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

                                   FORM 10-QSB

              [X] Quarterly Report Under Section 13 or 15(d) of the
                         Securities Exchange Act of 1934

                  For the quarterly period ended June 30, 2000;

                                       or

             [ ] Transition Report Under Section 13 or 15(d) of the

                         Securities Exchange Act of 1934

        For transition period from ________________ to _________________


                   AMERICAN RESOURCES AND DEVELOPMENT COMPANY
                 (Name of Small Business Issuer in Its Charter)


                  Utah                                  87-0401400
      (State or Other Jurisdiction of       (I.R.S. Employer Identification No.)
       Incorporation or Organization)

                     2035 N.E. 181st, Portland, Oregon 84115
               (Address of Principal Executive Offices) (Zip Code)

                                 (503) 492-1500
                (Issuer's Telephone Number, Including Area Code)


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


As of August 10, 2000, the Registrant had outstanding 4,008,730 shares of Common
Stock.

Transitional Small Business Disclosure Format (check one):  Yes [ ] No [X]

                                       1
<PAGE>

Item 1:  Financial Statements (Unaudited)

         Condensed Consolidated Balance Sheets - June 30, 2000 and
           March 31, 2000                                                    3

         Condensed Consolidated Statements of Operations -Three months
           ended June 30, 2000 and 1999                                      5

         Statements of Stockholders' Equity                                  7

         Condensed Consolidated Statements of Cash Flows - Three
           months ended June 30, 2000 and 1999                               9

         Notes to Condensed Consolidated Financial Statements - June
           30, 2000                                                         11


Item 2:  Management's Discussion and Analysis or Plan of Operation          22



Item 1.    Legal Proceedings                                                24

Item 2.    Changes in Securities                                            24

Item 3.    Defaults upon Senior Securities                                  24

Item 4.    Submission of Matters to a Vote of Security Holders              24

Item 5.    Other Information                                                24

Item 6.    Exhibits and Reports on Form 8-K                                 24

                                        2
<PAGE>
<TABLE>
<CAPTION>

                   AMERICAN RESOURCES AND DEVELOPMENT COMPANY
                           Consolidated Balance Sheet

                                     ASSETS

                                                                                 June 30,           March 31,
                                                                                   2000               2000
                                                                           ------------------  -----------------
CURRENT ASSETS
<S>                                                                        <C>                 <C>
   Cash and cash equivalents                                               $              349  $           8,914
   Accounts receivable, net (Note 1)                                                  534,065            586,829
   Inventory (Note 1)                                                                 209,842            232,310
   Prepaid and other current assets                                                    25,333            102,359
   Marketable securities (Note 1)                                                      -                   2,485
                                                                           ------------------  -----------------
     Total Current Assets                                                             769,589            932,897
                                                                           ------------------  -----------------

PROPERTY AND EQUIPMENT (NOTE 1)
   Furniture, fixtures and equipment                                                  408,572            404,322
   Capital leases                                                                   1,277,899          1,277,899
                                                                           ------------------  -----------------
     Total depreciable assets                                                       1,686,471          1,682,221
     Less: accumulated depreciation                                                  (665,328)          (597,131)
                                                                           ------------------  -----------------
     Net Property and Equipment                                                     1,021,143          1,085,090
                                                                           ------------------  -----------------
OTHER ASSETS
   Deposits                                                                            65,733             62,733
                                                                           ------------------  -----------------
   Total Other Assets                                                                  65,733             62,733
                                                                           ------------------  -----------------
   TOTAL ASSETS                                                            $        1,856,465  $       2,080,720
                                                                           ==================  =================
</TABLE>

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

                                       3
<PAGE>
<TABLE>
<CAPTION>
                                     AMERICAN RESOURCES AND DEVELOPMENT COMPANY
                                        Consolidated Balance Sheet (Continued)


                                    LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

                                                                                June 30,           March 31,
                                                                                  2000               2000
                                                                          ------------------  -----------------
CURRENT LIABILITIES
<S>                                                                        <C>                 <C>
   Accounts payable                                                        $          295,569  $         449,011
   Accrued expenses and other current liabilities                                     962,804            822,780
   Deferred revenue                                                                    10,000             20,000
   Line of credit (Note 3)                                                            376,755            416,171
   Current portion of notes payable (Note 4)                                          529,403            546,542
   Current portion of notes payable, related parties (Note 5)                         105,841             69,797
   Current portion of capital lease obligations (Note 6)                              301,970            302,551
                                                                           ------------------  -----------------
   Total Current Liabilities                                                        2,582,342          2,626,852
                                                                           ------------------  -----------------
LONG-TERM DEBT
   Deferred revenue                                                                    10,000             20,000
   Reserve for discontinued operations (Note 2)                                       734,988            734,988
   Notes payable (Note 4)                                                              77,947             62,981
   Notes payable, related parties (Note 5)                                          1,241,529          1,224,049
   Capital lease obligations (Note 6)                                                 312,103            389,275
                                                                           ------------------  -----------------
     Total Long-Term Debt                                                           2,366,567          2,411,293
                                                                           ------------------  -----------------
     Total Liabilities                                                              4,948,909          5,038,145
                                                                           ------------------  -----------------

COMMITMENTS AND CONTINGENCIES (Note 11)

STOCKHOLDERS' EQUITY (DEFICIT)
   Preferred stock, par value $0.001 per share: 10,000,000
    shares authorized; issued and outstanding: 94,953
    Series B shares, 150,000 Series C shares                                              245                245
   Common stock, par value $0.001 per share: 125,000,000
    shares authorized; issued and outstanding: 5,483,730
    shares issued and 4,008,730 outstanding.  (Note 9)                                  4,008              3,876
   Additional paid-in capital                                                       7,709,597          7,640,045
   Accumulated deficit                                                            (10,806,294)       (10,601,591)
                                                                           ------------------  -----------------
      Total Stockholders' Equity (Deficit)                                         (3,092,444)        (2,957,425)
                                                                           ------------------  -----------------
      TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
      (DEFICIT)                                                            $        1,856,465  $       2,080,720
                                                                           ==================  =================
</TABLE>


<PAGE>
<TABLE>
<CAPTION>
                                             AMERICAN RESOURCES AND DEVELOPMENT COMPANY
                                                Consolidated Statements of Operations


