UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                   Form 10-KSB

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(Mark one)
   XX       ANNUAL REPORT  UNDER  SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
----------  ACT OF 1934

                  For the fiscal year ended December 31, 2000

            TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE  ACT  OF
----------  1934

                  For the transition period from _____________ to ____________

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                         Commission File Number: 0-29582

                         United Community Holdings, Inc.
        (Exact name of small business issuer as specified in its charter)

          Nevada                                                75-2300997
------------------------                                ------------------------
(State of incorporation)                                (IRS Employer ID Number)

                       3935 I-55 South, Jackson, MS 39212
                       ----------------------------------
                    (Address of principal executive offices)

                                 (601) 371-0009
                                 --------------
                           (Issuer's telephone number)

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          Securities Registered under Section 12(b) of the Exchange Act
          -------------------------------------------------------------

Title of each Class                    Name of Each Exchange on which Registered
None                                                                        None

          Securities registered Under Section 12(g) of the Exchange Act
          -------------------------------------------------------------
                        Common Stock, $0.00001 Par Value

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Check  whether  the issuer  (1) has 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

Check if there is no disclosure of delinquent  filers in response to Item 405 of
Regulation S-B contained in this form, and no disclosure  will be contained,  to
the  best  of  management'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. [X]

State issuer's revenues for its most recent fiscal year: $351,641.

State the  aggregate  market  value of the voting  stock held by  non-affiliates
computed by reference  to the price at which the stock was sold,  or the average
bid and asked  prices of such stock,  as of a specified  date within the past 60
days: $-0-(stock is not quoted).

As of March 28, 1999 the issuer had 8,000,818  shares of common stock issued and
outstanding.

<PAGE>

PART 1

Item 1.  Description of the Business

General
-------

This   registrant   was   incorporated   on  May  31,   1989   with   the   name
Professionalistics, Inc. under the laws of the State of Delaware. It changed its
name to  Pacific  Great  China  Co.,  Ltd.  (herein  "PGCC")  on May 8,  1996 in
anticipation  of  a  planned   business   acquisition  or  merger   transaction.
Subsequently,  during  1996,  the  anticipated  business  acquisition  or merger
transaction was abandoned and canceled.

On December 17, 1998 PGCC changed its state of  incorporation  from  Delaware to
Nevada by means of a merger with and into United  Community  Holdings,  Inc.,  a
Nevada  corporation  (herein  "UCHI") formed solely for the purpose of effecting
the reincorporation. The Certificate of Incorporation and Bylaws of UCHI are the
Certificate  of  Incorporation  and Bylaws of the  surviving  corporation.  Such
Certificate  of  Incorporation  changed the company's  name to United  Community
Holdings,  Inc. and modified the  company's  capital  structure to allow for the
issuance of 50,000,000 total equity shares,  consisting of 50,000,000  shares of
common stock with a par value of $0.00001 per share (herein the "Common Stock).

In January 1999,  pursuant to a Stock Purchase  Agreement signed on November 19,
1998, James F. Robinson (herein "Robinson")  obtained a controlling  interest in
UCHI  by  acquiring  from  Halter  Capital  Corporation   7,200,000  shares,  or
approximately 90% of the issued and outstanding common stock, of UCHI.  Robinson
paid $50,000 cash as  consideration  for that stock and for other services to be
rendered by Halter Capital Corporation  ("HCC"). As of December 17, 1998 Pacific
Great China Co., Ltd., a Delaware  corporation,  had more than 700  shareholders
but no assets  and no  liabilities.  On that same  date PGCC  executed  a Merger
Agreement  with UCHI whereby PGCC was merged with and into UCHI,  with one share
of UCHI's  common stock being  exchanged  for each share of common stock of PGCC
then  outstanding.  As a  result,  United  Community  Holdings,  Inc.,  a Nevada
corporation,  is the surviving  corporation  resulting  from that merger and the
registrant filing this registration statement.

