UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                  FORM 10-QSB/A

(Mark One)

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

         For the quarterly period ended September 30, 2000

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

         For the transition period from ______________ to _________________

                           Commission File No. 0-28067

                               FIRST RESERVE, INC.
                               -------------------
             (Exact name of registrant as specified in its charter)

                  Florida                                 86-0740730
      -------------------------------                 ------------------
      (State or other jurisdiction of                  (I.R.S. Employer
       incorporation or organization)                 Identification No.)

    1360 South Dixie Highway, Coral Gables, FL                    33146
--------------------------------------------------------------------------------
     (Address of principal executive offices)                   (Zip Code)

                                 (305) 667-8871
--------------------------------------------------------------------------------
                 Issuer's Telephone Number, Including Area Code:


--------------------------------------------------------------------------------
              (Former Name, Former Address and Former Fiscal Year,
                         if changed since last report)

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

         As of September 30, 2000, 6,915,050 shares of the Registrant's Common
Stock, no par value per share, were outstanding.

<PAGE>

                      FIRST RESERVE, INC. AND SUBSIDIARIES

                             INDEX TO FORM 10-QSB/A
<TABLE>
<CAPTION>
                                                                                                       Page
                                                                                                       ----
                                       PART I - FINANCIAL INFORMATION

<S>                                                                                                      <C>
Item 1. Financial Statements

        Condensed Consolidated Balance Sheets
        September 30, 2000 and December 31, 1999........................................................ 1

        Liabilities and Stockholders' Equity
        September 30, 2000 and December 31, 1999........................................................ 1

        Condensed Consolidated Statements of Income and Accumulated Deficit
        Nine Months Ended September 30, 2000............................................................ 1

        Condensed Consolidated Statements of Income and Accumulated Deficit
        Three Months Ended September 30, 2000........................................................... 1

        Condensed Consolidated Statement of Stockholders' Equity
        Nine Months and Three Months Ended September 30, 2000........................................... 1

        Condensed Consolidated Statements of Cash Flows
        Nine Months Ended September 30, 2000 and September 30, 1999..................................... 1

        Notes to Condensed Consolidated Financial Statements............................................ 1

Item 2. Management's Discussion and Analysis of Financial
        Condition and Results of Operations............................................................. 1

                                         PART II - OTHER INFORMATION

Item 5. Other Information............................................................................... 7

Item 6. Exhibits and Reports on Form 8-K ............................................................... 8

Signatures.............................................................................................. 9
</TABLE>

                                        2
<PAGE>

                                     PART I
                              FINANCIAL INFORMATION

Item 1.  Financial Statements.

Immediately following the signature page in this Form 10-QSB/A.

Item 2.  Management's Discussion and Analysis of Financial Condition and
         Results of Operations.

The "Management's Discussion and Analysis of Financial Condition and Results of
Operations" included herein should be read in conjunction with the Condensed
Consolidated Financial Statements of First Reserve, Inc. and subsidiaries (the
"Company"), as of September 30, 2000, and the related notes to the Condensed
Consolidated Financial Statements as of September 30, 2000 and 1999, and
December 31, 1999, and the related Notes to the Consolidated Financial
Statements. The Company's Financial Statements have been prepared in accordance
with generally accepted accounting principles in the United States.

The financial information in "Management's Discussion and Analysis of Financial
Condition and Results of Operations" refers to the continuing operations of the
Company.

The results here are not necessarily representative of the results that may be
expected in any future period.

Results of Operations

Our real estate brokerage business is subject to seasonal fluctuations because
more home sale transactions tend to close during the second and third quarters
of the year. As a result, our operating results and profitability are typically
higher in the second and third quarters relative to the remainder of the year.

Revenues. Our revenues for the nine-month period ended September 30, 2000,
increased approximately 26.2% to approximately $23.5 million, from $18,598,069
for the comparable interim period in 1999. Revenues in 2000 reflect an increase
in residential real estate sales activity in our primary existing market
(Miami-Dade County, Florida). In addition, this nine-month period reflects the
inclusion of the operations of Ross and Associates, Inc. ("Ross") and The
Daniels Group, Inc. ("Daniels"), both of which were acquired as of September 1,
2000. In addition, the percentage increase can also be contributed to the
following sources: (i) permanent office in Plantation, Florida (Broward County);
the Broward County operation just began to contribute material revenues in the
third quarter of 1999; (ii) the volume of our mortgage brokerage operations also
increased from 1999 levels; and (iii) for the third quarter of 2000, the
operating results of Columbia Title of Florida, Inc. have increased.

                                        3
<PAGE>

Operating Expenses. Operating expenses for the nine-month period ended September
30, 2000, increased to approximately $22.4 million, as compared to approximately
$18.1 million for the nine- month period ended September 30, 1999. The
significant components of our operating expenses are: commissions to real estate
associates, officer and staff salaries, office rental costs, advertising
expenses, promotional expenses and insurance. Our operating expenses increased
as a result of the costs associated with the acquisitions of Ross and Daniels in
September, 2000, as well as the continued support of our two Broward County
sales offices. During this nine-month period, the Company had significant
professional expenses associated with its continued reporting requirements under
the Securities Exchange Act of 1934.

Interest Income and Expense. During the first nine months of 2000 we had a total
interest expense of $108,089, slightly up from $103,418 during the first
nine-months of 1999. This amount was associated with three borrowings, one of
which was the warehouse line of credit for the mortgage brokerage operations.
Interest income was approximately $23,476, down significantly from approximately
$43,479 for the nine-month period ended September 30, 1999. This was primarily
due to lower cash balances.

