# SECURITIES AND
EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-KSB

# [ X ]    
ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES ACT OF 1934 (FEE REQUIRED)

# For the fiscal year
ended December 31, 2000

# [  ]     TRANSITION REPORT UNDER SECTION 13 OR 15(d) THE SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)

# For the transition
period from _____________________________to ___________________________

# Commission file number
33-4844-D

# AMERICANA GOLD &
DIAMOND HOLDINGS, INC.(Name of small
business issuer in its charter)

|Delaware                                                       | 84-1023321                             
|-------------------------------------------------------------- | ---------------------------------------
|(State or other jurisdiction of incorporation or organization) | (I.R.S. employer identification Number)

# Avenida Francisco de
Miranda con Ave Diego Cisneros,Edificio Centro Empreserial Miranda Mez. Oficina
11, Los Ruices, c.p. 1070Caracas, Venezuela(Address of principal executive offices)Issuer's telephone number, including area code:  (011)-(58212)-238-8497 - Fax: (011) (58212)-285-2486

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

# none

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

# Common Stock, $.001
par value

Check
whether the issue (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. Yes ____ No __x__.

Check
if there is no disclosure of delinquent filers in response to Item 405 of Regulation S-B
is 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. ( )

State
issuers revenues for its most recent year. $-0-

State
the aggregate market value of the voting stock held by non-affiliates computed by
reference to the price at which the voting stock as sold, or the average bid and asked
prices of such stock, as of(See definition of affiliate in Rule 12b-2 of the Exchange
Act). $ (___________________).

Note: If determining whether a
person is an affiliate will involve an unreasonable effort and expense, the issuer may
calculate the aggregate market value of the common equity held by non-affiliates on the
basis of reasonable assumption, if the assumptions are stated.

At
March 1, 2001 there was outstanding 13,133,087 shares of the Issuers Common Stock,
$.001 par value.

# DOCUMENTS INCORPORATED
BY REFERENCE

Portions
of the Companys Proxy Statement (pursuant to Regulation 14A) concerning the Annual
Meeting of Shareholders is incorporated by reference to Part III of this Form 10-KSB.

TABLE OF CONTENTS

|                                                                        | Page
|----------------------------------------------------------------------- | ----
|PART I                                                                  | 3   
|ITEM 1. BUSINESS                                                        | 3   
|ITEM 2. DESCRIPTION OF PROPERTY                                         | 6   
|ITEM 3. LEGAL PROCEEDINGS                                               | 6   
|ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS             | 6   
|PART II                                                                 | 7   
|ITEM 5. MARKET FOR COMMON EQUITY AND RELATED SHAREHOLDER MATTERS        | 7   
|ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION       | 9   
|ITEM 7. FINANCIAL STATEMENTS                                            | 12  
|ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING    
|AND FINANCIAL DISCLOSURE                                                | 12  
|PART III                                                                | 13  
|ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS:  
|COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT                       | 13  
|ITEM 10. EXECUTIVE COMPENSATION                                         | 13  
|ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT | 13  
|ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS                 | 13  
|ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K                               | 13  

-2-

# PART I

# Item 1.        
       Business

| | (a)
Business Development
| | ------------------------

| | Americana
Gold & Diamond Holdings, Inc. (the Company or AGD) in its current
form resulted from the merger (the Merger) in February 1993 of Americana Gold
& Diamond Mining, Inc., a corporation incorporated in Tortola, British Virgin Islands
in April 1990 (Americana Gold) with and into Blue Willow Holdings, Inc., a
Colorado corporation incorporated in March 1986 (Blue Willows). In connection
with the Merger, Blue Willows changed its name to Americana Gold & Diamond Holdings,
Inc. and issued 2,823,180 shares of common stock, $.001 par value (the Common
Stock) to the shareholders of Americana Gold. Prior to the Merger, Blue Willows was
a publicly-held shell corporation and Americana Gold held several mining concessions which
generated limited revenue. Subsequent to the Merger, the Company purchased additional
mining concessions.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The
Company has two wholly-owned Venezuelan subsidiaries, Consorcio Minero Miamo, C.A., which
is the original owner of the Fortuna I concession and AGD Holdings Inc. de Venezuela,
C.A., which holds all of the Companys exploitation and exploration equipment. Unless
the context requires otherwise, references to the Company and AGD in this Form 10-KSB
shall mean Americana Gold & Diamond Holdings, Inc. and its subsidiaries.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | AGD
sold its Venezuelan subsidiaries Minera Rio Carichapo S.A. and Minera Rios del Oriente
S.A. as part of the sale of the El Foco Project area to Zaruma Mining Corporation ASA
(Zaruma) for a total consideration of $4 million payable as $200,000 in cash and the
balance, less closing costs, in shares valued at $2.00 per share, plus production
royalties. Americana thereby acquired 1,838,660 shares of Zaruma Mining Corporation ASA.
This transaction was completed March 13 1999. Zaruma was a Norwegian Company trading over
the counter in Oslo. In October 2000 Americana and the other shareholders of Zaruma
accepted an exchange of 1 share of Zaruma Mining Corporation ASA (the Norwegian Company)
for 0.7 shares of Zaruma Resources Inc. (Listed in Toronto and OTC in New York). AGD
thereby became the beneficial owner of 1,287,761 shares of Zaruma Resources Ltd.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | During
1999 AGD re-evaluated its holdings in Latinvan Metal Trading S.A. and the associated
Bochinche Project. The management concluded that due to the prevailing prohibitions of
commercial mining development in the Imataca region that the properties and their
installations were of no value to the company and correspondingly reduced their reported
value to nil.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | With
the exception of completion of acquisition and sale of the El Foco project, the company
has been inactive since August 1998 due to a suspension of its trading status on NASDAQ.
The primary business activity during this period of time has been research and evaluation
of new mining projects with potential for profitable development under prevailing market
conditions.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The
Company has limited capital resources and is actively seeking other sources of capital in
order to meet its working capital needs. The independent auditors report for the
fiscal year ended December 31, 2000 has been prepared assuming that the Company will
continue as a going concern. There can be no assurance that any additional financing will
be available to the Company on acceptable terms, or at all. See Managements
Discussions and Analysis or Plan of Operation.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

-3-

| | (b) Business of Issue:
| | ----------------------

| | (1) Principal products
or services and their markets.
| | -----------------------------------------------------

| | The
Company is engaged in the exploitation, exploration and development of gold mining
concessions in Venezuelas Guyana Shield. The Company currently has the rights to one
concession (Fortuna I), a net smelter return royalty covering an additional ten
concessions (Collectively referred to as the El Foco Project) and shares of Zaruma
Resources Inc. which acquired the El Foco project from Americana. The Shares of Zaruma
have a significant value which the Management believes may increase as the El Foco Project
is developed. However, there can be no assurance that there will be any gold production
from these concessions. The location and chief characteristics for each of these
properties are discussed below.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# Fortuna I Concession

