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

                                   FORM 10-KSB

[x] ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
    1934

For the fiscal year ended         June 30, 2001
                           ---------------------------

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

For the transition period from _______________________ to _____________

Commission file number              0-27635
                          ----------------------------


                            BASIC TECHNOLOGIES, INC
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                 (Name of small business issuer in its charter)

          COLORADO                                        84-1446622
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(State or other jurisdiction of                      (I.R.S. Employer No.)
 incorporation or organization)

 1026 West Main Street, Suite 104, Lewisville, Texas        75067
------------------------------------------------------    ----------
  (Address of principal executive offices)                (Zip Code)


                                  972-436-3789
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                            Issuer's telephone number

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

Title of each class                    Name of each exchange on which registered

None
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Securities registered under Section 12(g) of the Exchange Act:

Common Stock, $.00001 par value
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      (Title of class)

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.

[x] Yes [ ] No

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 fiscal year.  $420,977

State the aggregate market value of the voting and non-voting common equity held
by non-affiliates computed by reference to the price at which the common equity
was sold, or the average bid and asked price of such common equity, as of a
specified date within the past 60 days. (See definition of affiliate in Rule
12b-2 of the Exchange Act.)

At June 30, 2001, based upon the posted closing price of $.47 per share, as
posted on the National Association of Securities Dealers Over The Counter Bul-
letin Board, the aggregate market value of the voting stock held by non-
affiliates is $613,941.26.  During the existence of the Registrant since 1998,
there has been no trading on an exhange, and there has been limited over the
counter trading.

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
assumptions, if the assumptions are stated.


                   ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
                           DURING THE PAST FIVE YEARS

Check whether the issuer has filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court.

[ ]Yes [ ] No [X] NOT APPLICABLE

                    APPLICABLE ONLY TO CORPORATE REGISTRANTS

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date. As of June 30, 2001 the Registrant
had 7,855,555 shares of common stock issued and outstanding.

                       DOCUMENTS INCORPORATED BY REFERENCE

If the following documents are incorporated by reference, briefly describe them
and identify the part of the Form 10-KSB (e.g., Part I, Part II, etc.) into
which the document is incorporated: (1) any annual report to security holders;
(2) any proxy or information statement; and (3) any prospectus filed pursuant
to Rule 424(b) or (c) of the Securities Act of 1933 ("Securities Act"). The
listed documents should be clearly described for identification purposes (e.g.,
annual report to security holders for fiscal year ended December 24, 1990).

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

                                TABLE OF CONTENTS

PART I

Item 1.  Description of Business

Item 2.  Description of Property

Item 3.  Legal Proceedings

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

PART II

Item 5.  Market For Common Equity and Related Stockholder Matters

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

Item 7.  Financial Statements

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

PART III.

Item 9.  Directors, Executive Officers, Promoters and Control Persons;
         Compliance With Section 16(a) of the Exchange Act

Item 10. Executive Compensation

Item 11. Security Ownership of Certain Beneficial Owners and Management

Item 12. Certain Relationships and Related Transactions

Item 13. Exhibits and Reports on Form 8-K

                                     PART I

ITEM 1. DESCRIPTION OF BUSINESS.

(a) BUSINESS DEVELOPMENT.

Basic Technologies, Inc. (the "Company"), was organized under the laws of the
State of Colorado on January 21, 1998. The Company was initially organized for
the purpose of pursuing and completing a business combination with Yankee
Development Corporation ("Yankee Development"), a Texas corporation engaged in
the business of the acquisition and development of oil and gas ventures and
related interests. The Company's executive offices are presently located at 1026
West Main Street, Suite #104, Lewisville, Texas 75067, and its telephone and
facsimile numbers are (972) 436-3789 and (972) 219-1832, respectively. The
Company's presence on the world wide web is accessible at the domain
http://www.basictech.com and its related links.

The Company received gross proceeds in the amount of $25,000 from the sale of a
total of 25,000 shares of common stock, $.00001 par value per share (the "Common
Stock"), in an offering conducted during the period from March to April 7, 1998,
pursuant to Section 3(b) of the Securities Act of 1933, as amended (the "Act"),
and Rule 504 of Regulation D promulgated thereunder.

On April 23, 1998, the Company issued and sold, pursuant to that certain
Acquisition Agreement and Closing Memorandum dated April 23, 1998, an aggregate
of 5,305,625 newly-issued, restricted shares, constituting approximately 90% of
the then outstanding shares, of the Company's Common Stock in consideration of
the exchange therefor of all 1,000 outstanding shares of common stock, no par
value per share, of Yankee Development owned of record and beneficially by the
Shelton Voting Trust. Immediately following the "reverse acquisition"
transaction, the Shelton Voting Trust, the former owner of Yankee Development,
controlled approximately 90% of the outstanding shares of Common Stock of the
Company and Yankee Development became a wholly-owned subsidiary of the Company.
The transaction was accounted for under the purchase of assets, rather than the
pooling of interests, method of accounting. Mr. Bryan L. Walker, the President,
Chief Executive Officer and Chairman of the Board of Directors of the Company
and the President and a director of Yankee Development and Simpco, Inc.
("Simpco"), also a 100%-owned subsidiary of the Company, is the trustee of the
Shelton Voting Trust. (See Part I, Item 7. "Certain Relationships and Related
Transactions" and Part II, Item 4. "Recent Sales of Unregistered Securities.")

On October 16, 1998, the Company, together with Simpco, which was then
unaffiliated with the Company, organized P & A Remediation, LLC (hereafter "PAR
Texas"), a Texas limited liability company owned 99% and 1% by the Company and
Simpco, respectively, for the purpose of engaging in the business of plugging
oil wells, conducting environmental remediation of oil fields and salvaging the
construction materials, pipe, steel tubulars and used oil field equipment for
resale on the secondary market.

The Company, effective as of January 15, 1999, issued and sold, in accordance
with that certain Acquisition Agreement and Closing Memorandum dated effective
January 15, 1999, a total of 850,000 newly-issued, restricted shares of Common
Stock in consideration of the exchange therefor of all 10,000 outstanding shares
of common stock, no par value per share, of Simpco.  Simpco then became a
wholly-owned subsidiary of the Company, in the transaction which was accounted
for under the purchase of assets method. Prior to its acquisition by the Com-
pany effective as of January 15, 1999, Simpco was operating and approved by the
responsible regulatory agencies of the states of Texas and Oklahoma to be en-
gaged in the business of oil well plugging, remediation and salvage activities,
which are now conducted by P & A Remediation. Since its acquisition by the
Company, Simpco has acted solely in the capacity of referring business con-
tacts; acting as agent in the state of Oklahoma; and as the owner and lessor
to P & A Remediation, as the lessee, of the used oil field equipment owned by
Simpco effective as of January 15, 1999, and subsequently acquired from unaf-
filiated third parties.

On November 24, 1999, the Company organized P & A Remediation, LLC (hereafter
"PAR Oklahoma"), an Oklahoma limited liability company, for the purpose of
engaging in the business of plugging oil wells for industry and government in
the state of Oklahoma, conducting environmental remediation of oil fields and
salvaging the construction materials, pipe, steel tubulars and used oil field
equipment for resale on the secondary market.

On December 31, 1999, the Company organized Cyber Cities Technologies, Inc.
(hereafter CCTECH), a wholly-owned Hawaii corporation, for the purpose of
receiving and operating the assets of an unrelated third party and thereafter to
engage in the business of providing regional Internet provider services and
computer consulting operations from Honolulu, Hawaii.

The Company, on March 16, 2000, issued and sold, in accordance with that certain
Acquisition Agreement and Closing Memorandum dated effective December 31, 1999,
a total of 979,232 newly-issued, restricted shares of Common Stock in the
company, in consideration for the conveyance and transfer of certain selected
assets listed in (i) that certain Acquisition Agreement and Closing Memorandum
between the Company and Cyber City Honolulu, Inc., (hereafter CCHONO) an
unaffiliated third party; (ii) that certain Bill of Sale dated December 31, 1999
from Cyber City Honolulu, Inc. to Cyber Cities Technologies, Inc.; and (iii)
that certain Assignment dated December 31, 1999, from Cyber City Honolulu, Inc.,
to Cyber Cities Technologies, Inc. The stock for assets transaction was
accounted for under the purchase method.

See (b) "Business of Issuer" immediately below for a description of the
Company's current operations conducted through its subsidiaries: Yankee
Development, Simpco, PAR Texas, PAR Oklahoma, and CCTECH, as well as future
proposed activities.

(b) BUSINESS OF ISSUER.

General. The Company serves as a holding company for three wholly-owned
corporate subsidiaries, Yankee Development, Simpco, and Cyber Cities
Technologies, and two limited liability companies, PAR Texas and PAR Oklahoma
(hereafter collectively "P & A Remediation"). Yankee Development owns a working
interest in proven, developed oil reserves on 2,300 acres in Tom Green County,
Texas. Through P & A Remediation, during the two preceding fiscal years (ending
June 30, 1999, and June 30, 2000) the Company performed environmental remedi-
ation and salvage operations for the oil industry, and marketed and sold con-
struction materials, pipe, steel tubulars and used oil field equipment obtain-
ed from salvage operations or acquired for resale on the secondary market.
During the fiscal year ending June 30, 2001, P & A Remediation did not perform
any oil well plugging or environmental remdiation work due to litigation with
then mid-level managment of the Company that had the managerial responsibil-
ity of the oilwell plugging operations, though the Company did market and
sell oilfield equipment on the secondary market on a limited basis.  Simpco
owns certain reconditioned oil field equipment and vehicles that are leased
to P & A Remediation for use in conducting oil field plugging, remediation
and salvage activities. Cyber Cities Technologies provides high speed inter-
net access for residential and business customers in Hawaii.

Since its creation by the Company, PAR Oklahoma has acted as a general con-
tractor for oil well plugging and cleanup jobs for the company's operations
in the state of Oklahoma. Simpco has acted as the owner and lessor to PAR
Oklahoma, as the lessee, of the used oil field equipment owned by Simpco;
and as agent for the procurement of state bid contracts. Simpco, which was
a previously approved oil well cementer with the state of Oklahoma, has
successfully bid on, and been awarded a number of bid contracts from the
Oklahoma Corporation Commission to plug oil wells and clean up oil well
sites. PAR Oklahoma is the assignee of those bid contracts from Simpco.
Subsequent to its creation, and doing business in Oklahoma as Simpco, PAR
Oklahoma has engaged in the business of plugging oil wells for both gov-
ernment and industry, conducting environmental remediation of oil fields
and salvaging the construction materials, pipe, steel tubulars and used
oil field equipment for resale on the secondary market.

Company management has decided to delay additional development and production of
Yankee Development's oil reserves until such time as sufficient capital is
raised to properly drill and complete the required number of wells to prove or
disprove the field's reserve study. This could possibly mean the drilling of up
to twenty (20) wells, at a total cost of up to $3,000,000. The results of
drilling such wells can never be determined in advance. The industry has a
history of unprofitable efforts resulting from dry holes, or commercial wells
which fail to produce in quantities sufficient to provide an economic return.
Yankee Development, since inception, has generated no revenues from the
production of oil. No assurance can be given that Yankee Development will
generate any revenues or achieve profitability from the production of the
proven, developed reserves owned as of the date hereof or from oil and/or gas
properties, if any, acquired in the future. Until that time, the Company intends
to focus upon expanding P & A Remediation's environmental remediation and
salvage business in the private sector and, in addition, to include the State of
Texas' Railroad Commission; the Oklahoma Corporation Commission; and /or other
government customers. Management believes that the Company can continue to
exploit the numerous opportunities available because of the volatile nature of
the domestic oil and gas industry to expand P & A Remediation's business and,
additionally, acquire companies engaged in one or more aspects of the plugging,
remediation and salvage business, as well as obtain producing and/or developed
oil and/or gas properties. These opportunities include, but are not limited to,
(i) the availability of producing wells and field equipment at low or distressed
prices; (ii) the availability for minimal compensation of a pool of
highly-trained field and supervisory personnel because of industry layoffs;
(iii) the availability of heavy construction and oilfield equipment, and the
businesses operating the same, at low or distressed prices; and (iv) increased
environmental remediation and salvage business attributable to the increasing
number of wells desired to be plugged, or required to be plugged at public
expense because of abandonment by operators due to of the volatile nature of the
domestic independent oil & gas industry; the depressed (unstable) price of crude
oil; or because of environmental hazards.

Since March 2000, the Company's well plugging and pipe sales operations in Texas
under the direction of mid-level management brought in with the acquisition of
Simpco have been suspended. Since June 2000, the Company's well plugging opera-
tions in Oklahoma have been suspended. Both suspensions are a result of multiple
factors, including reorganization of equipment and re-evalutaion of employees;
financing requirements; and recently settled litigation. There can be no assur-
ance as to when, or if, operations will resume.

In the short term, the Company intends to develop a plan for internal growth for
its wholly-owned subsidiary, Cyber Cities Technologies, Inc., (hereafter CCTECH)
which services the consumers of the State of Hawaii with high speed Internet
Access for residence and business uses. The assets were acquired from CCHONO,
which was a regional Internet Service Provider located in a leased location in
Honolulu, Hawaii. Prior to the asset acquisition by the Company, CCHONO was
engaged in the provision of internet access and computer consulting to the
regional Hawaii market for a period of three years. Cyber Cities Technologies,
Inc., (CCTECH) is currently engaged in the growth of the existing regional
market for dial up internet access, as well as the growth of Asynchronous Data
Subscriber Line (ADSL), the newest high speed Internet Access technology, in the
regional market.

The Company is currently doing business as CYBER CITY HONOLULU and CYBER CITY
MAUI, maintaining offices on the islands of Oahu and Maui. CCTECH also provides
computer and internet commerce consultation services to businesses. A long term
plan for nationwide internet service and a review of market opportunities
available to the Company is currently in process by Company management.

The Company plans to diversify its operations through the acquisition of
companies engaged in businesses unrelated to the oil and gas business. The
Company is not presently engaged in negotiations for the acquisition of any
companies operating in industries unrelated to the Company's business.

See below for a more detailed description of the Company's current operations,
conducted through its subsidiaries, as well as how the Company addresses
competitive business conditions, its position in the industry, and methods of
operations that are designed to serve its targeted customers.

The Company owns a tract of land containing five acres in Young County, Texas,
on which a metal building is situated that was purchased from a non-affiliate on
March 19, 1999, for a total purchase price of $12,500. The property is subject
to that certain Promissory Note Secured by Deed of Trust dated March 19, 1999,
in the principal amount of $11,500, bearing interest at the rate of 10% per
annum and payable in installments of approximately $245 per month commencing on
May 1, 1999, and terminating on April 1, 2004.

During the most recent fiscal year, the Company leased or leases three addi-
tional facilities used as oil field offices or salvage yards.  One located at
408 South Highway 79, on approximately three acres in the City of Olney, Texas;
and one, used for a portion of the most recent fiscal year, is located at 505
Knox Street, on approximately five and one half acres in Young County, Texas.
The Company has a contract to purchase, and rental agreement, on 208 East Modoc
on leased railroad company land of approximately four acres in the City of
Nowata, Oklahoma.  All lessors are unaffiliated with the Company. The Young
County facility was maintained at a monthly rental of $550 pursuant to a renew-
able lease with a purchase option; the Olney facility in on a short term lease
under an agreement to improve and maintain physical possession.  The Nowata
facility was leased for $300 per month.

The Company has assumed liability for two leases of offices from which the
Company houses and operates its internet operations in the state of Hawaii. The
main office of the Company is located in the City of Honolulu, Hawaii, at 2628
Ualena Street, Suite C, in an industrial office / warehouse area adjoining to
and east of the Honolulu International Airport. The space is leased on a five
year lease (currently in year three) for a monthly rental of $1300, from an
unaffiliated company. The other leased location is on the island of Maui, in the
city of Kahului, at 355 Hukilike, Suite 103, in an industrial office / warehouse
area three miles west of the Kahului Airport for a monthly rental of $1,000.
The space is leased on a five year term (currently in year two) from an unaf-
filiated company.

The Company's executive offices are leased from an affiliate on a month-to-month
basis at the rate of $450 per month.

YANKEE DEVELOPMENT CORPORATION (YANKEE)

General. Yankee Development Corporation is a Texas corporation organized on
December 31, 1997. As described above, the corporation was acquired by the
Company in a reverse acquisition transaction consummated on April 23, 1998.

Yankee Development owns a working interest in proven, developed oil reserves on
2,300 acres in western Texas known as the Yankee (Canyon Sand) Field Unit, MA.,
RRC No. 03215, of Tom Green County, Texas, as set forth in that certain Unit
Agreement as recorded in Volume 405, Page 609 of the Deed Records of Tom Green
County, Texas. The acquisition cost of $3,711,000 assigned to the reserves at
the time of their acquisition in April 1998 represents the discounted net
present value of net revenues, and was calculated based upon the then market
price of $15.00 per each of 880,000 recoverable barrels of oil, less development
and operating costs, discounted at a rate of 10%. The current market price of
crude oil is approximately $25.00 per barrel, but the carrying value of the
reserves will not be increased. These proved, developed oil reserves are Yankee
Development's only significant assets. Management is negotiating with financial
partners to raise sufficient capital to properly drill and complete the required
number of wells to prove or disprove the field's reserve study. This could
possibly mean the drilling of up to twenty (20) wells, at a total cost of up to
$1,300,000. The results of drilling such wells can never be determined in ad-
vance. The industry has a history of unprofitable efforts resulting from dry
holes, or commercial wells which fail to produce in quantities sufficient to
provide an economic return. Yankee Development, since inception, has generated
no revenues from the production of oil. No assurance can be given that Yankee
Development will generate any revenues or achieve profitability from the pro-
duction of the proven, developed reserves owned as of the date hereof or from
oil and/or gas properties, if any, acquired in the future.

Competition. With respect to Yankee Development's future acquisition of
additional developed oil and/or gas properties, there are a large number of
operators engaged in the exploration for and production of oil and gas and a
correspondingly high degree of competition exists for desirable oil and gas
prospects. Because of Yankee Development's operating history, limited to the
company's acquisition of proven, developed oil reserves in western Texas to be
further developed and produced in the future, Yankee Development may be at a
severe competitive disadvantage in its ability to purchase prospects. The oil
and gas industry is dominated by a number of large companies having financial
resources far in excess of Yankee Development's resources. The principal means
of competition for the acquisition of oil and gas leases are the payment of
bonuses at the time of acquisition of leases and property, the payment of
royalties from production, the amount of annual rental payments and the nature
of requirements for exploration and production. Companies with greater financial
resources, larger staffs, more sophisticated equipment and more extensive
experience will be in a better position than Yankee Development to compete for
oil and gas leases and properties. Additionally, the marketing of oil and gas,
if any, found and produced by the company will be affected by a number of
factors that are beyond Yankee Development's control, the exact nature of which
cannot be accurately predicted. These factors include, but are not limited to,
crude oil imports, the availability of adequate pipeline and other
transportation facilities, the marketing of competitive fuels and other matters
affecting the availability of a ready market, such as fluctuating supply and
demand. In recent years, crude oil and natural gas prices have declined because
of, among other factors, an oversupply in the world markets and decreased
demand. In the past year, oil prices have significantly increased and then
subsided somewhat. The recent volatility in the international energy markets
points out the inherent risks in the industry.