Income. We had income, before taxes, of $1,079,689 for the nine-month period
ended September 30, 2000, with an income tax on this amount of $7,488, compared
with approximately $640,727 for the nine-month period ended September 30, 1999.
Our income from operations was generated principally from the realty services
(brokerage commissions) and, to a lesser extent, from mortgage brokerage
services and from our title insurance operations (Columbia Title).

Liquidity and Capital Resources

Cash and cash equivalents at September 30, 2000, were $1,284,943. Cash provided
by operating activities for the first nine months of 2000 was $1,200,722. This
was primarily due to an increase in cash received from from customers, offset by
cash paid to suppliers.

The bulk of cash used for investing activities, totalling $650,695, represents
expenditures for property leasehold improvements and for office furniture and
equipment in connectiom with the opening of the new offices.

Cash provided by financing activities was $7,786 for the nine-month period ended
September 30, 2000, principally due to loan proceeds from line of credit.

At September 30, 2000, we had long term notes payable of approximately $220,000.
We have a $1.8 million "warehouse" line of credit to fund loans to be made in
connection with its mortgage banking operations. Each "warehouse" loan is
fully-backed by a permanent loan "take-out" commitment from a national lender of
residential financing. As of September 30, 2000, the balance of this "warehouse"
line of credit was approximately $838,000 with a corresponding asset of
"mortgage loans held for sale" of approximately $847,000.

                                        4
<PAGE>

At September 30, 2000, we had shareholder equity of $3,965,021. For the
nine-month period ended September 30, 2000, our deficit in working capital
(current assets minus current liabilities) was $877,266.

Our second office in Broward County was opened in April 2000. We anticipate that
our Broward County offices will result in substantially increased sales. We
anticipate that our title business will be profitable by the end of 2000, and
will contribute to our cash flow and our overall operations.

We believe that our cash flow from operations combined with our ability to
borrow funds will be adequate to fund continuing operations. We expect to
continue to expand our existing business in the South Florida market through the
opening and acquisition of new offices in South Florida. In order to fund this
expansion, we may borrow additional monies from financial institutions or other
third-party sources. In addition, we may from time-to-time sell equity to raise
additional working capital. Using these available sources, as well as internally
generated cash, we expect to have sufficient funds to satisfy our working
capital needs for the immediate future.

Seasonality

Our operations are principally based on the residential real estate market in
South Florida (Miami- Dade and Broward Counties). Historically, this market has
been seasonal with generally higher sales in the second and third fiscal
quarters (April-September). Therefore, the results of any interim period is not
necessarily indicative of the results that might be expected during a full
fiscal year.

Forward Looking Statements

From time to time, we make statements about our future results in this Form
10-QSB/A that may constitute "forward-looking statements" within the meaning of
the Private Securities litigation Reform Act of 1995. These statements include,
but are not limited to, statements in the Management's Discussion and Analysis
(above) regarding the opening of our new offices and the expansion of our
business in South Florida, our anticipated revenues for 2000, the expected
aggregate value of real estate transactions we handled in 2000, as well as the
anticipated synergies among our three operating units, are based on our current
expectations and the current economic environment. We caution you that these
statements are not guarantees of future performance. They involve a number of
risks and uncertainties that are difficult to predict. Our actual results could
differ materially form those expressed or implied in the forward-looking
statements. Important assumptions and other important factors that could cause
our actual results to differ material from those in the forward-looking
statements, include, but are not limited to: (i) the continued growth in the
residential real estate market in South Florida including the successful
increase in operation; (ii) the operation of our recently-acquired title company
becoming profitable; (iii) the increased profitability of our mortgage brokerage
business; (iv) the general availability of home mortgage financing at favorable
rates; (v) continued positive economic climate in the United States; (vi)
competition in our existing lines of business; and (vii) our ability to obtain
and maintain working

                                        5
<PAGE>

capital, whether internally generated or from financing sources (on acceptable
terms) in order to finance our growth strategy.

                                        6
<PAGE>

                                     PART II
                                OTHER INFORMATION

Item 5.  Other Information

On September 1, 2000, Esslinger, Wooten & Maxwell, Inc. ("EWM") purchased
substantially all the assets of Ross for $186,300 in stock of the Company. As a
result of this acquisition, accounted for as a purchase, property, plant and
equipment of $46,875, accounts receivable of $41,500 and other assets of $97,925
were recorded. Ross was primarily engaged in the same activity as EWM. Under the
terms of the agreement, the Ross sole shareholder received 138,000 shares of
common stock of the Company on the date of the acquisition. An additional
112,000 "contingent" shares of common stock of the Company will be issued
pending future gross commission income to be generated by the former shareholder
of Ross over the next 12 months. Due to the contingent nature of these shares,
the Company will record them as additional purchase price upon issuance of the
shares.

On September 1, 2000, EWM acquired substantially all the assets of Daniels for
$13,500 in stock of the company. As a result of this acquisition, accounted for
as a purchase, property, plant and equipment totaling $13,500 was recorded.
Daniels was primarily engaged in the same activity as EWM. Under the terms of
the agreement, the shareholder of Daniels received 10,000 shares of common stock
of the Company on the date of the acquisition. Additional cash consideration to
the former shareholder of Daniels may be paid to her, pending achieving certain
commission levels during four separate one-year periods, ending on August 31,
2004. If these commission levels are not achieved during these four separate
one-year periods, no additional cash consideration will be paid. Due to the
contingent nature of this cash consideration, the Company will record this
transaction as additional purchase price upon the former shareholder of Daniels
achieving the required commission levels. Based on recent trading of the
Company's stock, the fair value of the Company's stock price on the acquisition
date was $1.35 per share. The total cost of the acquisition was approximately
$13,500. The results of operations for Daniels are included in the consolidated
condensed statements of income for the period from September 1, 2000 to
September 30, 2000.

