve this
situation while  vigorously  contesting any payment demands made pursuant to the
debenture.

TOMAHAWK CONSTRUCTION

      Tomahawk  continues to perform cost estimating for conceptual  projects in
order to assist in securing  financing for those specific  conceptual  projects.
Consequently,  management  is  currently  planning to explore  opportunities  to
combine  Tomahawk with a more profitable  company through merger or acquisition.
The Company continues to search for a construction company that is interested in
being acquired.  Such an acquisition would help fulfill the Company's  long-term
plan of becoming a full service housing resource that provides  construction and
mortgage services to Native American communities across the United States.

RESULTS OF OPERATIONS

      Revenues for the fiscal year ended December 31, 2000 decreased to $0, from
$82,348 in revenues for 1999. Our operating loss increased to $2,296,648 in 2000
as  compared  to  $1,361,597  in 1999 as a result  of an  increase  in legal and
professional expense from $220,000 for the year ended December 1999, to $612,497
for 2000. Our operating loss is also  attributable to an increase in general and
administrative  expenses  from $411,597 for the 1999 fiscal year to $708,251 for
the year ended December 31, 2000.

      Despite the increase in the Company's  operating  loss for the fiscal year
ended  December 31, 2000,  the Company's net loss  decreased to $2,122,835  from
$4,467,050 in 1999. This increase in net loss resulted  largely from two unusual
expenses in 1999, one of $2,760,673  attributable  the Company's loss on sale of
subsidiaries,  and the other due to a loss on publication  rights of $1,053,012.
Also  facilitating the decrease in net loss was the Company's gain on marketable
securities of $482,421  during the year ended  December 31, 2000, as compared to
no such gain in the year ended 1999.

LIQUIDITY AND CAPITAL RESOURCES

      As of December 31, 2000, the Company had a net working  capital deficit of
$2,861,062.  The  Company  plans to decrease  this  working  capital  deficit by
acquiring  income  producing  assets  in  exchange  for its  securities,  and by
attempting to settle  certain of its note  payables with equity.  As of December
31,  2000,  the  Company  had a total  stockholder's  deficit of  $4,730,274  as
compared to a deficit of $5,586,047  as of December 31, 1999.  The Company hopes
to continue  to improve its  stockholder  equity by  acquiring  income-producing
assets, which are hoped to generate profits.

      The  Company  and  its  subsidiaries  continue  to  have  very  restricted
liquidity.  The Company has experienced severe financial  difficulty as a result
of bankruptcy  proceedings involving its subsidiary Tomahawk.  Although Tomahawk
emerged  from   bankruptcy  in  August  1995,   Tomahawk's   ability  to  obtain
construction   projects  has  been  severely   limited  as  a  result  of  those
proceedings.



                                      9

<PAGE>



      Unless  and until the  Company  successfully  acquires  revenue  producing
assets,  it will continue to use its equity and the resources of its CEO, Delmar
Janovec, to finance its operations.  However, no assurances can be provided that
the Company will be successful in acquiring assets, whether revenue-producing or
otherwise,  or that Mr.  Janovec  will  continue  to  assist  in  financing  the
Company's operations.

ITEM 7.     FINANCIAL STATEMENTS

      The Company's financial  statements for the fiscal year ended December 31,
2000 are attached hereto beginning on page F-1.

                                      10

<PAGE>



                       AMERIRESOURCE TECHNOLOGIES, INC.
                               AND SUBSIDIARIES
                        -----------------------------

                      CONSOLIDATED FINANCIAL STATEMENTS
                              -----------------

                              DECEMBER 31, 2000


                                     F-1

<PAGE>



              AMERIRESOURCE TECHNOLOGIES, INC. AND SUBSIDIARIES


                                   CONTENTS

                                                                  Page

Independent Auditor's Report................................................ 1

Financial Statements:
   Consolidated Balance Sheet............................................. 4-5
   Consolidated Statements of Operations.................................... 6
   Consolidated Statement of in Stockholders' Equity........................ 7
   Consolidated Statements of Cash Flows.................................. 8-9
   Notes to Consolidated Financial Statements........................... 10-25

                                     F-2

<PAGE>



                          INDEPENDENT AUDITOR'S REPORT


The Stockholders
and Board of Directors
of AmeriResource Technologies, Inc.

We have audited the  accompanying  consolidated  balance sheet of  AmeriResource
Technologies,  Inc. and  subsidiaries  as of December 31, 2000,  and the related
consolidated statements of operations,  stockholders' equity, and cash flows for
the years  ended  December  31,  1999 and  2000.  These  consolidated  financial
statements   are  the   responsibility   of  the   Company's   management.   Our
responsibility  is  to  express  an  opinion  on  these  consolidated  financial
statements  based on our audit. The financial  statements of the Company,  as of
December 31, 1999,  were audited by other  auditors  whose report dated April 5,
2000 expressed an unqualified opinion on those statements.

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

In our opinion, the consolidated  financial statements referred to above present
fairly,  in all  material  respects,  the  financial  position of  AmeriResource
Technologies,  Inc. and subsidiaries as of December 31, 2000, and the results of
its operations and cash flows for the years ended December 31, 1999 and 2000, in
conformity with generally accepted accounting principles.

The accompanying  consolidated  financial statements have been prepared assuming
that the Company will  continue as a going  concern.  As discussed in Note 11 to
the  financial  statements,  the  Company  has  suffered  recurring  losses from
operations and has an accumulated  deficit that raises  substantial  doubt about
its  ability to  continue as a going  concern.  Management's  plans in regard to
those  matters  are  also  described  in Note  11.  The  consolidated  financial
statements do not include any adjustments  that might result from the outcome of
this uncertainty.



/s/ Clyde Bailey, P.C.
Clyde Bailey, P.C.
San Antonio, Texas
March 28, 2001


                                     F-3

<PAGE>



              AMERIRESOURCE TECHNOLOGIES, INC. AND SUBSIDIARIES
                          Consolidated Balance Sheet
                              December 31, 2000


                                    ASSETS


Current assets:



    Cash and cash equivalents (Note 1)                          $        24,007

    Notes receivable - other (Note 3)                                    30,000



                 Total current assets                                    54,007



Other assets:

    Oil & gas properties                                              1,700,000


    Marketable securities (Note 12)                                     120,288



Total assets                                                    $       1874295



                                 (continued)























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


                                     F-4

<PAGE>



              AMERIRESOURCE TECHNOLOGIES, INC. AND SUBSIDIARIES
                          Consolidated Balance Sheet
                              December 31, 2000
                                 (continued)

                     LIABILITIES AND STOCKHOLDERS' EQUITY


Current liabilities:

      Accounts payable:

            Trade                                               $        276,364

            Related party (Note 2)                                        70,413

      Notes payable - related party (Note 2 and 4)                       920,649

      Notes payable (Note 4)                                             745,643

      Accrued payroll taxes                                              251,431

      Accrued salaries                                                    80,000

      Accrued interest:

            Related party (Note 2)                                       293,011

            Other                                                        241,588

      Income Tax Payable                                                  35,960



               Total current liabilities                               2,915,069



Convertible debentures                                                 3,350,000

Commitments and contingencies (Note 10)                                  105,000



               Total liabilities                                       6,370,069




Stockholders' equity (Note 6)

       Preferred stock, $.001 par value; authorized, 10,000,000 shares;

             issued, 329,621 shares outstanding (Note 6)                     330

  Common Stock, $.0001 par value; authorized, 1,000,000,000 shares;

             issued and outstanding, 685,879,093 shares                   68,588

       Additional paid-in capital                                     12,226,105

       Accumulated deficit                                          (16,918,645)

       Accumulated other comprehensive loss                            (106,651)



                 Total stockholders' equity                          (4,730,274)