| | In
October 1994, the Company purchased the La Fortuna I Mining Concession from Inversiones
Megold C.A. (Inversiones), for a total purchase price of $2,000,000. Fortuna I
is located about 45 kilometers north of Las Cristinas, Placer Domes 7.7 million
ounce gold find, at kilometer 88 in Bolivar State. Fortuna I is accessible by a paved road
to 34 kilometers then a 4 by 4 gravel road 22 kilometers to the property with a ferry
crossing at the Cuyuni River. The Las Cristinas area is considered by many North American
mining experts to be the prime gold exploration area in Venezuela and significant
exploration activity is taking place at this time. Fortuna I possesses both alluvial
deposits and veins. The petrology of the La Fortuna Concession area is made up of basic to
intermediate volcanics, Pastora-Botanamo Super Group rocks, mainly metabasalts and
metagabros and Caballape Formation, andesite agglomerates. The host rocks in mineralized
areas have been subjected to carbonate and sericite alteration.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | During
the first Quarter of 1996 the Trenching Exploration Phase of La Fortuna I Mining
Concession was completed. Two broad zones of mineralization were identified, both 100
meters (330 feet) in width, and with assay results of 1.05 grams per tonne in saprolite
rock. A further trenching program conducted at La Fortuna I Mining Concession during the
Second and third Quarter of 1996 confirmed results of previous trenching, and better
defined targets for drill-holes into Central Zone. In December 1997 the companys
consulting engineer estimated a mineral inventory, based on trenching and drilling
results, of 2,102,061 tonnes of saprolite grading 0.558 grams per tonne, to a maximum
depth of fifty meters, in four zones. This inventory is open to expansion through
additional trenching and drilling but is not currently a viable resource for development.
Additional trenching of the Fortuna Zone and other targets in the concession was completed
at the end of the year. During 1997 an initial drilling program was conducted. A total of
1013 m of drilling was completed and 770 samples were analysed for gold. Diamond drilling
confirmed the mineralization indicated in the trenching. Additional trenching and drilling
was recommended by the Companys Geologist and Professional Engineering Consultant.
During 1999 and 2000 exploration activity was suspended pending completion of the re
 organization plan. The company has entered into discussions with third parties
interested in investing in the development of this property, and the management will
pursue this possibility during the forthcoming year.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# Santa Rosa

| | Pursuant
to an agreement signed July 1998 with Vannessa Ventures Corporation (VSE) AGD holds the
option to earn a 50% direct interest in the
| | --------------------------------------------------------------------------------------------------------------------------------------------

| | Santa
Rosa exploration concessions in Roraima State, Brazil through exploration and development
expenditures totalling $5 million over an unspecified period of time. The Santa Rosa
Project consists of 120,000 hectares in six exploration concessions.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The
Santa Rosa concessions cover deformed Archean rocks similar in character to those which
host major gold deposits in other productive shield areas around the world. The Santa
Rosa Property area was the site of a gold production boom in 1981 with a peak population
of 11,000 artisanal miners.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Subsequent
field studies by the Brazilian Geological Survey outlined geochemical anomalies in the
Santa Rosa Property area which are the primary focus for the AGD  Vannessa Joint
Venture. Consulting reports prepared for Vannessa Ventures, the vendor and joint venture
partner, report the presence of high grade vein prospects of potential economic
significance.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | AGD
is the project operator. The proposed evaluation will commence with a thorough field
review to confirm the reported importance of the area and select priority targets for
development. No field work was completed during 1999 or 2000.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

-4-

# Guariche

| | During
fiscal 2001,the company has negotiated but not yet closed an agreement with the L.B.
Mining Company of Boise, Idaho, whereby it can acquire 100% of the Guariche and Los Flores
Concessions in Venezuela for consideration in shares, cooperation in project management
and submission of a study of the economic viability and impacts of the project to the
Venezuelan Ministry of Mines. The transaction, if completed, will make L.B. Mining or its
nominee company the largest shareholder of Americana. When sufficient funds are available
the management proposes to expand the study of economic viability to a comprehensive and
bankable feasibility study to as part of advancing the project toward commercial
production.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The
Guariche Concessions cover 20,000 hectares of bedrock and alluvial mineral rights held
through concession from the Ministry of Mines of Venezuela. The Las Flores 6 and Las
Flores 7 Concessions consist of 10,000 hectares of bedrock and alluvial mineral rights
held through contracts with the Corporacion Venezolana de Guyana (CVG) and
through documentation in process with the Venzuelan Ministry of Mines according to
prevailing mining laws.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The
Guariche Concessions cover an area which has since 1988 produced about 600,000 ounces in
alluvial mining operations. Consultants to L.B. Mining estimated a measured and indicated
resource of 10,182,000 tonnes averaging 2.1 grams gold per tonne, with geometry and
metallurgical characteristics amenable to low cost development and production. The
management recognizes excellent potential for expansion of these resources and development
of a mineable reserve which warrants development and profitable mining.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The
Las Flores Concessions cover undeveloped but potentially large gold mineralized zones
which represent attractive targets for future development.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Distribution methods of the products or services.
|--- | -------------------------------------------------

| | Currently,
the Company has not produced any gold for distribution. If and when, the Company is in a
position to distribute gold, such distribution will be subject to regulation by the
Venezuelan government. The regulations concerning the sales and export of gold have been
liberalized considerably during the last year, and 80% of gold produced can now be
exported directly. See Business  Effect of existing or probable
governmental regulations on the business.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | Status of any publicly announced new product or services.
|--- | ---------------------------------------------------------

| | See
Business  Principal Products or Services and Their Markets for a
description of the current status of the Companys mining operations.
| | ---------------------------------------------------------------------------------------------------------------------------------------------

|(4) | Competitive business conditions and the small business issuers
          competitive position in the industry and methods of competition.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------

| | The
Company will remain a minor participant among the firms which engage in gold prospecting.
There are many other established firms with significantly greater capitalization and
financial resources. In view of the Companys lack of financial resources, the
Company will be at a competitive disadvantage compared to its competitors. However the new
management team, with extensive experience and contacts in the exploration and mining
business, and access business opportunities and equity markets, will bring with it a
substantial improvement in the Companys competitive position.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(5) | Sources and availability of raw material and the names of principal suppliers.
|--- | ------------------------------------------------------------------------------

# Not applicable.

|(6) | Dependence on one or
a few major customers.
|--- | -------------------------------------------

| | See
Effect of existing or probable governmental regulations on the business. The
objective of the company is production and sale of gold and diamonds. Although marketing
of these products requires experience and security precautions, many customers exist and
the market is open.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(7) | Patents, trademarks, licenses, franchises, concessions, royalty agreements
          or labor contracts, including duration.
|--- | ----------------------------------------------------------------------------------------------------------------------------

| | The
Company currently has the Fortuna I mining concession and Royalty interests in the El Foco
Concessions. The company is currently negotiating for other concessions in Venezuela. For
further information with respect to the Companys Concessions see Business
 Principal products or services and their markets.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(8) | Need for any governmental approval of principal products or services.
          Not applicable.
|--- | -----------------------------------------------------------------------------------------------

|(9) | Effect of existing or probable governmental regulation on the business.
|--- | -----------------------------------------------------------------------

| | The
 regime  for  the  comercialization  of gold in  Venezuela  is  essentially divided into
two areas: (i) internal comercialization of gold and (ii) external comercialization of
gold. On January 1, 1996 Resolution No 96-12-02 entered into effect, issued by the
Central Bank of Venezuela, establishing the norms on gold and gold alloys exports. The
most significant aspects of this resolution are the following:
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | *
Gold and gold alloys exports are allowed, and interested parties should be registered in
the Gold Exporters Registry at the Central Bank of Venezuela.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------

| | *
Authorization request will be processed by the Central Bank of Venezuela, accompanied by
a certification marked out for the internal market, in bars, a minimum equivalent to 15%
of the amount calculated in kilograms of refined or melted gold, resulting from adding
the amount whose authorization to be exported is requested, and the amount destined for
the local market. Said authorization will be granted in a term of 45 consecutive calendar
days. If and when the Company is in a position to produce and distribute gold the effect
of the regulation could have a significant impact on the Companys operations.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(10) | Estimate
of the amount spent during each of the last two fiscal years on           research and
development activities, and if applicable the extent to           which the cost
of such activities are borne directly by consumers.
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The
Company spent approximately $322,000 in gold deposit exploration during 1996,
$235,429 during 1997, and suspended its exploration activities during 1998, and 1999. The
company spent approximately $11,000 in evaluation of new mining opportunities during the
year 2000.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(11) | Costs and effects
of compliance with environmental laws.
|---- | --------------------------------------------------------

| | The
Company has spent approximately $1,000 in compliance with Venezuelan environmental laws.
| | --------------------------------------------------------------------------------------------

|(12) | Number of total
employees and full time employees.
|---- | --------------------------------------------------

| | The
company has one full time employee.
| | ---------------------------------------

