<PAGE>

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB

(Mark One)
         (x) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
         SECURITIES EXCHANGE ACT OF 1934

                For the quarterly period ended February 28, 2002

                                       OR

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

                 For the transition period from _____ to ______

                         Commission file number 0-30474

                              American Group, Inc.
        -----------------------------------------------------------------
        (Exact name of small business issuer as specified in its charter)

                                     Florida
         --------------------------------------------------------------
         (State or other jurisdiction of incorporation or organization)

                                   88-0326984
                        ---------------------------------
                        (IRS Employer Identification No.)

             5295 Town Center Road Third Floor, Boca Raton, FL 33486
             -------------------------------------------------------
                    (Address of principal executive offices)

                                  561-394-2443
                           ---------------------------
                           (Issuer's telephone number)

              ----------------------------------------------------
              (Former name, former address and former fiscal year,
                          if changed since last report)

         Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.

         Yes (x) No ( )

State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date. As of January 10, 2001 the
registrant had issued and outstanding 9,440,956 shares of common stock.
Transitional Small Business Disclosure Format (check one);

         Yes ( ) No (x)





<PAGE>




                         PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

INDEX TO FINANCIAL STATEMENTS

                                                                        Page No.
                                                                        --------
Condensed Consolidated Balance Sheet at
February 28, 2002(unaudited)                                             F-2

Condensed Consolidated Statements of Operations
for the three months ended February 28, 2002
and 2001 (unaudited)                                                     F-3

Condensed Consolidated Statements of Operations
for the nine months ended February 28, 2002
and 2001 (unaudited)                                                     F-4

Condensed Consolidated Statements of Cash Flow for
the nine months ended February 28, 2002
and 2001 (unaudited)                                                     F-5

Notes to the Condensed Consolidated Financial
Statements (Unaudited)                                                     2


















                                       1


<PAGE>

                      AMERICAN GROUP, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEET
                                FEBRUARY 28, 2002

<TABLE>
<S>                                                                       <C>
ASSETS

Current assets:
    Cash                                                                   $       818
    Accounts receivable, less allowance for doubtful accounts
        of $10,000                                                              13,028
    Inventory                                                                   42,885
                                                                           -----------

        Total current assets                                                    56,731

Property, plant and equipment, net of accumulated
    depreciation of $721,064                                                 2,492,831

Other assets:
    Equipment deposit                                                        1,507,571
    Goodwill, net                                                              629,000
    Other                                                                       17,599
                                                                           -----------

                                                                           $ 4,703,732
                                                                           ===========

LIABILITIES AND STOCKHOLDERS' DEFICIT

Current liabilities:
    Current portion of notes payable                                       $ 3,313,679
    Current portion of capital lease obligation payable                         18,953
    Accrued interest payable                                                   397,233
    Accounts payable and accrued expenses                                    1,270,608
                                                                           -----------

        Total current liabilities                                            5,000,473
                                                                           -----------

Long term liabilities:
    Long-term debt less current portion                                        586,182
    Long-term capital lease obligation less current portion                      9,485
                                                                           -----------

                                                                               595,667
                                                                           -----------


Stockholders' deficit:
    Preferred stock, $.001 par value, 9,991,000 shares authorized;
        no shares issued and outstanding                                            --
    Preferred stock, Series C, $.001 par value, 9,000 shares authorized;
        5,913 issued and outstanding                                                 6
    Common stock, $.001 par value, 50,000,000 shares authorized,
        9,440,956 shares issued and outstanding                                  9,441
    Additional paid-in capital                                               8,355,612
    Comprehensive income                                                        57,433
    Accumulated deficit                                                     (9,314,900)
                                                                           -----------

        Total stockholders' deficit                                           (892,408)
                                                                           -----------

                                                                           $ 4,703,732
                                                                           ===========
</TABLE>


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

                                       F-2


<PAGE>


                      AMERICAN GROUP, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
              FOR THE THREE MONTHS ENDED FEBRUARY 28, 2002 AND 2001


                                              For the three months ended
                                                     February 28,
                                                 2002          2001
                                                 ----          ----


Revenue                                     $   339,000    $   516,063
Cost of sales                                   420,412        547,405
                                            -----------    -----------

Gross loss                                      (81,412)       (31,342)

   Selling, general and administrative          311,767        471,171
                                            -----------    -----------