                                                                                      For the Three Months Ended
                                                                                                June 30,
                                                                                   --------------------------------------
                                                                                         2000                  1999
                                                                                   -----------------    -----------------
     SALES
<S>                                                                                <C>                  <C>
       Sales                                                                       $       1,361,522    $       1,128,088
       Cost of sales                                                                         946,245              835,348
                                                                                   -----------------    -----------------
          Gross Profit                                                                       415,277              292,740
                                                                                   -----------------    -----------------
     EXPENSES
       General and marketing expenses                                                        461,892              337,330
       Depreciation and amortization                                                           3,508                9,012
                                                                                   -----------------    -----------------
          Total Expenses                                                                     465,400              346,342
                                                                                   -----------------    -----------------
     LOSS FROM OPERATIONS                                                                    (50,123)             (53,602)
                                                                                   -----------------    -----------------
     OTHER INCOME AND (EXPENSES)
       Other income (expenses)                                                                10,971                3,979
        Interest expense                                                                    (165,551)            (146,105)
                                                                                   -----------------    -----------------
            Total Other Income and (Expenses)                                               (154,580)            (142,126)
                                                                                   -----------------    -----------------
      LOSS BEFORE INCOME TAXES AND
       DISCONTINUED OPERATIONS                                                              (204,703)            (195,728)
                                                                                   -----------------    -----------------

     DISCONTINUED OPERATIONS
       Loss from operations of Quade and USPA (Note 2)                                        -                    (5,871)
       Gain on disposal of USPA (Note 2)                                                                          813,389
                                                                                   -----------------    -----------------
             Total Discontinued Operations                                                    -                   807,518
                                                                                   -----------------    -----------------
     INCOME TAXES                                                                             -                    -
                                                                                   -----------------    -----------------
     NET INCOME (LOSS)                                                                      (204,703)             611,790
                                                                                   -----------------    -----------------

     OTHER COMPREHENSIVE LOSS
           Loss on valuation of marketable securities                                         -                  (797,844)
                                                                                   -----------------    -----------------
              Total Other Comprehensive Loss                                                  -                  (797,844)
                                                                                   -----------------    -----------------
     NET COMPREHENSIVE LOSS                                                        $        (204,703)   $       (186,054)
                                                                                   =================    ================
</TABLE>



<PAGE>
<TABLE>
<CAPTION>
                                     AMERICAN RESOURCES AND DEVELOPMENT COMPANY
                                   Consolidated Statements of Operations (Continued)


                                                                                      For the Three Months Ended
                                                                                                June 30,
                                                                                   --------------------------------------
                                                                                         2000                  1999
                                                                                   -----------------    -----------------
<S>                                                                                <C>                  <C>
     BASIC LOSS PER SHARE OF COMMON STOCK -
      CONTINUING OPERATIONS                                                        $           (0.05)   $            (.06)
                                                                                   =================    =================
     BASIC INCOME (LOSS) PER SHARE OF COMMON STOCK -
      DISCONTINUED OPERATIONS                                                      $               -    $             .19
                                                                                   =================    =================

     WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING                                         3,878,257            3,219,596
                                                                                   =================    =================
</TABLE>


<PAGE>
<TABLE>
<CAPTION>
                                             AMERICAN RESOURCES AND DEVELOPMENT COMPANY
                                           Consolidated Statements of Stockholders' Equity
                                                        June 30, 2000 and 1999



                                       Common Stock             Preferred Stock           Other           Additional
                                 ------------------------       ----------------      Comprehensive         Paid-In     Accumulated
                                   Shares         Amount         Shares   Amount          Loss              Capital       Deficit
                                 ---------       --------       -------  -------       -----------       ------------- ------------
<S>                              <C>             <C>            <C>      <C>           <C>               <C>           <C>
Balance, April 1, 1998           2,929,263       $  2,929       244,953  $   245       $         -       $   7,026,260 $ (5,718,980)

Stock issued for cash               48,000             48             -        -                 -              59,954            -

Stock issued for Quade
 acquisition (Note 2)              238,333            238             -        -                 -             417,678            -

Stock adjustment on PPW
 acquisition (Note 2)              (45,310)           (45)            -        -                 -            (226,505)           -

Expense recognized for
 vested options                          -              -             -        -                 -              17,496            -

Stock issued for loan                4,000              4             -        -                 -               2,183            -

Loss on valuation of
 marketable securities                   -              -             -        -          (435,188)                  -            -

Net loss for the year ended
 March 31, 1999                          -              -             -        -                 -                   -   (3,461,500)
                                 ---------       --------       -------  -------       -----------       ------------- ------------

Balance, March 31, 1999          3,174,286          3,174       244,953      245          (435,188)          7,297,066   (9,180,480)

Stock issued for Quade
 acquisition (Note 2)              451,667            452             -        -                 -             144,099            -

Stock issued for consulting
 services                          250,000            250             -        -                 -             181,384

Expense recognized for
 vested options                          -              -             -        -                 -              17,496

Recognition of loss on
 valuation of marketable
 securities                              -              -             -        -           435,188                   -             -

Net loss for the year ended
 March 31, 2000                          -              -             -        -                 -                   -   (1,421,111)
                                 ---------       --------       -------  -------       -----------       ------------- ------------
Balance, March 31, 2000          3,875,953       $  3,876       244,953  $   245       $         -       $   7,640,045 $(10,601,591)
                                 =========       ========       =======  =======       ===========       ============= ============


<PAGE>


                                     AMERICAN RESOURCES AND DEVELOPMENT COMPANY
                                        Consolidated Statements of Stockholders' Equity (Continued)
                                                          June 30, 2000 and 1999



                                       Common Stock             Preferred Stock           Other           Additional
                                 ------------------------       ----------------      Comprehensive         Paid-In     Accumulated
                                   Shares         Amount         Shares   Amount          Loss              Capital       Deficit
                                 ---------       --------       -------  -------       -----------       ------------- ------------
<S>                              <C>             <C>            <C>      <C>           <C>               <C>           <C>
Balance, March 31, 2000          3,875,953       $  3,876       244,953  $   245       $         -       $   7,640,045 $(10,601,591)
                                 =========       ========       =======  =======       ===========       ============= ============

Stock issued for consulting
 services                           32,777             32                                                       34,028

Expense recognized for
 vested options                                                                                                  4,374

Stock issued for interest
 on notes payable                  100,000            100                                                       31,150

Net loss for the year ended
 March 31, 2000                                                                                                            (204,703)

Balance at June 30, 2000         4,008,730       $  4,008       244,953  $   245       $         -       $   7,709,597 $(10,806,294)
                                 =========       ========       =======  =======       ===========       ============= ============
</TABLE>

<PAGE>
<TABLE>
<CAPTION>
                                   AMERICAN RESOURCES AND DEVELOPMENT COMPANY
                                    Consolidated Statements of Cash Flows

                                                                                       For the Three Months Ended
                                                                                                 June 30,
                                                                                  ---------------------------------------
                                                                                        2000                   1999
                                                                                  -----------------     -----------------
     OPERATING ACTIVITIES
<S>                                                                               <C>                   <C>
           Net Income (loss)                                                      $        (204,703)    $         611,790
           Adjustments to reconcile net loss to net cash
             (used) by operating activities, net of effect of mergers:
             Gain on sale of USPA, Ltd.                                                           -              (813,389)
             Depreciation and amortization                                                   68,197                72,012
             Stock option and stock for services                                            114,295                 4,374
             Changes in operating assets and liabilities:
             (Increase) decrease in accounts receivable                                      52,765               125,139
             Decrease in inventory                                                           22,467                 9,997
             (Increase) decrease in other assets                                             (3,000)               (9,715)
             Increase (decrease) in accounts payable and other
               current liabilities                                                           54,950                96,932
             Increase (decrease) in deferred revenue                                        (10,000)                    -