The Company created a new subsidiary, First Reserve Insurance, Inc. ("FRINS") in
2000. On September 13, 2000, FRINS signed an exclusive agreement with an
insurance broker to market and sell insurance products to the clients of EWM and
the Company. These insurance products include, but are not limited to, propert
and casualty, automobile, life and health insurance policies. The results of
operations for FRINS are included in the consolidated condensed statement of
income for the period from September 13, 2000, to September 30, 2000.

                                        7
<PAGE>

Item 6.  Exhibits and Reports on Form 8-K

         A.       Exhibits.
                  ---------

                  Exhibit 27     Financial Data Schedule

         B.       Reports on Form 8-K

                  None

                                        8
<PAGE>

                                   SIGNATURES

         Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

Date: November 20, 2000                 FIRST RESERVE, INC.


                                        By: /s/ Ronald A. Shuffield
                                           -------------------------------------
                                            Ronald A. Shuffield, President and
                                            Principal Financial Officer

                                        9
<PAGE>

                             CONDENSED CONSOLIDATED
                              FINANCIAL STATEMENTS

                        SEPTEMBER 30, 2000 AND 1999, AND
                               DECEMBER 31, 1999

                      FIRST RESERVE, INC. AND SUBSIDIARIES

                             CORAL GABLES, FLORIDA


<PAGE>

                      FIRST RESERVE, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
                                     ASSETS

                                           (Unaudited)
                                          September 30,   December 31,
                                               2000            1999
                                           -----------     -----------
<S>                                        <C>             <C>
CURRENT ASSETS
    Cash                                   $ 1,284,943     $   727,130
    Interest bearing deposit from bank         125,000         125,000
    Receivables                                389,694         356,331
    Mortgage loans held for sale               846,950         830,620
    Prepaid expenses and other                 155,146         178,297
                                           -----------     -----------
           Total current assets              2,801,733       2,217,378
                                           -----------     -----------
PROPERTY AND EQUIPMENT
    Furniture and equipment                  1,203,915         898,579
    Office equipment                           914,220         762,748
    Transportation equipment                    20,000          28,102
    Leasehold improvements                     690,244         435,323
    Equipment held under capital leases         35,730          35,730
                                           -----------     -----------
                                             2,864,109       2,160,482
    Less accumulated depreciation           (1,014,784)       (823,743)
                                           -----------     -----------
           Net property and equipment        1,849,325       1,336,739
                                           -----------     -----------
OTHER ASSETS
    Goodwill, net                            1,302,094       1,348,397
    Deposits and other                         175,764          87,834
                                           -----------     -----------
           Total other assets                1,477,858       1,436,231
                                           -----------     -----------
           Total assets                    $ 6,128,916     $ 4,990,348
                                           ===========     ===========
</TABLE>

See the accompanying notes to the condensed consolidated financial statements
which are an integral part of these statements.

                                  Page 1 of 15

<PAGE>

                      LIABILITIES AND STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
                                                     (Unaudited)
                                                    September 30,    December 31,
                                                         2000            1999
                                                     -----------     -----------
<S>                                                  <C>             <C>
CURRENT LIABILITIES
    Accounts payable and accrued expenses            $   362,371     $   297,063
    Deferred mortgage fee income                          17,721          22,740
    Escrow deposits                                           --           4,909
    Current portion of obligations under
        capital leases                                     6,774           6,109
    Current maturities of long term debt, net
        of unamortized discount                        1,537,601       1,011,382
                                                     -----------     -----------
           Total current liabilities                   1,924,467       1,342,203
                                                     -----------     -----------
LONG TERM LIABILITIES
    Obligations under capital leases                      19,114          24,299
    Note payable, net of unamortized discount            220,314         930,826
                                                     -----------     -----------
           Total long term liabilities                   239,428         955,125
                                                     -----------     -----------
           Total liabilities                           2,163,895       2,297,328
                                                     -----------     -----------
STOCKHOLDERS' EQUITY
    Common  stock,  no  par  value,
        100,000,000 authorized shares;
        6,915,050 and 6,767,050 shares issued and
        outstanding at September 30, 2000 and
        December 31, 1999, respectively                6,139,307       5,939,507
    Accumulated deficit                               (2,174,286)     (3,246,487)
                                                     -----------     -----------
           Total stockholders' equity                  3,965,021       2,693,020
                                                     -----------     -----------
           Total liabilities and stockholders'
               equity                                $ 6,128,916     $ 4,990,348
                                                     ===========     ===========
</TABLE>

                                  Page 2 of 15
<PAGE>

                      FIRST RESERVE, INC. AND SUBSIDIARIES
                   CONDENSED CONSOLIDATED STATEMENTS OF INCOME
<TABLE>
<CAPTION>
                                                       (Unaudited)      (Unaudited)
                                                        Nine-month       Nine-month
                                                       Period Ended     Period Ended
                                                       September 30,    September 30,
                                                           2000             1999
                                                       ------------     ------------
<S>                                                    <C>              <C>
REVENUES                                               $ 23,464,336     $ 18,598,069
                                                       ------------     ------------
COSTS AND EXPENSES
    Commissions, fees and other incentives               15,264,869       12,080,062
    General and administrative expenses                   6,825,976        5,843,105
    Depreciation and amortization                           263,413          185,701
    Legal and other settlements                                  --            9,300
                                                       ------------     ------------
           Total costs and expenses                      22,354,258       18,118,168
                                                       ------------     ------------
           Income  from  operations  before  income
               taxes and other income and expenses        1,110,078          479,901
                                                       ------------     ------------
OTHER INCOME AND (EXPENSES)
    Interest income                                          23,476           43,479
    Interest expense                                       (108,089)        (103,418)
    Other income                                             49,687               --
    Other expenses                                               --           (1,600)
    Gain on disposition of property and equipment             4,537          222,365
                                                       ------------     ------------
           Total other income and (expenses)                (30,389)         160,826
                                                       ------------     ------------
           Income before income taxes                     1,079,689          640,727