Total liabilities and stockholders' equity                  $          1,874,295








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

                                     F-5

<PAGE>



              AMERIRESOURCE TECHNOLOGIES, INC. AND SUBSIDIARIES
                    Consolidated Statements of Operations
                For the Years Ended December 31, 2000 and 1999


                                                  2000              1999
                                            ----------------    -------------



Net service income                          $            -      $        -

Consulting revenue                                       -           82,348
                                           ----------------    -------------





Operating expenses                                   -                -

Salaries                                         180,000           80,000

Consulting                                       795,900          650,000

Legal and professional                           612,497          220,000

General and administrative expenses              708,251          411,597



Operating loss                                 (2,296,648)      (1,361,597)



Other income (expense):

     Gain on settlement of debt (Note 1)               -          938,017

     Gain on marketable securities                 482,421            -

     Loss on sale of subsidiaries (Note 1)             -      (2,760,673)

     Loss on publication rights (Note 1)               -      (1,053,012)

     Interest expense                            (308,608)      (312,133)



                                                   173,813      (3,187,801)



Net loss before income tax                      (2,122,835)      (4,467,050)
                                            ----------------    -------------



Income tax provision (Note 7)                         -                -



Net loss                                   $    (2,122,835       $   (4,467,050)
                                             ----------------    -------------



Earnings per share                         $        (.005)       $       (.009)
                                            ----------------    -------------



Weighted average common shares outstanding      564,620,143        493,417,979
                                             ----------------    -------------













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

                                     F-6

<PAGE>

<TABLE>
<CAPTION>
                    AMERIRESOURCE TECHNOLOGIES, INC. AND SUBSIDIARIES
                     Consolidated Statement of Stockholders' Equity
                     For the Years Ended December 31, 2000 and 1999


                         $.0001 Par Value                0.001 Par                       Accumulated
                         Common Stock                    Value      Additional           Other
                         Number               Number     Preferred  Paid-In    Treasury  Comprehensive  Accumulated
                         of Shares    Amount  of Shares  Stock      Capital    Stock     Income         Deficit       Total
                                                                                         (Loss)
          <S>               <C>        <C>       <C>        <C>        <C>       <C>         <C>            <C>         <C>
Balance at December 31,
1998                     382,060,312  38,206  3,089,621   3,090     7,916,968  (76,886)        -        (13,728,795)  (5,827,417)

Issuance of Shares for:
S-8 options exercised    7,000,000     700                           (700)                                                    -
Cash                     54,000,000   5,400                         194,600                                              120,000
Consulting services      65,000,000   6,500                         645,000                                              651,500
Legal services           40,000,000   4,000                         396,000                                              400,000

Write off of subscription
receivable                                                                                                                80,000

Sale of Treasury Stock                                                         76,886                                     76,886

Converted from Preferred
shares to Common shares  2,760,000     276    (2,760,00)   (2,760)    2,484                                                   -

Adjustment to retained
earnings from sale                                                                        3,400,035      3,400,035
of subsidiary

Net loss for the year ended                                                                             (4,467,050)     (4,467,050)

Balance at December 31,
1999                     550,820,312  55,082   329,621      $330    9,154,352    -              -       (14,795,810    $(5,586,047)
Issuance of Shares for:
Subscription receivable  30,000,000   3,000                         1,797,000                                            1,800,000
Consulting services      38,750,000   3,875                          771,125                                               775,000
Legal services           36,307,781   3,631                          506,628                                               510,259
Collateral on loan
(restricted)             30,000,000   3,000                          (3,000)                                                    -

Net loss for the year ended                                                                              (2,122,835)     (2,122,835)
Unrealized loss on securities                                                              (106,651)                       (106,651)
Total Comprehensive income (loss)                                                                                        (2,229,486)

Balance at December 31,
2000                     685,870,093  68,588   329,621     $330      12,226,105  -         (106,651)     (16,918,645)    (4,730,274)

</TABLE>


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

                                         F-7

<PAGE>


<TABLE>
<CAPTION>
                  AMERIRESOURCE TECHNOLOGIES, INC. AND SUBSIDIARIES
                        Consolidated Statements of Cash Flows
                    For the Years Ended December 31, 2000 and 1999

                                                                                     2000             1999
                                                                                 --------------    -------------

                      <S>                                                             <C>              <C>
Reconciliation of net loss provided by (used in) operating activities:

Net loss                                                                        $(1,950,133)        $(4,467,050)

Non-cash items:
     Depreciation and amortization                                                       -               33,070
     Non-cash revenue through issuance of stock                                          -              (82,348)
     Non-cash services through issuance of stock                                  1,285,259           1,051,500
     Provision for bad debts                                                             -              172,416
     (Gain)/Loss on forgiveness of debt                                                  -             (938,017)
     Loss on sale of subsidiaries                                                        -            2,760,673
     Loss on publication rights                                                          -            1,053,012

Changes in assets affecting operations - (increase) decrease
     Accounts receivable                                                                 -              759,404
     Other receivables                                                                   -                   -
     Notes receivables                                                                   -              283,190
     Prepaid insurance and other expenses                                                -                   -

Changes in liabilities affecting operations - increase (decrease)
     Accounts payable                                                                    -             (377,647)
     Accrued payroll and related                                                     19,750            (455,746)
     Escrowed fees                                                                       -               (4,224)
     Accrued interest                                                               308,608            (136,023)

Net cash provided by (used in) operating activities                             $  (336,516)      $     (67,296)
                                                                                --------------    -------------
</TABLE>




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

                                         F-8

<PAGE>


<TABLE>
<CAPTION>
                  AMERIRESOURCE TECHNOLOGIES, INC. AND SUBSIDIARIES
                        Consolidated Statements of Cash Flows
                    For the Years Ended December 31, 2000 and 1999



                                                                 2000                    1999
                                                          -----------------       -----------------
            <S>                                                  <C>                     <C>
Cash flows from financing activities:
     Proceeds from issuance of stock                           $ 654,723            $ 200,000
     Proceeds from issuance of debt                                   -                80,000
     Repayment of debt                                          (294,365)            (248,691)

Net cash provided by (used in) financing activities              360,358               31,309


Cash flows from investing activities:
     Proceeds from sale of marketable securities                    -                   4,750

Net cash provided by (used in) investing activities                 -                   4,750

Increase (decrease) in cash                                      23,842               (35,987)

Cash - beginning of period                                          165                36,152

Cash - end of period                                           $ 24,007             $     165

</TABLE>



              SCHEDULE OF NON-CASH INVESTING AND FINANCING TRANSACTIONS

                                                      2000              1999
                                                      ----              ----

Purchase of fixed assets through issuance of debt  $        -        $        -

Debt paid through issuance of stock                $        -        $        -

Stock issued for services                          $1,285,259        $1,051,500


Additional cash flow information Cash paid for:
       Interest                                    $        -        $        -
       Income taxes                                $        -        $        -






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

                                         F-9

<PAGE>

                  AMERIRESOURCE TECHNOLOGIES, INC. AND SUBSIDIARIES
                      Notes to Consolidated Financial Statements
                                  December 31, 2000

1.    Summary of significant accounting policies

      Nature of business and business combinations

      AmeriResource Technologies, Inc., formerly known as KLH Engineering Group,
      Inc (the Management  Company),  a Colorado  corporation,  was incorporated
      March 3, 1989 for the purpose of providing  diversified  civil engineering
      services  throughout  the  United  States,  to  be  accomplished   through
      acquisitions of small to mid-size engineering firms. On July 16, 1996, the
      Company changed its name to AmeriResource Technologies, Inc.

      The Company  entered into a financing  agreement in December 1999 with Jay
      Dello &  Associates,  Ltd.  (Jay  Dello)  for  the  purpose  of  providing
      financing for merger and acquisitions of targeted companies. The financing
      agreement was terminated on or about June 18, 2000 due to non-performance.