-5-

# Item 2.     Description of
Property.

| | The
Company's  principal  executive  offices are located in Avenida Francisco de Miranda con
Ave Diego  Cisneros,  Edificio  Centro  Empreserial  Miranda Mez.  Oficina 11, Los
Ruices,  c.p.  1070 Caracas, Venezuela. This facility consists of approximately 300
square feet and is occupied under a lease.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | For
information relating to the Companys mining concessions, see Business 
Business of Issuer.
| | --------------------------------------------------------------------------------------------------

# Item 3.     Legal
Proceedings.

| | Not
applicable.
| | ---------------

# Item 4.    
  Submission of Matters to a Vote of Security Holders.

| | During
July 1998, 82% of the shareholders consented to a 1 for 10 reverse split and a private
placement of shares.
| | ------------------------------------------------------------------------------------------------------------------

| | During
March 2000, 82% of the shareholders consented again to a 1 for 10 reverse split.
| | ---------------------------------------------------------------------------------------

-6-

# PART II

# Item 5. Market for
Common Equity and Related Stockholder Matters.

| | The Common Stock of the Company was formerly traded on the NASDAQ Small Cap Market ("NASDAQ") until July 1998,
when trading was moved to the OTC Bulletin Board and in June 1999, was moved to the Pink Sheets, where it
currently trades under the symbol AGDM.The high and low
bid quotations for each quarterly period for fiscal 1996 to fiscal 2000 are listed below.
The quotations set forth in the table reflect inter-dealer prices, without retail mark-up,
mark-down or commission, and may not necessarily represent actual.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | As
indicated bellow, the Companys Common Stock has been trading below $1.00 per share.
Under new rules promulgated by NASDAQ, a security is subject to delisting from NASDAQ if
its trading price is below $1.00. Trading, if any, of the Common Stock would thereafter be
conducted in the OTC Bulletin Board or the OTC Pink Sheets. As a result of such inelegibility for quotations, an
investor may find it more difficult to dispose of, or to obtain accurate quotations as to
the market value of the Common Stock. Furthermore, the regulations of the Securities and
Exchange Commission (Commission) promulgated under the Securities Exchange Act
of 1934, as amended (Exchange Act), require additional disclosure relating to
the market for penny stocks. Commission regulations generally define a penny stock to be
an equity security that has a market price of less than $5.00 per share, subject to
certain exceptions. A disclosure schedule explaining the penny stocks market and the risks
associated therewith is required to be delivered to a purchaser and various sales practice
requirements are imposed on broker-dealers who sell penny stocks to persons other than
established customers and accredited investors (generally institutions). In addition, the
broker-dealer must provide the customer with current bid and offer quotations for the
penny stock, the compensation of the broker-dealer and its salesperson in the transaction
and monthly account statements showing the market value of each penny stock held in the
customers account. If the Companys securities become subject to the
regulations applicable to penny stocks, the market liquidity for the Companys
securities could be severely affected. In such an event, the regulations on penny stocks
could limit the ability of broker-dealers to sell the Companys securities and thus
the ability of purchasers of the Companys securities to sell their securities in the
secondary market. In the absence of an active trading market, holders of the Common Stock
may experience substantial difficulty in selling their securities.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

-7-

# Fiscal 1996

|            | Low | High
|----------- | --- | ----
|1st quarter |     |     
|2nd quarter |     |     
|3rd quarter |     |     
|4th quarter |     |     

# Fiscal 1997

|             | Low | High
|------------ | --- | ----
|1st  quarter |     |     
|2nd quarter  |     |     
|3rd quarter  |     |     
|4th quarter  |     |     

# Fiscal 1998

|             | Low | High
|------------ | --- | ----
|1st  quarter |     |     
|2nd quarter  |     |     
|3rd quarter  |     |     
|4th quarter  |     |     

# Fiscal 1999

|            | Low | High
|----------- | --- | ----
|1st quarter |     |     
|2nd quarter |     |     
|3rd quarter |     |     
|4th quarter |     |     

# Fiscal 2000

|            | Low | High
|----------- | --- | ----
|1st quarter |     |     
|2nd quarter |     |     
|3rd quarter |     |     
|4th quarter |     |     

-8-

| | Pursuant
to instructions from the SEC in July 1998, the trading of the companys shares in the
NASDAQ market was suspended, pending completion of the proposed re-organization plan.
During this period of inactivity the management also undertook a review and revised the
financial statements for 1996 and 1997.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b)       
               The Company has not paid any cash dividends on its Common Stock and does not
               intend to pay cash dividends on its Common Stock for the foreseeable future. The
               Company intends to retain future earnings, if any, to finance future
               development.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (c)       

           As of December 31, 2000, there were approximately 325 holders of record of the
          Companys Common Stock. The Company believes that at such date there were
          in excess of 500 beneficial owners of the Companys Common Stock.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# Item 6.
Managements Discussion and Analysis or Plan of Operation.

# Overview

| | The
Company has only recently begun its business activities and accordingly has generated
limited revenues. The Company has generated an accumulated deficit of $10,970,201 through
December 31, 2000, due to its significant research, development, administrative and
exploration expenses and insufficient revenues in relation to its operating expenses.
Management believes that losses will continue to be incurred until it is able to
successfully acquire or place a property in operation, but has undertaken to lower
operating costs as much as possible until a project suitable for profitable development is
identified and acquired. There can be no assurance that management will be successful in
accomplishing this task. The independent auditors report for the fiscal year ended
December 31, 2000 has been prepared assuming that the Company will continue as a going
concern.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | During
1993, the Company purchased the alluvial exploitation and exploration rights of a gold and
diamond mine in the Bochinche District. This concession covers a surface area of
approximately 250 acres and is located in the Municipality of Tumeremo, District of
Sifontes, in the State of Bolivar. The cost of the concession was approximately $811,905.
During Fiscal 1999 the Company wrote down the value of the Latinvan Trading S.A., the
Bochniche Concessions and the associated installations to zero.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

-9-

| | In
October 1994, the Company purchased the La Fortuna I Mining Concession form Inversiones
Megold C.A., for a total purchase price of $2,000,000 as follows:
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The
purchase price for the Fortuna I property was agreed upon by the seller
and Americana Gold & Diamond Holdings, Inc. after due diligence. Americana paid in
cash and shares with the amount of shares being calculated by dividing the unpaid balance
(after the cash payment) by the market price of the shares at the time of the purchase. As
of December 31, 2000, the remaining portion of debt outstanding of US$ dollars 283,094. As
part of the acquisition contract of this concession, the Company agreed to pay to a third
company between 3% and 5% of the net profits that would be obtained from mining of the
property.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Pursuant
to an agreement completed September 15, 1998 between AGD and the Homestake Mining Company
of California (Homestake), in consideration of a 3% net smelter royalty on
production in excess of the drill indicated resources defined by Homestake, 100% of the
shares of Minera Rio Carichapo S.A. and Minera Rios del Oriente S.A., the beneficial
owners of an option to earn a 90% vested interest in the El Foco and Chicanan 
Chicanan Contract Areas. This transaction was a significant development for AGD, adding
fixed assets, mineral resources and potential. AGD acquired this project to optimise the
value of its adjoining Fortuna Property and with the intention of selling the El Foco
project to Zaruma Mining Corporation ASA (Zaruma) for a total consideration $200,000 in
cash and 1,838,660 shares, plus a royalty of 1% Net Smelter Returns. This transaction was
contemplated in a letter agreement dated September 17, 1998 and closed March 13 1999.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# Results of Operations

| | Net
losses for the year 2000 were $213,108 compared with net losses for the year 1999 of
$1,776,115.
| | ----------------------------------------------------------------------------------------------------

| | Administrative  and  financial  expenses  were  $147,943 for the year ended  December  31, 2000  compared to
       $248,254 for the year ended December 31, 1999.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The
company operated under a care and maintenance basis during 2000, with its primary activity
limited to evaluation of new opportunities with sufficient merit to warrant re-activation
of its development programs. Exploration activity in the Fortuna I concession was
suspended. Research and negotiations commenced concerning other concessions in Venezuela,
Brazil, and Mexico.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# Liquidity and Capital
Resources