Regulation. The exploration for and production of oil and gas is generally
subject to regulation by state regulatory authorities. In some states, the
production of oil and gas is regulated by conservation laws and regulations,
which set allowable rates of production, regulate the spacing of wells and thus
control the number of wells that can be drilled in a given area and otherwise
control the conduct of oil and gas operations. Further, Yankee Development's
future drilling and production operations, if any, will be subject to state,
Federal and local environmental protection regulations that may necessitate
significant capital outlays that would materially affect the financial position
and business operations of the company. Despite the retention of qualified
engineers and operators, Yankee Development may be adversely affected by
pollution and environmental laws that protect against waste, conserve natural
resources and prevent pollution and damage to the environment, enacted by
Federal, state and local agencies in jurisdictions in which the company
operates. If any penalties or prohibitions were imposed on Yankee Development
for violating such regulations, the company's operations could be adversely
affected. Additionally, the production of oil and gas is subject to Federal
regulation with regard to the imposition of land use controls, the amount of oil
imported into the United States from other countries, taxation and other mat-
ters, that is complex and continuously changing. Legislation adopted by Con-
gress in some respects emphasizes decreasing demand for, rather than increas-
ing the supply of, oil and gas. Yankee Development cannot predict the nature
and terms of any energy legislation that may be enacted by Congress in the
future nor can the company be assured that any such legislation would not have
an adverse affect upon its business. In addition, foreign countries establish
prices and production quotas for petroleum products from time to time with the
intent of reducing global oversupply and maintaining or increasing certain
price levels. Management is unable to predict the effect, if any, such ac-
tions would have on the amount of, or the prices received for, oil and/or gas,
if any, produced and sold from Yankee Development's wells.

Title to Properties. Yankee Development believes it has satisfactory title to
all of its material properties in accordance with standards generally accepted
in the oil and gas industry. As is customary in the industry in the case of
undeveloped properties, little investigation of record title is made at the time
of acquisition. Investigations, including a title opinion of legal counsel,
generally are made before commencement of drilling operations. To the extent
title opinions or other investigations reflect title defects, Yankee
Development, rather than the seller of undeveloped property, typically is
responsible to cure any such title defects at the Company's expense. If the
Company was unable to remedy or cure title defects of a nature such that it
would not be prudent to commence drilling operations on the property, the
Company could suffer a loss of its entire investment in such property. Yankee
Development 's properties are subject to customary royalty, overriding royalty,
carried, net profits, working and other similar interests, liens incident to
operating agreements, liens for current taxes and other burdens.

Environmental Considerations. The exploration for, and development of, oil and
gas involves the extraction, production and transportation of materials which,
under certain conditions, can be hazardous or can cause environmental pollution
problems. In light of the current interest in environmental matters, Yankee
Development cannot predict what effect possible future public or private action
may have on the business of Yankee Development. Yankee Development is
continually taking actions it believes are necessary in its operations to ensure
conformity with applicable federal, state and local environmental regulations.
As of June 30, 2000, Yankee Development has not been fined or cited for any
environmental violations which would have a material adverse effect upon capital
expenditures, earnings, cash flows or the competitive position of Yankee
Development in the oil and gas industry.

Insurance Coverage. Yankee Development is subject to all the risks inherent in
the exploration for, and development of, oil and gas, including blowouts, fires
and other casualties. The Company maintains insurance coverage as is customary
for entities of a similar size engaged in operations similar to that of Yankee
Development, but losses can occur from uninsurable risks or in amounts in
excess of existing insurance coverage. The occurrence of an event which is not
insured or not fully insured could have an adverse impact upon Yankee
Development's earnings, cash flows and financial position.

Cautionary Statement Regarding Forward-Looking Statements. In the interest of
providing the shareholders with certain information regarding Yankee
Development's future plans and operations, certain statements set forth in this
Form 10KSB relate to management's future plans and objectives. Such statements
are forward-looking statements within the meanings of Section 27A of the Secur-
ities Act of 1933, as amended, and Section 21E of the Securities Exchange Act
of 1934, as amended. Although any forward-looking statements contained in this
Form 10KSB or otherwise expressed by or on behalf of Yankee Development are,
to the knowledge and in the judgment of the officers and directors of Yankee
Development, expected to prove true and come to pass, there can be no assurances
that any of these expectations will prove correct or that any of the actions
that are planned will be taken. Forward-looking statements involve known and
unknown risks and uncertainties which may cause Yankee Development 's actual
performance and financial results in future periods to differ materially from
any projection, estimate or forecasted result. There are a number of risks and
uncertainties in the oil & gas industry.

Volatility of oil and gas prices. It is impossible to predict future oil and gas
price movements with certainty. Declines in oil and gas prices may materially
adversely affect Yankee Development 's financial condition, liquidity, ability
to finance planned capital expenditures and results of operations. Lower oil and
gas prices may also reduce the amount of oil and gas that Yankee Development can
produce economically.

Yankee Development 's revenues, profitability, future growth and ability to
borrow funds or obtain additional capital, as well as the carrying value of its
properties, could be significantly affected by and / or dependent upon
prevailing prices of oil and gas. Historically, the markets for oil and gas have
been volatile, and they are likely to continue to be volatile in the future.
Prices for oil and gas are subject to wide fluctuation in response to relatively
minor changes in the supply of and demand for oil and gas, market uncertainty
and a variety of additional factors that are beyond Yankee Development 's
control.

Competition from larger, more established oil and gas companies. Yankee
Development may encounter competition from other oil and gas companies in all
areas of its operation, including the acquisition of exploratory prospects and
proven properties. Yankee Development 's competitors include major integrated
oil and gas companies and numerous independent oil and gas companies,
individuals and drilling and income programs. Many of its competitors are large,
well-established companies with substantially larger operating staffs and
greater capital resources than Yankee Development 's and, in many instances,
have been engaged in the oil and gas business for a much longer time than Yankee
Development. Those companies may be able to pay more for exploratory prospects
and productive oil and gas properties, and may be able to define, evaluate, bid
for and purchase a greater number of properties and prospects than Yankee
Development 's financial or human resources permit. Yankee Development 's
ability to explore for oil and gas prospects and to acquire additional
properties in the future will be dependent upon its ability to conduct its
operations, to evaluate and select suitable properties and to consummate
transactions in highly competitive environments.

Risks of drilling activities. Yankee Development 's success could be materially
affected upon the success of a drilling program. Yankee Development 's future
drilling activities may not be successful and, if drilling activities are
unsuccessful, such failure will have an adverse effect on Yankee Development 's
future results of operations and financial condition. Oil and gas drilling
involves numerous risks, including the risk that no commercially productive oil
or gas reservoirs will be encountered, even if the reserves targeted are
classified as proved. The cost of drilling, completing and operating wells is
often uncertain, and drilling operations may be curtailed, delayed or canceled
as a result of a variety of factors, including unexpected drilling conditions,
pressure or irregularities in formations, equipment failures or accidents,
adverse weather conditions, compliance with governmental requirements and
shortages or delays in the availability of drilling rigs and the delivery of
equipment. Although Yankee Development has identified numerous drilling
prospects, there can be no assurance that such prospects will be drilled or that
oil or gas will be produced from any such identified prospects or any other
prospects.

Availability of capital is important to the Company's ability to grow. The
acquisition of reserves is capital intensive, and funding for the costs of
acquisition may be greater than the Company's cash flow can provide. As a
result, additional financing may be required, and the availability or terms of
any such additional financing cannot be assured. In the event sufficient capital
resources are not available to the Company, it may negatively affect Yankee
Development 's flexibility in planning for and reacting to possible acquisition
activities.

Risks relating to the acquisition of oil and gas properties. The successful
acquisition of producing properties requires an assessment of recoverable
reserves, future oil and gas prices, operating costs, potential environmental
and other liabilities and other factors. Such assessments are necessarily
inexact and their accuracy inherently uncertain. In connection with such an
assessment, Yankee Development will perform a review of the subject properties
that it believes to be generally consistent with industry practices. This
usually includes on-site inspections and the review of reports filed with
various regulatory entities. Such a review, however, will not reveal all
existing or potential problems, nor will it permit a buyer to become
sufficiently familiar with the properties to fully assess their deficiencies and
capabilities. Inspections may not always be performed on every well, and
structural and environmental problems are not necessarily observable even when
an inspection is undertaken. Even when problems are identified, the seller may
be unwilling or unable to provide effective contractual protection against all
or part of these problems. There can be no assurances that any acquisition of
property interests by Yankee Development will be successful and, if an
acquisition is unsuccessful, that the failure will not have an adverse effect on
Yankee Development 's future results of operations and financial condition.

Hazards relating to well operations and lack of insurance. The oil and gas
business involves certain hazards such as well blowouts; craterings; explosions;
uncontrollable flows of oil, gas or well fluids; fires; formations with abnormal
pressures; pollution; and releases of toxic gas or other environmental hazards
and risks, any of which could result in substantial losses to Yankee
Development. In addition, Yankee Development may be liable for environmental
damages caused by previous owners of property purchased or leased by Yankee
Development. As a result, substantial liabilities to third parties or
governmental entities may be incurred, the payment of which could reduce or
eliminate the funds available for exploration, development or acquisitions or
result in the loss of Yankee Development 's properties. While the Company
believes that it maintains all types of insurance commonly maintained in the oil
and gas industry, it does not maintain business interruption insurance. In ad-
dition, Yankee Development cannot predict with certainty the circumstances
under which an insurer might deny coverage. The occurrence of an event not fully
covered by insurance could have a materially adverse effect on Yankee Develop-
ment 's financial condition and results of operations.

Future oil and gas production depends on continually replacing and expanding
reserves. In general, the volume of production from oil and gas properties
declines as reserves are depleted, with the rate of decline depending on
reservoir characteristics. Yankee Development 's future oil and gas production
is, therefore, could be affected by and be highly dependent upon its ability to
economically find, develop or acquire additional reserves in commercial
quantities. Except to the extent Yankee Development acquires properties
containing proved reserves or conducts successful exploration and development
activities, or both, the proved reserves of Yankee Development will decline as
reserves are produced. The business of exploring for, developing or acquiring
reserves is capital-intensive. To the extent cash flow from operations is
reduced, and external reserves of capital become limited or unavailable, Yankee
Development 's ability to make the necessary capital investments to maintain or
expand its asset base of oil and gas reserves would be impaired. In addition,
there can be no assurance that Yankee Development 's future exploration,
development and acquisition activities will result in additional proved reserves
or that Yankee Development will be able to drill productive wells at acceptable
costs. Furthermore, although Yankee Development 's revenues could increase if
prevailing prices for oil and gas increase significantly, Yankee Development 's
finding and development costs could also increase.

Estimates of reserves and future cash flows are imprecise. Reservoir engineering
is a subjective process of estimating underground accumulations of oil and gas
that cannot be measured in an exact manner. Estimates of economically
recoverable oil and gas reserves and of future net cash flows necessarily depend
upon a number of variable factors and assumptions, such as historical production
from the area compared with production from other producing areas, the assumed
effects of regulations by governmental agencies, and assumptions concerning
future oil and gas prices, future operating costs, severance and excise taxes,
development costs and workover and remedial costs, all of which may in fact vary
considerably from actual results. For these reasons, estimates of the
economically recoverable quantities of oil and gas attributable to any
particular group of properties, classifications of such reserves based on risk
of recovery, and estimates of the future net cash flows expected from them
prepared by different engineers, or by the same engineers but at different
times, may vary substantially, and such reserve estimates may be subject to
downward or upward adjustment based upon such factors. In addition, the status
of the exploration and development program of any oil and gas company is
ever-changing. Consequently, reserve estimates also vary over time. Actual
production, revenues and expenditures with respect to Yankee Development 's
reserves will likely vary from estimates, and such variances may be material.

P & A REMEDIATION, LLC. (PAR TEXAS)

General. P & A Remediation, LLC, is a Texas limited liability company organized
on October 16, 1998, by the Company and Simpco, which own 99% and 1%,
respectively, of the outstanding membership interests in the company.  Prior to
the acquisition of Simpco by the Company effective as of January 15, 1999, P &
A Remediation was managed as a joint venture, with the Company contributing
working capital and personnel and Simpco contributing management expertise and
equipment. After the acquisition of Simpco, most of Simpco's management members
became full time employees of P & A Remediation. Currently, none of these indiv-
iduals are employed by PAR. Further, P & A Remediation leases the oil field
equipment used in its business operations from Simpco or unaffiliated third
parties.

PAR Texas' previous environmental remediation and salvage business involved the
plugging of oil wells and the remediation and clean-up of oil fields in accord-
ance with government rules and regulations applicable to the environment, and
the salvage or purchase for resale on the secondary market of construction ma-
terials, pipe, steel tubulars and used and reconditioned oil field equipment.
To the extent practicable, PAR Texas performed its services, including testing,
threading and reworking of steel pipe recovered from the field, at the oil
field salvage yards leased by the Company in Ballinger and Olney, Texas. Al-
though PAR Texas desires to expand its customer base to include governmental
agencies such as the State of Texas' Railroad Commission, the company's cus-
tomers are presently limited to private and publicly-held oil and/or gas com-
panies which are operators of oil wells and fields requiring PAR Texas's plug-
ging, remediation and/or salvage services. The company's operations are present-
ly suspended and limited to the north central region of Texas. From the com-
mencment of plugging business operations by PAR Texas in April 1999, through
June 30, 2000 the company's plugging activities (approximately 131 wells) had
generated gross revenues from services approximating $391,470. In addition,
aggregate gross revenues approximating $113,892 generated during the period
from the date of the company's inception in October 1998 through March 2000,
are attributable to resales by the company of used and reconditioned oil field
equipment purchased for resale.

PAR Texas employed two types of contractual arrangements, cash and salvage, in
connection with its oil well plugging and remediation operations. Contractual
arrangements are often verbal in nature and may be turnkey on specific oil wells
or leases (groups of wells). Under the salvage type of contract, the Company
receives as its compensation pipe and/or used oil well equipment mutually agreed
upon by the parties. Revenue is recognized, and the pipe and/or equipment are
included in inventory, based upon the applicable wholesale market prices of the
items or the prices at which the items are purchasable for resale on the open
market. These inventory items, whether received by PAR Texas as consideration
for the performance of plugging and/or remediation services or purchased
outright for purposes of resale, are resold to customers including, primarily,
oil and construction companies. Typical cash payment arrangements for plugging a
well involve a payment in the amount of a percentage of the total estimated cost
of the job at the time that equipment is moved on site, with final payment due
upon completion of the work and delivery of the certification document (RRC Form
W-3) required to be filed with the Texas Railroad Commission. PAR Texas has
experienced limited bad debts to date. Management attributes this to the fact
that the company policy is to, only upon the receipt of final payment, deliver
the cementing affidavits required to be filed by the operator with the Texas
regulatory authority indicating that the well was properly plugged in accordance
with applicable state regulations and specifications.  The direct gross profit
on the industry jobs presently being performed by PAR Texas is generally approx-
imately 35%. Management believes that the gross profit margin on the same job,
if performed for a government agency, could increase to 55%. If PAR Texas is
able to obtain contracts from state agencies, the Company expects that payment
would typically be received thirty days from the date of completion of the
well(s) and all contract requirements, thus requiring that the Company have
additional working capital to cover expenses before payment is received. PAR
Texas is generally required to pay suppliers and subcontractors for pipe,
equipment and other supplies and threading, refurbishing and other services
on a cash on demand, or "COD", basis. Accordingly, should PAR Texas be suc-
cessful in expanding its customer base to include government agencies, of which
there is no assurance, its working capital may not be adequate to enable the
company to continue in operation without the receipt of additional funding.

The primary government customer targeted by the Company is the State of Texas'
Oil Well Plugging and Cleanup Fund (the "Cleanup Fund"), because of the
continuously increasing number of oil wells being added to the State of Texas'
inventory of wells requiring state-funded remediation. The Cleanup Fund, which
was enacted by Texas Senate Bill 1103 in 1991, created new sources of revenue
and authorized the Railroad Commission of the State of Texas to use the funds
for the purpose of plugging abandoned or environmentally undesirable oil and gas
wells. Each Railroad Commission District Office prepares bid contracts, referred
to as extended service contracts, which typically group twenty to forty
abandoned and plug-ordered wells that are available for bid by the Company and
others. Company management believes that the abandoned and inactive wells that
are candidates for state-funded plugging number in the tens of thousands as of
the date hereof. This calculation is based upon management's belief that there
are, on average, ten oil or gas wells, known as "stripper wells," producing, on
average, less than ten barrels of oil per day, per each of 12,500 operators
registered with the Railroad Commission listed in the Commission's inventory of
wells requiring state-funded remediation. Further, wells are added continuously
at the rate of 250 per month in an order of priority based on the perceived risk
to human health and the environment. The Dallas Morning News stated that there
are "as many as 17,000 wells abandoned across the state today..." on June 6,
2000. The past few years decline in the world price of crude oil has created
severe economic hardships on many small and medium sized operators with
"stripper" production. Due to the economic position in which they have been
placed many operators voluntarily decided to shut-in or abandon their wells, or
in the alternative, to not return to production after mechanical or equipment
failure. The recent months' increase in prices has made some marginal production
now economically viable. Yet many operators lack financial resources to reopen
their wells, and still others await longer term price stability before making
decisions on reopening wells.

In addition to the well plugging and clean-up operations, PAR Texas has the
ability to serve industry in the oil well servicing business by utilizing the
pulling machine equipment that the company has at its disposal, and other
equipment that is available in the marketplace, if it has adequate working
capital and can hire the necessary crews. Additional working capital would be
required, because PAR Texas is generally required to pay suppliers for equipment
and other supplies or services on a cash on demand, or "COD", basis.
Accordingly, should PAR Texas be successful in expanding its customer base to
include the industry well serving jobs, of which there is no assurance, its
existing working capital may not be adequate to enable the Company to continue
in operation without the receipt of additional funding.

In addition to oil well plugging and clean-up operations, PAR Texas serves as a
reseller of construction equipment, steel pipe and tubulars and select used and
reconditioned oil field equipment. These items are either obtained from the
company's salvage operations or purchased outright for resale on the secondary
market. The company is planning to resume remediation work on a Conoco, Inc.,
58-mile salvage project that involves the recovery of at least 150,000 feet of
three and one-half to six inch structural pipe which the Company intends to re-
sell for construction and other applications. Management believes, without as-
surance, that the price obtainable for the recovered pipe will range from $.80
to $1.50 per foot and that P & A Remediation will incur costs of approximately
$.30 per foot to gather and remove the pipe and additional expense to straight-
en, clean and/or ready the pipe for resale.

Competition. While PAR Texas has numerous competitors conducting plugging and
pipe salvage operations in the north central and central west regions of Texas
where it presently operates and a small number of capable oil well service and
cementing businesses in various locations throughout the southwestern United
States, the environmental remediation and salvage business is highly fragmented
in general. That is, the business is characterized by a large number of
companies which specialize in only one or a few, but not all, of the individual
job service requirements. This requires an operator, at increased cost, to
retain the services of a number of companies in order to complete the job of
plugging a well. Further, management perceives many of its competitors to be
undercapitalized. Accordingly, the Company's business plan involves the
acquisition of related businesses and additional equipment and personnel so as
to be capable of performing for the customer, on a turnkey basis and at
reasonable cost, all of the individual job service requirements involved in the
plugging of a single well. Company management believes that, should PAR Texas
achieve its desired level of vertical integration, which could not be assured,
the company would have a significant competitive advantage over its competitors.
Achievement of this goal, however, depends upon the receipt by the Company of
significant additional funding required to consummate the acquisition of, and
operate, the acquired companies.