      On July 19, 2000 the Company acquired all of the outstanding stock in West
      Texas Real Estate and Resources', Inc. (West Texas) for a convertible note
      payable in the amount of $1,700,000. West Texas owns the rights to certain
      leased oil rights that has a value  exceeding  $10,000,000  which has been
      reflected in a certified  audit report issued to West Texas for the leased
      oil rights.

      At December 31, 1998, the Management  Company directly or indirectly owned
      100% of the stock of KLH Engineering of Colorado Springs,  KLH Engineering
      of San Mateo,  KLH  Engineering  of Grand  Junction,  KLH  Engineering  of
      Lakewood,  KLH Engineering of Greeley, and KLH Engineers and Constructors.
      All of the  Subsidiaries  closed their  operations  during 1996,  with the
      exception of KLH Pueblo  which was sold to a third party  during 1996.  On
      June 30,  1999,  the Company sold all its shares to a third party for $550
      in the following subsidiaries:

                  KLH Engineering of Colorado Springs, Inc.
                  KLH Engineering of Lakewood, Inc.
                  KLH Engineering of Grand Junction,Inc.
                  KLH Engineering of Greeley, Inc.
                  KLH Engineering of San Mateo, Inc.
                  KLH Engineering & Constructors, Inc.
                  Morton Technologies, Inc.
                  LBH Engineering, Inc.
                  Coffee Engineering & Surveying, Inc.
                  Scanlon & Associates, Inc.

      Effective December 14, 1998, the Company acquired The Travel Agents Hotel
      Guide, Inc. in a stock purchase agreement.  The Company received all the
      outstanding shares of The Travel Agents Hotel Guide, Inc. (a wholly owned
      subsidiary of Gold Coast Resources, Inc.) in exchange for a convertible
      debenture in the amount of $3,350,000.


                                         F-10

<PAGE>



                     AMERIRESOURCE TECHNOLOGIES, INC. AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements
                                December 31, 2000

1.    Summary of significant accounting policies (continued)
      ------------------------------------------------------

      Effective July 1, 1998,  the Company  acquired  First  Americans  Mortgage
      Corporation  (First  Americans) in an agreement for the exchange of stock.
      The two  shareholders of First Americans  transferred 100% of their shares
      in exchange for  45,000,000  shares of the  Company's  stock (see Note 2).
      First Americans was incorporated on July 31, 1995 in Missouri. On December
      31,  1999,  the Company  sold 100% of the shares of First  Americans to an
      officer of First  Americans  for  $30,000  note  receivable.  This note is
      payable to the  Company  over 5 years at the prime  interest  rate.  These
      consolidated statements include First Americans activity from July 1, 1998
      through December 31, 1999.

      On May 13, 1994, the Company entered into an agreement to acquire Tomahawk
      Construction Company, a Missouri corporation (Tomahawk).  The acquisition,
      which was completed on July 27, 1994, was accomplished by merging Tomahawk
      into a  wholly-owned  subsidiary  of the Company.  Tomahawk  then became a
      subsidiary of the Company.  This transaction has been treated as a reverse
      acquisition.

      Tomahawk is a Kansas City,  Kansas-based  general contractor and qualified
      American Indian Minority Business Enterprise  specializing in concrete and
      asphalt paving,  utilities,  grading/site  work,  structural  concrete and
      commercial  buildings.  Tomahawk was  organized  on April 12,  1980,  as a
      Missouri corporation. Tomahawk had no operations during 1999 or 2000.

      Basis of presentation

      The  accompanying  financial  statements  have been prepared in conformity
      with  principles  of  accounting  applicable  to a  going  concern,  which
      contemplates  the realization of assets and the liquidation of liabilities
      in the normal  course of  business.  The Company has  incurred  continuing
      losses and has not yet generated sufficient working capital to support its
      operations.  The  Company's  ability  to  continue  as a going  concern is
      dependent, among other things, on its ability to reduce certain costs, and
      its obtaining  additional  financing and eventually attaining a profitable
      level of operations.

      It is  management's  opinion that the going concern basis of reporting its
      financial condition and results of operations is appropriate at this time.
      The  Company  plans to  increase  cash  flows  and to take  steps  towards
      achieving profitable  operations through the merger with or acquisition of
      profitable operations.

      Principles of consolidation

      The consolidated financial statements include the combined accounts of
      AmeriResource Technologies, Inc., The Travel Agent's Hotel Guide, Inc.,
      West Texas Real Estate & Resources', Inc. and Tomahawk Construction
      Company. All material intercompany transactions and accounts have been
      eliminated in consolidation.

      Cash and cash equivalents

      For the  purpose of the  statement  of cash flows,  the Company  considers
      currency  on  hand,   demand   deposits  with  banks  or  other  financial
      institutions,  money market  funds,  and other  investments  with original
      maturities of three months or less to be cash equivalents.





                                         F-11

<PAGE>


                     AMERIRESOURCE TECHNOLOGIES, INC. AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements
                                December 31, 2000

1.    Summary of significant accounting policies (continued)
      ------------------------------------------------------

      Escrow funds

      The escrow fund was established solely for the proceeds of securities sold
      by the Company.  Upon  termination  of the  financing  agreement  with Jay
      Dello,  approximately $400,000 was removed from this account by Jay Dello,
      JD Guidace, Jerald Delguidice and his associates without the authorization
      of either Delmar A. Janovec or the Company.  The Company filed a complaint
      with the Federal Bureau of  Investigation  in February 2001 regarding this
      matter.  As of December 31, 2000, the Company has written-off  this amount
      to Other Expense.

      Oil and gas properties

      The oil and gas  properties  consist of the  rights to certain  leased oil
      rights  that has a value  exceeding  $10,000,000.  These  assets have been
      written  down to  $1,700,000,  the value of the note  receivable  recorded
      related to this asset.

      Property, Plant and Equipment

      The Company's fixed assets are presented at cost. Certain Subsidiaries use
      tax  depreciation   methods  which  approximate   straight-line.   Related
      depreciation  and  amortization  expense for the years ended  December 31,
      1999 and 2000, was $33,070 and $0, respectively.

      Property,  plant and equipment  consisted of the following at December 31,
2000:




    Equipment                           $   599,843

    Furniture, fixtures and library         120,989

    Vehicles                                 53,087

    Less accumulated depreciation         (773,919)



                 Net property, plant and$equipment     -

      Stock Subscription Receivable

      The Company issued stock in exchange for a stock subscription  receivable.
      Since the  receivable  was  considered  uncollectible,  it was written off
      during 1999.

      Publication Rights

      The  publication  rights are for The Travel Agents Hotel Guide.  This is a
      publication used by travel agents to sell hotel rooms primarily throughout
      the United States.  The rights consist of the  publication  rights,  logo,
      client list and  business  concept.  These  rights  were deemed  worthless
      during 1999 and written off.







                                         F-12

<PAGE>



                  AMERIRESOURCE TECHNOLOGIES, INC. AND SUBSIDIARIES
                      Notes to Consolidated Financial Statements
                                  December 31, 2000

1.    Summary of significant accounting policies (continued)
      ------------------------------------------------------

      Gain on settlement of debt

      On July 9, 1999,  the Company  entered  into a settlement  agreement  with
      Industrial  State Bank.  This agreement  reduces the note in the amount of
      $1,071,214  with  related  accrued  interest  of  $123,789  be  reduced to
      $200,000.  The $200,000 was  subsequently  paid off with proceeds from the
      sale  of  common  stock  ($120,000)  and  by an  officer  of  the  Company
      ($80,000). This settlement resulted in $995,093 gain on settlement of debt
      recorded in the financial statements.