| | The Company had a deficit of $496,333 in working capital as of December 31, 2000, compared with a deficit working
capital of $437,305 during 1999.
| | --------------------------------------------------------------------------------------------------------------------------------------------------

| | At
December 31, 2000 the Company has an overdraft loan at an average annual interest of
7.95%. Accounts payable of the Company relating primarily to liabilities assumed by the
Company for the purchase of exploration and explorations rights of mining concessions
currently amounts to $283,094. Such amount relates to payments due on the Fortuna I
concession.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | In
1994, the Company received an aggregate of approximately $400,000 in net proceeds from a
private placement of Series B Convertible Preferred Stock. In addition, certain officers
and directors agreed to convert approximately $605,000 of debt into the Series B Preferred
Convertible Stock. Such Series B Convertible Preferred Stock paid a cumulative interest
rate of 12% per annum and were convertible into common stock at a 25% discount from the
bid price of the Companys common stock at the time of conversion.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | In
1995 and January 1996 the Company raised approximately $350,000 from a private placement
of 35 Units, each unit consisting of a $10,000 principal amount promissory note. The note
was due and payable on July 19, 1996 and bore interest at 8%. The note was converted, into
20,000 shares of the Companys Common Stock for each unit. In March 1996 the
purchasers of the 35 units of the private placement elected to convert their notes into
shares of the Companys Common Stock.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | In
1996 the Company raised approximately $ 677,843 from Private Placements of Common Stock to
investors who reside outside the United States including officers and directors of the
Company. The Company issued 1,250,000 shares of its Common Stock in connection with the
Private Placements.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | In
1997 the Company raised approximately $285,989 from Private Placements of Common Stock to
investors who reside outside the United States including officers and directors of the
Company. The Company issued 609,952 shares of its Common Stock in connection with the
Private Placements.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

-10-

| | In
1998 the Company raised approximately $ 213,182, from Private Placements of Common Stock
to investors who reside outside the United States including officers and directors of the
Company. The Company issued 440,404 Shares of its Common Stock in connection with the
Private Placements and the Company raised approximately $210,299.68 from contribution for
future capital increase to investors who reside outside the United States including
officers and directors of the Company. The Company agreed to issue 2,102,997 shares of
common stock in connection with the Private Placement.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | In
1999 the Company raised approximately $29,500 from contribution for future capital
increases to investors who reside outside the United States including officers and
directors of the Company. The company agreed to issue 295,000 shares of common stock in
connection with the Private Placement.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | In
2000 the Company raised approximately $67,500 from contribution for future capital
increases to investors who reside outside the United States including officers and
directors of the Company. The company agreed to issue 675,000 shares of common stock in
connection with the Private Placement
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The
Companys management is currently seeking to raise Funds to ensure that the
Companys operations will continue and that the Company can operate the La Fortuna
concession. The Company is also exploring whether to enter into joint ventures or
partnerships with other mining companies in the La Fortuna area. There can be no assurance
that the Company will be successful in raising the necessary funds or finding other
alternatives to ensure that the Company will continue and that the Company can operate the
La Fortuna concession. Moreover, the sale of additional equity or convertible debt
securities could result in addition dilution to the Companys Stockholders.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The
Company will continue to rely upon management until additional sources of financing are
secured or a suitable property is acquired with sufficient cash flow to sustain the
Company.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# Restated Financial Statements

| | During 1998, the management also undertook a review,  and  thereafter,  revised and restated the financial
         statements for 1996 and 1997 to comply with U.S. GAAP.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# Inflation

| | Venezuela
has historically had a high rate of inflation and the Company is potentially impacted by
currency rate exchanges. While neither high inflation or currency rate exchanges have had
a material adverse effect on the Company, there can be no assurance that such developments
will not have a material adverse effect on the Company in the future.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# Forward Looking
Statements

| | This
Form 10-QSB contains certain forward-looking statements within the meaning of Section 27A
of the Securities Act of 1993, as amended, and Section 21E of the Securities Exchange Act
of 1934, amended. Investors are cautioned that all forward looking statements involve
risks and uncertainty, including without limitation, the viability of gold mines,
exploration cost, foreign currency exchange rates and general market conditions. Although
the Company believes the assumptions underlying the forward-looking statements contained
herein are reasonable, any of the assumptions could be inaccurate, and therefore, there
can be no assurance that the forward-looking statements contained in the report will prove
to be accurate.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

-11-

# Item 7. Financial
Statement

| | See
Consolidated Financial Statement listed in the accompanying index to Consolidated
Financial Statements on Page F-1 herein.
| | ------------------------------------------------------------------------------------------------------------------------------

# Item 8.  Changes in and Disagreements
with Accountants on Accounting and Financial Disclosure.

| | Not
applicable.
| | ---------------

-12-

# PART III

Items 9, 10, 11, and 12.  Directors, Executive Officers, Promoters and Control Persons;
Compliance with Section 16(a) of the Exchange Act; Executive Compensation; Security
Ownership of Certain Beneficial Owners and Management; Certain Relationships and Related
Transactions.

| | The
information required by these Items is omitted because the Company will file a definitive
proxy statement pursuant to Regulation 14A, which information is herein incorporated by
reference as if set out in full.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# Item 13. Exhibits and
Reports on Form 8-K.

|Exhibit No.                                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|---------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|3.1 
 3.2 
 3.3 
     
 4.1 
10.1 
10.2 
31
32 | The Company's Amended and Restated Certificate of Incorporation. **
The Company's By-laws. **
Certificate of Designation for the Series A.
Series B and Series C Convertible Preferred Stock.*
Form of Common Stock Certificate. **
Agreement between Inversiones Megold, C.A. and the Company.*
Form of Promisory Note issued in a 1996 Private Placement. ***
Section 302 Certification
Certification Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of
the Sarbanes-Oxley of 2002

| | *       Incorporated by reference to the Company's Form 10-KSB for the fiscal year ended
December 31, 1994.
| | -----------------------------------------------------------------------------------------------------------

| | **      Incorporated  by reference to the Company's  Form 8-A, dated February 10, 1993.
| | ---------------------------------------------------------------------------------------

| | ***        Incorporated  by  reference to the  Company's  Form 10-KSB for the Fiscal year ended
December 31, 1996.
| | ------------------------------------------------------------------------------------------------------------------

-13-

# SIGNATURES

In
accordance with Section 13 or 15(d) of the Exchange Act, the registrant has duly caused
this report to be signed on its behalf by the undersigned, thereunto duly authorized in
the City of Caracas, Country of Venezuela on the 30th day of July, 2001.

# AMERICANA GOLD
& DIAMOND HOLDINGS, INC.

# /s/ DAVID BENDINGDAVID BENDING    
    President and
Director

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 on the dates indicated.

|Signature       | Title | Date
|--------------- | ----- | ----
|Tomaz Klingberg |       |     
|Gerald Sneddon  |       |     
|Gordon Gutraith |       |     
|Daniel Kunz     |       |     

-14-

AMERICANA GOLD AND DIAMOND HOLDINGS, INC.
 AND SUBSIDIARIESConsolidated Financial Statements as of  December 31, 2000 and
1999 and Independent Public
Accountants Report

F-1

Cardona Rodriguez & AsociadosAuditores & Consultores Nexia International

Independent
Public Accountants Report

To the Shareholders of: Americana Gold and
Diamond Holdings, Inc. and Subsidiaries

We have audited the accompanying
consolidated balance sheets of Americana Gold and Diamond Holdings, Inc. and Subsidiaries,
(a development stage company) as of December 31, 2000 and 1999, and the related
consolidated statements of operations, stockholders equity and cash flows for the
years then ended. 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 audits.

We conducted our audits in accordance
with generally accepted auditing standards in the United States. Those standards require
that we plan and perform the audits to obtain reasonable assurance about whether the
consolidated financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in the
consolidated financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as evaluating the
overall consolidated financial statements presentation. We believe that our audits provide
a reasonable basis for our opinion.