As of January 1, 1999, Robinson and UCHI entered into a Stock Purchase Agreement
(under that date) whereby  Robinson  sold all of the stock in Rosemont  which he
then owned  (representing 100% of the issued and outstanding shares of Rosemont)
to UCHI in exchange for 1000 shares of UCHI's common stock.  As a result of this
transaction Rosemont has become a wholly owned subsidiary of UCHI and at present
it is its only operating subsidiary.

As discussed  above, the reason UCHI entered into this transaction with Robinson
was so that it could complete an acquisition or merger  transaction  whereby its
shareholders   would  benefit  by  owning  an  interest  in  a  viable  business
enterprise.  Specifically,  UCHI  desired  to enter  into a  transaction  with a
company  such  as  Rosemont  that  on  a  consolidated  basis  either  presently
qualified,  or in the near  future  would  qualify,  for  listing  on the NASDAQ
SmallCap Market. Upon analysis of Robinson's business plan for Rosemont,  it was
determined  that  UCHI  had  specific  plans to meet the  assets  and net  worth
criteria to be listed on the NASDAQ  SmallCap  Market.  For these reasons,  UCHI
believed it could best enhance its shareholders'  interests in the registrant by
consummating this transaction with Robinson.

UCHI's principal office, as well as the principal office of Rosemont, is located
at 3935 Interstate 55 South,  Jackson,  Mississippi  39212. The telephone number
for both is (601) 371-0009.

Rosemont  Gardens  Funeral   Chapel-Cemetery,   Inc.  (herein   "Rosemont")  was
incorporated  on March 4,  1994  under  the  laws of the  State of  Mississippi.
Rosemont has an authorized  capital  stock of 10,000 shares of common stock,  of
which only 1000 shares are issued and outstanding. All of its outstanding shares
were originally  owned by James F. Robinson.  Rosemont founded in 1994 a funeral
home and cemetery in Jackson,  Mississippi  that it operates.  This  business is
known as Rosemont Gardens Memorial Park.

UCHI  continues  to analyze  the  dramatically  and  rapidly  changing  industry
conditions and to develop  proactive  business  strategies.  As the  acquisition
landscape began challenging following negative  announcements by larger industry
players  during the year,  UCHI  started to  identify  strategies.  We intend to
prepare our company for significant and  opportunistic  growth due to our belief
that there will be dramatic ownership  restructuring of previously  consolidated
industry  assets by others over the next 12 to 24 months.  Accordingly,  we will
seek to align ourselves with one or more capital partners that share our view of
the opportunities in the industry.

<PAGE>

UCHI   currently   owns  100%  of  the  stock  of   Rosemont   Gardens   Funeral
Chapel-Cemetery,   Inc.   Rosemont  Gardens   currently   operates  in  Jackson,
Mississippi  where  cremation  only  represents 2% of services as compared to as
much as 50% in some  areas.  We have  aggressively  moved into the  funeral  and
cemetery business and are servicing its pre-need and at-need customers.  We also
operate a vault  manufacturing  section which also provides vault merchandise to
our  customers  on-site.  We  furnish  transportation  for our  at-need  funeral
services  and also have  available  a  mortuary  and/or  embalming  facility  to
facilitate the funeral home's embalming services.

Rosemont  Gardens has doubled its funeral volume over 1998 and is poised to make
a significant gain in the Year 2000.  Administrative offices are maintained with
a staff of personnel for the purposes of keeping  records of pre-need  sales and
customer  services.  Funeral  directors  are on staff to conduct  the day to day
funeral services.