      Convertible Debentures

      The  convertible  debentures were issued in the purchase of Gold Coast and
      are guaranteed by Lexington Sales  Corporation,  Ltd. These debentures pay
      interest  of 7% per  year  (cumulative),  payable  at  the  time  of  each
      conversion  until  the  principal  amount  is paid  in  full  or has  been
      converted.  The  debentures  convert into shares of the  Company's  common
      stock  (par  value  $.0001) at any time after  December  14,  2001.  After
      December 14, 2001,  the  debentures can be converted in whole or part. The
      number of shares  issuable  upon  conversion is determined by dividing the
      principal converted plus accrued interest (less any required  withholding)
      by the conversion  price in effect on the conversion  date. The conversion
      price is the average bid closing price of the  Company's  common stock for
      the  five  trading  days  immediately  preceding  and  ending  on the  day
      preceding the date of conversion.

      Stock-Based Compensation Plans

      SFAS No. 123, "Accounting for Stock-Based Compensation," allows for either
      the  adoption  of a fair  value  method  for  accounting  for  stock-based
      compensation  plans or for the continuation of accounting under Accounting
      Principles  Board ("APB") Opinion No. 25,  "Accounting for Stock Issued to
      Employees," and related interpretations with supplemental disclosures.

      The  Company  has  chosen  to  account  for its  stock  options  using the
      intrinsic  value  based  method  prescribed  in APB  Opinion  No.  25 and,
      accordingly,  does not  recognize  compensation  expense for stock  option
      grants made at an exercise  price equal to or in excess of the fair market
      value of the stock at the date of grant.

      Comprehensive Income (Loss)

      SFAS No. 130, "Reporting  Comprehensive  Income" establishes standards for
      the reporting and display of  comprehensive  income and its  components in
      the financial statements.  The following types of items, among others, are
      to be  considered  in computing  comprehensive  income:  foreign  currency
      translation  adjustments,  pension  liability  adjustments  and unrealized
      gain/loss on  securities  available  for sale.  For all periods  presented
      herein,  there were no differences  between net income (loss) available to
      common shareholders and comprehensive income (loss).


                                         F-13

<PAGE>



                  AMERIRESOURCE TECHNOLOGIES, INC. AND SUBSIDIARIES
                      Notes to Consolidated Financial Statements
                                  December 31, 2000

1.    Summary of significant accounting policies (continued)
      ------------------------------------------------------

      Recent Accounting Pronouncements

      In June 1998, the Financial Accounting Standards Board issued Statement of
      Financial   Accounting  Standards  No.  133,  "Accounting  for  Derivative
      Investments  and Hedging  Activities"  ("SFAS No 133")  which  establishes
      accounting  and  reporting   standards  requiring  that  every  derivative
      instrument  be  recorded  in the  balance  sheet  as  either  an  asset or
      liability  measured at its fair value.  The  statement  also requires that
      changes in the  derivative's  fair value be recognized in earnings  unless
      specific hedge  accounting  criteria are met. SFAS No. 133, as extended by
      SFAS No. 137 and  amended by SFAS No.  138,  is  effective  for all fiscal
      quarters  beginning  after  June 15,  2000.  The  Company  does not expect
      adoption of SFAS No. 133 to have an effect on its financial statements.

      In December  1999, the  Securities  and Exchange  Commission  issues Staff
      Accounting Bulletin No. 101, "Revenue Recognition in Financial Statements"
      (SAB 101, which provides  guidance on the  recognition,  presentation  and
      disclosure of revenue in financial  statements of all public  registrants.
      The  provisions  of SAB 101 are effective  for  transactions  beginning in
      fiscal year after September 30, 2000. The Company does not expect adoption
      of SAB 101 to have an effect on its financial statements.

      Use of Estimates

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

      Income tax

      For the years ended  December  31, 2000 and 1999,  the Company  elected to
      file a  consolidated  tax  return and the  income  tax  provision  is on a
      consolidated  basis.  Prior  to  1992,  the  Subsidiaries  filed  separate
      corporate returns.

      Effective January 1, 1993, the Financial Accounting Standards Board (FASB)
      issued FASB No. 109,  "Accounting for Income Taxes". FASB No. 109 requires
      that the current or deferred tax consequences of all events  recognized in
      the financial statements be measured by applying the provisions of enacted
      tax laws to determine the amount of taxes payable or refundable  currently
      or in future  years.  There was no  impact  on from the  adoption  of this
      standard.


                                         F-14

<PAGE>



                   AMERIRESOURCE TECHNOLOGIES, INC. AND SUBSIDIARIES
                      Notes to Consolidated Financial Statements
                                 December 31, 2000

1.  Summary of significant accounting policies (continued)

    Deferred income taxes are provided for temporary differences in reporting
    income for financial statement and tax purposes arising from differences in
    the methods of accounting for construction contracts and depreciation.

    Construction contracts are reported for tax purposes and for financial
    statement purposes on the percentage-of-completion method.  Accelerated
    depreciation is used for tax reporting, and straight-line depreciation is
    used for financial statement reporting.

    Loss per common share

    Loss per common share is based on the weighted average number of common
    shares outstanding during the period.  Options, warrants and convertible
    debt outstanding are not included in the computation because the effect
    would be antidilutive.

2.  Related party transactions

    At December 31, 1999, in addition to the above, there were miscellaneous
    receivables owed from officers.  At December 31, 2000 there were no note
    receivables from related parties.

At  December  31,  2000 and 1999,  the  Company  had notes  payable  balances to
officers, a former officer and other  stockholders  (Note 4). In  addition,
there was  related  interest expense  incurred and accrued  interest.  At
December 31, 1999 the Company also had a note receivable from a former officer
and minority  shareholder of the Company (Note 3).

The following  transactions occurred between the Company and it stockholders and
its affiliated companies:

A.  The Company has a note payable to an officer, which totals $920,649 (see
    Note 4).

B.  During 1999, the Company issued 5,000,000 shares of common stock to a
    director for consulting services. This transaction was valued at $.01 per
    share.

The following is a table  summarizing the related party  transactions  described
above:

                                                         For the Years Ended
                                                              December 31,
                                                    ----------------------------
                                                        2000              1999
                                                    ----------      ------------

            Note receivable - current              $    -         $  157,133

            Accrued interest on notes payable      $ 277,952      $  144,003

            Notes payable - current                $ 920,649      $  552,058

            Interest expense on notes payable      $  59,049      $    -


                                         F-15

<PAGE>



                     AMERIRESOURCE TECHNOLOGIES, INC. AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements
                                December 31, 2000

3.    Notes receivable

Notes  receivable from First Americans  Mortgage Corp,  bearing  interest at the
prime rate,  principal and interest  payments due December 31, starting December
31, 2000 through December 31, 2004.                      30,000
                                                  --------------
Total Notes Receivable - Other                           30,000
                                                  --------------
Less current portion                                    (30,000)
                                                  --------------
Total Notes Receivable                            $          -
                                                  --------------

4.    Notes payable

      The Company had the following notes payable:

      Related Party:

Note payable to an officer, unsecured.  Note bears
interest at 8% and is due on demand.               920,649

      Total notes payable - related parties        920,649

      Less current portion                         920,649

Long-term portion                               $       -



                                         F-16

<PAGE>



                  AMERIRESOURCE TECHNOLOGIES, INC. AND SUBSIDIARIES
                      Notes to Consolidated Financial Statements
                                  December 31, 2000

4.      Notes payable (continued)

      Others:

Note dated August 31, 1998, payable to American
Factors in the original amount of $430,924, secured by
30,000,000 shares of the Company's common stock The
note bears interest at 9%.                        279,000

Notes  payable to various  subcontractors  and  suppliers
for goods and services provided  in  contracts.  The notes
have no  interest  rate and are paid to the extent a
payment for  providing  services or goods on  specified
contracts  are collected. This debt is under class 7 of
the Plan of Reorganization and is to be paid from cash
flows of Tomahawk.                                464,643

                   Total notes payable            743,643

                   Less current portion          (743,643)

                   Long-term portion          $        -

            Maturities of notes payable at December 31, 2000, are as follows:

                                Year Ended
                               December 31,
                                   2000                    1,564,292
                                   2001                           -
                                   2002                           -
                                   2003                           -
                                Thereafter                        -
                                                         ------------
                                                        $  1,564,292

          * These  obligations  are due when Tomahawk is profitable  and
has cash flow.