Regulation. The oil well plugging and remediation operations of the Company in
the State of Texas are subject to regulation by the Oil and Gas Division of the
Railroad Commission of the State of Texas (the "Railroad Commission"). As early
as 1899, the State of Texas has had laws requiring oil wells to be constructed
with wrought iron or steel casing and to be plugged upon abandonment for the
purpose of isolating oil and gas from fresh water formations. While the purpose
of these early laws was to protect oil and gas fields from contamination by
fresh water, the laws have been retained today for the opposite purpose, the
protection of the environment from contamination by oil, gas and their
byproducts. The Railroad Commission's Oil and Gas Division was created by
statute in 1919 to regulate oil and gas exploration and production operations in
the state's numerous oil and gas fields. In the 1960's, the Railroad Commission
undertook the plugging, using limited state funds appropriated from general
revenues, of certain wells abandoned by a Railroad Commission-registered
operator because of insolvency, negligence or otherwise. In 1983, a new
state-funded well plugging fund was established and, in 1991, additional
authority and funding was obtained by the Railroad Commission to address the
growing problem of abandoned oil fields. In 1992, the rules for plugging wells
were amended, including the enactment of more stringent requirements for moni-
toring and testing older, inactive wells having greater potential for damaging
the environment. At one time recently, the Railroad Commission's plugging fund
had a backlog of in excess of 1,800 wells requiring plugging and was engaged
in the review of seventy contaminated oil fields as candidates for state-funded
remediation. Company management believes that the abandoned and inactive wells
that are candidates for state-funded plugging number in the tens of thousands
as of the date hereof. This calculation is based upon management's belief that
there are, on average, ten oil or gas wells listed in the Railroad Commission's
inventory of wells requiring state-funded remediation per each of 12,500 oper-
ators registered with the Railroad Commission. Further, wells are added contin-
uously at the rate of 250 per month in an order of priority based on the per-
ceived risk to human health and the environment. The Dallas Morning News stated
that there are "as many as 17,000 wells abandoned across the state today..."
on June 6, 2000.

Current Activities.  Since March 2000, the Company's active well plugging
and pipe sales operations in Ballinger, Texas, have been suspended.  The Com-
pany's physical operations from its Olney, Texas, yard were suspended pending
the November - December move of equipment to PAR Oklahoma for its work on the
EPA project from its then newly contracted location in Nowata, Oklahoma. The
Olney, Texas, leased yards have been minimally maintained by contract staff
residing in Olney, Texas.  Since June 2000, the Company's well plugging and
active business operations in Oklahoma have been suspended. Both suspensions
are a result of multiple factors, including reorganization of equipment and
re-evaluation of employees; financing requirements; and the pending litiga-
tion with the former owners of Simpco and the then mid-level management of
PAR Texas. Due to the recent resolution (August 2001) pending litigation with
mid-level managment, and the logistics and financial requirements of resuming
operations in PAR Texas' business of previous years, there can be no assur-
ance as to when, or if, operations will resume.

SIMPCO, INC. (SIMPCO)

General. Simpco, a Texas corporation, was acquired by the Company in a
transaction effective as of January 15, 1999, as a result of which the Company
issued and sold a total of 850,000 newly-issued, restricted shares of Common
Stock in consideration of the exchange therefor of 100% of Simpco's outstanding
shares of common stock. Additional consideration for the acquisition was the
issuance of a promissory note for $110,000 payable to the Simpco shareholders,
and the assumption of $75,000 in Simpco or Simpco shareholders debt. Simpco was
engaged in oil and gas remediation operations prior to the effective date of its
acquisition by the Company on January 15, 1999. Since that date, Simpco has
ceased all ongoing operations except as procurement agent for state contracts
for PAR Oklahoma, and as the owner and lessor to P & A Remediation, also
wholly-owned subsidiaries of the Company, as the lessees, of the used oil field
and construction equipment, including, but not limited to, pulling machines,
trucks, trailers, bulldozers, wireline vehicles and specialty machined tools,
valued at approximately $960,000 as of the effective date on January 15, 1999,
of the Company's acquisition of Simpco.

In addition to the equipment owned by Simpco on the date of its acquisition by
the Company, Simpco leases to P & A Remediation other items of oil field and
construction equipment acquired by the Company from unaffiliated third parties
and assigned to Simpco subsequent to January 15, 1999. These items include a
double triple workover rig, a cementing system, a water truck, a bulldozer, a
wireline truck and all the specialty equipment necessary to cement oil wells,
which are leased by the Company from Mr. Rodney W. Simpson for a period of
five years through March 17, 2004, pursuant to that certain Equipment Lease
Agreement dated April 15, 1999. The lease provides for the payment of rental
in the amount of $1,093 per month through March 17, 2002, and monthly rental
payments in the amount of $818 commencing April 17, 2002, through March 17,
2004. Upon termination, or the earlier pay-off, of the lease, Simpco has the
option to purchase the equipment for the sum of $10.00.  In July of 2000, the
Company received notice from an attorney purportedly representing Rodney
Simpson, advising that Rodney Simpson considered the sale and purchase agree-
ment to be void.  Management believes that the position is without legal merit,
and intends to prosecute all remedies available to the Company vigorously.

In addition to the above-described equipment, in a separate transaction, Simpco
received from the Company other items of specialty oil field and construction
equipment that are directly related to and used in conjunction with a double
pole (single tubing) workover rig and water truck purchased by the Company from
a then-employee of a Company subsidiary, Eddie J. Gober, pursuant to the terms
of that certain Promissory Note and Bill of Sale dated March 29, 1999. The
$15,700 note provides for payments of $1,000 per month, including principal and
interest, on the anniversary date until paid in full.

In addition to the above-described equipment, in a separate transaction, Simpco
received from the Company other items of specialty oil field equipment that are
directly related to and used in conjunction with wire line truck and related
equipment purchased by the Company from an unaffiliated person, Russell Auto
Parts, pursuant to the terms of that certain Promissory Note and Bill of Sale
dated April 12, 1999. The $8,000 note provides for payments of $500 per month,
without interest, to start June 1, 1999 and thereafter monthly until paid in
full. Monthly payments were made until January 1, 2000, when the holder of the
note verbally agreed to alter the repayment terms of the original note to add
three payments onto the end of the note and forgive the payments due in January,
February, and March 2000, for and in consideration of the payment of $200 in
fees, and the addition of interest to the then $4,500 balance at 10% for the
balance of the term of the note. All other terms remained the same.  In July of
2000, the Company ascertained that the original unaffiliated seller and then
mid-level management of PAR Texas may have arranged a purported foreclosure of
the note giving possession of the vehicle to the then mid-level mangement of
PAR Texas.  Management believes that the transaction is without consideration
and potentially fraudulent, and intends to prosecute all remedies available to
the Company vigorously.

In addition to the above-described equipment, Simpco purchased a 1996 Ford F 350
Crewcab pickup truck from an unaffiliated person under an installment contract
and promissory note dated May 14, 1999, for the purchase price of approximately
$19,596. The contract requires the payment of a total of $15,775 in monthly
installments over a period of three years commencing June 25, 1999, at an
interest rate of 10% per annum.

In addition to the above-described equipment, Simpco received from the Company
by assignment a 1995 Ford F350 Supercab pickup truck and a 1996 Ford F350
Crewcab flatbed truck, each of which was purchased from an unaffiliated person
under promissory note and installment contracts. The purchase prices of the 1995
and 1996 Ford were approximately $17,995 and $19,657, respectively. The contract
for the purchase of the 1995 Ford requires the Company's payment of a total of
$15,000 in monthly installments over a period of three years commencing May 19,
1999, at an interest rate of 16.5% per annum. The contract for the purchase of
the 1996 Ford requires the Company's payment of a total of $18,300 in monthly
installments over a period of three years commencing December 16, 1999, at an
interest rate of 17.5% per annum.

In the aggregate, Simpco leases or has purchased, subject to promissory notes, a
variety of equipment and vehicles from a number of unaffiliated third parties.
The equipment and vehicle purchase notes are payable with the latest final pay-
ment due in December, 2002, bear interest between 10% and 17.5% annually, and
require aggregate monthly payments of approximately $3,200. No single equipment
lease or purchase is essential to the continuing operations of PAR; further,
equipment and vehicles of the type subject to the leases and purchase notes are
generally available in the marketplace.

In addition to the above-described equipment, in multiple and separate
transactions, Simpco has received from the Company various other items of
specialty oil field and construction equipment that are directly related to and
used in conjunction with the day to day operations of the Company and its
subsidiaries.

In August of 2000, three lawsuits were filed in Federal and state courts in
Texas and Oklahoma, with the Company opposing ther former owners of Simpco,
as well as former employees.  All three matters were resolved in a mediated
global settlement agreement in August of 2001.  The agreement called for a
return of the bulk of the assets acquired in the Simpco transaction; certain
post-Simpco acquisition acquired and improved assets; and the release of an
undetermined portion of the accounts receivable due from the State of Okla-
homa, in return for the return to treasury of the originally issued 850,000
shares of Common Stock, as well as the cancellation of $145,000 in promis-
sory notes.  A loss of $77,378 was incurred in this agreement, and reflected
 in the June 20, 2001 financial statements under the contingency provisions
of generally accpeted accounting principles.

Competition. As Simpco's only business is the leasing of equipment and vehicles
to affiliates, and as a contract procurement agent for affiliates, it is not a
revenue-producing operation of the Company, and is not subject to competition.

Regulation. As a lessor to affiliated companies only, the only regulations
applicable to Simpco are vehicle licensing and weight requirements imposed by
the states and the federal government.

Current Activities. Lease of equipment to affiliates has been suspended while
the affiliates are being reorganized and refinanced, and are recovering equip-
ment from the former owners of Simpco, under the terms of litigation settle-
ment agreements.

P & A REMEDIATION, LLC. (PAR OKLAHOMA)

General. P & A Remediation, LLC, (hereafter PAR Oklahoma) is an Oklahoma limited
liability company organized on October 31, 1999, by the Company. Field manage-
ment and support staff of Company operations in the state of Oklahoma were,
prior to July 2000, employed by PAR Oklahoma. PAR Oklahoma leased the oil field
equipment used in its business operations from the Company, Simpco, or unaffil-
iated third parties.

PAR Oklahoma's environmental remediation and salvage business involves the
plugging of oil wells and the remediation and clean-up of oil fields in
accordance with government rules and regulations applicable to the environment;
as well as the salvage or purchase for resale on the secondary market of
construction materials, pipe, steel tubulars and used and reconditioned oil
field equipment.

Working from a newly contracted (leased) location on leased railroad company
land, in December 1999, the Company, acting through Simpco, successfully bid
on and, in January 2000, was awarded the initial bid contract on the first phase
of the Oklahoma Corporation Commission's management of the clean up project on
the north shores of Oologah Lake in Rogers County, Oklahoma. For a combined
total of $72,900 the Company committed to properly plug eighty one (81) aban-
doned and purging oil wells within the confines of a forty two square mile site
that has several thousand wells to plug according to published statements by
EPA officials.  The December 1999 newly contracted and leased location in Nowata
is subject to renegotiation as the Company has not followed through on the ob-
ligations to purchase the property.  The Company has, however, continuously
maintained the closed business locations by payment of utilities.  The unaffil-
iated seller has not moved to alter the position of the Company in its position
in the contract.

Administered by the Oklahoma Corporation Commission, the United States Coast
Guard, and the Environmental Protection Agency, according to published reports
the well plugging project is the largest of its kind. To date more than eight
hundred abandoned, unplugged wells have been identified within the area targeted
by the project. Money from the Oil Spill Liability Trust Fund, a $50 million
emergency response fund, will be used to finance the project. The fund, created
by the Oil Pollution Act of 1990, is earmarked for cleaning up oil spills that
are contaminating or threatening to contaminate the nation's waterways. Based
upon EPA reports, Company management believes that the abandoned and inactive
wells that are candidates for this project number in the thousands as of the
date hereof, and that the project may have an effective life of five years and
potentially as much as $16 million in revenue available. There can be no assur-
ance that the project will continue, that the Company will win any of the con-
tracts for the project, that the Company will have the resources to complete
the work under any such contracts or that the Company, if it receives any such
contracts, will be able to complete them profitably.

PAR Oklahoma desires to expand its customer base to include private and
publicly-held oil and/or gas companies which are operators of oil wells and
fields requiring PAR Oklahoma's plugging, remediation and/or salvage services,
throughout the state of Oklahoma. The company's operations are presently sus-
pended, but by plan are limited to the northeast regions of Oklahoma. Since the
commencement of business operations by PAR Oklahoma in November, 1999, and the
award of the first phaseof the EPA project in January 2000, the company's activ-
ities have included the plugging of all eighty-one wells, and have earned the
$72,900 of the first awarded contract. After the initial EPA bid contract, the
Company was awarded other multiple well contracts with the EPA project, and
other single well contracts from the OCC on jobs that are unrelated to the EPA
cleanup project mentioned above. Due to the suspension of operations in July
2000, these state funded contracts were not completed, and the bid rights were
relinquished to be re-bid by other contractors.

PAR Oklahoma was to be paid for its services under the guidelines of the Okla-
homa Corporation Commission, the United States Coast Guard, and the Environ-
mental Protection Agency on the Oologah Lake project in Rogers County, Okla-
homa. Payment for services performed for industry in the oil well service
business was to be on a strict invoice contract basis. Company management has
the discretion on whether or not to establish credit arrangements with its oil
well service customers, but generally the company policy is to get payment upon
completion of work, thereby eliminating the possibility of credit loss.

For anticipated plugging and clean up operations with private industry, PAR
Oklahoma contemplates employing two types of contractual arrangements, cash and
salvage, in connection with its oil well plugging and remediation operations,
similar to its counterpart operating in the state of Texas.

Though the Company intends to work for industry predominantly on a cash or
payment due upon receipt invoice basis, there will arise situations that call
for other contractual agreements. These contractual arrangements are sometimes
verbal and may be turnkey on specific oil wells or leases (groups of wells).
Under the salvage type of contract, the Company receives as its compensation
pipe and/or used oil well equipment mutually agreed upon by the parties. Revenue
is recognized, and the pipe and/or equipment are included in inventory, based
upon the applicable wholesale market prices of the items or the prices at which
the items are purchasable for resale on the open market. These inventory items,
whether received by PAR Oklahoma as consideration for the performance of
plugging and/or remediation services, or purchased outright for purposes of
resale, are resold to customers including, primarily, oil and construction
companies. Typical cash payment arrangements for plugging a well involve a pay-
ment in the amount of a percentage of the total estimated cost of the job at
the time that equipment is moved on site, with final payment due upon comple-
tion of the work and delivery of the certification document (OCC Form 1003)
required to be filed with the Oklahoma Corporation Commission. PAR Oklahoma
has experienced limited bad debts to date because its sole business activity
has been working with the OCC on a government funded project. The Company has
a strategy to minimize any bad debt exposure in its operations in Oklahoma.
Only upon the receipt of final payment, does the Company deliver the cementing
affidavits required to be filed by the operator with the Oklahoma regulatory
authority indicating that the well was roperly plugged in accordance with ap-
plicable state regulations and specifications.

The geographic area typical of north east Oklahoma and southeast Kansas has a
market of abandoned oil wells different (though in principle the same) from
those that PAR Texas has encountered. Many of the wells drilled in this part of
the United States were drilled with the technology of, and in the era of, the
`oil boom' of the late 19th century. The producing horizon that is predominant
in the area, and the horizon specifically encountered on the project mentioned,
is significantly shallower that their counterparts in PAR Texas. Due to this
profound difference, the kinds of equipment used in the region varies
significantly from the Company's Texas operations. Much of the industry
equipment that is not sufficiently heavy enough to work in the regions of Texas
that PAR Texas works in, will work in the operations of Par Oklahoma. Due to
this, and other factors, the direct gross profit on the industry jobs presently
being performed by PAR Oklahoma, is generally approximately 55%. The gross
profit margin on the same job, management believes, with no assurances, if
performed for a government agency, could increase due to the volume of wells
typically put into a bid package or the `emergency' time frame involved.

The negative facet of working for government is the cash flow from operations.
Payment would typically be received thirty days from the date of completion of
the well(s), all contract requirements, and invoicing, thus requiring additional
working capital to cover expenses before payment is received. PAR Oklahoma is
generally required to pay suppliers and subcontractors for pipe, equipment and
other supplies and threading, refurbishing and other services on a cash on
demand, or "COD", basis. Accordingly, should PAR Oklahoma be successful in
expanding its customer base to include government agencies, of which there is no
assurance, its working capital may not be adequate to enable the company to
continue in operation without the receipt of additional funding.

For the specific EPA project on the northern shores of Lake Oologah in Rogers
County, Oklahoma, the Corporation Commission District Office prepares bid
contracts, referred to as an `Invitation to Bid', which typically has grouped
forty to one hundred abandoned and plug-ordered wells in an `Invitation to Bid',
that is available for bid by the Company and others.

In the normal day to day operations of the office, the Corporation Commission
District Office also prepares bid contracts for single wells (or small packages
of wells) that are plug-ordered, or `emergency' wells that are available for bid
by the Company and others. With the Company operating in the area, on similar
jobs within the project, PAR Oklahoma has the capability to expand its market
with only marginal increases in operating costs if the Company had the working
capital to acquire more equipment for state 'emergency' well jobs. Additional
working capital would also be required to fund expanded operations, because PAR
Oklahoma is generally required to pay suppliers and subcontractors for equip-
ment, other supplies and services on a cash on demand, or "COD", basis. Accord-
ngly, should PAR Oklahoma be successful in expanding its customer base to in-
lude the 'emergency' well jobs of government agencies, of which there is no
assurance, its existing working capital may not be adequate to enable the Com-
any to continue in operation without the receipt of additional funding.

In addition to the well plugging and clean-up operations, PAR Oklahoma has the
ability to serve industry in the oil well servicing business by utilizing the
pulling machine equipment that the company has at its disposal, and other
equipment that is available in the marketplace, if it has adequate working
capital and can hire the necessary crews. Additional working capital would be
required, because PAR Oklahoma is generally required to pay suppliers for
equipment and other supplies or services on a cash on demand, or "COD", basis.
Accordingly, should PAR Oklahoma be successful in expanding its customer base to
include the industry well jobs, of which there is no assurance, its existing
working capital may not be adequate to enable the Company to continue in
operation without the receipt of additional funding.

In addition to oil well plugging and clean-up operations, PAR Oklahoma serves as
a reseller of construction equipment, steel pipe and tubulars and select used
and reconditioned oil field equipment. These items are either obtained from the
Company's parallel salvage operations or purchased outright for resale on the
secondary market.

The re-negotiated purchase of a location from which PAR Oklahoma operated in
2000 afford an opportunity to supplement purchased operations by the Company
in Texas, and give the Company the capability to increase the market price of
steel tubulars it handles by threading and testing its inventory before resale.
In March of 1999, the Company purchased the physical assets of Jeffries Pipe &
Supply in north central Texas. The assets were comprised of steel testing and
threading equipment, the facility being one of three facilities available to
the open industry market in southern Oklahoma and central and west Texas. The
Company chose to dismantle the assets and move them to the Ballinger, Texas,
yard location. The Nowata leased yard location has a fully equipped and
functionally similar, though smaller, pipe threading facility. Use of this
facility, along with the establishment of operations of the previously ac-
quired equipment, will allow PAR Oklahoma and PAR Texas to work together in
the marketing of steel tubulars that are acquired by the Company in its sal-
vage operations.