           Net Cash Provided (Used) by Operating Activities                                  94,611                97,140
                                                                                  -----------------     -----------------
     INVESTING ACTIVITIES
           Proceeds from sale of USPA, Ltd.                                                       -               221,470
           Purchases of property and equipment                                               (4,250)                    -
                                                                                  -----------------     -----------------
           Net Cash (Used) by Investing Activities                                           (4,250)              221,470
                                                                                  -----------------     -----------------
     FINANCING ACTIVITIES
           Net (payment) proceeds on line of credit                                         (39,416)             (112,301)
           Payments on long-term debt and capital lease obligations                         (77,753)             (160,801)
           Note payable borrowings, related parties                                          18,243                     -

           Net Cash Provided (Used) by Financing Activities                                 (98,926)             (273,102)
                                                                                  -----------------     -----------------

     INCREASE (DECREASE) IN CASH                                                             (8,565)               45,508

     CASH, BEGINNING OF PERIOD                                                                8,914                41,967
                                                                                  -----------------     -----------------

     CASH, END OF PERIOD                                                          $             349     $          87,475
                                                                                  =================     =================


<PAGE>
<CAPTION>
                                                AMERICAN RESOURCES AND DEVELOPMENT COMPANY
                                             Consolidated Statements of Cash Flows (Continued)



                                                                                       For the Three Months Ended
                                                                                                 June 30,
                                                                                  ---------------------------------------
                                                                                        2000                   1999
                                                                                  -----------------     -----------------
     CASH PAID FOR
<S>                                                                               <C>                   <C>
       Interest                                                                   $          50,289     $         108,045
       Income taxes                                                               $          -          $          -

     NON CASH FINANCING ACTIVITIES

</TABLE>


<PAGE>

                   AMERICAN RESOURCES AND DEVELOPMENT COMPANY
                 Notes to the Consolidated Financial Statements
                             June 30, 2000 and 1999


NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES

         a. Quarterly Financial Statements

         The  preparation of financial  statements in conformity  with generally
         accepted  accounting  principles  requires management to make estimates
         and  assumptions  that  affect the amounts  reported  in the  financial
         statements  and  accompanying  notes.  Actual results could differ from
         those estimates.  The  accompanying  consolidated  unaudited  condensed
         financial   statements  have  been  prepared  in  accordance  with  the
         instructions  to Form 10-QSB but do not include all of the  information
         and footnotes required by generally accepted accounting  principles and
         should,  therefore,  be read in conjunction  with the Company's  fiscal
         2000 financial  statements in Form 10-KSB.  These statements do include
         all normal recurring  adjustments which the Company believes  necessary
         for a  fair  presentation  of the  statements.  The  interim  operating
         results are not necessarily  indicative of the results for a full year.
         Effective  for  fiscal  quarters  ending  after  March  15,  2000,  the
         Securities and Exchange Commission adopted a rule requiring  companies'
         independent auditors review the companies' financial  information prior
         to the companies filing their Quarterly Reports on Form 10-QSB with the
         Commission.  The  Company's  June 30, 2000 Form 10-QSB was not reviewed
         prior to  submission to the  Commission.  A Form 8-K will be filed when
         the review is completed by the independent auditors.

         b. Principles of Consolidation

         The accompanying  consolidated  financial  statements  include American
         Resources  and  Development  Company  and  its  subsidiaries,   Pacific
         Printing and Embroidery L.L.C. (PPW) and Fan-Tastic, Inc. (FTI).

         c. Estimates

         The  preparation of financial  statements in conformity  with generally
         accepted  accounting  principles  requires management to make estimates
         and  assumptions  that  affect  the  reported  amounts  of  assets  and
         liabilities  and  disclosure  of  contingent  assets  of  revenues  and
         expenses during the reporting period.  Actual results could differ from
         those estimates.

         d. Cash and Cash Equivalents

         The Company considers all highly liquid  investments with a maturity of
         three months or less when purchased to be cash equivalents.

         e. Concentrations of Risk

         The Company  maintains its cash in bank deposit accounts at high credit
         quality  financial  institutions.  The balances,  at times,  may exceed
         federally insured limits.

         In the normal  course of business,  the Company  extends  credit to its
         customers.

         f. Inventories

         Inventories  are  stated  at the  lower  of cost or  market  using  the
         first-in,  first-out method.  Inventory consists of items available for
         resale.

                                       11
<PAGE>

                   AMERICAN RESOURCES AND DEVELOPMENT COMPANY
                 Notes to the Consolidated Financial Statements
                             June 30, 2000 and 1999

NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES (Continued)

         g. Property and Equipment

         Property,  equipment  and capital  leases are  recorded at cost and are
         depreciated or amortized over the estimated  useful life of the related
         assets,  generally  three to seven  years.  When  assets are retired or
         otherwise  disposed of, the cost and related  accumulated  depreciation
         are  removed  from  the  accounts,  and any  resulting  gain or loss is
         reflected in income for the period.

         The costs of maintenance and repairs are charged to income as incurred.
         Renewals and betterments  are  capitalized  and depreciated  over their
         estimated useful lives.

         h. Accounts Receivable

         Accounts  receivable  are shown net of the  allowance  for bad debts of
         $63,822 at March 31, 2000.

         i. Financial Instruments

         Statement  of Financial  Accounting  Standards  No. 107, "  Disclosures
         about Fair Value of Financial  Instruments"  requires disclosure of the
         fair  value of  financial  instruments  held by the  Company.  SFAS 107
         defines the fair value of a financial instrument as the amount at which
         the  instrument  could be  exchanged in a current  transaction  between
         willing  parties.  The following  methods and assumptions  were used to
         estimate fair value:

         The  carrying  amount  of cash  equivalents,  accounts  receivable  and
         accounts payable approximate fair value due to their short-term nature.

         At March 31,  2000,  the Company  held  1,045,000  shares of GCA stock.
         Because of GCA filing for bankruptcy in July of 1999, substantial doubt
         exists  regarding the ability of the Company to recover its  investment
         in GCA. At July 14, 2000,  GCA was still in Chapter 11  bankruptcy  and
         its market value was $0.06 per share. Furthermore,  the majority of the
         Company's  stock in GCA is restricted and the Company does not have the
         ability to have the  restriction  removed because GCA is not current in
         its SEC filings.  As a result, the Company wrote off its cost in GCA at
         March 31, 2000 and incurred a loss of $1,434,239.

         j. Income Taxes

         Income taxes consist of Federal Income and State Franchise  taxes.  The
         Company has elected a March 31 fiscal year-end for both book and income
         tax purposes.