5.  Stockholder's Equity

Options

The Company agreed to issue options to an employee to purchase  3,000,000 shares
of common stock at $.01 per share in exchange for services. These options expire
on July 1, 2002.  None of these options were exercised during 2000.

In addition, the Company issued options to purchase 30,000,000 shares at $.06
per share. These options were exercised  during the third  quarter and the
proceeds were used to reduce notes payable.


                                         F-17

<PAGE>

                   AMERIRESOURCE TECHNOLOGIES, INC. AND SUBSIDIARIES
                      Notes to Consolidated Financial Statements
                                 December 31, 2000

5. Stockholders' equity (continued)

The  following  information  is presented  with respect to the  Company's  stock
options:

                                                 Number      Weighted  Average
                                               Of Shares       Exercise Price
                                              -----------   --------------------

  Outstanding at December 31, 1997                    -                  -
  Granted                                       15,000,000              0.01
  Exercised                                     8,000,000               0.01
  Cancelled                                           -                  -

  Outstanding at December 31, 1998              7,000,000               0.01
  Granted                                             -                  -
  Exercised                                     7,000,000               0.01
  Cancelled                                           -                  -

  Outstanding at December 31, 1999                    -                  -
  Granted                                       3,000,000               0.01
  Exercised                                           -                  -
  Cancelled                                           -                  -

  Outstanding at December 31, 2000              $ 3,000,000          $  0.01

Had  compensation  expense been recorded for the Company's  awards based on fair
value at the grant dates consistent with the  methodologies of SFAS No. 123, the
Company's  reported  net income  (loss)  available  to common  shareholders  and
earnings  per share would have been reduced to the pro forma  amounts  indicated
below:

<TABLE>
<CAPTION>
                                                        For the Years Ended December 31,
                                                            2000                   1999
                   <S>                                       <C>                    <C>
Net income (loss) available to common shareholders:
   As reported                                          $(2,122,835)            $(4,467,050)
   Pro forma                                             (2,152,835)             (4,467,050)

Basic earnings (loss) per share:
   Common share as reported                               (0.003)                  (0.009)
   Common share pro forma                                 (0.003)                  (0.009)

Diluted earnings (loss) per share:
   Common share as reported and pro forma                 (0.003)                  (0.009)

</TABLE>

                                         F-18

<PAGE>


                  AMERIRESOURCE TECHNOLOGIES, INC. AND SUBSIDIARIES
                      Notes to Consolidated Financial Statements
                                  December 31, 2000

5.    Stockholders' equity (continued)

      Under SFAS 123, the value of each option  granted during 2000 and 1999 was
      estimated  on the date of grant  using the Black  Scholes  model  with the
      following  assumptions:  Risk-free interest rate - 6.5%,  dividend yield -
      0%, volatility - 19.3% and expected life of the option - 5 years.

      Common stock

      The  Company   increased  its  authorized   shares  from   500,000,000  to
      1,000,000,000  during 1999.  During 2000, the Company issued the following
      shares of common stock:

      1.  38,750,000 shares of common stock (10,000,000 restricted shares) were
          issued for consulting services valued at $775,000.  These shares were
          valued at $.02 per share.

      2.  36,308,781 shares of common stock (10,000,000 restricted shares) were
          issued for legal services valued at $510,259.  These shares were
          valued at $.02 per share.

      3.  30,000,000 shares of restricted common stock were issued as collateral
          on a note payable to American Factors.

      Preferred stock

      The Company  has  20,000,000  of  preferred  stock  $.001 par  authorized,
      10,000,000 shares  designated as Series A Convertible  Preferred Stock and
      10,000,000 shares designated as Series B Convertible Preferred Stock.

      Both Series A and B preferred stock bear a cumulative  $.125 per share per
      annum dividend,  payable  quarterly.  The shareholders  have a liquidation
      preference  of $1.25 per share,  and in addition,  all unpaid  accumulated
      dividends  are to be paid  before  any  distributions  are made to  common
      shareholders.  These shares are subject to redemption  by the Company,  at
      any time after the second  anniversary  of the issue dates  (ranging  from
      August 1990 through  December 1995) of such shares and at a price of $1.25
      plus  all  unpaid   accumulated   dividends.   Each  preferred   share  is
      convertible,  at any time  prior to a  notified  redemption  date,  to one
      common share.  The  preferred  shares have equal voting rights with common
      shares and no shares were  converted  in 1998.  Dividends  are not payable
      until  declared  by the  Company.  At  December  31,  2000,  the amount of
      dividends in arrears on the preferred stock was $1,780,432.

      During 1999,  there was 2,760,000  shares of preferred  stock converted to
      2,760,000 shares of common stock.


                                         F-19

<PAGE>


                  AMERIRESOURCE TECHNOLOGIES, INC. AND SUBSIDIARIES
                      Notes to Consolidated Financial Statements
                                  December 31, 2000

6.    Income tax

      No  current  or  deferred  tax  provision  resulted  as there  was both an
      accounting and a tax loss for each of the periods  presented.  The primary
      permanent  differences  between  tax and  accounting  losses  are  non-tax
      deductible penalties, losses from closure of subsidiaries and amortization
      of certain goodwill.

      The Company has available for income tax  purposes,  a net operating  loss
      carryforward  of  approximately  $14,000,000  expiring  from 2004 to 2007,
      including $970,000 subject to certain recognition limitations. A valuation
      allowance  for the  full  amount  of the  related  deferred  tax  asset of
      approximately $1,380,000 has not been recorded, since there is more than a
      50 percent chance this will expire unused.

      The  significant  temporary  differences  are  associated  with bad debts,
      deferred compensation and accrued vacation.

      All of the net operating losses carryforward of approximately  $14,000,000
      is subject to significant  recognition  limitations due to the merger with
      Tomahawk.

7.    Closed and sold subsidiaries

      As of December 31, 1996 the following subsidiaries have ceased operations:
      KLH  Engineering of Colorado  Springs,  KLH Engineering of Grand Junction,
      KLH Engineering of Lakewood,  KLH Engineering of Greeley,  KLH Engineering
      of San Mateo and KLH Engineers and Constructors.

      In April 1996,  the Company sold KLH  Engineering  of Pueblo to an outside
      party for a $40,000  note  receivable,  $33,433  in cash and  $166,567  in
      assumption of debt. During 1998, an allowance of $20,000 was recorded, due
      to the notes  questionable  collectibilty.  During  1999,  the  balance of
      $20,000 was written off due to uncollectibility.

      On June 30,  1999,  the  Company  sold all its shares to a third party for
      $550 in the following  subsidiaries:  KLH Engineering of Colorado Springs,
      KLH  Engineering  of Grand  Junction,  KLH  Engineering  of Lakewood,  KLH
      Engineering of Greeley,  KLH  Engineering of San Mateo,  KLH Engineers and
      Constructors,  Morton  Technologies,  Inc., LBH Engineering,  Inc., Coffee
      Engineering & Surveying,  Inc. and Scanlon &  Associates,  Inc. The assets
      and liabilities of these subsidiaries are not included in the consolidated
      financial  statements.  The  results of  operations  are  included  in the
      consolidated  financial statements.  The sale of the subsidiaries resulted
      in a net loss of $718,717  being  recorded in the  consolidated  financial
      statements.


                                         F-20

<PAGE>



                  AMERIRESOURCE TECHNOLOGIES, INC. AND SUBSIDIARIES
                      Notes to Consolidated Financial Statements
                                  December 31, 2000

8.    Profit-sharing plan

      The  Company  has an  employee  savings  and  profit-sharing  plan for all
      eligible  employees which includes an employees  savings plan  established
      under  the  provisions  of  Internal  Revenue  Code  Section  401(k).  The
      Company's  contributions  to  the  plan  are at the  Board  of  Director's
      discretion,  but may not exceed the maximum allowable  deduction permitted
      under  the  Internal  Revenue  Code at the  time of the  contribution.  No
      contributions  were  made  under  this plan in 1997 or 1998.  The  Company
      distributed 100% of this plan during 1999.