The Company will require additional investment and working capital to expand
into this facet of its operations. PAR Oklahoma and PAR Texas are generally
required to pay suppliers and subcontractors for pipe, equipment and other
supplies and threading, refurbishing and other services on a cash on demand, or
"COD", basis. Accordingly, should the Company be successful in expanding its
customer base to include government agencies, of which there is no assurance,
its working capital may not be adequate to enable the company to continue in
operation without the receipt of additional funding.

Competition. While PAR Oklahoma has numerous competitors conducting plugging and
pipe salvage operations in the north east regions of Oklahoma and south west
Kansas, where it presently competes, and a small number of very capable oil well
service and cementing businesses in various locations throughout the
southwestern United States, the environmental remediation and salvage business
is highly fragmented in general. That is, the business is characterized by a
large number of companies which specialize in only one or a few, but not all, of
the individual job service requirements; thus requiring an operator, at
increased cost, to retain the services of a number of companies in order to
complete the job of plugging a well. Further, management perceives many of its
competitors to be undercapitalized. Accordingly, PAR Oklahoma's business plan
involves the acquisition of related businesses and additional equipment and
personnel so as to be capable of performing for the customer, on a turnkey basis
and at reasonable cost, all of the individual job service requirements involved
in the plugging of a single well. Company management believes that, should PAR
Oklahoma achieve its desired level of vertical integration, which could not be
assured, the company would have a significant competitive advantage over its
competitors. Achievement of this goal, however, depends upon the receipt by the
Company of significant additional funding required to consummate the acquisition
of, and operate, the acquired companies.

Regulation. The oversight of oil well drilling, production, and plugging/
remediation operations in the state of Oklahoma is a division of the Oklahoma
Corporation Commission (the "OCC"). The Oil & Gas Conservation Commission has
the mission statement `... to balance the rights of all parties, assist the
domestic oil and gas industry, protect and preserve the environment, conserve
the natural resources, and enforce the applicable rules and statutes of our
state with the highest degree of honesty and integrity for the people we serve.'
Like other states, in the late 19th century, the south west United States `oil
boom' required oversight. Created by statute, the OCC was created to regulate
oil and gas exploration and production operations in the state's numerous oil
and gas fields. The Company is also subject to federal jurisdiction when
operating within the confines of federal or Indian lands.

Current Activities. Collection of the Company's receivable for the EPA contract
has been modified by settlement of a lawsuit filed in the state of Oklahoma by
former employees and associates of the Company.  The Company has suspended bid-
ding on additional contracts, pending reorganization and refinancing, as well
as the completion of the litigation.

Since July 2000, the Company's active well plugging and pipe sales operations
in Nowata, Oklahoma, have been suspended. Since March 2000, the Company's well
plugging operations in Texas have been suspended. Both suspensions are a result
of multiple factors, including reorganization of equipment and re-evaluation of
employees; financing requirements; and the pending litigation with the former
owners of Simpco and the then mid-level management of PAR Texas. Due to the re-
cent resolution (August 2001) of pending litigation with mid-level management,
and the logistics and financial requirements of resuming operations in PAR
Oklahoma's business of previous years, there can be no assurance as to when,
or if, operations will resume.

CYBER CITIES TECHNOLOGIES, INC. (CCTECH)

General. Cyber Cities Technologies, Inc. (hereafter CCTECH), is a Hawaii
corporation organized on December 30, 1999, by the Company, to operate the
internet service assets in Hawaii that the Company acquired as of January 1,
2000, from Cyber City Honolulu, Inc (hereafter CCHONO).

CCTECH is engaged in the service of an existing client base in the Hawaii
regional internet service market. This client base of about 2,500 consists of
approximately (a) 80% conventional residential dial up access accounts, (b)
approximately 10% business access accounts, and (c) approximately 10%
Asynchronous Data Subscriber Line (ADSL) access. CCTECH solicits resellers
of its services to the resellers' client base, which represents approximately
15% of the conventional dial up access customers. Prior to the consummation
of the asset acquisition, CCHONO had been in business for three years in the
Honolulu market and for one year in the Wailuku market on the island of Maui.
Gross revenue for CCHONO for 1999 was approximately $ 425,000. Gross revenue
since its acquisition on January 1, 2000, through June 30, 2001, was $664,737.
CCHONO's limited capitalization and cash / banking position has not allowed
it to take advantage of the increase in its market to fulfill the needed
growth in the operation of the company.

CCTECH uses major Internet Access wholesalers, Verizon, Inc. (formerly GTE
Hawaiian Telphone, Inc.), Genuity, Inc., and AT&T Internet Access. It employs
access equipment, leased to ensure the latest technology available to the con-
sumer, to allow the client's computer to call for access on a local exchange.
This equipment, originally leased from Ascend Communications, is presently
possessed and used by the Company under currently questioned and re-negotiated
terms of the original leases that have been paid to term (or equivalent) by the
Company.  This equipment currently is state of the art and requires limited
upgrading to service its regional market at this time. The growth pattern of
this market is such that CCTECH is now capable of serving regional growth with
negligible growth of expenses, through the substitution of new equipment leases
in place of matured leases, resulting in increased profit. However, should
CCTECH be successful in expanding its customer base significantly, of which
there is no assurance, without sufficient equipment capacity upgrades, its
working capital may not be adequate to enable the company to continue in oper-
ation without the receipt of additional funding. CCTECH distributes licensed
software, from both Microsoft and Netscape, customized to provide the user
with the easiest possible installation of the system settings.

CCTECH offers computer consulting services to home and business network
customers. These services represent a significant growth area for this business,
as the traditional business client represents only approximately 10% of CCTECH's
revenue. These services are provided to advise the client on the type of network
to be developed, necessary security measures, type of equipment to be used, and,
if necessary, to build the desired network for the customer. Internet web based
work is performed in two ways. The first is the traditional small web page
product which is performed in-house, and the second is the larger project
requiring specialty work, such as e-commerce or extensive graphics work, which
CCTECH sub-contracts to professional designers. One area of growing interest is
the creation of Virtual Private Networking (VPN), which is one mechanism that
allows a company to have telecommuting employees. This is done through the use
of a provider, such as Cyber Cities Technologies, Inc., and ideally access such
as Asynchronous Data Subscriber Line (ADSL), and the recommended network
equipment on the client's site. Management believes that this type of access is
the only platform currently available at commercially reasonable prices that
allow the security necessary to meet the client's security needs.

CCTECH offers both residential and business consumers an access connection
referred to as Asynchronous Data Subscriber Line (ADSL). This type of access
does not require the client computer or network to "Dial-up" the access net-
work, but provides a continuous connection through the current phone line.
This type of access has two major benefits to CCTECH's client base: one is the
need for only one phone line, and the other is the high speed of the connection.
This type of networking represents approximately 10% of the corporation's rev-
enue and grew to this point in less than 7 months following the introduction
of the product by Verizon.  Verizon and other market forces are in the process
of upgrading the remaining areas of the State of Hawaii to enable consumers to
choose this alternative network connection. Most subscribers find that the
convenience of continued use of the lone phone line while using their computer
on the Internet has proven its worth. This is additionally an ideal solution
for many of the businesses in Honolulu, where building infrastructure does not
support the addition of any more phone lines. This solution, teamed with an
aggressive Internet Service Provider, has enabled several businesses to free
two or three of their existing phone lines that have been recently used for
Internet Access. This area also represents a large target area for growth.

Competition. While CCTECH has numerous competitors in its region of operations,
it has several market advantages. With the pricing of its services, CCTECH's
predecessor had a historical growth pattern in excess of its competition.
According to published company information, since the beginning of Cyber City
Honolulu, Inc. in 1996, there have been nine regional competitors created. None
are in existence today. CCTECH's primary and largest competitor has been in the
market for over twice the period and has begun expanding to the other islands
during its latest fiscal year. While the primary regional competitors continue
to experience moderate growth in the Hawaii market, few have experienced the
historical growth of this operation. The single largest competitor in the market
to the dial up regional Internet Service Provider is the cable modem system in
use in Honolulu, by Oceanic Cable, a subsidiary of AOL Time Warner, Inc. With
availability limited to certain service areas, cost is a factor affecting cable
services. With cost and required reliability comparable to the capabilities of
the telephone system, consumer loyalty is dependent on reliability as well as
speed.  The only present solution for the required security is the Asynchronous
Data Subscriber Line (ADSL) connection discussed earlier.

Industry Regulation and Changes. While to date there has been no regulation of
content or commerce utilizing the Internet, there are several potential changes
that the industry may potentially feel. There are a number of Internet Service
Providers (ISP's) that are engaged in the profitable area of Long Distance
Telephony, which is presently not regulated in any fashion. While there have
been several attempts to classify these ISP's as Long Distance Carriers and
Surcharge their services as are the Long Distance Phone Carriers, none have been
successful at introducing any type of taxation to date. Additionally, currently
there is no Federal or local taxation of the commerce conducted over the
Internet.

EMPLOYEES AND CONSULTANTS

Mr. Bryan L. Walker, the President, Chief Executive Officer and Chairman of the
Board of Directors of the Company is also the President and a director of Yankee
Development and Simpco; a vice president and director of Cyber Cities
Technologies, and a manager of P & A Remediation, both the Texas & Oklahoma
entities. He has approximately fifteen years of experience since 1984 as a con-
sultant to various independent oil companies and travel consulting firms /
agencies in the State of Texas.

Mr. Richard C. Smith, the Treasurer, Chief Financial Officer and Member of the
Board of Directors of the Company, is also the Treasurer and director of Yankee
Development; the Secretary/Treasurer and director of Simpco; and the Chief
Financial Officer, Secretary/Treasurer of Cyber Cities Technologies; and a
manager of P&A Remediation, both the Texas & Oklahoma entities. He has
approximately thirty years in public accounting and has been the Comptroller
of several independent companies in the State of Texas.

Mr. Michael L. Bacon, a Vice President and Member of the Board of Directors of
the Company, serves as a Director and CEO and President of CCTECH. Mr. Bacon
previously served as the Chairman of the Board of Directors and CEO of Cyber
City Honolulu, Inc. from November 1996 until selected assets were acquired by
Basic Technologies, Inc. Enlisting in May of 1980 and based in Honolulu, Mr.
Bacon served the United States Navy as Assistant Engineer on various nuclear
powered naval vessels from May 1980 until retirement May of 2000.

Mr. Derek T. Smith, the Secretary and Member of the Board of Directors of the
Company, is employed by Epylon Corporation as a Senior Manager.  From 1996
through 2000, he was employed as a princial consultant by a division of Comp-
uter Sciences Corporation, a public company located in El Segundo, California.
From August 1994 through July 1996, he was employed as a senior consultant by
Hogan Systems, Inc., a publicly-held consulting company with offices in Dallas,
Texas, that was acquired by Computer Sciences Corporation in August 1996.  Mr.
Smith was employed, from January through July 1994, by the U.S. Small Business
Administration as a senior loan officer, disaster relief. From October 1988
through May 1992, he was employed in the position of market cost analyst by
Electronic Data Systems, Dallas, Texas.

Mrs. Laura N. Walker, a Member of the Board of Directors of the Company, is also
the Secretary of Yankee Development, and has approximately fifteen years of
experience in the retail travel agency and travel consulting business. For the
past twelve years, Ms. Walker has been a solo destination travel consultant
dealing exclusively with destinations within the islands of the State of Hawaii
since 1988.

As of the date hereof, the Company has six full-time employees and eleven
part-time employees. Of the full time employees, six are engaged in
administration. Of part-time employees, eight are engaged in operations and
three are clerical in nature. Of said employees, executive positions, including
Messrs. Bryan L. Walker and Richard C. Smith have been employed by the Company
without cash compensation through the date hereof, except for Michael L. Bacon.
See "Executive Compensation" below for a description of the equity ownership
interests in the Company of all of its executive officers and directors,
including Messrs. Walker and Richard C. Smith. None of the Company's employees
are represented by a labor union. The Company has never had a strike or lockout
and considers its employee relations to be good.

(c) REPORTS TO SECURITY HOLDERS

General.  The Company has not scheduled its annual meeting of shareholders as
of the writing of this document, pending the receipt of the audit report of its
fiscal year ending June 30, 2001.

The Company delivered its fiscal year 2000 annual report to holder of its common
stock as part of its notice of the annual meeting of security holders held on
July 11, 2000. The Company voluntarily sends an annual report, complete with
audited financial statements to all interested parties in the Company.

Commencing with the filing of Form 10SB on June 12, 2000, the Company has made
periodic filings with the Securities and Exchange Commission as required by the
commission's regulations. The public may read and copy any materials filed by
the Company at the Commission's Public Reference Room at 450 Fifth Street, NW,
Washington, DC 20549. The public may obtain information on the operation of the
Public Reference Room by calling the Commission at 1-800-SEC-0330. The
Commission also maintains an Internet site that contains reports, proxy and
information statements and other information regarding issuers that file
electronically, such as the Company, at http://www.sec.gov. The Company also
maintains current information at its website, http://www.basictech.com and its
related links.

ITEM 2. DESCRIPTION OF PROPERTY.

Oil Development Projects and Acquisitions - Company Reserves, Production and
Discussion. The following discussion of the Company's properties and potential
capital projects contains forward-looking statements that are based on current
expectations, estimates and projections about the oil and gas industry,
management's beliefs and assumptions made by management. Words such as
"projects," "believes," "expects," "anticipates," "estimates," "plans," "could,"
variations of such words and similar expressions are intended to identify such
forward-looking statements. Please refer to the section entitled "Cautionary
Statement Regarding Forward-Looking Statements" under Items I. & 2. for a
discussion of factors which could affect the outcome of the forward-looking
statements.

Oil Reserves. The Company owns a working interest in proven, developed oil
reserves on approximately 2,300 acres in western Texas known as the Yankee
(Canyon Sand) Field Unit, MA., RRC No. 03215, of Tom Green County, Texas, as set
forth in that certain Unit Agreement as recorded in Volume 405, Page 609 of the
Deed Records of Tom Green County, Texas. The acquisition cost of $3,711,000
assigned to the reserves at the time of their acquisition in April 1998
represents the discounted net present value of net revenues, and was calculated
based upon the then market price of $15.00 per each of 880,000 recoverable
barrels of oil, less development and operating costs, discounted at a rate of
10%.

Future Plans. With a continuation of the current world market and pricing for
crude oil, the Company plans to initiate a plan to raise sufficient capital to
properly drill and complete the required number of wells to prove or disprove
the Company's field's reserve study. This could possibly mean the drilling of up
to twenty (20) wells, at a total cost of up to $1,300,000. The results of
drilling such wells can never be determined in advance. The industry has a
history of unprofitable efforts resulting from dry holes, or commercial wells
which fail to produce in quantities sufficient to provide an economic return.
Yankee Development, since inception, has generated no revenues from the
production of oil. No assurance can be given that Yankee Development will
generate any revenues or achieve profitability from the production of the
proven, developed reserves owned as of the date hereof or from oil and/or gas
properties, if any, acquired in the future.

Average Sales Prices and Production Costs. The Company has not produced its sole
producing property long enough to establish average costs against its
approximate income of $4,600 during the fiscal year.

i)   the average sales price (including transfers) per unit of oil produced and
     of gas produced was $25.50;

ii)  the average production cost (lifting cost) per unit of production is not
     ascertainable.

Productive Oil and Gas Wells. The following table summarizes the productive oil
and gas wells as of June 30, 2001 attributable to the Company's direct
interests. Productive wells are producing wells and wells capable of production.

Productive Wells - Grace Bell Lease, Archer County, Texas

                    Oil                     2
                    Gas                     0

Oil and Gas Acreage - Proved Reserve Quantities. The following sets forth the
undeveloped and Proven Developed Oil Reserves leasehold held directly by the
Company as of June 30, 2001. Proved Developed Oil Reserves is acreage offsetting
acreage which is spaced or assignable to productive wells within a known
productive strata supported by geological and production analysis and /or study.
This undeveloped acreage is acreage on which wells have not been drilled or
completed to a point that would permit the production of commercial quantities
of oil and gas.

a. Proven Developed Oil Reserves acreage 1120 acres
Yankee Unit, Tom Green County, Texas 2358 acres total

b. Proven Developed Oil Reserves acreage 4 acres
Grace Bell Lease, Archer County, Texas 8 acres total

Drilling Activity. The Company has not had drilling activity on its owned
properties.

Present Activity and Commitments. The Company is presently producing only the
Grace Bell Lease, and has no delivery or drilling commitments.

Locations. During portions of the most recent fiscal year, the Company has had
six locations, including (i) its leased executive offices located at 1026 West
Main Street, #104, Lewisville, Texas 75067; (ii) a five-acre tract of land lo-
cated in Young County, Texas, on which a metal building is situated; (iii) for
a portion of the year, a leased building situated on three and one half acres
in the City of Olney, Texas; (iv) a leasehold facility under lease and purchase
contract, including three buildings and a pipe threading and testing facility
on leased railroad land in the City of Nowata, Oklahoma; (v) a leased office
location of approximately fifteen hundred (1,500) square feet, located upstairs
in an industrial building at 2628 Ualena Street, Suite C, Honolulu, Hawaii
96819; and (vi) a leased office location of approximately eight hundred (800)
square feet, located downstairs with retail front in an industrial building at
355 Hukilike Street, Suite 103, Kahului, Maui, Hawaii 96732. The Olney facil-
ities that has been evacuated was used by PAR Texas for storage in its oil well
plugging, remediation and salvage operations. The Nowata facilities were used
by PAR Oklahoma for storage in its oil well plugging, remediation and salvage
operations.  The Honolulu and Kahului, Maui, facilities are presently used by
CCTECH for its internet service provider and computer consulting operations.
The Company anticipates that these facilities will be adequate for its fore-
seeable future needs.

The executive offices of the Company are comprised of approximately 450 square
feet of space in the DFW Metroplex located in Lewisville, Texas, approximately
ten miles north of the Dallas/Fort Worth International Airport. The space has
been rented from an affiliate of the Company on a month-to-month basis at the
rate of $450 per month since July 1, 1999.

The Company owns a tract of land containing five acres located within the Texas
Emigration and Land Company Survey No. 178, Abstract No. 425, in Young County,
Texas, immediately north of State Highway No. 79. A fenced-in, metal building,
comprised of approximately 1,600 square feet in sound structural and functional
condition, is situated on the property. The acreage and facility were purchased
by the Company from a non-affiliate on March 19, 1999, for a total purchase
price of $12,500. The property is subject to that certain Promissory Note
Secured by Deed of Trust dated March 19, 1999, in the principal amount of
$11,500, payable in installments of approximately $245 per month commencing on
May 1, 1999, and terminating on April 1, 2004. The note bears interest at the
rate of 10% per annum. P & A Remediation presently uses the land and building
for storing equipment.

For a portion of the year, the Company leased a house and lots on approximately
five and one-half acres located at 505 Knox Street, Olney, Texas, which it used
as an oilfield salvage yard. The yard was originally leased from a non-affiliate
for a period of one year through November 30, 1999, at an annual rent of $6,600
payable in monthly installment of $550 each. The lease was renewable for a per-
iod of one year; at the expiration of which year the Company had the option to
purchase the property.  When the agreement came to term in November 2000, man-
agement decided to vacate the property.  Management believes that the terms of
use were comparable to those available for the lease of comparable facilities
in the surrounding Olney area.