Operating loss                                 (393,179)      (502,513)
                                            -----------    -----------

Other income (expenses):
   Interest expense                             (90,501)      (108,839)
   Interest income                                1,407             55
                                            -----------    -----------

                                                (89,094)      (108,784)
                                            -----------    -----------

Net loss                                       (482,273)      (611,297)

Preferred stock dividend                        (58,342)       (18,000)
                                            -----------    -----------


Net loss available to common stockholders   $  (540,615)   $  (629,297)
                                            ============   ===========

Earnings per share

Net loss                                          (0.05)         (0.62)

Preferred stock dividend and other
  charges                                         (0.01)         (0.02)
                                            -----------    -----------

Net loss available to common stockholders,
  basic and fully diluted                   $     (0.06)   $     (0.64)
                                            ===========    ===========


Weighted average shares outstanding           9,440,956        985,750
                                            ===========    ===========




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

                                       F-3

<PAGE>


                      AMERICAN GROUP, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
              FOR THE NINE MONTHS ENDED FEBRUARY 28, 2002 AND 2001


                                            For the nine months ended
                                                   February 28,
                                               2002            2001
                                               ----            ----


Revenue                                     $ 1,818,591    $ 2,358,600
Cost of sales                                 1,971,478      2,507,236
                                            -----------    -----------

Gross loss                                     (152,887)      (148,636)

   Selling, general and administrative        1,328,066      1,403,298
                                            -----------    -----------

Operating loss                               (1,480,953)    (1,551,934)
                                            -----------    -----------

Other income (expenses):
   Interest expense                            (226,969)      (431,075)
   Interest income                                2,296            773
                                            -----------    -----------

                                               (224,673)      (430,302)
                                            -----------    -----------

Loss before extraordinary item               (1,705,626)    (1,982,236)

Extraordinary item                                            (248,127)
                                            -----------    -----------

Net loss                                     (1,705,626)    (2,230,363)


Preferred stock dividend                       (176,889)      (668,343)
                                            -----------    -----------

Net loss available to common stockholders   $(1,882,515)   $(2,898,706)
                                            ===========    ===========

Earnings per share

Loss before extraordinary item              $     (0.18)   $     (2.02)

Extraordinary item                                   --          (0.25)
                                            -----------    -----------

Net loss                                          (0.18)         (2.27)

Preferred stock dividend and other
  charges                                         (0.02)         (0.68)
                                            -----------    -----------

Net loss available to common stockholders,
  basic and fully diluted                   $     (0.20)   $     (2.95)
                                            ===========    ===========

Weighted average shares outstanding           9,440,956        981,614
                                            ===========    ===========



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

                                       F-4

<PAGE>


                      AMERICAN GROUP, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
              FOR THE NINE MONTHS ENDED FEBRUARY 28, 2002 AND 2001

<TABLE>
<CAPTION>
                                                          For the nine months ended
                                                                February 28,
                                                            2002           2001
                                                            ----           ----
<S>                                                         <C>            <C>
Cash flows from operating activities:
Net loss                                                 $(1,705,626)   $(2,862,706)
  Adjustments to reconcile net income to net cash
    provided by (used in) operating activities:
      Depreciation and amortization                          250,573        391,172
      Foreign currency exchange rate gain (loss)             113,444             --
      Issuance of common stock for debt conversion and
         release of an unasserted claim                           --      1,274,732
      Changes in assets and liabilities
        Accounts receivable                                  122,271          4,116
        Inventory                                              6,369         28,343
        Other assets                                              --       (149,707)
        Accounts payable and accrued expenses                380,111        287,856
                                                         -----------    -----------

     Net cash used in operations                            (832,858)    (1,026,194)
                                                         -----------    -----------

Cash flows from investing activities:
      Proceeds from sale of equipment                         40,000             --
      Deposit on new equipment                              (293,861)      (359,810)
                                                         -----------    -----------

     Net cash used in investing activities                  (253,861)      (359,810)
                                                         -----------    -----------

Cash flows from financing activities:
       Proceeds from loans payable                         1,100,825        893,951
       Payments on loans payable                             (14,759)       (77,250)
       Proceeds from sale of common stock                         --        575,000
                                                         -----------    -----------

     Net cash provided by financing activities             1,086,066      1,391,701
                                                         -----------    -----------