9.    Other commitments and contingencies

      The Company's subsidiaries are typically subject to various claims arising
      in the  ordinary  course of  business  which  usually  relate to claims of
      professional negligence or contract breaches.

      The Company believes that all pending professional  liability  proceedings
      are  adequately  covered by insurance.  However,  due to the nature of the
      Company's  business,  the  Company has  historically  been able to procure
      insurance,  but there can be no assurance  such insurance will be adequate
      or that it will be renewable or remain available in the future.

      In February 1996, Imperial Premium Finance filed an action in the Superior
      Court of the  State of  California  for the  County of Los  Angeles.  This
      action is for premiums  financed for errors and omissions  coverage.  This
      matter has been settled by allowing a  stipulated  judgement in the amount
      of  $60,000.   This  obligation  is  recorded  in  the  contingencies  and
      commitments section of the financial statements.


                                         F-21

<PAGE>



                  AMERIRESOURCE TECHNOLOGIES, INC. AND SUBSIDIARIES
                      Notes to Consolidated Financial Statements
                                  December 31, 2000

9.    Other commitments and contingencies (continued)

      On September 16, 1994,  Tomahawk filed for protection pursuant to Title 11
      of the U.S.  Codes under Chapter 11, in the Western  District of Missouri,
      Western Division.  A plan of reorganization was filed on or about March 9,
      1996 and an Amended Plan of  Reorganization  on April 29, 1996.  The court
      confirmed the amended plan on August 28, 1996.

      Tomahawk filed suit against M.K. Ferguson for work completed in Oak Ridge,
      Tennessee.  The claim was  settled in May 1997 for the sum of  $1,851,444.
      Tomahawk has agreed with its subcontractors to sharing a percentage of the
      delay claim  only,  in exchange  for  releases of money owed by  Tomahawk.
      Tomahawk has agreed to settle with it's bonding  company (USF&G) by paying
      $500,000 for a release of $2,300,000 of bond claims. In addition, Tomahawk
      has agreed to pay Industrial State Bank the sum of $336,000 for release of
      the  Bank's  claim on the  settlement  money.  Tomahawk  will also pay the
      Internal Revenue Service $22,000 for a release of all liens.

      In July 1996,  a  judgement  was entered in favor of  Lexington  Insurance
      Company in the amount of $39,774 with interest (8%). In December 1997, the
      court entered an order ordering the Company to appear for a hearing in aid
      of  execution.  A hearing date is to be  determined.  This  obligation  is
      recorded as a contingency and commitment.

      In October 1996,  the Internal  Revenue  Service (IRS) placed liens on the
      assets of all of the Company's  Colorado and California  subsidiaries  for
      failure  to  pay  payroll  taxes  in  1996.  The  total  of the  liens  is
      approximately  $251,000.  A  payment  plan  has  been  established  with a
      director of the Company.

      In February 1996, American Factors Group, L.L.C.  (American Factors) filed
      suit against the Company and certain  subsidiaries  for breach of contract
      and  fraud  in the  extension  of  credit  in a  factoring  agreement.  An
      arbitrator  was appointed and a hearing was held in July 1998. An award of
      $422,066 was issued in favor of American Factors.  The Company agreed to a
      settlement  and payment plan which has been reflected in the notes payable
      section of the financial statements.

      Anderson & Associates,  Inc.  (AAI) obtained a judgment  against  Tomahawk
      construction  in Harris  County,  Texas in the  amount of  $3,337.  AAI is
      actively   continuing  their  collection   efforts  for  this  note.  This
      obligation is reflected in the accounts  payable  section of the financial
      statements.

      The Company has defaulted  upon  interest and principal  with respect to a
      $40,819  note in  favor  of the  Roy Lee  Johnston  Trust  (the  "Johnston
      Trust").  The Johnston Trust has received a judgement in its favor but has
      been  unsuccessful  in their  attempts  to  collect.  This  obligation  is
      reflected in the accounts payable section of the financial statements.


                                         F-22

<PAGE>



                  AMERIRESOURCE TECHNOLOGIES, INC. AND SUBSIDIARIES
                      Notes to Consolidated Financial Statements
                                  December 31, 2000

9.    Other commitments and contingencies (continued)

      In  December  1997,  Morthole &  Zeppetello  (Morthole)  commenced  action
      against  the Company  based upon an alleged  failure of the Company to pay
      under the terms of a  promissory  note,  dated May 3,  1996.  The case was
      dismissed pursuant to a settlement  agreement reached by the parties.  The
      Company  defaulted on the  settlement  agreement  and a judgement was then
      entered in the amount of $8,500 plus interest of 10% per annum from May 3,
      1996 forward and attorney's fees of $1,275.  The judgment remains pending,
      therefore no liability has been recorded in the financial statements.

      In January  1998,  OCI, Inc.  commenced an action  against the Company for
      certain temporary services provided for the Company. The amount alleged to
      be owed is $2,436 plus  interest.  On December 14, 1998, a settlement  was
      reached  between the parties and the Company  will pay the sum of $100 per
      month until the  principal  amount has been paid.  This is recorded in the
      accounts payable section of the financial statements.

      In August 1998, the City of Greenwood Village (the "City"), Colorado filed
      a third party complaint against a subsidiary, KLH Engineering of Lakewood.
      The  City  alleges  that  the  Company  negligently  performed  inspection
      services with respect to a drainage system  constructed in the City by the
      developer, KTC. This was settled with no claim against the Company.

      The Company's subsidiary, KLH Engineers & Constructors, Inc. has defaulted
      on a promissory note to Thomas Little, a former officer of the subsidiary.
      The note became due on November 14,  1996.  The  principal  amount owed is
      $17,500 with 10% interest accruing from the date of the note,  October 29,
      1990. This obligation is reflected in the accounts  payable section of the
      financial statements.

      In November, 1998, an action was filed against the Company in the District
      Court of Johnson County,  Kansas.  The plaintiff,  Industrial  State Bank,
      claims it is owed for  non-payment  of a line of  credit in the  amount of
      $1,071,000  which  matured in August of 1998.  The Company filed a counter
      action against  Industrial  State Bank for  misappropriations  of funds. A
      settlement was reached in July 1999.

      An action was filed against a subsidiary, KLH Engineering of San Mateo, by
      Lincoln  Property  Company,  N.C.  This  action  alleged  that the Company
      negligently provided construction  services. In March of 1999, this action
      was dismissed.

      The  convertible  debentures  issued in the  acquisition of Gold Coast are
      guaranteed  by  Lexington  Sales   Corporation,   Ltd   (Lexington).   The
      consideration given to Lexington in this transaction consists of Lexington
      receiving  10% of the  gross  proceeds  (if and) when the  Company  either
      merges or is sold to another party and 20,000,000  shares of the Company's
      stock.


                                         F-23

<PAGE>



                  AMERIRESOURCE TECHNOLOGIES, INC. AND SUBSIDIARIES
                      Notes to Consolidated Financial Statements
                                  December 31, 2000

10.   Marketable securities

      At December  31, 2000  marketable  equity  securities  are stated at their
      lower of aggregate cost or market value. No unrealized or realized holding
      gains occurred during the fiscal year ended December 31, 2000. The Company
      has  marketable  securities  available for sale. No other  investments  in
      trading or held-to-maturity marketable securities exist as of December 31,
      2000.