On a short term lease, the Company leases an office building and shop facility
on approximately three and one-half acres located at 480 South Highway 79,
Olney, Texas, which it used as a base of operations from July 1999 up to January
2000, when the facility was closed pending the establishment of full scale
operations in the Company's Nowata, Oklahoma, yard. The yard is leased from a
non-affiliate for the consideration of general maintenance and improvement of
the leasehold estate and premises. The agreement is renewable for an
undetermined period of time. The Company has received a verbal agreement and
option to purchase the property, for $60,000 USD. The Company intends to renew
and maintain the lease on the Olney yard for the period provided. Management
believes that the terms for renewal are significantly below market to those
available for the lease of comparable facilities in the surrounding Olney area.

The Company had negotiated the purchase of the leasehold estate which includes
two buildings and a pipe threading and testing facility, located on leased
railroad land within the City of Nowata, Oklahoma. The former pipe dealer and
supply store located at 208 East Modoc, Nowata, Oklahoma 74048, was under con-
tract to be acquired by the Company under an asset purchase agreement for a
total of $62,500.

The Company leases office space of approximately fifteen hundred (1,500) square
feet, located upstairs in an industrial building at 2628 Ualena Street, Suite C,
Honolulu, Hawaii 96819. The space is leased from a non-affiliate for a period of
five years from January 1997 through December 31, 2001, at an annual rent of
$15,600 payable in monthly installment of $1,300 each.  The lease does not have
renewal provisions in the agreement, but the Lessor has indicated its willing-
ness to renew at market rates and terms. Management believes that the terms of
the lease and subsequent renewal are comparable to those available for the lease
of comparable facilities in the surrounding Honolulu area.

The Company leases retail front office space of approximately eight hundred
(800) square feet, located downstairs with retail front in an industrial
building at 355 Hukilike, Suite 103, Kahului, Maui, Hawaii 96732. The space is
leased from a non-affiliate for a period of five years from May 1998 through
April 30, 2003, at a floating (based on CAM) annual rent of $12,000 payable in
monthly installment of $1,000 each. The lease does not have renewal provisions
in the agreement, but the Lessor has indicated its willingness to renew at
market rates and terms. Management believes that the terms of the lease and
subsequent renewal are comparable to those available for the lease of comparable
facilities in the surrounding Honolulu area.

The Company's current investment policy with respect to real estate is to
purchase in fee simple 100% of the interest in a particular real property that
is expected to be useful to the Company as a site on which to conduct business
operations. Accordingly, the Company's primary purpose for investing in real
estate is not the realization of capital gain or income, although it is possible
that such benefits may be realized. There are no limitations on the percentage
of assets which may be invested in any one investment, or type of investment,
and such policy may be changed without a vote of the Company's shareholders.

ITEM 3 LEGAL PROCEEDINGS.

Company management does not know of any legal proceedings to which the Company
or its subsidiaries are parties or to which the property of any of such
companies is the subject which are pending, threatened or contemplated, or of
any unsatisfied judgments against the Company or its subsidiaries except as
described heretofore in this filing or in annual or quarterly filings.

PAR Texas with current trade accounts payable of $105,000, is involved in some
disputes on open accounts, some of which have resulted in suits on sworn account
being filed in three counties in the State of Texas.  Each of the matters is
either being negotiated for a settlement or has been taken to judgment in favor
of the Plaintiff as of the date hereof. The disputed account balances total
less than $45,000 and management does not believe the disputes are likely to
have a material adverse effect on the Company's financial condition. The Company
has accrued what it believes to be amounts sufficient to properly reflect its
maximum liabilities.

In August of 2000, three lawsuits were filed in Federal and state courts in
Texas and Oklahoma, with the Company opposing ther former owners of Simpco, as
well as former employees.  All three matters were resolved in a mediated global
settlement agreement in August of 2001.  The agreement called for a return of
the bulk of the assets acquired in the Simpco transaction; certain post-Simpco
acquisition acquired and improved assets; and the release of an undetermined
portion of the accounts receivable due from the State of Oklahoma, in return
for the return to treasury of the originally issued 850,000 shares of Common
Stock, as well as the cancellation of $145,000 in promissory notes.  A loss
of $77,378 was incurred in this agreement, and reflected in the June 20, 2001
financial statements under the contingency provisions of generally accepted
accounting principles.

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

Other than the annual meeting of shareholders, held on July 11, 2000, there
was no matter submitted during the fiscal year, covered by this report, or
the most recent quarter, to a vote of the security holders, through solicita-
tions of proxies or otherwise.

The Annual Meeting of Shareholders of Basic Technologies, Inc., (the "Company")
was held at the Hampton Inn, 885 South Stemmons Freeway, Lewisville, Texas, on
Tuesday July 11, 2000, at 9:00 A. M., CDT, for the following purposes :

     (1)  the election of directors;

     (2)  transacting such other business as may properly come before such
          meeting.

May 31, 2000 had been fixed as the date of record for determining shareholders
entitled to receive notice of and to vote at the Annual Meeting.

The annual report submitted with the notice of the meeting consisted of the
following :

"On June 12, of this year, the Company filed its registration statement under
the provisions of the Securities Exchange Act of 1934. The Registration
Statement on Form 10-SB filed with the United States Securities & Exchange
Commission with its related exhibits; independent auditors report for year
ending 30June99; and financial statements for the most recent nine (9) months
ending 31March00 of the Company, is available for public viewing in the Edgar
Archives of the Securities & Exchange Commission (at http://www.sec.gov) .

Since the Company is now in the internet industry, and businesses in general are
moving into the electronic age, the Directors have determined that it would be
appropriate for this year's annual report to be presented in this format. Should
you not have access to the internet, the Company will be pleased to provide you
with a copy of the annual reports, upon written request.

All operational data on the company and its subsidiaries, including financial
statements, and filings with the Securities & Exchange Commission, is available
at the Company's web page at http://www.basictech.com on the internet."

o See Form 10SB Registration Statement filed June 12, 2000.

                                     PART II

ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

     (a) Market Information. The Company's common stock was listed for active
trading on the NASD Over the Counter Bulleting Board on April 26, 2001.  Prior
to such, there has been no established public trading market for the Common
Stock since the Company's inception on January 21, 1998.

     (b) Holders. As of June 30, 2001, the Company had approximately 170 share-
holders of record of its 7,855,555 issued and outstanding shares of Common
Stock, $.00001 par value per share.

     (c) Dividends. The Company has never paid or declared any dividends on its
Common Stock and does not anticipate paying cash dividends in the foreseeable
future.


ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF PLAN AND RESULTS OF OPERATIONS.

The following discussion and analysis should be read in conjunction with the
financial statements and related notes included elsewhere in this Form 10KSB.
This discussion contains forward-looking statements based on current
expectations, which involve risks and uncertainties. Actual results and the
timing of certain events could differ materially from the forward-looking
statements as a result of a number of factors, including those referred to in
Factors Affecting Future Operating Results.

Overview. The Company was founded in January 1998. Since then, by business
combinations, we have established a presence in two diverse industries. In the
environmental remediation and cleanup (oil well and field hazardous sites)
industry, we entered by acquiring the assets and operations of a private
company, and subsequently created two operating subsidiaries to take advantage
of business and market opportunities. The retention as full-time employees of
key management of the private company was pivotal to the natural development of
the business' growth. The Company recently entered the internet and computer
consulting business with the acquisition of a growing internet service provider
(in Honolulu), which has a blended consumer dialup and business customer base.

The retention of the previous owners (and family) of Simpco, though pivotal to
an introduction to the industry, proved to be an overall negative effect on the
development of the Company's equity.  Being key personnel in the building and
devopment of the potential market for PAR Texas and PAR Oklahoma, the previous
owners (and family) of Simpco proved to be inefficient business and cost mana-
gers evidenced by the cost over-runs and income short-falls demonstrated with
the mid-level management's domain.  However, during their tenure with the Com-
pany, equipment was accumulated and a market was more clearly identified.  The
Company was put in the market position to move forward profitably, assuming
adequate financing is secured to handle day to day operations and maintenance,
and there is an ability to carry accounts receivable of government contracts
that are normal and ordinary in the specific geographic markets that the Com-
pany operates.

With adequate equipment and working capital financing, we are poised to become a
significant provider of oilfield environmental remediation and cleanup services
in the states of Texas and Oklahoma. With proper planning and financial backing,
our internet presence can expand in hosting domain-based Web sites, and become a
significant provider of high speed connectivity and enhanced services in the
State of Hawaii. Expanding from this market focus (basic internet and high speed
service) applications, such as electronic commerce and virtual private networks
based on Internet communications links, could be brought to smaller population
centers, and to small and medium sized businesses on the mainland US and Pacific
Rim.  As of June 30, 2001, on Oahu and Maui, the Company served approximately
2,500 customer accounts, including hosted Web sites and resellers.

From the time of our inception, the Company has raised limited amounts of
capital through the private placement and negotiation of short and intermediate
term promissory notes, relying  heavily on the monetary backing of key manage-
ment and control persons. Since its organizational funding of $27,250, through
private placements the Company has sold $44,500 in common stock. The Company's
three major acquisitions, and the bulk of the Company's assets, have been ac-
quired by the issuance of restricted common stock. The remainder of its asset
acquisition has been funded through seller financing and cash expenditures. The
Company has used income from operations and loan proceeds from short term and
stockholder notes to expand to its position today. We expect to use the proceeds
of sales of debt and equity securities, through both public and private offer-
ings, to further our strategic acquisition and investment strategy, and to fund
our operations in all industries in which the Company operates.

Plan and Results of Operation. The Company serves as a holding company for three
wholly-owned corporate subsidiaries, Yankee Development, Simpco, and Cyber
Cities Technologies, and two limited liability companies, PAR Texas and PAR
Oklahoma (hereafter collectively "P & A Remediation"). Yankee Development owns a
working interest in proven, developed oil reserves on 2,300 acres in Tom Green
County, Texas. Through P & A Remediation, the Company performs environmental
remediation and salvage operations for the oil industry, and markets and sells
construction materials, pipe, steel tubulars and used oil field equipment
obtained from salvage operations or acquired for resale on the secondary market.
Simpco owns certain reconditioned oil field equipment and vehicles that are
leased to P & A Remediation for use in conducting oil field plugging,
remediation and salvage activities. Cyber Cities Technologies provides high
speed internet access for residential and business customers in Hawaii.

For the period from inception (January 21, 1998) through June 30, 2001, the
Company had approximately $1,256,000 in total revenues and $795,000 in gross
profit on sales, and net operating expenses aggregating $1,714,000. As a result,
the Company had a net loss in the amount of $(919,000), ($.16) per share
attributable to common stockholders.

The Company proposes to increase its oil well plugging, remediation and salvage
business in its two geographic regions of operation in north Texas (Olney,
Texas, RRC District 09)and northeast Oklahoma (Lake Oologah EPA Cleanup Pro-
ject), and expand such operations to the States of Kansas and New Mexico.

In March 2000, the Company's well plugging and pipe sales operations in Texas
were suspended.  In July 2000, the Company's well plugging operations in Okla-
homa were suspended.  Both suspensions are a result of multiple factors, in-
cluding reorganization of equipment and employees, and financing requirements.
There can be no assurance as to when, or if, operations will resume.

Management does not foresee Yankee Development's conducting additional
development operations on its existing properties or exploring for oil and gas
elsewhere, until sufficient capital is raised to prove the production
capabilities of the field. The Company intends to pursue available opportunities
in the oil and gas business, including the acquisition of additional proven,
developed reserves, equipment and personnel, and to expand its business through
the acquisition of businesses related and unrelated to the oil and gas business.
If the Company is unable to generate sufficient revenue from operations,
management intends to explore all available alternatives for debt and/or equity
financing, including but not limited to private and public securities offerings.

The Company proposes to create a world wide market distribution system for oil &
gas tubulars, equipment, and related products under synergies with its internet
subsidiary, utilizing the Company's presence on the World Wide Web and the
Internet on its domain `oilfieldjunk.com'. Significant steps are continuing to
be made by competitors in similar endeavors at the time of this writing.

Because of understaffing in the oilfield equipment marketing department of the
Company, and its corresponding lack of training in this relatively new marketing
venue, the Company has decided to take the position to `wait and see' what the
competition develops.

The Company proposes to increase its core business of dial up internet service
in its current regions of operation on Oahu and Maui, and expand such operations
to the islands of Kauai and the Big Island of Hawaii. The Company plans to
develop a national presence to make web page hosting and computer consulting
available to customers world wide in the coming months and years.

Comparability of Year-to-Year Results of Operations. The table below reflect
the operations of the most recent two fiscal years. Due to the short period of
Company existence, the comparable periods of financial and operating activity
may not accurately reflect the potential operations of the Company. The prior
fiscal year ending June 30, 1999 consisted of only about four months of
revenue-producing activities, preceded by an additional three months of start up
activities.

<TABLE>
<CAPTION>
                                        Year End          Year End
                                        June 30, 2001     June 30, 2000
                                        -------------     -------------

<S>                                     <C>               <C>
Revenues                                $    420,977      $    710,671
Cost of Sales                                 (7,298)         (359,257)
                                        ------------      ------------
Gross Profits                           $    413,679      $    351,414

Operating Expenses                        (1,015,463)         (873,793)
                                        ------------      ------------

Net Loss From Operations                $   (601,784)     $   (522,379)
Tax Benefits and Other Income                142,284           179,157
                                        ------------      ------------

Net Loss                                $   (459,500)     $   (343,222)
                                        ============      ============
</TABLE>

Revenue. The Company's revenues are for the most part limited to those
generated by CCTECH in its business of internet service provider in Honolulu,
Hawaii.  Revenue from P & A Remediation from oil well plugging, remediation and
salvage operations in the states of Texas and Oklahoma was been suspended for
this fiscal year.  Limited revenues have been realized from oil or gas produc-
tion from company acquired producing oil & gas leases.

Most of the internet service provider revenue is received from customers who
purchase basic internet service, hosting products, high-speed Internet
connectivity, and other enhanced value Internet services. The Company hopes to
offer a broad range of connectivity options to its customers including
dedicated, digital subscriber lines, integrated services digital network, frame
relay and dial-up connections. Connectivity customers typically sign a contract
for one year of service and pay fixed, recurring monthly service charges plus a
one-time setup fee under those agreements. These charges vary depending on the
type of service, the length of the contract and local market conditions. Web
hosting customers typically pay fixed, recurring monthly service charges plus a
one-time setup fee. These charges vary depending on the amount of disk space and
transit required by the customer.

Other potential enhanced services include (but are not limited to) e-commerce;
virtual private networks permitting our customers to engage in private and
secure Internet communication with their employees, vendors, customers and
suppliers; security services; co-location services, which include leased space,
connectivity and support services in specialized facilities for customers that
wish to place their own equipment and software in our secure, controlled facil-
ities; consulting; and, the sales of equipment and customer circuits.

Revenue for all products is recognized as the service is provided. Amounts
billed relating to future periods are recorded as deferred revenue and amortized
monthly as services are rendered.

When active, revenue is generated from two types of contractual arrangements,
cash and salvage, in connection with its oil well plugging and remediation oper-
ations.  Under the salvage type of contract, the Company receives as its compen-
sation pipe and/or used oil well equipment mutually agreed upon by the parties.
Revenue is recognized, and the pipe and/or equipment are included in inventory,
based upon the applicable wholesale market prices of the items or the prices at
which the items are purchasable for resale on the open market. These inventory
items, whether received by P & A Remediation as consideration for the perfor-
mance of plugging and/or remediation services or purchased outright for purposes
of resale, are resold to customers including, primarily, oil and construction
companies.

The direct gross profit on the industry jobs performed by PAR Texas was gener-
ally planned to be approximately 35%. Management believes that the gross profit
margin on the same job, if performed for a government agency, could increase to
55%. If PAR Texas is able to obtain contracts from state agencies, the Company
expects that payment would typically be received thirty days from the date of
completion of the well(s) and all contract requirements, thus requiring that
the Company have additional working capital to cover expenses before payment
is received. P & A Remediation is generally required to pay suppliers and sub-
contractors for pipe, equipment and other supplies and threading, refurbishing
and other services on a cash on demand, or "COD", basis. Accordingly, should
P & A Remediation be successful in expanding its customer base to include gov-
ernment agencies, of which there is no assurance, its working capital may not
be adequate to enable the company to continue in operation without the receipt
of additional funding.

The Company's plan (in Texas) calls for the primary government customer targeted
by the Company to be the State of Texas' Oil Well Plugging and Cleanup Fund (the
"Cleanup Fund"), because of the continuously increasing number of oil wells
being added to the State of Texas' inventory of wells requiring state-funded
remediation. Company management believes that the abandoned and inactive wells
that are candidates for state-funded plugging number in the tens of thousands as
of the date hereof. This calculation is based upon management's belief that
there are, on average, ten oil or gas wells, known as "stripper wells,"
producing, on average, less than ten barrels of oil per day, per each of 12,500
operators registered with the Railroad Commission listed in the Commission's
inventory of wells requiring state-funded remediation. Further, wells are added
continuously at the rate of 250 per month in an order of priority based on the
perceived risk to human health and the environment. The Dallas Morning News
stated that there are "as many as 17,000 wells abandoned across the state
today..." on June 6, 2000.

In addition to oil well plugging and clean-up operations, PAR Texas can serve
as a reseller of construction equipment, steel pipe and tubulars and select
used and reconditioned oil field equipment. These items are either obtained
from the company's salvage operations or purchased outright for resale on the
secondary market. The company is currently planning to resume remediation work
on a Conoco, Inc., 58-mile salvage project that involves the recovery of at
least 150,000 feet of three and one-half to six inch structural pipe which the
Company intends to resell for construction and other applications.

Cost of Sales and Services. Cost of internet service consists primarily of local
telecommunications expense. Local telecommunications expense is primarily the
cost of transporting data between a customer's place of business, and the
Company's local points of presence as gateway to the internet. Customer's cost
of service also includes internet access expense and the cost of equipment sold
to customers.

Cost of oilfield remediation services consist principally of direct labor;
contracted services; and in-hole material (cement, drilling gel, and water) and
equipment supplies.

Cost of sales consists of the purchased cost or earned cost of oilfield pipe and
equipment that has been sold.

General and Administrative Expenses. General and administrative expenses consist
primarily of salaries, rent and utilities. Such expenses also include the
expenses of general management, technical labor, customer care and accounting.

General and administrative expenses are expected to continue to increase in
absolute dollars, but decrease as a percentage of total revenue as revenue
growth continue can outpace general expenses.

Both the internet operations and the oilfield remediation operation have the
opportunity to acquire scalable systems that can limit the number of additional
personnel and the need for additional office space to support incremental
revenue. The company expects these systems will result in the ability to add
significant additional revenue at low incremental costs. Although we expect to
continue to reduce our operating losses as a percentage of revenue, there can be
no assurance that we will be able to do so, or that the rate of any reduction in
losses will be as rapid as we expect.

Depreciation and Amortization. Depreciation is provided over the estimated
useful lives of assets ranging from three to forty years using the straight-
line method. The excess of cost over the fair value of net assets acquired,
or goodwill, is amortized using the straight-line method over a twenty-year
period.  Debt issuance costs are amortized over the life of the debt.  Addi-
tional acquisitions and investments are expected to cause depreciation and
goodwill amortization to increase significantly in the future.

Other expenses. Other expenses consist primarily of interest expense.

Liquidity and Capital Resources. Our business strategy has required, and is
expected to continue to require, substantial capital to fund acquisitions,
working capital, capital expenditures, and interest expense.

As of June 30, 2001, the Company had approximately $2,700 in cash and cash
equivalents, $112,200 in a certificate of deposit, and $33,000 in current
receivables.