         The Company accounts for income taxes under the provisions of Statement
         of Financial  Accounting  Standards No.109 (SFAS No. 109),  "Accounting
         for Income  Taxes," which  requires the asset and  liability  method of
         accounting for tax deferrals.

         k. Basic Loss Per Common Share

         Basic loss per common share is computed  based on the weighted  average
         number of common shares outstanding during the period. The common stock
         equivalents are antidilutive and, accordingly,  are not used in the net
         loss per common share computation.  Fully diluted loss per share is the
         same as the basic loss per share because of the antidilutive  nature of
         common stock equivalents.

         Basic net loss from continuing  operations per common share and diluted
         net  loss  from   continuing   operations  per  common  share  amounts,
         calculated in accordance with SFAS 128, were $(0.05) and $(.06) for the
         three  months  ended June 30,  2000 and 1999,  respectively.  Basic net
         (loss) income from discontinued operations

                                       12
<PAGE>

                   AMERICAN RESOURCES AND DEVELOPMENT COMPANY
                 Notes to the Consolidated Financial Statements
                             June 30, 2000 and 1999


NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES (Continued)

         k. Basic Loss Per Common Share (Continued)

         per common share and diluted net loss from discontinued  operations per
         common share were $0.00 and $.19, respectively. Weighted average common
         shares  outstanding  were  3,878,257 and 3,219,596 for the three months
         ended June 30, 2000 and 1999, respectively.

         l. Revenue Recognition for Franchise Operations

         Revenue for contract screen printing,  embroidery and product sales are
         recognized  when  the  goods  have  been  shipped.  Franchise  fees are
         recognized as revenue when all material  services  relating to the sale
         have been substantially performed by FTI. Material services relating to
         the  franchise  sale include  assistance in the selection of a site and
         franchisee training.

         m. Goodwill

         On March 31, 1998, the Company  recognized  goodwill of $1,696,412 from
         the  purchase  of  Pacific  Print  Works  (aka  Pacific   Printing  and
         Embroidery  LLC). The Company  amortized  $128,198 of goodwill from the
         PPW  acquisition  in fiscal 1999. In the fourth quarter of fiscal 1999,
         the Company  wrote-off its remaining  goodwill from the PPW acquisition
         due to a permanent  impairment,  resulting in an additional  expense of
         $1,568,215.  The  Company  recognizes  goodwill  from the excess of the
         purchase  price of its  acquisitions  over  the  fair  value of the net
         assets acquired.

         The Company  evaluates the  recoverability  of goodwill and reviews the
         amortization  period on an annual  basis.  Several  factors are used to
         evaluate goodwill, including but not limited to: management's plans for
         future operations, recent operating results and projected, undiscounted
         cash flows.

         n. Recent Accounting Pronouncements

         The Company adopted Statement of Financial  Accounting Standards (SFAS)
         No. 130, "Reporting  Comprehensive  Income" during the year ended March
         31, 1999. SFAS No. 130 established  standards for reporting and display
         of comprehensive income (loss) and its components (revenues,  expenses,
         gains  and  losses)  in  a  full  set  of  general  purpose   financial
         statements.  This statement requires that an enterprise  classify items
         of other comprehensive  income by their nature in a financial statement
         and  display  the  accumulated  balance of other  comprehensive  income
         separately from retained earnings and additional paid-in capital in the
         equity section of a balance sheet.

         o. Advertising

         The Company  follows the policy of charging the costs of advertising to
         expense as incurred.

         p. Prior Period Reclassification

         Certain  1999  amounts  have  been   reclassified  to  conform  to  the
         presentation of the 2000 consolidated financial statements.

                                       13
<PAGE>

                   AMERICAN RESOURCES AND DEVELOPMENT COMPANY
                 Notes to the Consolidated Financial Statements
                             June 30, 2000 and 1999

NOTE 2 - MERGERS AND ACQUISITIONS

         Golf Ventures, Inc.

         In November  1997,  Golf Ventures,  Inc., a former Company  subsidiary,
         merged  with U.S.  Golf  Communities.  U.S.  Golf  Communities  was the
         controlling  company in this  merger and  subsequent  to the merger the
         combined  company's name changed to Golf  Communities of America (GCA).
         This merger resulted in a less than 20% American  Resources'  ownership
         in GVI. Therefore,  subsequent to the merger, the Company's  investment
         in GVI is reflected  as an  investment  in  accordance  with  Financial
         Accounting Standards Board Statement No. 121.

         The Company has a reserve for  discontinued  operations  of $734,988 at
         March 31, 2000.

         Pacific Print and Embroidery, LLC (aka Pacific Print Works)

         In May 1998,  the Company  acquired  83% of the  outstanding  shares of
         Pacific  Print Works (PPW).  The  acquisition  was accounted for by the
         purchase method of accounting, and accordingly,  the purchase price was
         allocated to assets  acquired and  liabilities  assumed  based on their
         fair market value at the date of  acquisition.  Liabilities  assumed in
         excess  of assets  acquired  was  $629,252  and  213,472  shares of the
         Company's  common  stock  were  issued  to  PPW  shareholders   with  a
         guaranteed share value of $5.00 resulting in goodwill of $1,686,411. In
         addition,  depending  on PPW's  performance  from April 1, 1998 through
         March 31, 2001,  additional  shares of the Company's common stock would
         be issued to the Sellers if minimum  earnings levels were met. Based on
         the $5.00  guarantee  and the  Company's  share value from October 1998
         through March 1999, the Company is obligated to issue additional shares
         of common stock to the Sellers.  An amendment to the PPW Stock Purchase
         Agreement  is being  evaluated  by the Company and the Sellers in which
         the Company would issue another 854,000 shares of the Company's  common
         stock to the Sellers and any additional earnings requirements by PPW or
         per share value guarantee by the Company would be eliminated.

         Quade, Inc. and U.S. Polo Association, Ltd.

         In 1997,  Quade,  Inc.  acquired  from the U.S. Polo  Association  ("US
         Polo") the exclusive  master license rights to the US Polo name for the
         United States and Canada. On July 23, 1998, the Company purchased Quade
         by issuing 238,333 shares of its common stock.

         Effective  October 8,  1998,  the  Company  and  Jordache  Enterprises,
         through its  affiliate,  Iron Will,  Inc.  ("Iron Will") formed a joint
         venture  company,  U.S. Polo  Association,  Ltd. (US Polo), to hold the
         master license  granted by the US Polo  Association  and to perform all
         licensing  activities relating to the US Polo Association  licenses and
         trademarks for the United States and Canada.  The Company and Iron Will
         each owned 50% of US Polo and management and the Board of Directors for
         US Polo were  shared  equally by the  Company  and Iron  Will.  For its
         ownership in US Polo, the Company contributed, through Quade, Inc., all
         assets and liabilities  relating to the business of the licensing of US
         Polo including the master  license and sublicense  agreements in the US
         Polo name and trademarks. Iron Will contributed $900,000. The Company's
         investment  in this joint  venture was  accounted  for under the equity
         method of  accounting.  The  Company's  share of losses from this joint
         venture for the year ended March 31, 1999 were $127,268.