<TABLE>
<CAPTION>
                                                                Gross
                                                 Cost           Unrealized              Market Value
                                                                Gains/(Losses)
             <S>                                   <C>               <C>                      <C>
Marketable securities available for sale:

4,598,950 shares of restricted common stock,
Kelly's Coffee Group, Inc.                      $   116,698    $          -             $    116,698

239,326 shares of restricted common stock,
Oasis Hotels and Casino International
(formerly Flexweight Corporation)                   110,241        (106,651)                   3,590

Total marketable securities                     $   226,939    $   (106,651)            $    120,288

</TABLE>


11.   Going concern uncertainty

      The  accompanying  financial  statements  have been prepared in conformity
      with  principles  of  accounting  applicable  to a  going  concern,  which
      contemplates  the realization of assets and the liquidation of liabilities
      in the normal  course of  business.  The Company has  incurred  continuing
      losses and has not yet generated sufficient working capital to support its
      operations.  The  Company's  ability  to  continue  as a going  concern is
      dependent,  among other things,  on its ability to reduce  certain  costs,
      obtain new contracts and additional financing and eventually,  attaining a
      profitable level of operations.

      It is  management's  opinion that the going concern basis of reporting its
      financial condition and results of operations is appropriate at this time.
      The Company plans to increase cash flows and take steps towards  achieving
      profitable   operations  through  the  sale  or  closure  of  unprofitable
      operations,  and  through  the merger with or  acquisition  of  profitable
      operations.


                                         F-24

<PAGE>



                  AMERIRESOURCE TECHNOLOGIES, INC. AND SUBSIDIARIES
                      Notes to Consolidated Financial Statements
                                  December 31, 2000

12.   Bankruptcy proceedings of subsidiary

      On September 16, 1994,  Tomahawk filed for protection pursuant to Title 11
      of the U.S. Code under Chapter 11, in the Western District of Missouri. On
      August  28,  1995  the  court  confirmed  the  Company's  amended  plan of
      reorganization.  The plan  provides  for  payment  of claims  through  the
      continued operations of the Company, and contingent upon the collection of
      receivables on completed  projects.  The Company has reclassified  various
      payables  into long term debt  relative  to these  claims in the amount of
      $464,643.


                                         F-25

<PAGE>



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

     On  December  31,  2000,  the  Company's  auditor,   Crouch,  Bierwolf  and
Associates,  resigned  because a conflict of interest  had arisen as a result of
Mr.  Crouch's  representation  of the  Company in  negotiations  with  unrelated
parties.  The Company has  appointed  Clyde  Bailey,  P.C. as its auditor  which
represents a change in the Company's auditor.

      Neither of  Crouch,  Bierwolf  and  Associates'  reports on the  financial
statements for either of the past two fiscal years  contained an adverse opinion
or disclaimer of opinion nor were they modified as to uncertainty,  audit scope,
or accounting principles.

      The Company's board of directors appointed Clyde Bailey, P.C. on March 27,
2001 as the Company's new auditor.

      The Company  did not have any  disagreements  with  Crouch,  Bierwolf  and
Associates  on any  matter of  accounting  principles  or  practices,  financial
statement disclosure, or auditing scope or procedure,  which, if not resolved to
the former accountant's satisfaction,  would have caused it to make reference to
the subject matter of the disagreement(s) in connection with its report.

      Prior to  retaining  his  services,  the Company  did not consult  Crouch,
Bierwolf and Associates regarding the application of accounting  principles to a
specific  completed or  contemplated  transaction,  or the type of audit opinion
that  might be  rendered  on the  Company's  financial  statements  and  Crouch,
Bierwolf  and  Associates  did not  provide  any  written or oral  advice on any
accounting, auditing, or financial reporting issue.

      The  Company  anticipates  that  Clyde  Bailey,  P.C.  will  provide  this
disclosure,  and the  Company  does expect a letter from  Crouch,  Bierwolf  and
Associates  regarding  whether it agrees with statements made by the issuer and,
if not, stating the respects in which he does not agree.

      The Company will obtain a more recent  letter  stating that the  financial
statements are fairly  presented.  However,  management  remains confident these
financial statements fairly present the Company's financial position.

                                   PART III

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

     Directors, Executive Officers and Control Persons

  Name               Age         Position(s) and Office(s)
  ----               ---         -------------------------

  Delmar Janovec     52          President, Chief Executive Officer and Director
  Rod Clawson        46          Director

      Delmar A. Janovec has served as a director of the Company since May 12,
1994.  On June 27, 1994, he was appointed CEO of the Company.  On December 31,
1999, Mr. Janovec was appointed President of the Company when Dustan Shepherd
resigned.  He is a descendant of the


                                      10

<PAGE>



Mdewakanton Wahpakoota and Sisseton-Wahpeton  bands of the Sioux American Indian
Tribe and has over twenty years of experience in the construction  industry as a
general foreman,  superintendent,  project manager, and estimator.  For the past
fifteen years, he has been the owner and CEO of Tomahawk Construction Company, a
subsidiary of the Company. Mr. Janovec attended  undergraduate studies at Kansas
State University.

      Rod Clawson has been with the Company  since October 1, 1993 and served as
Vice  President of the Company and  President of KLH  Engineers &  Constructors,
Inc., the Company's  engineering  subsidiary,  until June 1, 1998. On August 10,
1995, Mr. Clawson was made a director of the Company.  Before his appointment as
an officer of the  Company,  Mr.  Clawson  served as the  Company's  Director of
Marketing.  Before  joining  KLH,  Mr.  Clawson  worked as a  manager  for other
engineering  and  industrial  companies.  Mr.  Clawson  is a  graduate  of Regis
University  and  currently  serves as Marketing  Director of the Western  United
States for another large Engineering & Architecture firm..

Compliance with Section 16(a) of the Exchange Act

      Based  solely upon a review of forms 3, 4 and 5 furnished  to the Company,
the Company is not aware of any person,  other than Delmar  Janovec,  who at any
time during the fiscal year ended December 31, 2000, was a director, officer, or
beneficial  owner of more than ten percent of the Common  Stock of the  Company,
and who failed to file, on a timely basis,  reports required by Section 16(a) of
the  Securities  Exchange Act of 1934 during such fiscal year.  Janovec  filed a
form 4 for stock transactions in October 2000 on November 13, 2000, and a form 4
for transactions in November 2000 on December 12, 2000.

ITEM 10.   EXECUTIVE COMPENSATION

      No  compensation  in excess of $100,000 was awarded to, earned by, or paid
to any executive  officer of the Company during the fiscal years 2000,  1999 and
1998. The following table provides summary  information for the years 2000, 1999
and 1998 concerning cash and noncash compensation paid or accrued by the Company
to or on behalf of the Company's current president,  Delmar Janovec. Mr. Janovec
has continued to work without pay since October 1, 1996.

                         SUMMARY COMPENSATION TABLES


                 Annual Compensation
- -----------------------------------------------------

     Name and                                                Other Annual
Principal Position  Year    Salary ($)     Bonus ($)       Compensation ($)
- ---------------------------------------- --------------------------------------
  Delmar Janovec,   2000    $100,000 (1)       -0-(2)             -0-
     President
- ---------------------------------------- --------------------------------------
  Delmar Janovec,   1999     $81,000          - 0-               - 0-
     President
- ---------------------------------------- --------------------------------------
  Delmar Janovec,   1998     $81,000          - 0-               - 0-
     President
- ---------------------------------------- --------------------------------------




                                      11

<PAGE>




                                   Long Term Compensation
                        -----------------------------------------

                             Awards                     Payouts
                        -----------------------------------------
                                           Securities
                          Restricted       Underlying   LTIP       All Other
Name and Principal          Stock          Options/     Payouts   Compensation
     Position      Year   Award(s)($)       SARs(#)       ($)         ($)
- -------------------------------------------------------------------------------
 Delmar Janovec,   2000     - 0-            - 0-          - 0-        - 0-
    President
- -------------------------------------------------------------------------------
 Delmar Janovec,   1999     - 0-            - 0-          - 0-        - 0-
    President
- -------------------------------------------------------------------------------
 Delmar Janovec,   1998     - 0-            - 0-          - 0-        - 0-
    President
- -------------------------------------------------------------------------------

(1) Delmar Janovec has accrued, but not been paid, an annual salary since 1996.