The Company also has significant debt service requirements. At June 30, 2001,
our interest bearing liabilities were $740,000 and the expected annual interest
expense associated with it is approximately $80,000. The interest expense and
principal repayment obligations associated with our debt could have a signifi-
cant effect on our future operations.

Our anticipated expenditures are inherently uncertain and will vary widely based
on many factors including operating performance and working capital
requirements, the cost of additional acquisitions and investments, the
requirements for capital equipment to operate our business and our ability to
raise additional funds. Accordingly, we may need significant amounts of cash in
excess of our plan, and no assurance can be given as to the actual amounts of
our future expenditures. We will have to increase revenue without a commensurate
increase in costs to generate sufficient cash to enable us to meet our debt
service obligations. There can be no assurance that we will have sufficient
financial resources if operating losses increase or additional acquisition or
other investment opportunities become available.

We expect to meet our capital needs for the next 3 months with cash on hand,
operating cash flow and additional debt, and beyond 3 months, with the proceeds
from the sale or issuance of capital stock, lease financing and additional debt.
We regularly examine financing alternatives based on prevailing market condi-
tions and expect to access the capital markets from time to time based on our
current and anticipated cash needs and market opportunities. Over the longer
term, we will be dependent on obtaining positive operating cash flow and, to
the extent cash flow is not sufficient, the availability of additional financ-
ing, to meet our debt service obligations. Insufficient funding may require us
to delay or abandon some of our planned future expansion or expenditures, which
could have a material adverse effect on our growth and ability to realize econ-
omies of scale.

Forward-Looking Statements. The statements included in the discussion and
analysis above that are not historical or factual are "forward-looking
statements" (as that term is defined in the Private Securities Litigation Reform
Act of 1995). The safe harbor provisions provided in Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities Exchange
Act of 1934, as amended, apply to forward-looking statements made by the
Company. These statements can be identified by the use of forward-looking
terminology such as "believes," "expects," "may," "will," "should," or
"anticipates" or the negative thereof or other variations thereon or comparable
terminology, or by discussions of strategy that involve risks and uncertainties.
Management cautions the reader that these forward-looking statements addressing
the timing, costs and scope of our acquisition of, or investments in, existing
affiliates, the revenue and profitability levels of the affiliates in which we
invest, the anticipated reduction in operating costs resulting from the
integration and optimization of those affiliates, and other matters contained
herein or therein from time to time regarding matters that are not historical
facts, are only predictions. No assurance can be given that future results
indicated, whether expressed or implied, will be achieved. While sometimes
presented with numerical specificity, these projections and other
forward-looking statements are based on current expectations and a variety of
assumptions relating to our business, which, although we consider them
reasonable, may not be realized. Because of the number and range of the
assumptions underlying our projections and forward-looking statements, many of
which are subject to significant uncertainties and contingencies that are beyond
our reasonable control, some of the assumptions will not materialize and
unanticipated events and circumstances may occur subsequent to the date of this
report. Therefore, our actual experience and results achieved during the period
covered by any particular projections or forward-looking statements may differ
substantially from those projected.

Financial Condition, Capital Resources and Liquidity. At June 30, 2001, the
Company had assets totaling $5,536,882 including current assets in the amount of
$216,594, fixed assets, including land, building and equipment (less accumulated
depreciation) in the amount of $345,074 and $4,975,214 in other assets
(primarily proved, developed oil reserves). Since the Company's inception, it
has received $71,750 in cash contributed as consideration for the issuance of
shares of Common Stock.

ITEM 7. FINANCIAL STATEMENTS

The financial statements of the Company are included immediately following the
signature page of the Form 10-KSB.

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

David S. Hall, P.C., 1660 South Stemmons, Suite #420, Lewisville, Texas 75067,
reported upon the Company's financial statements for the period from inception
(January 21, 1998) to June 30, 2001, and has been appointed as the Company's
independent accountant for the fiscal year ending June 30, 2002. There has been
no change in the Company's independent accountant during the period commencing
with the Company's retention of David S. Hall, P.C., through the date hereof.

                                    PART III

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

(1) "Section 16(a) Beneficial Ownership Reporting Compliance," identify each
person who, at any time during the fiscal year, was a director, officer, bene-
ficial owner of more than ten percent of any class of equity securities of the
registrant registered pursuant to section 12 ("reporting person") that failed
to file on a timely basis, as disclosed in the above Forms, reports required
by section 16(a) of the Exchange Act during the most recent fiscal year or
prior fiscal years.

(2) For each such person, set forth the number of late reports, the number of
transactions that were not reported on a timely basis, and any known failure
to file a required Form. A known failure to file would include, but not be
limited to, a failure to file a Form 3, which is required of all reporting
persons, and a failure to file a Form 5 in the absence of the written repre-
sentation referred to in paragraph (b)(2)(i) of this section, unless the
registrant otherwise knows that no Form 5 is required.

The Directors of the Company did not file Form 3 or Form 5 during the period
covered by this filing.  The Company became a reporting company by voluntary
filing of Form 10SB on June 12, 2000.  The Company made application to the
NASD OTCBB for its common stock to be traded in October 2000.  Approval for
active listing was given and the Company's stock was changed to active quot-
ing on April 24, 2001.  None of the Directors of the Company have traded any
of the Company's securities to date.

Item 5. Directors, Executive Officers, Promoters and Control Persons.

Executive Officers and Directors. Set forth below are the names, ages,
positions with the Company, Yankee Development, Simpco, CCTech and P & A
Remediation; and the business experience of the executive officers and
directors of the Company, Yankee Development, Simpco and CCTech, and the
Managers of P & A Remediation.


<TABLE>
<CAPTION>
Name                          Age       Position

<S>                           <C>      <C>
Bryan L. Walker(1)(2)(3)      47        President, Chief Executive Officer and
                                        Chairman of the Board of Directors of
                                        the Company; President and Director of
                                        Yankee Development and Simpco; Vice
                                        President and Director of CCTech.

Richard C. Smith(1)(2)(3)     56        Treasurer, Chief Financial Officer and
                                        Director of the Company; Treasurer and
                                        Director of Yankee Development;
                                        Secretary/Treasurer of Simpco; and Chief
                                        Financial Officer, Secretary/Treasurer,
                                        and Director of CCTech.

Michael L. Bacon              42        Vice President of the Company, Director
                                        of the Company; Chief Executive Officer,
                                        President, and Director of CCTech.

Derek T. Smith(1)             35        Secretary of the Company, Director of
                                        the Company.

Laura N. Walker(1)            43        Director of the Company; Secretary of
                                        Yankee Development.
</TABLE>

(1) The above-named persons may be deemed to be "promoters" and "parents" of the
Company, as those terms are defined under the General Rules and Regulations
promulgated under the Securities Act of 1933, as amended.

(2) Messrs. Walker and Smith hold, in addition to the positions with each of the
above-named corporations indicated in the above table, the office of Managers of
PAR Texas. They occupy these offices until the next annual meeting of the
members of PAR Texas and until their successors have been elected, unless they
sooner resign or are removed.

(3) Messrs Walker and Smith hold, in addition to the positions with each of the
above-named corporations indicated in the above table, the office of Manager of
PAR Oklahoma. They occupy this office until the next annual meeting of the
members of PAR Oklahoma and until their successors have been elected, unless
they sooner resign or are removed.

All directors hold office until the next annual meeting of the Company's
shareholders and until their respective successors have been elected and
qualify. Officers serve at the pleasure of the Board of Directors. Messrs.
Walker, Bacon, Richard C. Smith and Derek T. Smith and Ms. Walker are expected
to devote approximately 90%, 100%, approximately 40%, approximately 5% and
approximately 10%, respectively, of their time to the business of the Company.

Family Relationships. Mr. Bryan L. Walker, President, Chief Executive Officer
and Chairman of the Board of Directors of the Company and President and a
director of Yankee Development and Simpco; and Vice President and director of
Cyber Cities Technologies; and a Manager of P&A Remediation; is the spouse of
Ms. Laura N. Walker, a director of the Company, and Secretary and of Yankee
Development. Mr. Richard C. Smith, Treasurer, Chief Financial Officer and a
director of the Company, Treasurer and a director of Yankee Development, the
Secretary/Treasurer and a director Simpco; and a Manager of P&A Remediation; is
the father of Mr. Derek T. Smith, the Company's Secretary and a director.

Business Experience. Bryan L. Walker has served as the President/Chief Executive
Officer and the Chairman of the Board of Directors of the Company since August
14, 1998, and April 23, 1998, respectively. He served in the position of Vice
President of the Company from April 23, 1998, through August 14, 1998. Mr.
Walker has served as a director and the President of Yankee Development since
January 7 and April 16, 1998, respectively. From January 7 through April 16,
1998, he served in the position of Vice President of Yankee Development. Since
January 15, 1999, Mr. Walker has served in the positions of President and a
director of Simpco. Since January 4, 2000, Mr. Walker has served in the position
of Vice President and director of Cyber Cities Technologies. He has been
self-employed as a business/management consultant in the oil business serving
independent oil production companies since 1984. Mr. Walker has co-owned,
together with his spouse, Ms. Walker, a director of the Company, Secretary of
Yankee Development, since May 1997, Hawaiian Travel, Inc., a travel consulting
firm affiliated with the Company having offices in Irving, Texas. He received a
Bachelor of Business Administration degree from Southern Methodist University,
Dallas, Texas, in 1976.

Richard C. Smith has served as the Treasurer and a director of the Company since
April 23, 1998, and as the Company's Chief Financial Officer since August 14,
1998. Since April 16, 1998, he has served in the positions of Treasurer and
director of Yankee Development. Mr. Smith served, from January 7 through April
16, 1998, as a director and the Secretary of Yankee Development. He has served,
since January 15, 1999, as the Secretary/Treasurer and a director of Simpco. Mr.
Smith has twenty-eight years of experience in public accounting. He has owned
and operated a public accounting practice in Lewisville, Texas, since March
1998, as a professional corporation under the name of Richard C. Smith, CPA,
P.C., and, during the period from February 1971 through February 1998, prior to
that time, as a sole proprietor. He was employed by Atlantic Richfield Oil
Company as a staff accountant from June 1967 through February 1969 and by Mark
III Manufacturing Corp., a privately-held manufacturing company located in
Roanoke, Texas, as a controller from March 1969 through January 1971. Mr. Smith
received a Bachelor of Business of Administration degree in accounting from the
University of North Texas in 1967.

Michael L. Bacon has served as a Vice President and Director of the Company
since January 4, 2000, and as the President and Chief Executive Officer and a
Director of Cyber Cities Technologies, Inc., since December 31, 1999. Mr. Bacon
served the United States Navy as Assistant Engineer on various nuclear powered
naval vessels from enlistment in May 1980 until his retirement May of 2000. He
was an executive officer of Cyber City Honolulu, Inc. from November 1996 until
selected operating assets and certain liabilities were acquired and assumed by
Basic Technologies, Inc. Mr. Bacon Served the United States Navy as the
Assistant Engineer on numerous Nuclear Powered Naval Vessels from May 1980 until
May of 2000.

Derek T. Smith has served, since January 4, 2000, in the office of Secretary of
the Company. He served as the President of the Company during the period from
April 23 through August 14, 1998; and as Vice President of the Company from
August 14, 1998 through January 4, 2000. Since August 1996,  Mr. Smith is em-
ployed by Epylon Corporation as a Senior Manager.  From 1996 through 2000, he
was employed as a princial consultant by a division of Computer Sciences Cor-
poration, a public company located in El Segundo, California.  From August
1994 through July 1996, he was employed as a senior consultant by Hogan Systems,
Inc., a publicly-held consulting company with offices in Dallas, Texas, that
was acquired by Computer Sciences Corporation in August 1996. Mr. Smith was em-
ployed, from January through July 1994, by the U.S. Small Business Administra-
tion as a senior loan officer, disaster relief. From October 1988 through May
1992, he was employed in the position of market cost analyst by Electronic Data
 Systems, Dallas, Texas, a publicly-held company. Mr. Smith received a Bachelor
 of Business Administration degree in finance from The University of Texas at
Austin in 1988 and a Masters of Business Administration degree in strategic
management, marketing and international business from the University of Georgia
in 1993.

Laura N. Walker served as the Secretary of the Company from August 14, 1998,
until January 4, 2000, and as a director of the Company since April 23, 1998.
Since April 16, 1998, she has served as the Secretary of Yankee Development.
Together with her spouse, Mr. Walker, an executive officer and director of the
Company, Yankee Development, Simpco, Cyber Cities Technologies, and a manager of
P&A Remediation, Ms. Walker has co-owned, since May 1997, Hawaiian Travel, Inc.,
a travel consulting firm with offices in Irving, Texas, which is an affiliate of
the Company.

To the knowledge of management, during the past five years, no present or former
director, executive officer or person nominated to become a director or
executive officer of the Company has :

(1)  Any bankruptcy petition filed by or against any business of which such
     person was a general partner or executive officer either at the time of the
     bankruptcy or within two years prior to that time;

(2)  Any conviction in a criminal proceeding or being subject to a pending
     criminal proceeding (excluding traffic violations and other minor
     offenses);

(3)  Being subject to any order, judgment, or decree, not subsequently reversed,
     suspended or vacated, of any court of competent jurisdiction, permanently
     or temporarily enjoining, barring, suspending or otherwise limiting his
     involvement in any type of business, securities or banking activities; and

(4)  Being found by a court of competent jurisdiction (in a civil action), the
     Commission or the Commodity Futures Trading Commission to have violated a
     federal or state securities or commodities law, and the judgment has not
     been reversed, suspended, or vacated.


ITEM 10. EXECUTIVE COMPENSATION

$87,000 cash compensation, and except for Mr. Walker's use of a Company auto-
mobile since January 8, 1999, (10% of which usage is estimated to be personal),
no non-cash compensation, has been awarded to, earned by or paid to any Company
executive officer or director for all services performed in all capacities for
the Company during the approximate two year and six month period from the date
of the Company's inception on January 21, 1998, through the date hereof. It is
anticipated that at such time as the Company's financial position permits, the
executive officers and/or directors of the Company will receive appropriate
compensation, in addition to reasonable salaries, such as bonuses, coverage
under medical and/or life insurance benefits plans and participation in stock
options and/or other profit sharing or pension plans, for services as executive
officers of the Company and may receive fees for their attendance at meetings of
the Board of Directors of the Company. As of the date hereof, the Company does
not provide officers with pension, stock appreciation rights, long-term
incentive or other plans and has no intention of implementing any such plans for
the foreseeable future. Further, to date, no cash or no non-cash compensation
has been awarded to, earned by or paid to any executive officer or director of
Yankee Development, Simpco, P & A Remediation LLC. (both the Oklahoma and the
Texas entities), or Cyber Cities Technologies, Inc. (other than Michael L.
Bacon, President - $87,000), all wholly-owned subsidiaries of the Company, or to
Mr. Richard C. Smith, Manager of P & A Remediation, for services performed in
all capacities for said companies.

Compensation of Directors. The Company has no standard arrangements for
compensating the directors of the Company, who also serve as the directors of
Yankee Development, Simpco, P & A Remediation LLC. (both the Oklahoma and the
Texas entities), or Cyber Cities Technologies, Inc., for their attendance at
meetings of the Board of Directors.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

The following table sets forth certain information regarding the ownership of
the Company's Common Stock as of June 30, 2001 by each shareholder known by the
Company to be the beneficial owner of more than 5% of its outstanding shares of
Common Stock, each director and all executive officers and directors as a group.
Under the General Rules and Regulations of the Securities and Exchange Commis-
sion (the "Commission"), a person is deemed to be the beneficial owner of a
security if such person has or shares the power to vote or direct the voting,
or dispose or direct the disposition, of such security. Accordingly, more than
one person may be deemed to be a beneficial owner of the same securities. Un-
less otherwise indicated by footnote, each of the shareholders named in the
table has sole voting and investment power with respect to the shares of Com-
mon Stock beneficially owned.

<TABLE>
<CAPTION>
                                                          Shares             Percentage
                                                       Beneficially           of Class
Beneficial Owner                                         Owned (1)            Class (1)

<S>                                                    <C>                   <C>
Bryan L. Walker (2)                                     5,505,625(5)           70.08%
1026 West Main Street, Suite 104
Lewisville, Texas 75067

Laura N. Walker (3)                                     5,505,625(6)           70.08%
8505 Freeport Parkway North, Suite #141
Irving, Texas 75063

Shelton Voting Trust                                    5,305,625(7)           67.53%
1026 West Main Street, Suite 104
Lewisville, Texas 75067

Michael Lewis Bacon (8)                                   105,672(9)            1.34%
1430 Aalapapa Dr.
Kailua, Hawaii 96734

Richard C. Smith (2)                                       73,000(10)           0.92%
1026 West Main Street, Suite #208
Lewisville, Texas 75067

Derek T. Smith (4)                                         15,000(11)
14608 Lakecrest Drive
Addison, Texas 75244

All executive officers and directors                    5,699,297              72.55%
as a group (four persons)
</TABLE>

(1) Represents the number of shares of Common Stock owned of record and
beneficially by each named person or group, expressed as a percentage of
7,759,857 shares of the Company's Common Stock issued and outstanding as of June
30, 2000.

(2) Executive officer and member of the Board of Directors of the Company,
Yankee Development, Simpco, Cyber Cities Technologies; and a Manager of P & A
Remediation.

(3) Member of the Board of Directors of the Company; executive officer of Yankee
Development.

(4) Executive officer and member of the Board of Directors of the Company.

(5) Includes 5,305,625 shares of Common Stock owned of record by the Shelton
Voting Trust, of which Mr. Walker is the trustee, and 100,000 shares of Common
Stock owned of record by each of Mr. Walker and Ms. Laura N. Walker, Mr.
Walker's spouse.

(6) Includes 5,305,625 shares of Common Stock owned of record by the Shelton
Voting Trust, of which Mr. Walker is the trustee, and 100,000 shares of Common
Stock owned of record by each of Mr. Walker and Ms. Walker.

(7) Because Mr. Walker is the trustee of the Shelton Voting Trust, beneficial
ownership of the shares of Common Stock owned of record by the trust is
attributable to him and Ms. Walker, his spouse, under the applicable General
Rules and Regulations of the Commission.

(8) Executive officer and member of the Board of Directors of the Company.

(9) Includes only individually owned common stock owned of record.

(10) Includes 30,000 shares of Common Stock owned of record by Ms. Margie Moreno
Smith, Mr. Smith's spouse.

(11) Less than one per cent.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

On or about January 21, 1998, the Company issued and sold 200,000 shares,
200,000 shares, 170,000 shares, and 30,000 shares, of Common Stock to Messrs.
James L. Speir, James Howe and John Bradley and Ms. Janine Kreuter, respectively
(a total of 600,000 shares of Common Stock), in consideration for cash paid by
each individual in the amount of $.00375 per share (a total of $2,250). On or
about April 16, 1998, a total of 510,000 shares of Common Stock owned
collectively by Messrs. Speir, Howe and Bradley and Ms. Kreuter were transferred
to a total of fourteen residents of the State of Texas, including Mr. Bryan L.
and Ms. Laura N. Walker and Messrs. Richard C. and Derek T. Smith, the current
members of management of the Company, Yankee Development, P & A Remediation
Simpco, and/or Cyber Cities Technologies; two trusts of which Mr. Richard C.
Smith serves as trustee and certain immediate family members of the foregoing,
including Mesdames Margie Moreno-Smith, Catherine E. Smith, and Angela D.
McClure, Mr. Richard C. Smith's spouse, mother and daughter, respectively. (See
Form 10SB filed June 12, 2000, Part II, Item 4. "Recent Sales of Unregistered
Securities.")