         In March 1999, the Company's Board of Directors made a decision to sell
         its 50% ownership in U.S. Polo to Iron will. In June 1999,  the Company
         closed its sale of U.S.  Polo  ownership to Iron Will.  For its sale of
         U.S. Polo, the Company  received the cancellation of $1,000,000 in debt
         from Jordache Enterprises,  the cancellation of $13,185 in interest and
         cash of $221,470.  In addition,  the Company  received  another $70,000
         upon the collection of U.S. Polo royalties earned through May 31, 1999.

                                       14
<PAGE>

                   AMERICAN RESOURCES AND DEVELOPMENT COMPANY
                 Notes to the Consolidated Financial Statements
                             June 30, 2000 and 1999

NOTE 2 - MERGERS AND ACQUISITIONS (Continued)

         The results of  operations  of Quade,  Inc. and U.S.  Polo for the year
         ended  March 31,  1999 has  generated  a loss of  $252,972  on sales of
         $232,712.  A gain  on the  disposal  of  U.S.  Polo  for  $867,587  was
         recognized  for year ending  March 31,  2000.  No income tax benefit or
         expense has been attributed to the disposal of U.S. Polo.

         In  addition,  the  Company and the former  owner of Quade  amended the
         original stock purchase agreement.  Under the amendment,  an additional
         451,667 shares of common stock were issued to the former owner of Quade
         and to a Quade creditor and the  additional  earnings  requirements  by
         Quade or U.S.  Polo to  receive  additional  Company  common  stock was
         eliminated.  In  return,  the $5.00 per share  guaranteed  value of the
         initial common shares issued to the Quade shareholder was removed.

NOTE 3 - LINE OF CREDIT

         In November  1998,  the  Company  entered  into an accounts  receivable
         financing  agreement  to  sell,  with  recourse,  up to $1  million  of
         receivables,  net of a 15% collection  reserve.  The Company is charged
         .065%  daily  for all  receivables  sold  and  uncollected  under  this
         financing  agreement.  At June 30 and March 31, 2000, the Company had a
         payable of $376,755 and $416,171,  respectively, for net funds advanced
         from this  accounts  receivable  line of credit.  The Company  received
         $1,233,670  and  $914,140  from the sale of  receivables  for the three
         months ended June 30, 2000 and 1999 and recognized  $34,201 and $24,059
         in interest  expense  from the discount of selling  these  receivables,
         respectively.

NOTE 4 - NOTES PAYABLE

         Notes payable are comprised of the following:

                                                                      June 30,
                                                                        2000
                                                                     ----------
         Note payable, unsecured, bearing interest at 12%,
           payable in monthly installments of $7,000, including
           interest. Due on demand.                                  $   26,603

         Convertible subordinated debentures, originally due June
           30, 1996 bearing interest at 12% per annum. Interest
           payable quarterly.                                           187,000

         Notes payable to shareholders of PPW. Interest rates
           average 10%, primarily due on demand, unsecured.             341,008

         Notes payable with three vendors with interest rates
           averaging 12%; partially secured by equipment, due in
           2000.                                                         52,739
                                                                     ----------
         Subtotal                                                       607,350

         Less current portion                                          (529,403)
                                                                     ----------
         Long-term portion                                           $   77,947
                                                                     ==========

         Maturities of long-term debt are as follows:

                              June 30, 2001                          $  529,403
                              June 30, 2002                              77,947
                                                                     ----------
                                                                     $  607,350
                                                                     ==========
                                       15
<PAGE>

                   AMERICAN RESOURCES AND DEVELOPMENT COMPANY
                 Notes to the Consolidated Financial Statements
                             June 30, 2000 and 1999

NOTE 5 - NOTES PAYABLE, RELATED PARTIES

                                                                     June 30,
                                                                       2000
                                                                  -------------

         Note payable to Miltex Industries, secured by 700,000
           shares of GCA and 1,475,000 shares of the Company's
           common stock. Interest at 15% with monthly principal
           and interest payments of $11,000 with a final balloon
           payment December 31, 2001.                             $     723,494

         Note payable to a shareholder, secured by GCA stock.
           Interest payable monthly at 13.5% with interest and
           principal payments of $5,000 per month. Due October
           31, 2001.                                                    315,859

         Note payable to a Company owned by a shareholder.
           Interest payable at 72% with interest and principal
           payments due currently.                                       66,285

         Notes payable to shareholders (includes officers and
           directors of the Company). Interest rates average
           10.5%. Unsecured, due on demand, but not expected to
           be repaid until 2003.                                        241,732
                                                                  -------------
                                Subtotal                              1,347,370

                                Less current portion                   (105,841)
                                                                  -------------

                                Long-term portion                 $   1,241,529
                                                                  =============


         Maturities of notes payable, related parties are as follows:

                                June 30, 2001                     $     105,841
                                June 30, 2002                         1,039,353
                                June 30, 2003                           202,176
                                                                  -------------
                                                                  $   1,347,370
                                                                  =============

NOTE 6 - CAPITAL LEASES

         Property and equipment  payments  under capital  leases as of March 31,
         2000 is summarized as follows:

                     Year End
                     March 31,
                   -------------
                      2001                                        $     373,124
                      2002                                              225,438
                      2003                                              123,785
                      2004                                               88,308
                      2005                                               32,378
                                                                  -------------

         Total minimum lease payments                                   843,033
         Less interest and taxes                                       (151,207)
                                                                  -------------

                                       16
<PAGE>

                   AMERICAN RESOURCES AND DEVELOPMENT COMPANY
                 Notes to the Consolidated Financial Statements
                             June 30, 2000 and 1999

NOTE 6 - CAPITAL LEASES (Continued)


         Present value of net minimum lease payments                    691,826
         Less current portion                                          (302,551)
                                                                  -------------

         Long-term portion of capital lease obligations           $     389,275
                                                                  =============

         The  Company  recorded  depreciation  on  capitalized  lease  equipment
         expense of $232,589 and $196,606 for the years ended March 31, 2000 and
         1999, respectively.

NOTE 7 - INCOME TAXES

         The Company had net operating loss  carry-forwards  available to offset
         future   taxable   income.   The   Company  has  net   operating   loss
         carry-forwards  of  approximately   $7,500,000  to  offset  future  tax
         liabilities. The loss carry-forwards will begin to expire in 2014.

         Deferred income taxes payable are made up of the estimated  federal and
         state  income  taxes  on items  of  income  and  expense  which  due to
         temporary  differences  between  books  and  taxes  are  deferred.  The
         temporary  differences  are  primarily  caused by the use of the equity
         method for reporting investment in subsidiaries. The deferred tax asset
         is  offset  in  full by a  valuation  allowance  because  it can not be
         reasonably determined that the net operating loss will be useable.