PROVISION FOR INCOME TAX                                      7,488               --
                                                       ------------     ------------
           Net income                                  $  1,072,201     $    640,727
                                                       ============     ============
BASIC EARNINGS PER COMMON SHARE                        $       0.16     $       0.10
                                                       ============     ============
WEIGHTED AVERAGE COMMON SHARES                            6,783,314        6,567,783
                                                       ============     ============
DILUTED EARNINGS PER COMMON SHARES                     $       0.16     $        .10
                                                       ============     ============
WEIGHTED AVERAGE DILUTED COMMON SHARES                    6,783,314        6,712,792
                                                       ============     ============
</TABLE>

See the accompanying notes to the condensed consolidated financial statements
which are an integral part of these statements.

                                  Page 3 of 15
<PAGE>

                      FIRST RESERVE, INC. AND SUBSIDIARIES
                   CONDENSED CONSOLIDATED STATEMENTS OF INCOME
<TABLE>
<CAPTION>
                                                       (Unaudited)     (Unaudited)
                                                       Three-month     Three-month
                                                      Period Ended    Period Ended
                                                      September 30,   September 30,
                                                           2000            1999
                                                       -----------     -----------
<S>                                                    <C>             <C>
REVENUES                                               $ 8,140,384     $ 6,742,950
                                                       -----------     -----------
COSTS AND EXPENSES
    Commissions, fees and other incentives               5,203,429       4,334,465
    General and administrative expenses                  2,339,102       2,110,431
    Depreciation and amortization                           93,589          68,378
    Legal and other settlements                                 --           5,300
                                                       -----------     -----------
           Total costs and expenses                      7,636,120       6,518,574
                                                       -----------     -----------
           Income  from  operations  before  income
               taxes and other income and expenses         504,264         224,376
                                                       -----------     -----------
OTHER INCOME AND (EXPENSES)
    Interest income                                         10,896          24,864
    Interest expense                                       (43,262)        (44,570)
    Other income                                            16,955              --
    Gain on disposition of property and equipment            4,537              --
                                                       -----------     -----------
           Total other income and (expenses)               (10,874)        (19,706)
                                                       -----------     -----------
           Income before income taxes                      493,390         204,670

PROVISION FOR INCOME TAX                                     2,888              --
                                                       -----------     -----------
           Net income                                  $   490,502     $   204,670
                                                       ===========     ===========
BASIC EARNINGS PER COMMON SHARE                        $      0.07     $      0.03
                                                       ===========     ===========
WEIGHTED AVERAGE COMMON SHARES                           6,783,314       6,567,783
                                                       ===========     ===========
DILUTED EARNINGS PER COMMON SHARES                     $      0.07     $      0.03
                                                       ===========     ===========
WEIGHTED AVERAGE DILUTED COMMON SHARES                   6,783,314       6,712,792
                                                       ===========     ===========
</TABLE>

See the accompanying notes to the condensed consolidated financial statements
which are an integral part of these statements.

                                  Page 4 of 15
<PAGE>

                      FIRST RESERVE, INC. AND SUBSIDIARIES
            CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
                                                                (Unaudited)
                                                 Nine-month Period Ended September 30, 2000
                                         ---------------------------------------------------------
                                            Common         Common                        Total
                                            Stock          Stock       Accumulated    Stockholders'
                                            Shares         Amount        Deficit         Equity
                                         -----------    -----------    -----------     -----------
<S>                                        <C>          <C>            <C>             <C>
BALANCE, December 31, 1999                 6,767,050    $ 5,939,507    $(3,246,487)    $ 2,693,020

No par value stock issued for the
    acquisition of assets of Ross &
    Associates, Inc.                         138,000        186,300             --         186,300

No par value stock issued for the
    acquisition of assets of Daniels
    Group, Inc.                               10,000         13,500             --          13,500

Net income for the nine-month period
    ended September 30, 2000                      --             --      1,072,201       1,072,201
                                         -----------    -----------    -----------     -----------
        BALANCE, September 30, 2000        6,915,050    $ 6,139,307    $(2,174,286)    $ 3,965,021
                                         ===========    ===========    ===========     ===========
<CAPTION>
                                                                (Unaudited)
                                                 Three-month Period Ended September 30, 2000
                                         ---------------------------------------------------------
                                            Common         Common                        Total
                                            Stock          Stock       Accumulated    Stockholders'
                                            Shares         Amount        Deficit         Equity
                                         -----------    -----------    -----------     -----------
<S>                                        <C>          <C>            <C>             <C>
BALANCE, June 30, 2000                     6,767,050    $ 5,939,507    $(2,664,788)    $ 3,274,719

No par value stock issued for the
    acquisition of assets of Ross &
    Associates, Inc.                         138,000        186,300             --         186,300

No par value stock issued for the
    acquisition of assets of Daniels
    Group, Inc.                               10,000         13,500             --          13,500

Net income for the three-month period
    ended September 30, 2000                      --             --        490,502         490,502
                                         -----------    -----------    -----------     -----------
        BALANCE, September 30, 2000        6,915,050    $ 6,139,307    $(2,174,286)    $ 3,965,021
                                         ===========    ===========    ===========     ===========
</TABLE>

See the accompanying notes to the condensed consolidated financial statements
which are an integral part of these statements.