In our opinion, the consolidated
financial statements referred in the first paragraph above present fairly, in all material
respects, the consolidated financial position of the Company as of December 31, 2000 and
1999, and the results of its operations and its cash flows for the years then ended, in
conformity with generally accepted accounting principles in the United States.

The Company have an accumulated
losses in development stage of U.S. dollars 10,970,201. This factor, along with other
matters as set forth in the following paragraph raise a doubt that Company will be able to
continue as a going concern. The consolidated financial statements have been prepared
under the assumption that the Company will be able to continue in operation, having
sufficient financial support from the shareholders. See notes 1 and 11.

As explained in notes 1 and 6, during
2000, the Companys operation is temporal inactive. Managements plans
concerning the matters are also described in note 1; we do not express an opinion
regarding the feasibility of such plans. The Companys continuity as a going concern
is subject to or the success of the Companys future operations. The consolidated
financial statements do not include any adjustments that might result from the outcome of
these uncertainties.

CARDONA RODRIGUEZ &
ASOCIADOS

Nexia International

/s/ Luis Cardona R.Luis Cardona R. CPCN° 24408 
Caracas, April 13, 2001

F-2

AMERICANA GOLD AND DIAMOND HOLDINGS,
INC. AND SUBSIDIARIES(A development stage Company) CONSOLIDATED BALANCE SHEETS
-DECEMBER 31, 2000 AND 1999 (Expressed in U.S.
dollars)

ASSETS

|                                          | 2000 | 1999
|----------------------------------------- | ---- | ----
|CURRENT ASSETS:                           |      |     
|Cash                                      |      |     
|Prepaid expenses and other current assets |      |     
|                                          |      |     
|Total current assets                      |      |     
|                                          |      |     
|PERMANENT INVESTMENT                      |      |     
|                                          |      |     
|PROPERTY AND EQUIPMENT, NET               |      |     
|                                          |      |     
|MINING CONCESSIONS:                       |      |     
|Temporal inactivity exploration           |      |     
|                                          |      |     
|OTHER ASSETS                              |      |     
|                                          |      |     
|                                          |      |     
|                                          |      |     
|                                          |      |     

The
accompanying notes (1 to 11) form an integral part of these consolidated financial
statements

F-3

AMERICANA GOLD AND DIAMOND HOLDINGS,
INC. AND SUBSIDIARIES(A development stage Company) CONSOLIDATED BALANCE SHEETS
-DECEMBER 31, 2000 AND 1999 (Expressed in U.S.
dollars)

LIABILITIES AND
STOCKHOLDERS EQUITY

|                                          | 2000 | 1999
|----------------------------------------- | ---- | ----
|CURRENT LIABILITIES:                      |      |     
|Bank loans                                |      |     
|Accounts payable                          |      |     
|Accrued liabilities                       |      |     
|                                          |      |     
|Total current liabilities                 |      |     
|                                          |      |     
|PROVISION FOR EMPLOYEE SEVERANCE BENEFITS |      |     
|                                          |      |     
|Total liabilities                         |      |     
|                                          |      |     
|STOCKHOLDERS' EQUITY:                     |      |     
|Capital stock                             |      |     
|Accumulation for not carried out          |      |     
|profit of investment                      |      |     
|Accumulated losses                        |      |     
|                                          |      |     
|Total stockholders' equity                |      |     
|                                          |      |     
|                                          |      |     
|                                          |      |     

The
accompanying notes (1 to 11) form an integral part of these consolidated financial
statements

F-4

AMERICANA GOLD AND DIAMOND HOLDINGS,
INC. AND SUBSIDIARIES(A development stage Company) CONSOLIDATED BALANCE SHEETS
-DECEMBER 31, 2000 AND 1999 (Expressed in U.S.
dollars)

|                                            | 2000 | 1999 | Cumulative
From incef
1991 to 2000
|------------------------------------------- | ---- | ---- | ----------------------------------
|ACQUISITION COST                            |      |      |                                   
|EXPLORATION COST                            |      |      |                                   
|ADMINISTRATIVE EXPENSES                     |      |      |                                   
|                                            |      |      |                                   
|Operating loss                              |      |      |                                   
|                                            |      |      |                                   
|OTHER (EXPENSES) INCOME:                    |      |     
|Financial interest expenses, net            |      |      |                                   
|Currency translation adjustment             |      |      |                                   
|Retirement of fixed assets and other assets |      |      |                                   
|Purchase agreement                          |      |      |                                   
|Other income                                |      |      |                                   
|                                            |      |      |                                   
|                                            |      |      |                                   
|                                            |      |      |                                   
|Net loss                                    |      |      |                                   
|                                            |      |      |                                   
|Net loss per share -pre split basis         |      |     
|weighted average                            |      |      |                                   
|                                            |      |      |                                   
|Shares -pre split basis                     |      |      |                                   
|                                            |      |      |                                   

The
accompanying notes (1 to 11) form an integral part of these consolidated financial
statements

F-5

AMERICANA GOLD AND DIAMOND HOLDINGS,
INC. AND SUBSIDIARIES(A development stage Company) CONSOLIDATED BALANCE SHEETS
-DECEMBER 31, 2000 AND 1999 (Expressed in U.S.
dollars)

|                                         | Capital
Stock | Accumulation
for not carried
out profit of
investment | Accumulated
Losses | Total
Stockholders'
Equity
|---------------------------------------- | ------------- | ----------------------------------------------------- | ------------------ | --------------------------
|Balance as of December 31, 1998          |               |                                                       |                    | 12,361,046                
|                                         |               |                                                       |                    |                           
|Contribution for future capital increase |               |                                                       |                    | 68,029                    
|Not carried out profit of investment     |               |                                                       |                    | --                        
|Net loss                                 |               |                                                       |                    | --                        
|                                         |               |                                                       |                    |                           
|Balance as of December  31, 1999         |               |                                                       |                    | 12,429,075                
|Contribution for future capital increase |               |                                                       |                    | 86,262                    
|Not carried out profit of investment     |               |                                                       |                    | --                        
|Net loss                                 |               |                                                       |                    | --                        
|                                         |               |                                                       |                    |                           
|Balance as of December 31, 2000          |               |                                                       |                    | 12,515,337                
|                                         |               |                                                       |                    |                           
|                                         |               |                                                       |                    |                           

The
accompanying notes (1 to 11) form an integral part of these consolidated financial
statements

F-6

AMERICANA GOLD AND DIAMOND HOLDINGS,
INC. AND SUBSIDIARIES(A development stage Company) CONSOLIDATED BALANCE SHEETS
-DECEMBER 31, 2000 AND 1999 (Expressed in U.S.
dollars)

|                                                        | 2000 | 1999
|------------------------------------------------------- | ---- | ----
|OPERATING ACTIVITIES:                                   |      |     
|Net loss                                                |      |     
|Adjustments to reconcile net loss to net cash (used in) |      |     
|provided from operating activities:                     |      |     
|Depreciation of property and equipment                  |      |     
|Gain in translation of foreign currency                 |      |     
|Provision for employee severance benefits               |      |     
|                                                        |      |     
|                                                        |      |     
|Changes in operating assets and liabilities:            |      |     
|Decrease in prepaid expenses and other current assets   |      |     
|Decrease in other assets                                |      |     
|Increase in accounts payable                            |      |     
|Decrease in accrued liabilities                         |      |     
|Payments of employee severance benefits                 |      |     
|                                                        |      |     
|NET CASH USED IN OPERATING ACTIVITIES                   |      |     
|                                                        |      |     
|INVESTING ACTIVITIES:                                   |      |     
|Retirement of temporary investment                      |      |     
|Purchase of permanent investment                        |      |     
|Retirement of permanent investment                      |      |     
|Retirement of mining concessions                        |      |     
|Retirement of property and equipment, and other assets  |      |     
|                                                        |      |     
|NET CASH PROVIDED FROM INVESTING ACTIVITIES             |      |     
|                                                        |      |     
|FINANCING ACTIVITIES:                                   |      |     
|Increase of bank loan                                   |      |     
|Contribution for future capital increase                |      |     
|                                                        |      |     
|NET CASH PROVIDED FROM FINANCING ACTIVITIES             |      |     
|                                                        |      |     
|EFFECT IN EXCHANGE RATE                                 |      |     
|                                                        |      |     
|(DECREASE) INCREASE IN CASH                             |      |     
|CASH BEGINNING OF YEAR                                  |      |     
|                                                        |      |     
|CASH END OF YEAR                                        |      |     
|                                                        |      |     