Net decrease in cash                                            (653)         5,697

Cash at beginning of period                                    1,471          9,732
                                                         -----------    -----------

Cash at end of period                                    $       818    $    15,429
                                                         ===========    ===========

Supplemental disclosure of cash flow information:
    Cash paid during the period for interest             $     9,930    $    63,235
                                                         ===========    ===========
    Cash paid during the period for taxes                $        --    $        --
                                                         ===========    ===========
</TABLE>


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

                                       F-5



<PAGE>



                              AMERICAN GROUP, INC.
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                                February 28, 2002

Note 1 - Basis of Presentation

         The accompanying unaudited condensed consolidated financial statements
have been prepared in accordance with accounting principles generally accepted
in the United States of America for interim financial information and with the
instructions of Form 10-QSB and Article 310 of Regulation S-B. Accordingly, they
do not include all of the information and footnotes required by generally
accepted accounting principles for complete financial statements. The
preparation requires management to make estimates and assumptions that affect
the reported amounts of assets and liabilities and the disclosure of contingent
assets and liabilities at the date of the financial statements and the reported
amount of revenues and expenses during the reporting period. Actual results may
differ from these estimates. In the opinion of management, all adjustments
(consisting of normal recurring accruals) considered necessary for a fair
presentation have been included. Operating results for the nine month period
ended February 28, 2002 are not necessarily indicative of the results that may
be expected for the year ending May 31, 2002.

         For further information, refer to the consolidated financial statements
and footnotes thereto included in the Company's annual report on Form 10-KSB for
the year ended May 31, 2001 as filed with the Securities and Exchange
Commission.

Note 2 - Going Concern

         The accompanying financial statements have been prepared on a going
concern basis, which contemplates the realization of assets and the satisfaction
of liabilities in the normal course of business. The Company's continued
existence is dependent upon its ability to resolve its liquidity problems,
principally by obtaining equity capital and commencing profitable operations.
During the interim, the Company must continue to operate on cash flows generated
from loans, raising capital, and internally generated cash flow. The Company
experienced net losses available to common stockholders of $1,882,515 for the
nine months ended February 28, 2002, and has a negative working capital of
$4,943,742 at February 28, 2002. In addition, the note payable to purchase the
Canadian peat bog, one of the Company's principal suppliers, is delinquent.
These factors raise substantial doubt about the Company's ability to continue as
a going concern.

         Management's plans in regard to this matter are to raise capital,
become profitable by integrating its operations with Torland, and increase
efficiency by relocating its operations to a new facility in Homestead, Florida,
near its customer base. The Company plans, upon integration with Torland, to
begin utilizing the new facility, and management believes operating costs will
decrease due to the efficiencies of the new facility. Management believes these
efforts will generate positive cash flow. The financial statements do not
include any adjustments that might result from the outcome of this uncertainty.


Note 3. Legal Proceedings.

         On March 26, 2002, the Company and its President were served with a
lawsuit filed in the Circuit Court of Palm Beach County Florida styled
Gittelstob vs American Group, Inc. and Robert I. Claire seeking the enforcement
of a guaranty of an obligation owed to a third party by Eric W. Deckinger the
president of LPS Acquisition Corp. and a member of its Board of Directors in the
amount of $352,500. The Company believes the filing to be premature and will
defend the lawsuit vigorously. The Company gives no assurance that it will
prevail. A judgment against the Company could have a material adverse effect on
the Company.

In March 2002, the Company received notice of acceleration and default
of payment of four (4) operating equipment leases for equipment utilized at its
Boynton Beach, Florida plant. The equipment utilized is essential to the
production of soil-mixes distributed by the Company. The loss of such equipment
would impair the Company's ability to meet its customers demands which could
have a material adverse effect on the Company.

On March 4, 2002, the Company received written notice that the bank
with which it has an operating line of credit was closed by the Federal Deposit
Insurance Corporation as Receiver. Under powers afforded Receivers under Federal
banking laws, the Receiver disaffirmed its contractual obligations under the
line of credit. While the Company is in the process of determining whether it
has a claim against the Receiver, the Company's inability to open a line of
credit with another financial institution could have a material adverse effect
on the Company.



                                        2
<PAGE>


Item 2. Management's Discussion and Analysis or Plan or Operation.