On April 23, 1998, the Company issued and sold 5,305,625 shares of Common Stock
to the Shelton Voting Trust in consideration for the sale and transfer to the
Company of all 1,000 outstanding shares of common stock of Yankee Development.
Mr. Walker, the President, Chief Executive Officer and Chairman of the Board of
Directors of the Company and Yankee Development and the President and a director
of Simpco and the beneficial owner of approximately 70.95% of the outstanding
shares of the Company's Common Stock, is the trustee of the Shelton Voting
Trust. (See Form 10SB filed June 12, 2000, Part II, Item 4. "Recent Sales of
Unregistered Securities.")

On January 8, 1999, the Company acquired a 1995 Jeep from Ms. Walker, the
Secretary and a director of the Company and Yankee Development and the Vice
President, Secretary and a director of Simpco, in consideration for the
assumption by the Company of a promissory note in the principal amount of
$10,500, secured by a certificate of deposit owned by Ms. Walker, payable to a
bank in connection with the purchase. The note, which bears interest at the rate
of 7.85% per annum, is scheduled to pay off of February 15, 2002. Since January
8, 1999, Mr. Walker has had the use of the automobile, 10% of his usage of
which is estimated to be personal.

The Company issued and sold, on January 15, 1999, 212,500 shares of Common Stock
to each of the Simpco Trust #1, the Simpco Trust #2 and the Simpco Trust #3 (an
aggregate of 637,500 shares of Common Stock) in consideration and exchange for
the sale and transfer to the Company by each trust of 2,500 shares of common
stock, collectively constituting 75% of the outstanding shares of common stock,
of Simpco. As a result of this transaction, ownership by the Simpco Trusts of
approximately 9.4% of the outstanding shares of the Company's Common Stock is
attributable to Mr. Richard Simpson, trustee of the Simpco Trusts. As a result
of a lawsuit settlement such shares have been returned to the Company to be
held in treasury for resale.  (See Form 10SB filed June 12, 2000, Part II,
Item 4. "Recent Sales of Unregistered Securities.")

The Company issued and sold, on March 16, 2000, 979,232 shares newly-issued,
restricted shares of Common Stock in the company to Cyber City Honolulu, Inc.,
in consideration for the sale and conveyance to the Company's wholly owned
subsidiary CCTECH certain assets in accordance with that certain Acquisition
Agreement and Closing Memorandum dated effective January 1, 2000. As a result of
this transaction, approximately 12.61% of the outstanding shares of the
Company's Common Stock are owned by CCHONO. (See Form 10 SB filed June 12, 2000,
Part II, Item 5. "Recent Sales of Unregistered Securities.")

Certain executive officers, directors and controlling shareholders of the
Company, including Messrs. Bryan L. Walker and Richard C. Smith and Ms. Laura N.
Walker, have made cash advances on open account to the Company aggregating
$360,023 during the period from June 1, 1998, through June 30, 2000. These
advances have been classified as long-term debt in the Company's financial
statements.

ITEM 12.  EXHIBITS AND REPORTS ON FORM 8-K

There are no exhibits submitted with the filing of this Form 10KSB.

There were no reports of Form 8-K filed during the fiscal year covered by
this filing.

Other Information

(a)  On September 6, 2000, the Board of Directors authorized the
corporation to initiate discussions with Sierra Brokerage Services,
Inc., of Columbus, Ohio, to enlist their sponsorship of the Com-
pany's application to list and trade its common stock on trading
mechanisms of NASD. Such application was made and approved for
listing on the OTC Bulletin Board by NASD staff on March 23, 2001.
Our common stock commenced trading on the electronic Bulletin Board
under the symbol "BTEC" on March 26, 2001.  Under NASD rules, there
were no high and low closing bid quotations in the over-the-counter
market for the common stock, as reported by the single sponsoring
market maker during the period from March 23 through the first 30
days.  Quotations would represent inter-dealer quotations,  without
adjustment for retail markups, mark-downs or commissions, and may
not necessarily represent actual transactions.  The Company has made
no public announcements regarding the availability of its common
stock in public markets.

(b)  On September 20, 2000, the Company executed a contract with Neil
Rand d/b/a Corporate Imaging, 5800 West Glenn Drive, Suite 250,
Glendale, Arizona 85301, to be provided business management, public
and investor relations and other related corporate advisory services.
As compensation for his services, Neil Rand shall receive an initial
payment of fifty thousand (50,000) shares of common stock in the
Company, and a monthly payment of five thousand (5,000) shares for
his services.  The monthly payment of shares were to start upon NASD
approval of the listing of the Company's stock on a NASD venue.  The
Company voided the contract based upon non-performance and misrepre-
sentations of the part of Neil Rand.

(c)   On May 24, 2001, the Company signed a 'memorandum of understand-
ing to set forth the terms of the acquisition of two corporations in
the business as a local internet service provider in the state of
Hawaii, collectively doing business as Inter-Pacific Network Services.
This understanding was agreed to be unpublicized and subject to the
Company being able to secure financing sufficient to acquire and pro-
vide operating capital for its combined internet operations.


INDEX TO EXHIBITS.

Item
Number              Description

None

DESCRIPTION OF EXHIBITS.

The documents required to be filed as Exhibit Number 2 in Part III of Form 1-A
filed as part of this Registration Statement on Form 10-SB are listed in Item 1
of this Part III above. No documents are required to be filed as Exhibit Numbers
3, 5, 6 or 7 in Part III of Form 1-A, and the reference to such Exhibit Numbers
is therefore omitted. No additional exhibits are filed hereto.


                                   SIGNATURES

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

BASIC TECHNOLOGIES, INC.


By:  /s/ Bryan L. Walker
     ------------------------------------------------------
Bryan L. Walker, President and
Chief Executive Officer, Chairman of the Board of Directors
Date:    September 28, 2001


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

By:  /s/ Bryan L. Walker
     ------------------------------------------------------
Bryan L. Walker, President and
Chief Executive Officer, Chairman of the Board of Directors
Date:    September 28, 2001

By:  /s/ Richard C. Smith
     ------------------------------------------------------
Richard C. Smith, Treasurer and
Chief Financial Officer, Director
Date:    September 28, 2001

By:  /s/ Michael L. Bacon
     ------------------------------------------------------
Michael L. Bacon, Vice President and
Director
Date:    September 28, 2001

By:  /s/ Derek T. Smith
     ------------------------------------------------------
Derek T. Smith, Secretary and
Director
Date:    September 28, 2001

By:  /s/ Laura N. Walker
     ------------------------------------------------------
Laura N. Walker
Director
Date:    September 28, 2001




                                   PART F/S.

                              Financial Statements




                                BASIC TECHNOLOGIES, INC.
                              Consolidated Balance Sheets
                            June 30, 2001 and June 30, 2000







                                 DAVID S. HALL, P.C.
                             CERTIFIED PUBLIC ACCOUNTANT
                            1660 S. STEMMONS,  SUITE 420
                                LEWISVILLE, TX 75067

                                   (214) 315-1315
                                 FAX (214) 420-0032




INDEPENDENT AUDITOR'S REPORT

To the Board of Directors of
Basic Technologies, Inc.:


We have audited the accompanying consolidated balance sheets of Basic
Technologies, Inc. (a Corporation) as of June 30, 2001 and June 30, 2000
and the related consolidated statements of income, retained earnings and
cash flows for the fiscal years then ended.  These consolidated financial
statements are the responsibility of the Company's management.  Our
responsibility is to express an opinion on these financial statements
based on our audit.

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

In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of Basic
Technologies, Inc. as of June 30, 2001 and June 30, 2000, and the
results of its operations and its cash flows for the fiscal years then
ended in conformity with generally accepted accounting principles.



/s/ DAVID S. HALL


Lewisville, Texas
September 28, 2001







                                BASIC TECHNOLOGIES, INC.
                              Consolidated Balance Sheets
                            June 30, 2001 and June 30, 2000


<TABLE>
<CAPTION>
                                                                  June 30	    June 30
                                                                    2001            2000
<S>                                                          <C>              <C>
ASSETS

CURRENT ASSETS

     Cash                                                    $        2,682   $       22,342
     Accounts Receivable-Net                                         33,334          108,882
     Inventories                                                     46,224           70,903
     Deferred Tax Asset                                             134,354           71,072
                                                             --------------   --------------

               TOTAL CURRENT ASSETS                                 216,594          273,199

FIXED ASSETS

     Equipment                                                      421,302        1,404,838
     Land and Buildings                                              13,088            9,974
                                                             --------------   --------------
                                                                    434,390        1,414,812

     Less:  Accumulated Depreciation                                (89,316)        (125,484)
                                                             --------------   --------------

                TOTAL FIXED ASSETS                                  345,074        1,289,328

OTHER ASSETS

     Certificate of Deposit                                  $      112,199   $            0
     Deposits                                                           760            5,864
     Organization Costs-Net                                             712            1,162
     Proved Developed Oil Reserves                                3,711,000        3,711,000
     Deferred Tax Asset                                             313,491          165,835
     Acquisition Goodwill-Net                                       837,052          882,295
                                                             --------------   --------------

                TOTAL OTHER ASSETS                                4,975,214        4,766,156
                                                             --------------   --------------

                          TOTAL ASSETS                       $    5,536,882   $    6,328,683
                                                             ==============   ==============

</TABLE>

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






                                BASIC TECHNOLOGIES, INC.
                              Consolidated Balance Sheets
                            June 30, 2001 and June 30, 2000


<TABLE>
<CAPTION>
                                                                June 30	             June 30
                                                                  2001                 2000
<S>                                                         <C>               <C>

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES

     Short Term Notes Payable                                $      89,846    $       299,759
     Accounts Payable                                              226,446            248,774
     Accrued Taxes and Interest Payable                            128,221             33,564
     Current Portion of Long Term Debt                             103,992             73,138
                                                             -------------    ---------------

               TOTAL CURRENT LIABILITIES                           548,505            655,235

LONG TERM LIABILITIES

     Accrued Interest Payable                                $      22,167    $             0
     Deferred Tax Liability                                        223,069            223,069
     Payables-Shareholders                                         532,660            436,880
     Capital Lease Payable                                          32,871             32,871
     Long Term Notes and Obligations                               710,445            322,657
     Less: Current Maturities                                     (103,992)           (73,138)
                                                            --------------    ---------------

               TOTAL LONG TERM LIABILITIES                   $   1,417,220    $       942,339

  STOCKHOLDERS' EQUITY

     Common Stock, $.00001 par value, 100,000,000 shares
       authorized and 7,855,555 shares and 7,759,857
       shares, respectively, issued and outstanding                     78                 77
     Preferred Stock, $.00001 par value, 10,000,000 shares
       authorized and no shares issued and outstanding                   0                  0
     Paid in Capital                                             5,258,105          5,162,408
     Paid Stock Subscriptions                                          500             28,500
     Treasury Stock (850,000 shares common)                       (768,150)                 0
     Retained Earnings (Deficit)                                  (919,376)          (459,876)
                                                           ---------------    ---------------

                         TOTAL STOCKHOLDERS' EQUITY              3,571,157          4,731,109
                                                           ---------------    ---------------

                               TOTAL LIABILITIES AND
                                 STOCKHOLDERS' EQUITY      $     5,536,882    $     6,328,683
                                                           ===============    ===============

</TABLE>

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






                                BASIC TECHNOLOGIES, INC.
                           Consolidated Statements of Income
                  For the periods ended June 30, 2001 and June 30, 2000


<TABLE>
<CAPTION>
                                                                  June 30	      June 30
                                                                    2001              2000
<S>                                                          <C>              <C>

REVENUES                                                     $      420,977   $       710,671

COST OF SALES                                                         7,298           359,257
                                                             --------------   ---------------

                    GROSS PROFIT                             $      413,679   $       351,414

OPERATING EXPENSES

     Selling, General and Administrative Expenses                   757,047           703,640
     Interest                                                        90,418            40,447
     Amortization                                                    45,693            23,072
     Depreciation                                                   114,844           102,667
     Bad Debt Expense                                                 7,461             3,967
                                                             --------------   ---------------
                    TOTAL EXPENSES                                1,015,463           873,793

          NET INCOME (LOSS) FROM OPERATIONS                  $     (601,784)  $      (522,379)

OTHER (INCOME) EXPENSE

     Gain - Debt Payoff                                      $       (4,248)  $             0
     Gain - Asset Disposition                                        (2,299)                0
     Loss - Lawsuit Settlement                                       77,378                 0
     Interest (Income)                                               (2,177)             (380)
                                                             --------------   ---------------

               TOTAL OTHER (INCOME) EXPENSE                          68,654              (380)
                                                             --------------   ---------------

          NET INCOME (LOSS) BEFORE TAXES                     $     (670,438)  $      (521,999)

DEFERRED TAX BENEFIT                                                210,938           178,777
                                                             --------------   ---------------

                    NET INCOME (LOSS)                        $     (459,500)  $      (343,222)

     Beginning Retained Earnings (Deficit)                         (459,876)         (116,654)
                                                             --------------   ---------------

          ENDING RETAINED EARNINGS (DEFICIT)                 $     (919,376)  $      (459,876)
                                                             ==============   ===============

EARNINGS PER SHARE

     Income (Loss) for Common Stockholders                   $       (0.08)   $        (0.06)
                                                             ==============   ===============

</TABLE>

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






                                BASIC TECHNOLOGIES, INC.
                          Consolidated Statement of Cash Flows
                  For the periods ended June 30, 2001 and June 30, 2000


<TABLE>
<CAPTION>
                                                                  June 30	       June 30
                                                                    2001               2000
<S>                                                          <C>              <C>

CASH FLOWS FROM OPERATING ACTIVITIES
     Net Income (Loss)                                       $    (459,500)   $     (343,222)
     Adjustments to reconcile net income
        to net cash provided by operating activities:

               Depreciation and Amortization                       160,537           125,739
               Loss - Lawsuit Settlement                            77,378                 0
               Other Adjustments                                     7,250                 0
               (Increase) Decrease in Accounts Receivable              733           (89,582)
               (Increase) Decrease in Inventories                   24,679            16,432
               (Increase) in Deferred Tax Asset (net)             (210,938)         (178,777)
               Increase in Accounts Payable and
                  Accrued Liabilities                               94,496           186,315
               Increase in Deposits                                  5,104                 0
               Increase in Bad Debt Reserve                          1,915                 0
                                                             -------------    --------------

                    NET CASH USED BY OPERATING ACTIVITIES         (298,346)         (283,095)

NET CASH USED BY INVESTING ACTIVITIES

     Purchase of Fixed assets                                      (17,794)          (75,209)
     Proceeds - Sale of Fixed Assets                                 4,000                 0
                                                             --------------   --------------

                    NET CASH USED BY INVESTING ACTIVITIES          (13,794)          (75,209)

CASH FLOWS FROM FINANCING ACTIVITIES

     Principal Payments on Bank and Other Notes	                   (65,988)         (136,436)
     Proceeds of Notes Payable                                     246,688           244,921
     Proceeds of Shareholder Loans                                  95,780           279,983
     Issuance of Stock Sale Proceeds                                16,000                 0
                                                             -------------    --------------

                    NET CASH PROVIDED BY
                       FINANCING ACTIVITIES                        292,480           388,468
                                                             -------------    --------------

                       NET INCREASE (DECREASE) IN CASH             (19,660)           30,164

                       CASH AT BEGINNING OF YEAR                    22,342            (7,822)
                                                             -------------    --------------

                       CASH AT END OF YEAR                   $       2,682    $       22,342
                                                             =============    ==============

</TABLE>

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

                                 BASIC TECHNOLOGIES, INC.
                Consolidated Statements of Changes in Stockholders' Equity
                  For the periods ended June 30, 2001 and June 30, 2000


<TABLE>
<CAPTION>
                                                                  June 30	       June 30
                                                                    2001              2000
<S>                                                          <C>              <C>
COMMON STOCK
     Balance at Beginning of Year                            $           77   $           68
     Issuance of Stock for Acquisition of
        Wholly Owned Subsidiary (Sale of 0 shares and 979,232
        shares, respectively)                                             0                9

     Issuance of 44,000 shares of stock subscribed for
        and 51,698 shares of stock for expenses and
        debt repayment                                                    1                0
                                                             --------------   --------------

     Balance at End of Year                                  $           78   $           77

STOCK SUBSCRIPTIONS
     Balance at Beginning of Year                            $       28,500   $            0
     Subscriptions Received                                          16,000           28,000
     Stock Issued                                                   (44,000)               0
                                                             --------------   --------------
     Balance at End of Year                                  $          500   $       28,500


PAID IN CAPITAL
     Balance at Beginning of Year                            $    5,162,408   $    4,506,332
     Proceeds or Market Value in Excess of Par Value of
        Common Stock Issued for Acquisitions of Wholly
        Owned Subsidiaries ($656,076), and for Expenses, Debt
        Repayment and Stock Sold ($95,697)                           95,697          656,076
                                                             --------------   --------------

     Balance at End of Year                                  $    5,258,105   $    5,162,408

TREASURY STOCK
     Common Stock Assigned from Lawsuit Settlement
        and Held for Resale (850,000 shares)                 $     (768,150)  $            0

RETAINED EARNINGS (DEFICIT)
     Balance at Beginning of Year                            $     (459,876)  $     (116,654)
     Net Loss                                                      (459,500)        (343,222)
                                                             --------------   --------------

     Balance at End of Year                                  $     (919,376)  $     (459,876)
TOTAL STOCKHOLDERS' EQUITY                                   $    3,571,157   $    4,731,109
                                                             ==============   ==============

</TABLE>

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







                           BASIC TECHNOLOGIES, INC.
                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
                           Year Ended June 30, 2001


NOTE 1 - NATURE OF ACTIVITIES AND SIGNIFICANT ACCOUNTING POLICIES

      Nature of Activities and Basis of Accounting

     The Company, a Corporation, is engaged in the diversified operations
     of environmental remediation and recovery of oil and gas properties
     in Texas and Oklahoma, and development of oil and gas ventures and
     related interests, and as an internet service provider and e-business
     consultant in Hawaii, with its corporate headquarters located in
     Lewisville, Texas.  The Company incorporated in the state of Colorado
     on January 21, 1998 and its fiscal year end is June 30.

     The accompanying financial statements have been prepared on the
     accrual basis of accounting in accordance with generally accepted
     accounting principles.

     Consolidation

     The Company was formed as a parent holding company to operate through
     subsidiaries.  The financial statements consolidate the activities of
     the parent along with:

          Yankee Development Corp., a Texas corporation
          P & A Remediation, LLC, a Texas limited liability company
          Simpco, Inc., a Texas corporation
          P & A Remediation, LLC, an Oklahoma limited liability company
          Cyber Cities Technologies, Inc., an Hawaii corporation

     All significant intercompany transactions and balances have been
     eliminated.

     Cash

     For purposes of the statement of cash flows, the Company considers
     all short term securities purchased with a maturity of three months
     or less to be cash equivalents.  There are no restrictions on any
     balances.

     Accounts Receivable

     Bad debt expense is recognized by use of the allowance method, with
     net additions to the allowance of $1915 for this year,and total bad
     debt expense of $7,461.  Prior year additions were $3,967 and total
     bad debt expense of $3,967.  There are no significant concentrations of
     credit risk.