(2)   On January 31, 2001,  the Company's  Board of Directors  granted Delmar A.
      Janovec 30,500,000 shares of the Company's common stock as a bonus for his
      services over several years.

Compensation of Directors

      The Company's  directors are not  compensated for any meeting the board of
directors which they attend.

ITEM 11.   SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
           MANAGEMENT

      The  following  table  sets  forth  certain  information   concerning  the
ownership of the Company's  Common Stock as of March 29, 2001,  with respect to:
(i) each  person  known to the Company to be the  beneficial  owner of more than
five  percent of the  Company's  Common  Stock;  (ii) all  directors;  and (iii)
directors  and  executive  officers of the  Company as a group.  As of March 29,
2001, there were 762,162,093 shares of Common Stock issued and outstanding.


  Title of Class       Name and Address of      Amount and Nature    Percent of
                        Beneficial Owner          of Beneficial        Class
                                                    Ownership
     Class B             Tibor L. Nemeth
 Preferred Stock     165 North Aspen Avenue          177012             100%
                     Azusa, California 91702

   Common Stock          Delmar Janovec
($0.0001 par value)        8021 Hallet              67721361            8.8%
                      Lenexa, Kansas 66215

   Common Stock            Rod Clawson
($0.0001 par value)   8815 East Long Street         21000000            2.7%
                      Lenexa, Kansas 66215


                                      12

<PAGE>




   Common Stock      Directors and Executive
($0.0001 par value)    Officers as a Group          41721361            5.4%
                         (2 individuals)

ITEM 12.   CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

      On December 31, 1999,  Dustan Shepherd,  the Company's  former  president,
executed a Share Purchase  Agreement  with the Company  whereby the Company sold
all of its shares of common stock in First Americans  Mortgage  Company ("FAMC")
to Shepherd for $30,000 payable pursuant to a promissory  note.  Pursuant to the
Share Purchase  Agreement,  the Company  forgave a June 30, 1999 promissory note
owed by FAMC to Tomahawk

      As of December 31, 2000, the Company was indebted to its president, Delmar
Janovec, in the amount of $920,649.

      In connection with the sale of FAMC to Shepherd,  FAMC agreed to surrender
to the Company  7,000,000  shares of common stock Kelly's  Coffee which had been
received by FAMC for services FAMC and the Company had rendered.

      During the quarter ended December 31, 1999, the Company fully resolved its
$1,071,214 debt, plus accrued  interest,  to Industrial State Bank when the last
portion of the $200,000 settlement proceeds was tendered.  Industrial State Bank
had agreed to forgive this debt in exchange for $200,000 and 2,760,000 shares of
the Company's common stock. Previously, Delmar Janovec had transferred shares of
Series A and Series B Preferred Stock  convertible  into 2,760,000 shares of the
Company's  common stock to Industrial  State Bank. While the payment of $200,000
and 2,760,000  shares  extinguished the Company's debt to Industrial State Bank,
it also  extinguished  a personal  promissory  note Janovec had made in favor of
Industrial  State Bank in  connection  with the  emergence  of  Tomahawk  out of
bankruptcy. Industrial State Bank was due approximately $3,350,000 from Tomahawk
and would not consent to Tomahawk's  Chapter 11 plan of  reorganization  without
Janovec's  personal  assumption  of this debt.  However,  Industrial  State Bank
agreed to extinguish  Janovec's  personal note upon  settlement of the Company's
$1,071,  214  debt.  At the time the  Company's  debt  was  resolved,  Janovec's
personal note had been reduced to approximately $2,100,000.

BONUSES

      On January 31, 2001, the Company's Board of Directors  unanimously  passed
resolutions in accordance with the Company's desires to reward Delmar A. Janovec
and Rod Clawson for their services over several years by granting them shares of
the Company's common stock as a bonus because neither have ever received a bonus
from the Company for services to the Company.

      All of the members of the board of directors of the Company on January 31,
2001,  resolved  by  written  consent  effective  immediately  to issue  Janovec
30,500,000 shares of the Company's common stock and Clawson 17,000,000 shares of
the  Company's  common stock  pursuant to the  Company's  2000 Stock Option Plan
which  was  registered  on the  Company's  Form S-8 with  the SEC,  file  number
333-71343.  Janovec was granted 30,500,000 shares of the Company's common stock,
and Clawson was granted  17,000,000  shares of the  Company's  common  stock via
Stock Grants dated January 31, 2001.

                                      13

<PAGE>



ITEM 13.   EXHIBITS AND REPORTS ON FORM 8-K

(a)   Exhibits.  Exhibits  required to be attached by Item 601 of Regulation S-B
      are  listed  in the  Index to  Exhibits  beginning  on page14 of this Form
      10-KSB, which is incorporated herein by reference.

(b)   No  reports  on Form 8-K were  filed on the  Company's  behalf  during the
      quarter ended December 31, 2000.

(c)   A Form 8-K was filed on January 31,  2001,  however,  regarding  the bonus
      compensation  to Delmar A.  Janovec and Rod Clawson for their  services in
      the amount of 30,500,000  and  17,000,000  shares of the Company's  Common
      Stock as a bonus.  Neither  Janovec nor Clawson had ever  received a bonus
      from the Company for their  services to it, despite both having served the
      Company since at least 1994.


                                  SIGNATURES

      In accordance with Section 13 or 15(d) of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized, this ___ day of April 2001.

                                          AmeriResource Technologies, Inc.

                                          /s/ Delmar Janovec
                                          ------------------------------------
                                          Delmar Janovec, President

      In accordance  with the Exchange Act, this report has been signed below by
the following  persons on behalf of the  registrant and in the capacities and on
the dates indicated.

Signature               Title                                  Date

/s/ Delmar Janovec
_____________________   President, Chief Executive Officer     April 2, 2001
Delmar Janovec          and Director


/s/ Rod Clawson
_____________________   Director                               April 2, 2001
Rod Clawson


                                      14

<PAGE>



                               INDEX TO EXHIBITS

EXHIBIT    PAGE
NO.        NO.       DESCRIPTION

3(i)       *         Articles of Incorporation of the Company.

3(ii)      *         Bylaws of the Company.

10(iii)    *         August 23, 1999, Stock Purchase Agreement between Staruni
                     Corporation and the Company.

10(iv)     *         July 15, 1999, Stock Purchase Agreement between the Company
                     and Kelly's Coffee Group, Inc.

10(v)      *         July 9, 1999, Settlement Agreement between the Company,
                     Delmar and Marilyn Janovec and Industrial State Bank dated
                     July 1999.

10(vi)     *         June 30, 1999, Share Purchase Agreement by and between the
                     Company and Calbear LLC.

21         **        Subsidiaries of Registrant

23         **        Consent of Auditor

27         **        Financial Data Schedule


* Previously  filed as indicated and  incorporated  herein by reference from the
referenced filings previously made by the Company.

** Filed herewith.

                                      15

<PAGE>



                                  EXHIBIT 21

                            LIST OF SUBSIDIARIES
                                     OF
                       AMERIRESOURCE TECHNOLOGIES, INC.

1.    Tomahawk Construction, Inc. was incorporated in Missouri.

2.    The Travel Agent's Hotel Guide, Inc. was incorporated in Nevada.

3.    West Texas Reak Estate, Inc. was incorporated in Texas.

                                      16

<PAGE>



                                                                    Exhibit 23





CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS


      We hereby consent to the use of our report,  dated March 27, 2001, in this
annual  report  on  Form  10-KSB  for the  year  ended  December  31,  2000  for
AmeriResource Technologies, Inc.



                             /s/ Clyde Bailey, P.C.

                             Clyde Bailey, P.C.


San Antonio, Texas
March 30, 2001

                                      17