The
accompanying notes (1 to 11) form an integral part of these consolidated financial
statements

F-7

AMERICANA GOLD AND DIAMOND HOLDINGS,
INC. AND SUBSIDIARIES(A development stage Company) CONSOLIDATED BALANCE SHEETS
-DECEMBER 31, 2000 AND 1999 (Expressed in U.S.
dollars)

Note 1 -Incorporation, purpose and
operation of the Company

The Company was incorporated in 1993,
through the merger of Americana Gold a Diamond Mining Corporation (incorporated in
Tortola, British Virgin Island on April 3, 1990) and Blue Willows Holdings Inc.
(incorporated in the United States of America) with the purpose of negotiating, exploring,
exploiting, transporting and performing all those activities related to the handling of
gold, diamonds and precious metals and stones, as well as participating in any related
activities.

The Company is under development
stage and its activity is performed through the acquisition and exploration of mining
concessions, acquired through its subsidiaries domiciled in Venezuela. During 2000, the
companies temporal inactivated the exploration of certain mines acquired in concession See
note 6. Likewise, the Company has incurred losses since its incorporation, and has
undergone a working capital deficit. The deficiency in working capital and the operating
losses since inception raise a doubt as to the Companys ability to continue as a
going concern. Managements plans concerning these matters are described below.

The Companys Management adopted
a Restructuring Plan in 2000:

 At March 21, 1999, the Company employed
12 employees. This was reduced to two in June 1999, and one in March 2000. Most
administration and support services provided on a consulting basis as required.

 During 2000, exploration
activity in Fortuna I concession was suspended pending completion of the reorganization
plan. The Company has entered into discussions with third parties interested in investing
in the development of this property, and the management will pursue this possibility
during the forthcoming year.  AGD is the project operator. The proposed evaluation
will commence with a thorough field review to confirm the reported importance of the area
and select priority targets for development. No field work was completed during 2000.

 The Company has not paid any
cash dividends on its common stock and does not intend to pay dividends on its common
stock for the foreseeable future.

 In March 2000, the
shareholders agreed to a consolidation of the issued and outstanding shares of Americana
with one new share exchanged for the old shares. This will reduce the number of
outstanding consolidated shares to 1,952,551. This approval will be ratified once again at
the forthcoming Americana Gold Meeting.

 Part of the shares of TSE
Zaruma Resources Inc., will be transferred to Americanas U.S. shares account in
preparation for a partial sale. The other accounts will be transferred later as the
management learns more about the costs and functionality of the process of transfer and
sale and as the Companys cash requirements dictate.

 The Company will propose to
enter into a transaction with L.B. Mining Company of Boise, Idaho, whereby it can acquire
100% of the Guariche and Los Flores concessions in Venezuela for consideration in shares,
cooperation in project management and submission of a study of the economic viability and
impacts of the project to the Venezuelan Ministry of Mines.

F-8

The transaction, if completed, will
make L. B. Mining or its nominee company the largest shareholder of Americana. When
sufficient funds are available the management proposes to expand the study to as part of
advancing the project toward commercial production.

 The Company will remain a
minor participant among the firms, which engage in gold prospecting. There are many other
established firms with significantly greater capitalization and financial resources. In
view of the Companys lack of financial resources, the Company will be at a
competitive disadvantage compared to its competitors. However the new management team,
with extensive experience and contacts in the exploration and mining business and access
business opportunities and equity markets, will bring with it a substantial improvement in
the Companys competitive position.

 The Companys management
is currently to raise funds to ensure that the Companys operations will continue and
that the Company can operate the La Fortuna concession. The Company is also exploring
whether to enter into joint ventures or partnerships with other mining companies in the La
Fortuna area.

There can be no assurance that the
Company will be successful in raising the necessary funds or finding other alternatives to
ensure that the Company will continue and that the Company can operate the La Fortuna
concession. Moreover, the sale of additional equity or convertible debt securities could
result in addition dilution to the Companys Stockholders.

 The Company will prepare to
move forward on a solid program for growth toward profitability as it re- enters the
market.

# Note 2 -Summary of
significant accounting principles and practices

The most significant accounting
policies followed by the Company in the recording of its operations and in the
preparations of its consolidated financial statements are summarized as follows:

Consolidation principles:

The consolidated financial statements
includes the accounts of Americana Gold and Diamond Holdings Inc. and those of its wholly
owned subsidiaries: Consorcio Minero Miamo, C.A., Americana Gold and Diamond Holdings Inc.
de Venezuela, C.A., (companies domiciled in Venezuela) as of December 31, 2000 and 1999.
The consolidated financial statement as of December 2000 includes Desarrollos Americana
Gold and Diamond Holdings, C.A., subsidiary registered during 2000. The consolidated
financial statements as of December 1999 also include the subsidiary Latinvan Metal
Trading Ltd, C.A. See note 3.

All subsidiaries balances and
transactions have been eliminated in the consolidation.

# Property and equipment:

Property and equipment are recorded
at acquisition cost. Repairs and maintenance expenses are charged directly to operations,
and improvements and renovations are added to the cost of the corresponding property.
Depreciation is determined based on the straight-Iine method, in accordance with the
estimated useful lives of the assets. When assets are sold or retired, the corresponding
cost and accumulated depreciation are eliminated from the accounts, and the gain or loss
is reflected in the years operations.

# Mining Concession:

The mining concession is owned by the
subsidiary Consorcio Minero Miamo, C.A., and is recorded at the acquisitions cost,
consisting of the price agreed upon to obtain the rights of exploration and exploitation.
Concession is reviewed for recoverability as long-Iived assets. Provisions for write downs
are recorded when it is determined that the asset is impaired. See note 6.

F-9

As of December 31, 2000 and 1999,
there is no charge for depletion, due to the fact that the capacity of the mines to be
exploited has not been determined, and the Company has not initiated extraction
activities.

# Translation of financial
statements:

The financial statements of the
subsidiaries are denominated in bolivars and have been translated into U.S. dollars using
the following procedure: all monetary assets and liabilities denominated in bolivars were
translated at the floating market exchange rates of Bs. 699.75 and Bs. 648.25 to U.S.
dollar 1.00, in effect as of December 31, 2000 and 1999, respectively. United States of
America dollars may be freely purchased at demand. Property and equipment, other assets
and Stockholders equity have been translated at historical exchanges rates; and
transactions have been included in the statement of operations at an average exchange rate
in each month of the period in which the transactions were effected. Subsidiaries operate
in a highly inflationary economy.

# Use of estimates:

The preparation of the consolidated
financial statements in conformity with generally accepted accounting principles in the
United States requires that management make estimations and assumptions that affect the
reported amounts of assets and liabilities, the disclosure of contingent assets and
liabilities at the date of the consolidated financial statements and the income and
expenses reported during the reported period. Actual results may differ from these
estimates.

# Presentation of the
consolidated financial statement:

Certain amounts of the consolidated
financial statements as of December 31, 1999, have been reclassified in order to conform
with 2000 presentation.

# Note 3 -Holdings in
Subsidiary

On December 31, 1999, The
Companys management re-evaluated its holdings in Latinvan Metal Trading Ltd, C.A.,
and the associated Bochinche Project. The management concluded and decided that due to the
properties and their installations were of no value to the Parent Company Americana, and
correspondingly reduced their reported value to nil. See note 6.