     Inventories

     Inventories are shown at cost, using the first-in, first-out method.
     In addition to direct purchases, inventory is acquired through the
     performance of services (See note about revenues).

     Pipe inventory, in the form of a 35-mile long abandoned oil gathering
     pipeline, was acquired for the issuance of a $35,000 promissory note.
     The Company plans to dig up the pipeline and prepare it for sale, if
     title problems are resolved.

     Fixed Assets

     These assets are carried at acquisition cost.  Depreciation is
     provided using the straight-line method over the estimated economic
     lives of the assets, which range from 40 years for buildings to 3 to
     15 years for all other assets.

     The Company rebuilt and upgraded certain newly acquired used operating
     equipment prior to  placing the equipment in the field.  All upgrade
     costs, including related payroll costs, were capitalized.

     Intangibles

     Amortization of Organization Costs is calculated over 60 months.
     Goodwill, created from the purchase of Cyber Cities Technologies,
     Inc. is being amortized over 20 years.

     Income Taxes

     Income from the corporation is taxed at regular corporate rates per
     the Internal Revenue Code. There are no provisions for current taxes
     due to net available operating losses.

     Deferred Tax Liability

     The Company purchased Cyber Cities Technologies, Inc. and accounted
     for the transaction using the "purchase" method of accounting.  This
     requires the acquisition to be accounted for at the fair value of the
     assets received or given up, whichever is more readily available.
     Further, this transaction caused a Deferred Tax Liability to be
     booked, due to the difference between the book basis and tax basis of
     the assets received.  The offset to this entry increased Goodwill.

     Common Stock

     The Company's common stock is stated at par value ($.00001) and the
     paid in capital represents the difference between the fair value of
     the assets received and the common stock at par value.  There are
     currently no commitments or provisions for stock options, stock
     compensation, conversion rights, redemption requirements or unusual
     voting rights.

     There are 850,000 shares of common stock to be held in treasury for
     resale by the Company.  These shares were assigned in a lawsuit set-
     tlement.

     Revenues

     Services

     The Company sells services as an Internet service provider and
     consultant in Hawaii.

     Services for oil well plugging are provided using two types of
     contracts:  cash and salvage.  Under the salvage type, the Company
     receives as its compensation specified types of used oil well
     equipment or pipe.  Revenue is recognized and the items taken into
     inventory based upon the relevant wholesale market prices, or the
     prices at which the Company could buy the items for resale on the
     open market.  No such services were performed during the period.

     Sales

     Inventory, whether acquired by purchase or through services, is
     resold to oil and construction customers.

     Revenues of $4,608 have been earned from oil and gas production
     during the fiscal year and $3,100 for the prior fiscal year.

     Interest

     Interest expensed for the year is $ 90,418 and $40,447 for the prior
     fiscal year.  No interest has been capitalized.

     Estimates

     The preparation of financial statements in conformity with generally
     accepted accounting principles requires management to make estimates
     and assumptions that affect certain reported amounts and disclosures.
     Accordingly, actual results could differ from those estimates.


NOTE 2 - INVESTMENTS IN WHOLLY OWNED SUBSIDIARIES

On April 23, 1998, the Company issued 5,305,625 restricted common shares
in exchange for 100% of Yankee Development Corporation.  Upon consummation
of the transaction, the former owners of Yankee Development Corporation
controlled approximately 90% of the issued and outstanding shares of Basic
Technologies, Inc. and Yankee Development Corporation became a wholly
owned subsidiary of Basic Technologies, Inc.

The transaction was consummated as a purchase of assets, rather than a
pooling of interests.  The valuation assigned to the purchase of Yankee
Development Corporation is based on the underlying net assets, which
consist of working interests in proven oil and gas reserves discounted
to net present value of net revenues less development and operating costs.
The discount applied was 10%. The oil and gas reserves are the only
substantial assets in the subsidiary company.


     Cost of Acquiring Yankee Development Shares     $3,711,000


The valuation of the oil and gas reserves is based on the market price of
oil.  At the time of the valuation, the price used was $15/bbl.  The price
of oil at the balance sheet date was $26.50 per barrel, and the current
price of oil is $22.75; however, the reserves are not to be revalued in
excess of their original valuation.

In October 1998, the Company formed a Limited Liability Company (P & A
Remediation, LLC) with Simpco, Inc. (a wholly owned subsidiary) with the
intention of developing environmental remediation in oil and gas fields.
The Company owns 99% of the stock of P & A Remediation, LLC, and Simpco,
Inc. owns 1%.  See also Note 5.

In January, 1999, the Company issued 850,000 shares of its authorized but
previously unissued shares of voting common stock in exchange for all of
the outstanding common stock of Simpco, Inc., a Texas corporation.  That
corporation, now a wholly owned subsidiary, is intended to be the owner
and lessor of the consolidated entities' operating equipment.  A
promissory note for $110,000.00 was also issued to the shareholders of
Simpco, Inc. as part of the acquisition cost.  The transaction was
accounted for under the purchase method.  See also Note 5.

On November 24, 1999, P&A Remediation LLC, an Oklahoma Limited Liability
Company, was formed for the purpose of beginning remediation and sales
operations in Oklahoma.  See also Note 5.

Effective  January 1, 2000, the Company issued 979,232 shares of its
authorized but unissued shares of voting common stock in exchange for
all of the assets and operations, subject to certain liabilities, of
Cyber City Honolulu, Inc., a Hawaii corporation.  Included in the
exchange was the acquisition of all intangibles including all trade names,
customer lists, goodwill and other intangibles.  The assets and
liabilities were then transferred into a newly formed, wholly owned Hawaii
corporation, Cyber Cities Technologies, Inc.  The acquisition was
accounted for using the "purchase" method of accounting.  The predecessor
and successor companies are a regional Internet service provider and
Internet web page hosting service.  The Company recognized goodwill in
the amount of $681,848.  A related deferred tax liability of $223,069 was
recognized, which increased the acquisition goodwill to $904,917.


NOTE 3 - EMPLOYEE BENEFITS

There are currently no qualified or non-qualified employee pensions,
profit sharing, stock option or other plans authorized for any class of
employees.  Group health insurance is provided to employees in Hawaii.


NOTE 4 - LEASES

Capital Leases

There is one equipment lease, the terms of which mandate accounting as
a capital lease.  The leased assets are depreciated with interest im-
puted.

Amortization of capitalized lease costs is included with depreciation.
Payment on this lease has been suspended pending the results of
negotiation on terms.  Total remaining obligations are $32,871.


Operating Leases

One subsidiary, which operates as an Internet service provider, leased
certain computer/communication equipment.  Management exercised the
buyout options on these during the year.

Additional leases have remaining noncancellable lease terms extending
beyond the current year.  Rental payments due under existing leases are
$2,334 for the year ended June 30, 2002.

There are no contingent rentals, subleases or related party leases of
equipment.

Leases for some physical facilities are on a month-to-month basis. Two
facilities are occupied under long-term leases.  Future lease commit-
tments are:

                  Years Ending
                     June 30              Amount

                       2002               $ 19,800
                       2003                 10,000
                                          --------
                       Total              $ 29,800
                                          --------

Total equipment rental expense for the period was $13,981.


NOTE 5 - COMMITMENTS AND CONTINGENCIES

Initiated in August 2000, there are two known lawsuits involving the
former owners of Simpco, Inc., which the Company purchased in January,
1999.  The former owners alleged that the Company and its officers
violated applicable securities laws in the acquisition of Simpco, Inc.,
and sought to return their 850,000 shares of the Common Stock of the
Company and the Company's $110,000 promissory note, in return for payment
of $940,000 by the Company, plus expenses, or damages of $940,000 plus
expenses and punitive damages.

In late August 2000, the Company filed a lawsuit against dismissed
employees of P & A Remediation (some of whom were the former owners of
Simpco), alleging violation of employment agreements and to seek return
of Company equipment in the possession of the dismissed employees.

In August 2001, the Company settled the above lawsuits, which essen-
tially transferred the original equipment acquired from the former
owners back to the former owners in exchange for the 850,000 shares of
Basic Technologies, Inc., originally issued.  Additionally, certain
payables and notes payable were simultaneously cancelled.  The Company
recognized a loss on the settlement of $77,378.

There are a few small lawsuits over disputed open commercial accounts.
The full potential cost is included in accounts payable.


NOTE 6 - PROVEN DEVELOPED OIL RESERVES

The Company owns, through a subsidiary, proven developed oil reserves on
2300 acres in west Texas.   Valuation at the time of acquisition was
based upon the discounted net present value of net revenues, after
development and operating costs.  The applied discount rate was 10%, and
the oil price used was $15.00 per barrel.  The price of oil at the
statement date was $26.50 per barrel, and the current price of oil is
$22.75 per barrel, but the reserves are not to be revalued.  Recoverable
oil reserves are estimated to be 880,000 barrels.  See also Note 2 above.


NOTE 7 - INCOME TAXES

Starting in 1998, the Company has adopted Statement of Financial
Accounting Standards No. 109, Accounting for Income Taxes ("SFAS No. 109),
which requires the use of the liability method in the computation of
income tax expense and the current and deferred income taxes payable.
Under SFAS No. 109, income tax expense consists of taxes payable for the
year and the changes during the year in deferred assets and liabilities.
Deferred income taxes are recognized for the tax consequences in future
years of differences between the tax bases and financial reporting bases
of assets and liabilities.  Valuation allowances are established when
necessary to reduce deferred tax assets to the amount expected to be
realized.

As there is a net operating loss in the current fiscal year, the Company
has calculated a deferred tax asset (benefit) as follows:

     Fiscal Year June 30, 2001                    $210,938
     Prior Years                                   236,907
                                                  --------

     Gross deferred tax asset                     $447,845
                                                  ========

The Company has also recorded a deferred tax liability for the difference
between book bases and tax bases for the acquisition of Cyber Cities
Technologies, Inc.

     Deferred tax liability                       $223,069


NOTE 8 - SEGMENT REPORTING

The Company has adopted SFAS No. 131, and uses the Management approach
to determine and disclose reportable segment information.

The Company's four reportable business segments are based upon distinctive
types of activities or services:  environmental remediation; equipment
leasing; oil and gas production; and Internet and e-business services.
A full description of these segments is included in Note 1.  All segments
operate within the United States.  The equipment leasing segment provides
service only to the environmental segment.

The accounting policies of the segments are the same as those described in
the summary of significant policies.  Inter-segment services are recorded
using internal transfer prices set by the Company.


NOTE 9 - EARNINGS PER SHARE

Basic earnings (loss) per share are computed by dividing the net loss by
the weighted average number of common shares outstanding during the period.
There are no provisions or contracts that would create dilutive potential
common stock.


NOTE 10 - ACCRUALS

Local and federal taxes, as well as interest on notes and other payables
have been accrued.

No accrual of vacation time is made, because no employee met eligibility
requirements at the statement date.


NOTE 11 - LONG-TERM DEBT

In January, 1999, the Company issued a $110,000 unsecured note, due
January 2001, as part of the acquisition cost of Simpco, Inc.  The note
has been cancelled in a lawsuit settlement.  See also Note 5.

In March, 1999, the Company issued $50,000 in notes payable, due in
March 2003 for working capital.  These were refinanced in March 2001,
with additional funding.  The new notes totaled $52,979, with payoff in
February 2005.  Principal and interest accrued at 10% are payable
monthly, and the notes are secured by equipment.

In March, 1999, the Company issued a $11,500 mortgage payable, due in
March 2004 for the purchase of real estate.  Principal and interest
accrued at 10% are payable monthly and the mortgage is secured by real
estate.

In February, 1999, the Company assumed $71,700 in unsecured notes payable,
due March 2004 for the purchase of inventory.  A $35,000 note has been
cancelled in a lawsuit settlement. Interest accrued at 7%, as well as
the entire principal balance, is due at maturity.

From November, 1998 through May 1999, the Company issued six notes for a
total of $73,975 in notes payable for vehicle and equipment purchases, due
from August 2000 through March 2004.  Principal and interest accrued at
rates from 7.85% to 16.5% are payable monthly and the notes are secured by
vehicles and equipment.

In August, 1999, the Company issued $19,000 in unsecured notes maturing
in August 2003 for working capital.  Principal and interest accrued at
11.5% are payable monthly.

In November, 1999, the Company issued a note for a total of $18,300 for a
vehicle purchase, due from December 1999 through November 2003.  Principal
and interest accrued at 17.5% is payable monthly and the note is secured by
a vehicle.

In December, 2000, the Company renewed and extended a short-term note of
$100,000 to mature in November, 2002.  Accrued interest of 10% is payable
at maturity, and the accrued interest is classified as a long-term
liability.

In December, 2000, the Company issued a promissory note for $110,298 to
acquire a certificate of deposit maturing in January, 2002.  The note bears
interest of 10%, and both principal and interest are payable at maturity
in December, 2003.

Certain installment notes payable for equipment purchases are non-interest
bearing.  On these notes, interest has been imputed at 9%, the related
asset has been discounted, and the imputed/discounted interest is included
in interest expense.

In conjunction with the acquisition of Cyber Cities, the Company assumed
three installment notes totaling $68,750.  These are repaid in monthly
installments, with no interest accrued or payable.  Remaining balances of
$39,000 on two notes were cancelled in exchange for the issuance of 39,000
shares of common stock.

There are no restrictive or subordinate covenants other than standard liens.
Certain debts have the option to be converted to common stock at a price of
$1.00 per share.

Maturities of long term debt are as follows:

                Year Ending
                  June 30            Amount

                   2002            $ 103,992
                   2003              299,114
                   2004              330,362
                   2005                9,848
                                   ---------

                 Total             $ 743,316
                                   =========

Short Term Notes Payable

Between November, 1999 and June, 2000, the Company issued six (6)
promissory notes totaling $ 187,791 for short term working capital needs.

During the current year,the Company issued nine (9) promissory notes
totaling $222,500 for short term working capital needs.  Interest rates
varied from 10% to 12%, payable monthly on some notes, and at maturity
on others.  Some notes were secured by equipment and contract proceeds.
Maturities varied, and renewal and extension provisions were available.

Short-term notes including some newly-issued notes totaling $406,968
were converted to long-term maturities.


NOTE 12 - RELATED PARTY TRANSACTIONS

Open account cash advances have been made by various shareholders.  As of
the financials statement date, no promissory notes, interest rates or
repayment schedules have been set.  The balances are classified as long
term obligations.


NOTE 13 - SUPPLEMENTAL DISCLOSURES-STATEMENT OF CASH FLOWS

Operating activities reflect interest paid of $90,418 for the current
period and $40,447 for the prior fiscal year's period.  A certificate of
deposit for $110,298 was acquired by issuance of a promissory note.
Debt of $41,000 was retired through the issuance of 41,000 shares of com-
mon stock.


NOTE 14 - COMPREHENSIVE INCOME

The Company had no elements of comprehensive income during the period.



<TABLE>
<CAPTION>
                                               BASIC TECHNOLOGIES, INC.
                                       Consolidated Quarterly Income Statements
                                           For The Year Ended June 30, 2001

                                     Quarter Ended        Quarter Ended       Quarter  Ended      Quarter Ended       Nine Months
                                  September 30, 2000    Dcember 31, 2000      March 31, 2001      June 30, 2001           Total
<S>                                 <C>                   <C>                 <C>                <C>                 <C>
REVENUES                             $   105,262           $   110,071         $   114,344        $     91,300        $    420,977

COST OF SALES                                779                   684               4,269               1,566               7,298
                                     -----------           -----------         -----------        ------------        ------------

                    GROSS PROFIT     $   104,483           $   109,387         $   110,075        $     89,734        $    413,679

OPERATING EXPENSES

     Selling, General and
       Administrative                    211,943               198,950             157,148             189,006             757,047
     Interest                             13,761                24,255              21,356              31,046              90,418
     Amortization and Depreciation        39,806                39,806              40,592              40,333             160,537
     Bad Debt Expense                          0                     0                   0               7,461               7,461
                                     -----------           -----------         -----------        ------------        ------------
                    TOTAL OPERATING
                       EXPENSES      $   265,510           $   263,011         $   219,096        $    267,846        $  1,015,463

          NET INCOME (LOSS)
             FROM OPERATIONS         $  (161,027)          $  (153,624)        $  (109,021)       $   (178,112)       $   (601,784)

OTHER INCOME (EXPENSE)

     Other Gains                     $     1,818           $       700         $     1,730        $      2,299        $      6,547
     Interest Income                         133                    57               1,447                 540               2,177
     Loss - Lawsuit Settlement                 0                     0                   0             (77,378)            (77,378)
                                     -----------           -----------         -----------        ------------        ------------

               TOTAL OTHER INCOME
                  (EXPENSE)                1,951                   757               3,177             (74,539)            (68,654)
                                     -----------           -----------         -----------        ------------        ------------

          NET INCOME (LOSS)
              BEFORE TAXES           $  (159,076)          $  (152,867)        $  (105,844)       $   (252,651)       $   (670,438)

DEFERRED TAX BENEFIT                      54,086                51,975              35,987              68,890             210,938
                                     -----------           -----------         -----------        ------------        ------------

                    NET INCOME
                        (LOSS)       $  (104,990)          $  (100,892)        $  ( 69,857)       $   (183,761)       $   (459,500)

EARNINGS PER SHARE

   Income (Loss) for
        Common Stockholders          $     (0.01)          $     (0.01)        $     (0.01)       $      (0.05)       $      (0.08)
                                     ============          ============        ============       =============       =============
</TABLE>

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







                             BASIC TECHNOLOGIES, INC.
                          Table of Reportable Segments
                        For The Year Ended June 30, 2001
<TABLE>
<CAPTION>
                           Oil & Gas   Environmental  Equipment  Internet &   Elimin-  Consoli-
                           Production   Remediation    Leasing   E-Business   ations    dated
                           --------------------------------------------------------------------

<S>                        <C>            <C>         <C>        <C>        <C>     <C>
Sales to
Unaffiliated Customers     $   4,608   $    4,000     $   1,527  $  410,842 $        $ 420,977
Inter-Segment Sales                0            0             0           0                  0
                           -------------------------------------------------------------------

        Total Sales        $   4,608        4,000         1,527     410,842        0   420,977
                           ===================================================================

Operating Income (Loss)    $   1,720      (59,993)      (106,064)   (88,033)          (252,370)

Corporate Expenses                                                                    (349,414)
                                                                                     ---------
        Total Operating Income (Loss)                                                 (601,784)
                                                                                     ==========
Depreciation &
   Amortization            $       0          933        99,329      58,064        0   158,326
                           =========================================================
Corporate Expenses                                                                       2,211
                                                                                     ---------
        Total Depreciation & Amortization                                              160,537
                                                                                     =========
Interest Revenue (Not Allocated to Segments)                                             2,177
                                                                                     =========

Interest Expense           $       0       22,564         8,239      11,730        0    42,533
                           =========================================================
Corporate Expenses                                                                      47,885
                                                                                     ---------
        Total Interest Expense                                                          90,418
                                                                                     =========
                                                                                             0
Segment Assets             $3,711,000     255,842       260,035     948,431 (220,199)
                           ========================================================= 4,955,109
General Corporate Assets                                                               581,773
                                                                                     ---------
        Total Assets                                                                 5,536,882
                                                                                     =========
Expenditures for
Segment Fixed Assets       $       0 $       0     $          0   $  14,680  $     0 $  14,680
                           ==========================================================
Corporate Assets                                                                         3,114
                                                                                     ---------
        Total Expenditures                                                           $  17,794
                                                                                     =========

</TABLE>

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