Forward-looking Statement and Information

The Company is including the following cautionary statement in this Form 10-QSB
for any forward-looking statements made by, or on behalf of, the Company.
Forward-looking statements include statements concerning plans, objectives,
goals, strategies, expectations, future events or performance and underlying
assumptions and other statements which are other than statements of historical
facts. Certain statements contained herein are forward-looking statements and,
accordingly, involve risks and uncertainties which could cause actual results or
outcomes to differ materially from those expressed in the forward-looking
statements. The Company's expectations, beliefs and projections are expressed in
good faith and are believed by the Company to have a reasonable basis, including
without limitations, management's examination of historical operating trends,
data contained in the Company's records and other data available from third
parties, but there can be no assurance that management's expectations, beliefs
or projections will result or be achieved or accomplished. In addition to other
factors and matters discussed elsewhere herein, the following is an important
factor that, in the view of the Company, could cause actual results to differ
materially from those discussed in the forward-looking statements: the ability
of the Company to obtain acceptable forms and amounts of financing to fund
planned acquisitions and the new facility in Homestead.

Introduction

The Company's continued existence is dependent upon its ability to resolve its
liquidity problems, principally by obtaining equity capital and commencing
profitable operations. While pursuing equity capital, the Company must continue
to operate on cash flow generated from operations and financing activity. The
Company experienced a net loss available to common stockholders of $1,705,626
for the nine months ended February 28, 2002 and has a negative working capital
of $4,943,742 at February 28, 2002. These factors raise substantial doubt about
the Company's ability to continue as a going concern. Management's plans in
regard to this matter are to raise capital, become profitable by integrating its
operations with Torland and increase efficiency by relocating its operations
into a new state of the art soil blending facility near Homestead, Florida,
close to the major portion of its customer base. Additionally, the Company
plans, along with the integration with Torland, to begin utilizing this state of
the art soil blending plant, which management believes will substantially
decrease its operating costs. Management believes these efforts will generate
positive cash flow.


Nine months Ended February 28, 2002 compared to the nine months ended February
28, 2001

Revenues for the nine months ended February 28, 2002 were $1,818,591 compared to
$2,358,600 for the nine months ended February 28, 2001. The decrease in sales
can
be attributed to a decrease of sales at LPS. Gross loss margins as a percentage
of revenues for the nine months ended February 28, 2002 and 2001 was (8.4%) and
(6.3%), respectively. The Company's current facility is not adequate to handle
the volume of business currently in place. Due to the Company's poor cash flow
during the nine months ended February 28, 2002, the Company was unable to avail
itself of any purchasing discounts that would have otherwise been available had
the Company been able to make commitments to purchase products at greater
amounts. The Company estimates that the price of material is 20% higher than the
price that could be obtained if the Company were able to take advantage of
volume price concessions. The Company is currently relocating to Homestead, FL
where it is expected to reverse the negative gross profit trend. Operating
expenses for the nine months ended February 28, 2002 and 2001 were $1,328,066
and $1,403,298, respectively, consisting of selling, general and administrative
expenses. The net losses available to common stockholders for the nine months
ended February 28, 2002 and 2001 were $1,882,515 and $2,898,706, respectively.
The decrease is due to the payment-in-kind of preferred stock valued at the
stated value of $800 per share which amounted to approximately $1,218,472 and
the issuance of 300,000 shares of the Company's common stock, valued at $56,550
(market value), in exchange for the retirement of certain warrants issued in
connection with convertible debt and the extension for payment of this debt
during the nine months ended February 28, 2001.


                                        3


<PAGE>

Three months Ended February 28, 2002 compared to the three months ended February
28, 2001

Revenues for the three months ended February 28, 2002 were $339,000 compared to
$516,063 for the three months ended February 28, 2001. The decrease in sales can
be attributed to a decrease of sales at LPS. Gross loss margin as a percentage
of revenues for the three months ended February 28, 2002 and 2001 was (24.0%)
and (6.1%), respectively. The Company's current facility is not adequate to
handle the volume of business currently in place. Due to the Company's poor cash
flow during the three months ended February 28, 2002, the Company was unable to
avail itself of any purchasing discounts that would have otherwise been
available had the Company been able to make commitments to purchase products at
greater amounts. The Company estimates that the price of material is 20% higher
than the price that could be obtained if the Company were able to take advantage
of volume price concessions. The Company is currently relocating to Homestead,
FL where it is expected to reverse the negative gross profit trend. Operating
expenses for the three months ended February 28, 2002 and 2001 were $311,767 and
$471,171, respectively, consisting of selling, general and administrative
expenses. The net losses available to common stockholders for the three months
ended February 28, 2002 and 2001 were $540,615 and $629,297, respectively.