UCHI's  strategic plan is to acquire and/or  construct,  own and operate funeral
homes,  cemeteries and pre-arrangement centers at various strategically selected
sites in the  Southeastern  portion of the United States.  Each  geographic area
selected  for  development  of  these  community-based   funeral  homes/cemetery
operations and pre-need  centers will be developed in a "cluster" of facilities.
The exact  composition  of each cluster will vary  depending on the  anticipated
demands for the  company's  services in each  geographic  area  selected and the
results of a study to be conducted by UCHI of various  demographic  factors,  as
well as the present and  potential  markets for funeral  homes,  cemeteries  and
pre-arrangement service centers. The clustering of existing operating facilities
which have been acquired  along with the  construction  of economical  satellite
facilities  and  pre-arrangement  sales  centers  will  provide  UCHI  with  the
appearance  of  an  "overnight"   presence  in  the  communities   selected  for
development.  Clustering  these  facilities  will also  help to  ensure  that an
adequate cash flow can be generated by the  facilities in each cluster to assure
financial  independence  and  reduce  the  need for cash  infusions  from  other
operating clusters. This clustering approach and the use of standardized designs
for  the  physical   facilities  will  limit  construction  costs  and  increase
operational economies. The cluster concept will permit the economical sharing of
personnel and other resources among the facilities in each cluster, for example,
embalming facilities, hearses, cremation equipment, administrative and financial
services,  etc.  Actual  clusters will vary in  configuration  from area to area
depending on the availability of existing operating  facilities,  the population
of the geographic area, the perceived needs in the area and other factors.

During  its  initial  development  phase,  UCHI will seek to  acquire  ownership
interests  in  existing  funeral  and/or  cemetery  operations  and  facilities,
including  undeveloped  acreage  to be used  for  new  funeral  and/or  cemetery
operations,  all of which  will be located  in the  Southeastern  portion of the
United States.  UCHI may acquire such  properties and operations  directly using
leverage,  newly raised capital or its own internal funds, or by the issuance of
additional shares of stock of UCHI which are currently  authorized but unissued.
There is no assurance  that UCHI will  acquire  ownership  of, or a  controlling
interest in, any of the aforementioned types of properties or businesses and, as
of  the  date  of  this  registration  statement,   UCHI  has  no  contracts  or
understandings to acquire any such properties or businesses and has not yet held
any discussions which might result in any such acquisitions or purchases.  While
UCHI's  management  is  hopeful  that  such  acquisitions  or  purchases  can be
consummated on favorable terms, it can make no such representations.

Management  believes that there are  opportunities for UCHI to acquire ownership
interests   in  several   existing   operations   in  its   industry   that  are
under-performing in their markets due to ineffective management and marketing or
substandard  facilities.  UCHI may attempt to acquire  such  operations  and, by
using UCHI's experienced staff of professionals,  to increase the efficiency and
profitability of such operations and/or remodel the existing  facilities,  while
creating a larger network of funeral homes and cemeteries  that can benefit from
UCHI's unique approach to serving its clientele.

At the present time UCHI has not  identified any specific  business  opportunity
that it plans to  pursue,  nor has UCHI  reached  any  agreement  or  definitive
understanding  with any person  concerning  an  acquisition.  Moreover,  none of
UCHI's officers,  directors or promoters,  and no affiliate of UCHI, has had any
preliminary  contact or discussions with a  representative  of any other company
regarding the  possibility  of an  acquisition  or merger  between UCHI and such
other company. No assurance can be given that UCHI will be successful in finding
or  acquiring a desirable  business  opportunity  or that any  acquisition  that
occurs will be on terms that are favorable to UCHI and its  stockholders,  given
the fact that only limited funds are currently  available for  acquisitions  and
that UCHI does not know  whether it can raise the  additional  capital  which it
believes is necessary to expand.

<PAGE>

It is anticipated that business opportunities will come to UCHI's attention from
various  sources,  including  its  officers  and  directors,  its  stockholders,
professional   advisors   such  as   attorneys   and   accountants,   securities
broker-dealers,  venture capitalists,  members of the financial  community,  and
others who may present unsolicited proposals. UCHI has no plans, understandings,
agreements,  or  commitments  with any  individual  for such  person to act as a
finder of opportunities for UCHI.