                                  Page 5 of 15
<PAGE>

                      FIRST RESERVE, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
<TABLE>
<CAPTION>
                                                           (Unaudited)      (Unaudited)
                                                            Nine-month       Nine-month
                                                           Period Ended     Period Ended
                                                           September 30,    September 30,
                                                               2000             1999
                                                           ------------     ------------
<S>                                                        <C>              <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
    Cash received from customers                           $ 23,512,232     $ 18,623,010
    Interest received                                            23,476           39,266
    Interest paid                                              (127,100)        (126,202)
    Cash paid to suppliers and employees                    (22,006,480)     (18,068,236)
    Net increase in mortgage loans held for sale                (16,330)        (683,350)
    Settlements paid                                           (177,588)        (170,488)
    Income taxes paid                                            (7,488)              --
                                                           ------------     ------------
           Net cash provided by (used in)
               operating activities                           1,200,722         (386,000)
                                                           ------------     ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
    Advances to employees                                       (12,700)          (8,300)
    Net increase (decrease) in deposits                          12,823          (40,292)
    Purchase of property and equipment                         (655,355)      (1,018,187)
    Purchase of interest bearing deposit with bank                   --         (125,000)
    Payment for purchase of acquired companies;
        net of cash received                                         --         (185,397)
    Proceeds from disposition of property and equipment           4,537          225,000
                                                           ------------     ------------
           Net cash used in investing activities               (650,695)      (1,152,176)
                                                           ------------     ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
    Proceeds from borrowings on loan payable                         --          500,000
    Net proceeds from line of credit                             16,952          674,289
    Payment on loan payable                                      (4,646)          (1,500)
    Payment of capital lease obligation                          (4,520)              --
                                                           ------------     ------------
           Net cash provided by  financing
               activities                                         7,786        1,172,789
                                                           ------------     ------------
           Net increase (decrease)  in cash                     557,813         (365,387)

CASH, beginning of period                                       727,130        1,055,160
                                                           ------------     ------------
CASH, end of period                                        $  1,284,943     $    689,773
                                                           ============     ============
</TABLE>

See the accompanying notes to the condensed consolidated financial statements
which are an integral part of these statements.

                                  Page 6 of 15
<PAGE>

                      FIRST RESERVE, INC. AND SUBSIDIARIES
           CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (CONTINUED)
                INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
<TABLE>
<CAPTION>
                                                                 (Unaudited)    (Unaudited)
                                                                 Nine-month      Nine-month
                                                                Period Ended    Period Ended
                                                                September 30,   September 30,
                                                                    2000            1999
                                                                 -----------     -----------
<S>                                                              <C>             <C>
RECONCILIATION  OF  NET INCOME  TO  NET  CASH
    PROVIDED BY (USED IN)  OPERATING ACTIVITIES:
        Net income                                               $ 1,072,201     $   640,727
        Adjustments to reconcile net income to net cash
           provided by (used in) operating activities:
               Depreciation                                          203,144         135,774
               Amortization                                           60,269          50,028
               Gain on disposition of property and equipment          (4,537)       (222,365)
               Decrease in accounts receivable                         8,137          24,941
               Increase in mortgage loans held for sale              (16,330)       (683,350)
               Decrease in prepaid expenses and
                  other assets                                        19,057          51,302
               Decrease  in  accounts  and  notes (operating)
                  payable and accrued expenses                      (131,291)       (383,057)
               Decrease in deferred mortgage fee income               (5,019)             --
               Decrease in escrow deposits                            (4,909)             --
                                                                 -----------     -----------
                      Net cash provided by (used in)
                         operating activities                    $ 1,200,722     $  (386,000)
                                                                 ===========     ===========
</TABLE>

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:

         On September 1, 2000, Esslinger, Wooten & Maxwell, Inc. "EWM" purchased
         substantially all the assets of Ross & Associates, Inc. for $186,300 in
         stock of the Company. As a result of this acquisition, accounted for as
         a purchase, property, plant and equipment of $46,875, accounts
         receivable of $41,500 and other assets of $97,925 were recorded.

         On September 1, 2000, EWM acquired substantially all the assets of The
         Daniels Group, Inc. for $13,500 in stock of the company. As a result of
         this acquisition, accounted for as a purchase, property, plant and
         equipment totaling $13,500 was recorded.

         On March 31, 1999 the Company purchased all the stock of Columbia Title
         of Florida, Inc. ("Columbia") for $191,350. As a result of this merger,
         accounted for as purchase, assets of $104,267, goodwill of $257,340,
         and liabilities of $170,257 were recorded.

         On September 30, 1999, the Company issued 200,000 shares of common
         stock of the Company to the former shareholders of Gerard International
         Realty, Inc. These shares were previously held in escrow as
         "contingent" shares as further discussed on Note 7. As a result, common
         stock and goodwill increased by $200,000.

See the accompanying notes to the condensed consolidated financial statements
which are an integral part of these statements.

                                  Page 7 of 15
<PAGE>

                      FIRST RESERVE, INC. AND SUBSIDIARIES
            NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         In the opinion of management, the accompanying unaudited condensed
         consolidated interim financial statements reflect all adjustments
         (consisting of only normal and recurring adjustments) necessary to
         present fairly the financial position of First Reserve, Inc. and
         Subsidiaries ("the Company") as of September 30, 2000 and the results
         of their operations and cash flows for the periods then ended. The
         results of operations for such interim periods are not necessarily
         indicative of the results for a full year. The accompanying unaudited
         condensed consolidated interim financial statements have been prepared
         in accordance with generally accepted accounting principles for interim
         financial reporting and with instructions to Form 10-QSB and,
         accordingly, do not include all disclosures required by generally
         accepted accounting principles. The condensed consolidated financial
         statements should be read in conjunction with the audited consolidated
         financial statements and the notes to the audited consolidated
         financial statements included in the Company's Form 10-KSB annual
         report for 1999 filed with the Securities and Exchange Commission.

         The accounting policies followed for interim financial reporting are
         the same as those disclosed in Note 1 of the notes to the consolidated
         financial statements included in the Company's Form 10-KSB annual
         report for the year ended December 31, 1999.