NOTE 8 - PREFERRED STOCK

         The  shareholders of the Company have authorized  10,000,000  shares of
         preferred stock with a par value of $0.001.  The terms of the preferred
         stock are to be determined when issued by the board of directors of the
         Company.

         SERIES B:

         At March 31, 2000,  there are 94,953 shares of series B preferred stock
         issued and outstanding.  The holders of these series B preferred shares
         are  entitled to an annual  cumulative  cash  dividend of not less than
         sixty cents per share. At March 31, 2000,  there is a total of $406,620
         of accrued and unpaid dividends related to the series B preferred stock
         which have been  included in the  accompanying  consolidated  financial
         statements.  These  series B  preferred  shares were  convertible  into
         shares of the Company's  common stock which  conversion  option expired
         March 31, 1995.

NOTE 9 - COMMON STOCK ISSUED BUT NOT OUTSTANDING

         The Company has issued  160,820  shares of common  stock which had been
         offered  to the  holders  of the  Series  B  preferred  stock  and  the
         debentures.  The shares have not been  accepted by the holders of those
         investments as of the date of the  consolidated  financial  statements.
         Additionally,  the Company has issued  1,475,000 shares of common stock
         as collateral for the note payable to Banque SCS (Note 5).

                                       17
<PAGE>

                   AMERICAN RESOURCES AND DEVELOPMENT COMPANY
                 Notes to the Consolidated Financial Statements
                             June 30, 2000 and 1999

NOTE 10 - STOCK OPTIONS

          In August 1997,  the  Company's  Board of Directors  approved the 1997
          American  Resources and Development  Company Stock Option Plan (Option
          Plan).  Under the Option Plan,  500,000 shares of the Company's common
          stock are reserved for issuance to Directors  and  employees.  Options
          are granted at a price and with  vesting  terms as  determined  by the
          Board of Directors.

          In August  1999,  the Board of Directors  granted  options to purchase
          696,291  shares  of  common  stock at $0.25.  Fifty  percent  of these
          options vest  immediately  and the remainder  vest in August 2000. The
          options were issued to various  officers and  directors of the Company
          for past  services,  risk  associated  with various  debt  incurred by
          officers for the Company and  guarantees  by officers of Company debt,
          and for future services.  No compensation  expense was recognized,  as
          the option  price was greater  than the fair market value of the stock
          at the date of the option grant.

          In December 1997, the Board of Directors  granted  options to purchase
          39,000  shares  of stock  at  $2.00.  These  options  are  exercisable
          beginning March 31, 1998, are exercisable  over staggered  periods and
          expire after ten years. No compensation  expense was recognized as the
          option  price was greater  than the fair market  value of the stock at
          the date of the option grant.

          In October 1997,  the Board of Directors  granted  options to purchase
          140,000  shares  of stock at  $2.00.  These  options  are  exercisable
          beginning March 31, 1998, over staggered  periods and expire after ten
          years. Compensation expense of $1,458 per month will be recognized for
          40,000 of the options  issued over a 4 year vesting  period and $1,458
          per month will be recognized for 100,000 of the options over a 10 year
          vesting period. In July 1998, the Board of Directors changed the terms
          of the 100,000 options vesting over 10 years.  25,000 of these options
          were fully vested and the remainder of the options were canceled. As a
          result,  compensation  expense of $52,498 was  recognized for the year
          ended March 31, 1998 for the vesting of these options.

          Pro forma net income and net income per common share was determined as
          if the Company had accounted for its employee  stock options under the
          fair value method of Statement of Financial  Accounting  Standards No.
          123.

          Pro forma  expense in year 1 would be  $77,660,  $52,402 and $5,646 in
          years 2 and 3,  respectively,  with an increase in pro forma  expenses
          per share of $0.02 in year 1, $0.05 in year 2 and $0.00 in year 3.

          On March 1, 2000, the Company granted options to a company to purchase
          up to 340,000 shares of the company's common stock. This company is to
          provide  various   investor   relations   services.   The  Company  is
          recognizing  a $32,385  expense  over 4 months based upon the value of
          the options as calculated from an option pricing model.

                                       18
<PAGE>

                   AMERICAN RESOURCES AND DEVELOPMENT COMPANY
                 Notes to the Consolidated Financial Statements
                             June 30, 2000 and 1999

NOTE 10 - STOCK OPTIONS (Continued)

          The options expire  September 1, 2001, are not  transferrable  and are
          exercisable at any time at the following rates:

                       85,000 share s        at      $1.08 per share;
                       85,000 shares         at      $1.32 per share;
                       85,000 shares         at      $1.49 per share;
                       85,000 shares         at      $1.72 per share.

          On January 22, 1999,  the Company  granted  options to a consultant to
          purchase  up to 160,000  shares of the  Company's  common  stock.  The
          consultant  is  to  provide  various  investor  and  public  relations
          services  through  January 21, 2000 and the Company is  recognizing an
          expense of $6,000 over the term of the  services  based upon the value
          of the options as calculated from an option pricing model. The options
          expire in December 31, 2001, are not transferrable and are exercisable
          at any time at the following rates:

                       40,000 shares         at      $0.50 per share;
                       40,000 shares         at      $1.00 per share;
                       40,000 shares         at      $2.00 per share;
                       40,000 shares         at      $3.00 per share.

          For the pro forma  disclosures,  the options' estimated fair value was
          amortized over their expected  ten-year life. The fair value for these
          options was  estimated  at the date of grant  using an option  pricing
          model which was designed to estimate the fair value of options  which,
          unlike employee stock options, can be traded at any time and are fully
          transferable.  In  addition,  such models  require the input of highly
          subjective assumptions, including the expected volatility of the stock
          price.  Therefore, in management's opinion, the existing models do not
          provide a  reliable  single  measure  of the value of  employee  stock
          options.  The  following  weighted-average  assumptions  were  used to
          estimate the fair value of these options:

                                                                March 31,
                                                                 2000
                                                             ------------
              Expected dividend yield                              0%
              Expected stock price volatility                     70%
              Risk-free interest rate                            6.5%
              Expected life of options (in years)                 10

NOTE 11 - COMMITMENTS AND CONTINGENCIES

          Office Lease

          The Company leases office and warehouse  space in Salt Lake City, Utah
          and  Portland,  Oregon and leases  space for a retail store in Oregon.
          Lease commitments for the years ended March 31, 2001 through March 31,
          2003 are $467,478, $421,671 and $67,574, respectively.

                                       19
<PAGE>

                   AMERICAN RESOURCES AND DEVELOPMENT COMPANY
                 Notes to the Consolidated Financial Statements
                             June 30, 2000 and 1999

NOTE 11 - COMMITMENTS AND CONTINGENCIES (Continued)

          Legal Proceedings

          The Company is involved in various claims and legal actions arising in
          the ordinary  course of business.  In the opinion of  management,  the
          ultimate disposition of these matters will not have a material adverse
          effect on the Company's financial position,  results of operations, or
          liquidity.