The decision of the management was
based in the following evaluations:

 The May 1999, field audit
demonstrated that camp was abandoned due to a lack of field support during the period
January to April 1999, that the equipment was vandalized and all easily removed parts and
tools stolen, and that the stripped rolling stock was not operable.

 The estimated cost of
repairing the rolling stock and retrieving it to safe storage in El Callao exceeds the
salvage value of the equipment.

 The road has deteriorated and
re-establishment access to the site for repair and maintenance purpose will be very
expensive.

 The prevailing regulations
prohibit establishment of new commercial scale mining operations in the Imataca area, in
which the Bochinchito project lied. It is not clear when a mining operation in this area
could be permitted.

 The exploration and mining
results on file for the project shown limited potential and no further development work
can be justified on the basis of those results.

The corresponding net effect for
reduce the value to nil is reflected in the years operations.

F-10

# Note 4 -Permanent
Investment

In March 1999, the Company completed
the share purchase agreement whereby Zaruma Mining Corporation ASA, a corporation
organized and existing under the laws of Norway, acquired 100% of Americanas
subsidiaries Minera Rio Carichapo, S.A. and Minera Rios del Oriente, S.A.

In accordance therewith the purchase
price will be the equivalent of U.S. dollars 4,000,000, which the parties agree is the
fair market value of the shares and that such fair value shall be paid by means of payment
in cash and shares of Zaruma Mining Corporation ASA, as follows:

 U.S. dollars 200,000 in cash
(the U.S. dollars Fund) and U.S. dollars 3,800,000, which the parties agree
shall be paid through the delivery of 1,900,000 shares of Zaruma (the Share
Fund) issued at NOK 0.50 per share at a subscription price of NOK 15 per share,
pursuant to the capital increase of Zaruma, which will take place in April-March 1999. The
parties agree that the exchange rate of NOK 7.50 per 1.00 U.S. dollar shall be applicable
for the value of the shares to be delivered hereunder.

 As additional consideration
for the purchase of the shares, Zaruma grants Americana a 1% Net Smelter Returns
(NSR) royalty from all metal production from the El Foco areas and
a 1% royalty on the realized value of all diamonds produced from the El Foco
areas.

 The Seller undertakes, as a
consideration for the sale of the shares that it shall not, without prior written consent
from the Purchaser, for a period terminating on March 31, 2002, interfere of seek to
interfere or take such steps as may interfere with the continuance of supplies to
Carichapo (or the terms relating to such supplies) from the suppliers who have
been supplying components materials or service to Carichapo.

 The purchaser accepts the
financial responsibility on behalf of Carichapo for the direct payment of reasonable
operational property maintenance and security costs with Alto Horizonte (Carichapo has
entered into the Alto Horizonte Agreement) up to the maximum amount of U.S. dollar 30,000.

 Any payment to Alto Horizonte
beyond U.S. dollar 30,000, for services rendered up to and until January, 1999, inclusive,
shall be the exclusive responsibility of the Seller and the Seller agrees to pay such
amounts, if they were to arise.

In accordance therewith, as of
January 31, 1999, the Company is responsible for repayment of the sum of U.S. dollar
58,272.81. The Company will exercise its right under section of the Agreement to repay
this sum paid by Zaruma on its behalf through delivery of shares of Zaruma forming part of
the share fund at NOK 7.50 per share providing such payment is permitted under Norwegian
Law.

Therefore the adjusted total share
payment under the share subscription agreement with the difference calculated on the basis
of NOK 7.50 per share (exchange rate: NOK 8.00 per U.S. dollar 1.00) is 1,900,000 minus
61,340 shares to total 1,838,660, U.S. dollars 1,378,995.

As of December 31, 1999, the market
value of the shares of Zaruma, have been trading in the range of NOK 6 (exchange rate: NOK
8 per U.S. dollar 1.00). The net profit or loss in the market value is reflected in the
account accumulation for not carried out profit of investment in stockholders
equity.

During 2000, the shares of Zaruma
Mining Corporation ASA (the Norwegian Company) were exchanged by approval for 1,287, 761,
new shares of Zaruma Resources Ltd. a Canadian Company listed on the Toronto Stock
Exchange (TSE), at ration of 0.7 new shares for each old share.

As of December 31, 2000, theses
Canadian shares were trading thinly in the range of U.S. dollar Canadian 0.30 (exchange
rate: U.S. dollar Canadian 1.43 per U.S. dollar 1.00) with maximum and minimum of U.S.
dollar Canadian 0.50 and 0.25, respectively. The net profit or loss in the market value is
reflected in the account accumulation for not carried out profit of investment in
stockholders equity.

F-11

# Note 5 -Property and
equipment

The amounts shown in the consolidated
balance sheets as property and equipment as of December 31, are represented as follows:

|                               | 2000 | 1999 | Annual
depreciation
rates
|------------------------------ | ---- | ---- | -------------------------
|Machinery and equipment        |      |      |                          
|Office furniture and equipment |      |      |                          
|Vehicles                       |      |      |                          
|Tools and utensils             |      |      |                          
|Computer equipment             |      |      |                          
|                               |      |      |                          
|                               |      |      |                          
|Less: accumulated depreciation |      |      |                          
|                               |      |      |                          
|                               |      |      |                          
|                               |      |      |                          

# Note 6 -Mining
Concessions -temporal inactivity exploration

The balances for mining concessions
-temporal inactivity exploration, shown in the consolidated balance sheets as of December
31, 2000 and 1999, represent the acquisition of the concession known as Fortuna
I. For the acquisition of this concession, the Company paid U.S. dollars 110,000, in
cash, and U.S. dollars 1,500,000, with the shares of Consorcio Minero Miamo, C.A., owner
of Fortuna I concession. The purchase price for the Fortuna 1
property was agreed upon by the seller and Americana Gold and Diamond Holdings after due
diligence. Americana paid in cash and shares with the amount of shares being calculated by
dividing the unpaid balance (after the cash payment) by the market price of the shares at
the time of the purchase. As of December 31, 2000 and 1999, the remaining portion of debt
outstanding of U.S. dollars 283,094, and U.S. dollars 252, 723, respectively, are included
in the accounts payable shown in the consolidated balance sheets.

As of December 31, 1998, the balance
of mining concessions -temporal inactivity also included the acquisition of the concession
known as Bochinche. During 1999, the Company decided to terminate the contract
pertaining to this concession and reversed the book value to reflect the effect in the
operations statements.

# Note 7 -Other assets

As of December 31, 1999, the
Companys Management decided to adjusted the balance of U.S. dollar 512,952 of plant
for future mineral exploitation and reverse the book value to reflect the effect in the
operations statements. This Management decision should be based on the valuation of the
recuperation and repossession of this asset.

# Note 8 -Bank loans

The amounts shown as bank loans in
the balance sheets as of December 31, 2000 and 1999 are represented by local bank
overdraft at interest rate of 7.5% annually.

# Note 9 -Capital stock

For the years ended December 31, 2000
and 1999, the following capital stock modifications were made (number of shares are on a
pre-split basis).

F-12

# During 2000:

 U.S. dollars 86,262, paid by
different shareholders in cash for contribution of the future capital increase.

During
1999:

 U.S. dollars 38,529, by capitalization of debts based on the agreement
between the Company and Inversiones Megold for contribution of the future capital
increase. See note 6.

 U.S. dollars 27,500, paid by
different shareholders in cash for contribution of the future capital increase. 
U.S. dollars 2,000, by capitalization of debts maintained to the shareholders for
contribution of the future capital increase.