         The Company created a new subsidiary, First Reserve Insurance, Inc.
         ("FRINS") in 2000. On September 13, 2000 FRINS signed an exclusive
         agreement with an insurance broker to market and sell insurance
         products to the clients of EWM and the Company. These insurance
         products include, but are not limited to, property and casualty,
         automobile, life and health insurance policies. The results of
         operations for FRINS are included in the consolidated condensed
         statement of income for the period from September 13, 2000 to September
         30, 2000.

NOTE 2 - ESTIMATES

         The preparation of financial statements in conformity with generally
         accepted accounting principles requires management to make estimates
         and assumptions that affect the amounts reported in the financial
         statements and accompanying notes. Actual results could differ from
         those estimates.

NOTE 3 - BUSINESS COMBINATIONS

         On September 1, 2000, EWM acquired substantially all the assets of Ross
         & Associates, Inc. ("Ross") in a business combination accounted for as
         a purchase. Ross was primarily engaged in the same activity as EWM.
         Under the terms of the agreement, the Ross sole shareholder received
         138,000 shares of common stock of the Company on the date of the
         acquisition. An additional 112,000 "contingent" shares of common stock
         of the Company will be issued pending future gross commission income to
         be generated by the former shareholder of Ross over the next 12 months.
         Due to the contingent nature of these shares, the Company will record
         them as additional purchase price upon issuance of the shares.

                                  Page 8 of 15
<PAGE>

                      FIRST RESERVE, INC. AND SUBSIDIARIES
            NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

NOTE 3 - BUSINESS COMBINATIONS (CONTINUED)

         Based on recent trading of the Company's stock, the fair value of the
         Company's stock price on the acquisition date was $1.35 per share. The
         total cost of the acquisition, excluding the contingent shares, was
         $186,300. The results of operations for Ross are included in the
         consolidated condensed statements of income for the period from
         September 1, 2000 to September 30, 2000.

         On September 1, 2000, EWM acquired substantially all of the assets of
         the Daniels Group, Inc. ("Daniels") in a business combination accounted
         for as a purchase. Daniels was primarily engaged in the same activity
         as EWM. Under the terms of the agreement, the shareholder of Daniels
         received 10,000 shares of common stock of the Company on the date of
         the acquisition. Additional cash consideration to the former
         shareholder of Daniels may be paid to her, pending achieving certain
         commission levels during four separate one-year periods, ending on
         August 31, 2004. If these commission levels are not achieved during
         these four separate one- year periods, no additional cash consideration
         will be paid. Due to the contingent nature of this cash consideration,
         the Company will record this transaction as additional purchase price
         upon the former shareholder of Daniels achieving the required
         commission levels. Based on recent trading of the Company's stock, the
         fair value of the Company's stock price on the acquisition date was
         $1.35 per share. The total cost of the acquisition was approximately
         $13,500. The results of operations for Daniels are included in the
         consolidated condensed statements of income for the period from
         September 1, 2000 to September 30, 2000.

         On March 31, 1999, the Company acquired all the stock of Columbia Title
         of Florida, Inc. ("Columbia") in a business combination accounted for
         as purchase. Columbia is a title company engaged in the business of
         closing real estate and mortgage loan transactions, primarily in the
         South Florida area. Columbia has two branches, Miami and Key Largo,
         Florida. Under the terms of the agreement, the shareholder of Columbia
         ("seller") received $100 for the stock of Columbia. The agreement also
         provided for additional consideration if the assets of the Key Largo
         branch were sold within ninety days of the acquisition date. If this
         condition was met, the seller would receive eighty-five percent (85%)
         of the net proceeds of the sale of the assets of the Key Largo branch.
         If the sale did not effectuate within the ninety days, all the assets
         of the Key Largo branch would be transferred back to the seller. The
         sale of the Key Largo branch was made within the ninety day period. As
         a result, additional consideration of $191,250 for the acquisition of
         the stock was recorded. The total cost of the acquisition was
         approximately $191,350. Goodwill of approximately $257,340 resulting
         from this transaction is being amortized on the straight-line method
         over 20 years. The results of operations of Columbia are included in
         the condensed consolidated statements of income from March 31, 1999 to
         September 30, 1999 and January 1, 2000 to September 30, 2000.

                                  Page 9 of 15
<PAGE>

                      FIRST RESERVE, INC. AND SUBSIDIARIES
            NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

NOTE 4 - CASH HELD IN TRUST

         The Company maintains separately designated Trust accounts for home
         buyers' earnest money, property owners, tenants and other third
         parties. The Company holds such funds until sold properties are closed
         and leases have expired. Funds are disbursed in accordance with the
         settlement instructions or rental management agreements. These funds
         are not recorded in the Company's financial statements as they are held
         in a fiduciary capacity. At September 30, 2000, the Company held
         $7,095,884 of funds in trust.

NOTE 5 - MORTGAGE LOANS HELD FOR SALE

         Mortgage loans held for sale consist primarily of residential mortgage
         loans made in connection with Embassy's mortgage banking operations and
         are reported at the lower of cost or market value. The method used to
         determine this amount is the commitment price from national lenders
         utilizing the individual loan method. Net unrealized losses, if any,
         are recognized through a valuation allowance by charges to income. Each
         loan is fully backed by a permanent loan "take-out commitment" from a
         national lender of residential financing. The mortgage loans are
         purchased by the national lender once permanent financing is secured,
         usually within five to twelve days of original funding.

NOTE 6 - LEGAL AND OTHER SETTLEMENTS

         Included in legal and other settlements amounts are costs incurred by
         EWM in settling various disputes arising with customers or tenants in
         the ordinary course of business.