NOTE 12 - GOING CONCERN

          The accompanying  financial statements have been prepared assuming the
          Company will  continue as a going  concern.  In order to carry out its
          operating  plans, the Company will need to obtain  additional  funding
          from outside  sources.  The Company has received  funds from a private
          placement and debt funding and plans to continue  making private stock
          and  debt.  There is no  assurance  that the  Company  will be able to
          obtain  sufficient  funds  from  other  sources as needed or that such
          funds, if available,  will be obtainable on terms  satisfactory to the
          Company.

NOTE 13 - BUSINESS SEGMENTS

          Effective   March  31,  1999,  the  Company   adopted  SFAS  No.  131,
          "Disclosure about Segments of an Enterprise and Related  Information."
          The Company conducts its operations principally in the contract screen
          printing and  embroidery  industry with Pacific Print works,  Inc. and
          the retail franchise industry with Fan-Tastic, Inc.

          Certain financial  information  concerning the Company's operations in
          different industries is as follows:
<TABLE>
<CAPTION>
                                              For the Three
                                              Months Ended             Pacific                                 Corporate
                                                March 31,             Print Works      Fan-Tastic             Unallocated
                                                ---------             -----------      ----------             -----------
<S>                                               <C>              <C>               <C>                   <C>
Net sales                                         2000             $      1,310,348  $        51,174
                                                  1999                    1,035,474           92,614

Operating income (loss)                           2000                      142,113          (43,858)
applicable to industry                            1999                       42,822          (40,840)
segment

General corporate expenses                        2000                                                        $ 148,137
not allocated to industry                         1999                                                           45,584
segments

Interest expense                                  2000                      (96,128)         (12,983)           (56,440)
                                                  1999                      (83,209)          (7,908)           (54,989)

Other income (expenses)                           2000                          (29)          10,971             11,000
                                                  1999                          886            3,093                  -

                                       20
<PAGE>

                   AMERICAN RESOURCES AND DEVELOPMENT COMPANY
                 Notes to the Consolidated Financial Statements
                             June 30, 2000 and 1999

NOTE 13 - BUSINESS SEGMENTS (Continued)

<CAPTION>
                                              For the Three
                                              Months Ended             Pacific                                 Corporate
                                                March 31,             Print Works      Fan-Tastic             Unallocated
                                                ---------             -----------      ----------             -----------
<S>                                               <C>              <C>               <C>                   <C>
Income (loss) from                                2000                                                                -
discontinued operations                           1999                                                     $    807,518

Assets                                            2000              $     1,768,173  $        64,607             23,684

Depreciation and                                  2000                       65,689            2,268                240
 amortization                                     1999                       66,042            4,400              1,189

Property and equipment                            2000                        4,250                -                  -
 acquisitions                                     1999                            -                -                  -
</TABLE>

NOTE 14 - SUBSEQUENT EVENTS

          On June 7, 2000,  the  company  announced  the  signing of a letter of
          intent to merge with Royal Avalon S.A. De C.V., a Mexico based apparel
          manufacturer. Under terms of the deal, the newly merged entity will be
          renamed  Royal  Pacific  Apparel  Group,  Inc.  and will  continue all
          present business  activities as well as constructing new garment dying
          and printing  facilities  at Royal  Avalon's  manufacturing  plants in
          Mexico.

          Royal  Avalon has been  manufacturing  T-shirts in Mexico for the past
          five  years.  During  calendar  1999 Royal  Avalon  achieved  over $12
          million in revenue.

          The present  agreement  between the Company and Royal Avalon calls for
          the Company to issue its common stock to Royal Avalon shareholders for
          the purchase of the business.  The deal is contingent on  satisfactory
          due diligence findings,  board approvals and execution of a definitive
          agreement.  Management  from the companies  believe the merger will be
          consummated  by the end of August 2000.  Additionally,  the Company is
          presently   soliciting   additional  funding  in  order  to  establish
          screenprinting and garment dying at Royal Avalon's facility as well as
          increasing T-shirt manufacturing capacity.

                                       21
<PAGE>

Item 2. Management's Discussion and Analysis or Plan of Operations

Forward Looking Statements

The statements in this report  concerning  certain expected future expenses as a
percentage of net sales,  future financing and working capital  requirements and
availability  constitute  forward - looking statements that are subject to risks
and  uncertainties.  These risks could cause  actual  results or  activities  to
differ materially from those expected.  Factors that could adversely affect cost
of sales and general expenses as a percentage of net sales include,  but are not
limited to, increased competitive factors,  changes in consumer preferences,  as
well as an inability to increase sales. Other factors could include a failure to
adequately fund operations.  In addition,  unfavorable business  conditions,  or
changes in the general  economy could have adverse  effects.  Factors that could
materially affect future financing requirements include, but are not limited to,
the ability to obtain  additional  financing on acceptable  terms.  Factors that
could materially affect future working capital requirements include, but are not
limited  to, the  factors  listed  above and the  industry  factors  and general
business conditions noted above.

The following  table sets forth,  for the periods  indicated,  selected  Company
income statement data expressed as a percentage of net sales.

                                                 Three Months Ended June 30,
                                                2000                    1999
                                                ----                    ----
Net sales                                     100.0%                   100.0%
Cost of sales                                  69.5%                    74.0%
Gross profit                                   30.5%                    26.0%
General expenses                               33.9%                    29.9%
Depreciation and amortization                   0.3%                     0.8%
Loss from operations                           -1.0%                    -1.3%
Other income and expenses                       0.2%                     0.1%
Interest expense                               -3.4%                    -3.7%
Loss before income taxes
  and discontinued operations                  -4.2%                    -4.9%
Discontinued operations                         0.0%                    20.2%
Income taxes                                    0.0%                     0.0%
Net Income (loss)                              -4.2%                    15.3%

For the three months ended June 30, 2000 ("first quarter fiscal 2001"), compared
to the three months ended June 30, 1999 ("first quarter fiscal 2000"):

Sales for the three  months  ended June 30,  2000 were  $1,361,522  compared  to
$1,128,088  for the three months ended June 30, 1999 Pacific Print Works ("PPW")
sales for the first quarter fiscal 2001 were  $1,310,348  compared to $1,035,474
for the first quarter  fiscal 2000.  The $274,874  increase in PPW's revenue was
primarily  due to an  increase  in sales to PPW's  two  largest  customers.  The
increase  with these  customers  is largely due to PPW's high  density  printing
capabilities  in  addition to the overall  quality of the  printing  and related
services.

Sales for  Fan-Tastic  declined  by  $41,440  which was  primarily  due to first
quarter  fiscal 2001 sales  coming from one store as opposed to three  stores in
the first quarter fiscal 2000.