         At February 28, 2002, the Company had cash and cash equivalents of
$818, which was an decrease of $653 compared to the cash held at May 31,
2001. During the nine months ended February 28, 2002 the Company used net cash
from operations of $832,858, which was primarily due to the Company's operating
loss. This was funded by additional borrowings. In addition, the Company had a
working capital deficit of $4,943,742 at February 28, 2002.

Qualitative Discussion

We believe that our present operations will require us to obtain additional
capital during the next twelve months. One of our objectives for the next twelve
months is to increase our capital so that we can increase the scope of our
operations with the completion of our new soil blending facility, and to acquire
additional soil blending facilities. It is unknown at this time whether we will
be successful in raising capital at reasonable terms. We have been unable to
meet our cash requirements for our current operations through internal cash flow
in the prior twelve months. These requirements were only met by the additional
sale of stock or borrowings. We believe that the cash requirements for our
current operations during the next twelve months, excluding capital requirements
for completion of construction of our new soil blending facility, can be met
through LPS's internal cash flow from operations. We believe that the operations
from the new facility will change our cash flow so as to have our cash flow
needs provided by operations. Until that time we will need to generate loans and
raise capital in order to continue to operate. Our other cash requirements would
be in connection with additional capital for our growth, if any, in an amount
not yet determined. In addition, Torland will continue to sell its sphagnum peat
moss product to other customers. We must pay $921,283, plus interest, in
connection with the acquisition of Torland.

Until such time as our operating results improve sufficiently, we must obtain
outside financing to fund our operations and to meet our obligations. Any
additional debt or equity financing may be dilutive to the interests of our
stockholders. Such outside financing must be provided from the sale of equity
securities, borrowing, or other sources of third party financing in order for us
to expand our operations. Further, the sale of equity securities could dilute
our existing stockholders' interest, and borrowings from third parties could
result in our assets being pledged as collateral and loan terms which would
increase our debt service requirements and could restrict our operations. There
is no assurance that capital will be available from any of these sources, or, if
available, at terms and conditions acceptable to us.







                                        4
<PAGE>


                           PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

         On March 26, 2002, the Company and its President were served with a
lawsuit filed in the Circuit Court of Palm Beach County Florida styled
Gittelstob vs American Group, Inc. and Robert I. Claire seeking the enforcement
of a guaranty of an obligation owed to a third party by Eric W. Deckinger the
president of LPS Acquisition Corp. and a member of its Board of Directors in the
amount of $352,500. The Company believes the filing to be premature and will
defend the lawsuit vigorously. The Company gives no assurance that it will
prevail. A judgment against the Company could have a material adverse effect on
the Company.

In March 2002, the Company received notice of acceleration and default
of payment of four (4) operating equipment leases for equipment utilized at its
Boynton Beach, Florida plant. The equipment utilized is essential to the
production of soil-mixes distributed by the Company. The loss of such equipment
would impair the Company's ability to meet its customers demands which could
have a material adverse effect on the Company.

On March 4, 2002, the Company received written notice that the bank
with which it has an operating line of credit was closed by the Federal Deposit
Insurance Corporation as Receiver. Under powers afforded Receivers under Federal
banking laws, the Receiver disaffirmed its contractual obligations under the
line of credit. While the Company is in the process of determining whether it
has a claim against the Receiver, the Company's inability to open a line of
credit with another financial institution could have a material adverse effect
on the Company.

Item 2. Changes in Securities.

         None.


Item 3. Defaults Upon Senior Securities.

         None.

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

         None.

Item 5. Other Information.

         None.

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

         (a)      Exhibits.

No.                               Description
---                               -----------


         (b) Reports on Form 8-K.

         None.

                                       5
<PAGE>



                                   SIGNATURES

         In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.


                                        American Group, Inc.,
                                        a Nevada corporation

Date: April 19, 2002                    By: /s/ Robert I. Claire
                                              ---------------------
                                              Robert I. Claire,
                                              President















                                        6