As of December 31, 2000, the
Companys capital stock on a pre-split basis, is constituted as follows:

|Class of shares                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | Number of
shares                                                                                                                                                                                                               | Total
value in
U.S. dollars                                                                                                                                                                                                               | Manner of payment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Preferential 
 
        Common 
                                
                                
         "Fortuna I"
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
                                 
Total Common                     
                                 
Total | 25
  3,764,251
  4,725,882
  1,721,053
     445,455
           
           
    964,960
           
           
           
    523,844
           
           
 1,207,474
           353,502
           13,706,446-13,706,446 | 25,000
  4,516,216
  3,493,991
  1,500,000
     321,104
           
           
    683,992
           
           
           
    421,773
           
           
    690,025
           281,327
           11,933,428581,90912,515,337 | Cash
Merger (AGD Mining & Blue Willows)
Cash
Acquisition of concession
Cash and preferential shares
converted into common shares and
interest paid in shares
Capitalization of debt to directors
preferential shares S-B converted
into common shares and interest
paid with shares
Cash and preferential shares S-B
converted into common shares and
interest paid with shares
Capitalization of debt todirectors 
and officers
Capitalization of debt to suppliers 
for services rendered
Contribution for future capital increase

F-13

# Note 10- Administrative
expenses

Administrative expenses for the years
ended December 31, are represented as follows:

|                                          | 2000 | 1999
|----------------------------------------- | ---- | ----
|Compensation to directors and officers    |      |     
|Managements expenses                      |      |     
|Services rendered                         |      |     
|Depreciation                              |      |     
|Other general and administrative expenses |      |     
|                                          |      |     
|                                          |      |     
|                                          |      |     

# Note 11 -Legal matters
related to subsidiaries

# Provision for employee severance
benefits:

Benefits have been accrued at an
amount sufficient to cover the employees vested benefits as set forth under
Venezuelan labor legislation, net of anticipated payments. As of December 31, 1997, the
Company adopted the new legislation reform of June 1997, and paid the total liabilities of
the prior legislation.

Provision for income tax and
corporate assets tax:

The provision for income tax is
calculated based on a reasonable estimate of net taxable income for the year, in
accordance with current tax legislation, which also establishes the annual readjustment
for tax inflation of its non monetary assets, foreign accounts payable and
Stockholders equity as an increase or decrease on the net taxable income. Likewise,
the Income Tax Law authorizes the transfer of tax losses carry forward for a term of up to
three (3) years. The subsidiaries tax losses available to offset future taxable
income are as follows:

|Subsidiaries                            | Amount | Year
incurred | Carry forward
up to
|--------------------------------------- | ------ | ------------- | -------------------
|A.G.D. Holdings  Inc. de  Venezuela,C.A |        |               |                    
|Consorcio  Minero Miamo,C.A             |        |               |                    
|Latinvan  Metal Trading LTD             |        |               |                    
|                                        |        |               |                    
|                                        |        |               |                    
|                                        |        |               |                    
|A.G.D. Holdings Inc. de  Venezuela,C.A  |        |               |                    
|Consorcio Minero Miamo,C.A              |        |               |                    
|Latinvan Metal Trading LTD              |        |               |                    
|                                        |        |               |                    
|                                        |        |               |                    
|                                        |        |               |                    
|A.G.D. Holdings Inc. de Venezuela,C.A   |        |               |                    
|Consorcio Minero Miamo,C.A              |        |               |                    
|Latinvan Metal Trading LTD              |        |               |                    
|                                        |        |               |                    
|                                        |        |               |                    
|                                        |        |               |                    

F-14

Likewise, current tax legislation
establishes the corporate assets tax, which is determined applying 1% to the average of
the Subsidiaries assets adjusted for inflation invested in income production during
the fiscal year. Corporate assets tax expense will be subject to the income tax
calculation, and the excess generated by the comparison with income tax will be considered
as a corporate assets tax expense. The amount paid for corporate assets tax during the
period also constitutes a credit against income tax arising during the three (3)
subsequent fiscal periods.

The legislation establishes an
exemption for companies during development stage of two (2) years thereafter initiation of
its operating activities. If and when the Company is in a position to produce and
distribute gold the effect of the regulation could have a significant impact on the
Companys operations.

# Other relevant norms:

#  Luxury Assets and
Wholesale, and Added Value Tax:

OnMay 25, 1994, Decree N°
187 was proclaimed, which establishes the Income on Luxury Assets and Wholesale, which tax
the assets, professional or technical services and the import of goods and services. On
July 25, 1996, The National Administration Bureau in Official Gazette N° 36,007
published the change on the percentage to the tax basis applied, beginning form August
1st, 1996, from 12.5% to 16.5%.

On May 5, 1999, The National
Administration Bureau proclaimed Decree N° 126, which establishes Added \/alue Tax,
which substitutes the Income on Luxury Assets and Wholesale, which taxes the assets,
professional services and import of goods. The percentage to the tax basis applied from
June 1st, 1999, is 15.5%. On July 28, 2000, The National Commission published in Official
Gazette N° 37,002 the modification of aliquot to this tax, beginning from August 1,
2000, from 15.5% to 14.5%. As of December 31, 2000, the subsidiaries may compensate the
fiscal credit of U.S. dollars 40,369.

#  Bank Transactions
Tax:

On April 28, 1999, the National
Administration Bureau proclaimed Decree N° 118, which establishes the Bank
Transactions Tax, and tax debits or withdrawals on check accounts, saving accounts, time
deposits, or any other kind of deposits, liquid assets, fiduciary, and any other funds
from the financial market performed on banks and/or financial entities. The percentage to
be applied from May 8, 1999, is 0.50%.This tax will last for 12 months from its
proclamation. Thus, it ended on May 2000.

#  Norms on Gold and
Gold Alloys Exports:

On January 1, 1996, Resolution
No.96-12-02 entered into effect, issued by the Central Bank of Venezuela, establishing the
norms on gold and gold alloys exports. The most significant aspects of this resolution are
the following:

 Gold and gold alloys exports
are allowed, and interested parties should be registered in the Gold Exporters Registry to
be kept by the Central Bank of Venezuela.

 Authorization requests will be
effected before the Central Bank of Venezuela, accompanied by a certification marked out
for the internal market, in bars, a minimum equivalent to 15% of the amount calculated in
kilograms of refined or melted gold, resulting from adding the amount whose authorization
to be exported is requested, and the amount destined for the local market. Said
authorization will be granted in a term of 45 consecutive calendar days. If and when the
Company is in a position to produce and distribute gold the effect of the regulation could
have a significant impact on the Companys operations.

F-15

#  Mining taxes:

In addition to the normal taxes that
any private company in Venezuela has to pay, the Mining Law establishes the following
taxes:

 Exploration tax: A
single payment of U.S. dollars 0.0004 / hectare for the right to explore the concession.

 Surface tax: An annual payment in proportion to the number of hectares
granted. For alluvial concessions the rate is U.S. dollars 0.001 / hectare a year, and for
vein concessions U.S. dollars 0.002 / hectare a year. The tax is levied only after the
concession title is published in the official gazette.

#  Foreign
investment treatment regulations:

Actual foreign investment regulations
on foreign capital, trademarks, patents, licenses and royalties allow the foreign
companies, among other, the following:

 Reinvestment of net income;
distribution, profit remittance of dividends to foreign investors and reexportation of the
foreign Stockholders investment will not require authorization from the
Superintendence of Foreign Investments (SI EX).

 All agreements regarding
Information Technology and use of Patent and Trademarks are authorized, regardless of the
modality that said agreements adopt. There is a subsequent obligation to register such
agreements with the Superintendence of Foreign Investments (SI EX).

Foreign companies are allowed to take
out loans from local banks and to raise credit on the Venezuelan capital markets,
including the sale of stocks and bonds on local exchanges. External credits do not require
prior authorization or registration.

Capital stock:

As of December 31, 2000, the
Companys subsidiaries accrued losses that exceeds more than two thirds (2/3) of the
capital stock. According to the Venezuelan Commercial Code establishes the following:
When capital stock as per records decrease more that 33,33% (1/3) of the capital
stock of the Company, must be restored or reintegrated to capital stock in that amount, or
limit it, to the remaining balance. When capital stock decreases exceeds more
than 66,66% (2/3) of the capital stock, company must be liquidated or dissolved, if
shareholders does not reintegrate or limit to the remaining balance.

The shareholders intention is
to give financial support to the Company in order to continue operating.

F-16