Gross  profit and the gross profit as a percentage  of sales  increased  for the
first quarter fiscal 2001 as compared to the first quarter fiscal 2000, $415,277
and 30.5%  compared  to  $292,740  and 26%.  The  increase  in gross  profit was
primarily  due to the increase in PPW revenues as noted above.  The gross profit
from PPW operations increased by approximately $145,000.

                                       22
<PAGE>

General  and  administrative  expenses  for the first  quarter  fiscal 2001 were
$461,892 as compared to $337,330 for the first quarter fiscal 2000. The increase
in general and administrative  expenses is primarily due to $110,000 in investor
relation expenses in the first quarter fiscal

The gain (loss) from  operations  before other income and expenses for the first
quarter  fiscal  2001 was a loss of $50,123 as opposed to a loss of $53,602  for
the first quarter fiscal 2000.

Interest  expense for the first  quarter  fiscal 2001 was  $165,551  compared to
$146,105 for the prior year.

For the three months ended June 30, 1999 ("first  quarter 99"),  compared to the
three months ended June 30, 1998 ("first quarter 98"):

Sales for the three  months  ended June 30,  1999 were  $1,128,088  compared  to
$809,034 for the three months ended June 30, 1998.  Pacific  Print Works ("PPW")
sales for the three  months  ended June 30,  1999 were  $1,035,474  compared  to
$624,958  for the three months  ended June 30,  1998.  The $410,516  increase in
PPW's  revenue  was  primarily  due to an increase of over 50% in sales to PPW's
four  largest  customers.  Sales to PPW's four  largest  customers  in the first
quarter 99 exceeded  $760,000.  The increase with these customers is largely due
to PPW's high density  printing  capabilities in addition to the overall quality
of the  printing  and  related  services.  The PPW first  quarter  99 sales also
include  approximately  $123,000  of garment  blank  sales as opposed to garment
blank sales of  approximately  $15,000 for the first quarter 98. The increase in
garment blank sales is due to PPW selling garment blanks with contract  printing
to two of its  largest  customers  in the  first  quarter  99 while in the first
quarter 98 these two  customers  provided  their own  garment  blanks to PPW for
printing.  PPW expects a similar or larger increase in sales over the next three
quarters  based on its  relationship  and  orders  with  existing  customers  in
addition to PPW samples with potential new customers.

Sales for  Fan-Tastic  declined  by  $91,463  which was  primarily  due to first
quarter  99 sales  coming  from  three  stores as opposed to six stores in first
quarter 98.

Gross profit for the first quarter 99 was $292,740  compared to $171,479 for the
first  quarter 98. The  increase in gross profit was due to an increase in sales
which also resulted in an  improvement  in gross profit as a percentage of sales
(26% compared to 21%) which was also due to additional  sales  available for the
first quarter 99 to cover direct expenses.

General and  administrative  expenses for the first  quarter 99 were $346,342 as
compared  to  $519,490  for the  first  quarter  98. A  $69,000  decline  in the
corporate office expenses was primarily due to approximately  $30,000 in reduced
goodwill  amortization and a reduction of $37,000 in consulting fees. Fan-Tastic
also saw a decline in  general  and  administrative  expenses  of  approximately
$90,000 due to less rent and payroll  expenses  resulting  from the closure of 3
stores.  The Company expects general and  administrative  expenses over the next
three quarters to be similar to the first quarter 99 amount.

Depreciation  and amortization  expenses  included in total general expenses for
the fiscal year ended March 31, 1999 was $9,012 in the first quarter 99 compared
to $44,945  for the first  quarter 98. This  decrease is  primarily  due to zero
goodwill  amortization  in the first  quarter  99 as the  Company  wrote off all
goodwill from the PPW acquisition at March 31, 1999.

The loss from  operations  for the  first  quarter  99 was  reduced  to  $53,602
compared to $348,011  for the first  quarter  98. The  reduction  in the loss is
primarily  due to the  increase  in  sales  and the  reduction  in  general  and
administrative expenses as discussed above.

Interest expense for the first quarter 99 was $146,105  compared to $107,042 for
the prior year.  The increase in interest  expense for the first  quarter 99 was
due to additional debt in Fiscal 1999 that was used for working capital purposes
and to fund losses  from  operations.  The Company had a $813,389  gain from the
sale of its 50%  ownership in USPA Ltd. in the first quarter 99. For its sale of
USPA Ltd.,  the Company  received the  cancellation  of  $1,000,000 in debt from
Jordache  Enterprises,  the  cancellation  of  $13,185 in  interest  and cash of
$221,470.

                                       23
<PAGE>

LIQUIDITY AND CAPITAL RESOURCES

At June 30, 2000, the Company had total assets of $1,856,465,  total liabilities
of $4,948,909 and total stockholders'  deficit of $3,092,444 compared with total
assets of $2,080,720,  total  liabilities  of $5,038,145 and total  stockholders
deficit of $2,957,425 at March 31, 2000. The changes in assets,  liabilities and
stockholders  equity is due  primarily  to losses from  operations  and interest
expense.  At June 30, 2000 the Company's  current ratio was  approximately  .299
current  assets to 1  current  liabilities.  The  Company  will seek to  convert
certain debt to equity which will improve its current ratio.

Management  intends to improve  its  overall  financial  structure  and  provide
operating  capital through private  placement of the Company's  common stock and
seeking the conversion of debt and preferred stock to common stock.

Management  intends to improve  its  overall  financial  structure  and  provide
operating  capital through private  placement of the Company's  common stock and
seeking the conversion of debt and preferred stock to common stock.  There is no
assurance  that the Company will be able to obtain  sufficient  funds from other
sources as needed or that such funds, if available,  will be obtainable on terms
satisfactory to the Company.

Part II   -  Other Information

Item 1. Legal Proceedings

                 Not applicable.

Item 2. Changes in Securities

                 Not applicable.

Item 3. Default upon Senior Securities

                 Not applicable.

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

                 Not applicable.

Item 5. Other Information

         Effective  for  fiscal  quarters  ending  after  March  15,  2000,  the
Securities  and  Exchange   Commission  adopted  a  rule  requiring   companies'
independent  auditors review the companies'  financial  information prior to the
companies filing their Quarterly Reports on Form 10-QSB with the Commission. The
Company's  June 30, 2000 Form 10-QSB was not reviewed prior to submission to the
Commission.  A Form 8-K  will be  filed  when the  review  is  completed  by the
independent auditors.

Item 6. Exhibits and Reports on Form 8-K

                 Not applicable.

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<PAGE>

                                   SIGNATURES

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

                                    AMERICAN RESOURCES AND
                                   DEVELOPMENT COMPANY
                                      (Registrant)

/s/ B. Willes Papenfuss      President, Chief Executive         August 11, 2000
-----------------------      Officer and Director
B. Willes Papenfuss          (Principal Executive
                             Officer)


/s/ Timothy M. Papenfuss     Secretary / Treasurer and          August 11, 2000
------------------------     Director (Chief Financial
 Timothy M. Papenfuss        Officer, Chief Accounting
                             Officer and Controller)

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