NOTE 7 - CONTINGENT SHARES

         Under the terms of the September 30, 1998 merger agreement between the
         Company and Gerard International Realty, Inc. ("Gerard"), the former
         shareholders of Gerard would receive an additional 200,000 "contingent"
         shares of common stock of the Company, pending future gross commission
         income to be generated by the former shareholders of Gerard over a 24
         month "review" period, beginning September 30, 1998. These contingent
         shares were held in escrow. At September 30, 1999, the former
         shareholders of Gerard had met the gross commission income requirements
         stated in the agreement and 200,000 of contingent shares were issued as
         common stock and valued at $1 per share. As a result, goodwill and
         common stock of $200,000 were recorded.

NOTE 8 - EARNINGS PER SHARE

         Basic earnings per share ("EPS") was computed by dividing net income by
         the weighted average number of common shares outstanding during the
         period. Diluted EPS were determined on the assumption that the
         contingent shares where excised at the beginning of the period, or at
         time of issuance, if later.

                                  Page 10 of 15
<PAGE>

                      FIRST RESERVE, INC. AND SUBSIDIARIES
            NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

NOTE 8 - EARNINGS PER SHARE (CONTINUED)

         The following is the calculation of earnings per share:
<TABLE>
<CAPTION>
                                                                Nine-month          Nine-month
                                                               Period Ended        Period Ended
                                                            September 30, 2000  September 30, 1999
                                                                ----------          ----------
<S>                                                             <C>                 <C>
Basic earnings per common share:
    Numerator
       Net income before extraordinary
           items applicable to common
               stockholders                                     $1,072,201          $  640,727
           Extraordinary items, net                                     --                  --
                                                                ----------          ----------
           Income applicable to common
               stockholders                                     $1,072,201          $  640,727
                                                                ==========          ==========
       Denominator
          Weighted average common shares                         6,783,314           6,567,783
                                                                ----------          ----------
           Basic EPS                                            $      .16          $      .10
                                                                ==========          ==========
Diluted earnings per common share:
       Numerator
           Net income before extraordinary
               items applicable to common
               stockholders                                     $1,072,201          $  640,727
           Extraordinary items, net                                     --                  --
                                                                ----------          ----------
           Income applicable to common
               stockholders                                     $1,072,201          $  640,727
                                                                ==========          ==========
       Denominator
           Weighted average common shares                        6,783,314           6,712,792
           Contingent shares                                            --                  --
                                                                ----------          ----------
           Weighted average diluted common
               shares                                            6,783,314           6,712,792
                                                                ----------          ----------
           Diluted EPS                                          $      .16          $      .10
                                                                ==========          ==========
</TABLE>

                                  Page 11 of 15
<PAGE>

                      FIRST RESERVE, INC. AND SUBSIDIARIES
            NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

NOTE 8 - EARNINGS PER SHARE (CONTINUED)

<TABLE>
<CAPTION>
                                                               Three-Month        Three-Month
                                                               Period Ended       Period Ended
                                                            September 30, 2000  September 30, 1999
                                                                ----------          ----------
<S>                                                             <C>                 <C>
Basic earnings per common share:
   Numerator
       Net income before extraordinary
           items applicable to common
           stockholders                                         $  490,502          $  204,670
       Extraordinary items, net                                         --                  --
                                                                ----------          ----------
       Income applicable to common
           stockholders                                         $  490,502          $  204,670
                                                                ==========          ==========
   Denominator
       Weighted average common shares                            6,783,314           6,567,783
                                                                ----------          ----------
       Basic EPS                                                $      .07          $      .03
                                                                ==========          ==========
Diluted earnings per common share:
   Numerator
       Net income before extraordinary
           items applicable to common
           stockholders                                         $  490,502          $  204,670
       Extraordinary items, net                                         --                  --
                                                                ----------          ----------
       Income applicable to common
           stockholders                                         $  490,502          $  204,670
                                                                ==========          ==========
   Denominator
       Weighted average common shares                            6,783,314           6,712,792
       Contingent shares                                                --                  --
                                                                ----------          ----------
       Weighted average diluted common
           shares                                                6,783,314           6,712,792
                                                                ----------          ----------
       Diluted EPS                                              $      .07          $      .03
                                                                ==========          ==========
</TABLE>

         Warrants to purchase 500,000 shares of common stock at $2.54 per share
         and 500,000 shares of common stock at $2.92 per share were outstanding
         for the nine- month periods ended September 30, 2000 and 1999, but were
         not included in the computation of diluted EPS because the warrants'
         exercise price was greater than the average market price of the common
         shares. The warrants, which expire on August 31, 2003, were still
         outstanding at the end of the nine-month periods ending September 30,
         2000 and 1999.

                                  Page 12 of 15
<PAGE>

                      FIRST RESERVE, INC. AND SUBSIDIARIES
            NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

NOTE 9 - BUSINESS SEGMENT INFORMATION

         The Company's operations are principally managed on a product services
         basis and are comprised of three reportable segments: Esslinger, Wooten
         and Maxwell, Inc. ("EWM"), Embassy Financial Services, Inc. ("Embassy")
         and Columbia Title of Florida, Inc. ("Columbia"). EWM's product
         services consists of residential and commercial real estate brokerage
         and relocation services. Embassy's product services have been in the
         capacity of a mortgage lender and mortgage broker in the South Florida
         area, specializing in conventional, FHA and VA mortgages. Columbia's
         product has been in the capacity of a title company. Revenue, net
         income and identifiable assets for these segments are as follows:

<TABLE>
<CAPTION>

                                     Nine-month Period Ended September 30, 2000
                       ------------------------------------------------------------------------
                        Esslinger,      Embassy       Columbia
                         Wooten,       Financial      Title of        First
                      Maxwell, Inc.  Services, Inc. Florida, Inc.  Reserve, Inc.       Total
                       -----------    -----------    -----------    -----------     -----------
<S>                    <C>            <C>            <C>            <C>             <C>
Revenue                $21,615,313    $ 1,088,514    $   760,509    $        --     $23,464,336
Net income (loss)      $ 1,212,782    $    78,251    $    45,427    $  (264,259)    $ 1,072,201
Identifiable assets
     at period end     $ 4,445,237    $ 1,217,857    $   211,657    $   254,165     $ 6,128,916
<CAPTION>
                                     Three-month Period Ended September 30, 2000
                       ------------------------------------------------------------------------
                        Esslinger,      Embassy       Columbia
                         Wooten,       Financial      Title of        First
                      Maxwell, Inc.  Services, Inc. Florida, Inc.  Reserve, Inc.       Total
                       -----------    -----------    -----------    -----------     -----------
<S>                    <C>            <C>            <C>            <C>             <C>
Revenue                $ 7,370,516    $   467,495    $   302,373    $        --     $ 8,140,384
Net income (loss)      $   478,659    $    62,856    $    45,502    $   (96,515)    $   490,502
Identifiable assets
     at period end     $ 4,445,237    $ 1,217,857    $   211,657    $   254,165     $ 6,128,916
<CAPTION>
                                     Nine-month Period Ended September 30, 1999
                       ------------------------------------------------------------------------
                        Esslinger,      Embassy       Columbia
                         Wooten,       Financial      Title of        First
                      Maxwell, Inc.  Services, Inc. Florida, Inc.  Reserve, Inc.       Total
                       -----------    -----------    -----------    -----------     -----------
<S>                    <C>            <C>            <C>            <C>             <C>
Revenue                $17,414,145    $   899,801    $   283,471    $       652     $18,598,069
Net income (loss)      $   779,768    $    27,672    $   163,493    $  (330,206)    $   640,727
Identifiable assets
     at period end     $ 3,069,144    $   998,978    $   589,392    $   267,087     $ 4,924,601
</TABLE>

                                  Page 13 of 15
<PAGE>

                      FIRST RESERVE, INC. AND SUBSIDIARIES
            NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

NOTE 9 - BUSINESS SEGMENT INFORMATION (CONTINUED)

<TABLE>
<CAPTION>
                                  Three-month Period Ended September 30, 1999
                       ----------------------------------------------------------------------
                        Esslinger,      Embassy       Columbia
                         Wooten,       Financial      Title of        First
                      Maxwell, Inc. Services, Inc. Florida, Inc.  Reserve, Inc.     Total
                       ----------    ----------     ----------     ----------     ----------
<S>                    <C>           <C>            <C>            <C>            <C>
Revenue                $6,279,565    $  322,655     $  140,730     $       --     $6,742,950
Net income (loss)      $  358,646    $   30,392     $  (46,328)    $ (138,040)    $  204,670
Identifiable assets
     at period end     $3,069,144    $  998,978     $  589,392     $  267,087     $4,924,601
</TABLE>

NOTE 10 - REGULATORY MATTERS

         HUD Requirements

         Embassy is a nonsupervised loan correspondent for purposes of the U.S.
         Department of Housing and Urban Development ("HUD"). As such, 24 -CFR
         Part 202 of the HUD handbook requires Embassy to have an Adjusted Net
         Worth of at least $50,000. Embassy is in compliance with this
         requirement.

         State of Florida Requirements

         Embassy is also a licensed mortgage lender under Chapter 494 of the
         State of Florida. As such, Embassy is required to have a minimum net
         worth of $250,000. Embassy is in compliance with this requirement.

NOTE 11 - UNAUDITED PROFORMA CONSOLIDATED STATEMENTS OF INCOME

         The unaudited pro forma information for the period set forth below
         gives effect to the 1999 Columbia acquisition accounted for under the
         purchase method of accounting as if it had occurred on January 1, 1999
         and Ross as if it had occurred on January 1, 2000 after giving effect
         to certain adjustments, including increased goodwill amortization
         generated from the acquisitions. The proforma adjustments are based
         upon available information and certain assumptions that the Company
         believes are reasonable.

                                  Page 14 of 15
<PAGE>

                      FIRST RESERVE, INC. AND SUBSIDIARIES
            NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

NOTE 11 - UNAUDITED PROFORMA CONSOLIDATED STATEMENTS OF INCOME (CONTINUED)

         The pro forma information is presented for informational purposes only
         and is not necessarily indicative of the results of operations that
         actually would have been achieved had this transaction been consummated
         at the beginning of the period presented:

                                            Nine-month        Nine-month
                                           Period Ended      Period Ended
                                           September 30      September 30,
                                               2000             1999
                                            -----------      -----------
         Total revenue                      $25,980,588      $18,741,126
                                            ===========      ===========
         Net income                         $ 1,051,748      $   461,565
                                            ===========      ===========
         Earnings per share
             Basic                          $      0.16      $      0.07
                                            ===========      ===========
             Weighted average shares          6,783,314        6,567,783
                                            ===========      ===========
             Diluted                        $      0.16      $      0.07
                                            ===========      ===========
             Weighted average shares          6,783,314        6,712,792
                                            ===========      ===========

         No proforma information is yet available on the acquisition of Daniels.

NOTE 12 - SUBSEQUENT EVENT

         In October 2000, the Company entered into an agreement with a
         shareholder to purchase 200,000 shares of common stock owned by this
         shareholder at $1.35 per share for a total purchase price of $270,000.

                                  Page 15 of 15
<PAGE>

                                 EXHIBIT INDEX

     EXHIBIT NO.     EXHIBIT DESCRIPTION
     -----------     -------------------

         27          Financial Data Schedule