UCHI does not  foresee  that it would  purchase  an  interest in or enter into a
contract  with  any  business  with  which an  officer  or  director  of UCHI is
affiliated.  Should  UCHI's  management  determine  in the  future,  contrary to
management's current expectations, that a transaction with an affiliate would be
in the best interests of UCHI and its stockholders,  UCHI is permitted by Nevada
law to enter into such a transaction if:

   (1) The material  facts as to the  relationship  or interest of the affiliate
       and as to the contract or  transactions  are disclosed or are known o the
       Board of Directors,  and the Board in good faith  authorizes the contract
       or   transaction  by  the   affirmative   votes  of  a  majority  of  the
       disinterested   directors,   even  though  the  disinterested   directors
       constitute less than a quorum; or

   (2) The material  facts as to the  relationship  or interest of the affiliate
       and as to the contract or  transaction  are disclosed or are known to the
       stockholders entitled to vote thereon, and the contract or transaction is
       specifically approved in good faith by vote of the stockholders; or

   (3) The  contract  or  transaction  is fair  as to UCHI as of the  time it is
       authorized,  approved  or  ratified,  by the  Board of  Directors  or the
       stockholders.

The  analysis  of  business  opportunities  will be  undertaken  by or under the
supervision of UCHI's executive  officers and directors.  See "Management." UCHI
anticipates that it will consider, among other things, the following factors:

   (1) Potential for growth and profitability, and anticipated market expansion;

   (2) Competitive  position, as compared to other companies of similar size and
       experience  within the industry segment as well as within the industry as
       a whole;

   (3) Strength and diversity of existing  management  or  management  prospects
       that are scheduled for recruitment;

   (4) Capital  requirements and anticipated  availability of required funds, to
       be provided by UCHI or from  operations,  through the sale of  additional
       securities, through joint ventures or similar arrangements, or from other
       sources;

   (5) The cost of participation  by UCHI as compared to the perceived  tangible
       and intangible values and potential of such an acquisition;

   (6) The extent to which the business opportunity can be advanced;

   (7) UCHI's  perception of how any  particular  business  opportunity  will be
       received by the investment community and by UCHI's stockholders;

   (8) The accessibility of required management expertise,  personnel, services,
       professional assistance, and other required items; and

   (9) Whether the financial condition of the business  opportunity would be, or
       would have a significant  prospect in the  foreseeable  future to become,
       such  as to  permit  the  securities  of  UCHI,  following  the  business
       combination,  to qualify to be listed on a national automated  securities
       quotation system, such as NASDAQ.

UCHI has no employees but Rosemont currently employs approximately ten people on
a full time basis. No employees are members of collective bargaining units.

Environmental Matters
---------------------

UCHI is not aware of any environmental  liability  relating to its facilities or
operations  that would have a material  adverse  affect on UCHI,  its  business,
assets or results of operations.

<PAGE>

Inflation
---------

Inflation has not historically  been a material effect on UCHI's  operations and
is not expected to have a material  impact on the company or its  operations  in
the future.

Competition
-----------

The funeral  home/cemetery  industry in the United States has historically  been
highly fragmented, consisting of numerous small operations, typically owned by a
family with  strong ties to its local  geographic  service  area.  Many of these
family-owned  businesses do not have successors who are active in the management
of the business.  Based on past  experience with such owners and the dynamics of
the industry,  UCHI  believes that many of these  business es can be acquired at
attractive cash flow multiples.

Nevertheless,  in the past twenty  years there has been a growing  trend in this
industry toward mergers and  consolidation  and several large  corporations have
acquired thousands of formerly independent operators.  While some of these giant
competitors  have  recently  evidenced  problems   (apparently   resulting  from
difficulties in economically  assimilating their past acquisitions and/or making
acquisitions  that were priced  unrealistically),  these large  competitors have
assets,  readily  marketable  stock,  cash and other  advantages in  negotiating
potential merger or acquisition transactions that UCHI, at its current size, can
not effectively counter.

Item 2.  Description of Property

Rosemont Gardens Memorial Park,  which is owned by UCHI's  subsidiary,  Rosemont
Gardens Funeral  Chapel-Cemetery,  Inc. is situated on 106 acres of land located
within the city limits of Jackson, Mississippi. It is a combination funeral home
and  perpetual   care  cemetery  and   mausoleum.   The  funeral  home  contains
approximately  17,000  square  feet  and  is  designed  in  the  fashion  of  an
ante-bellum  mansion.  Its dramatic  presentation  - high upon a hill  bordering
Interstate  55 -  offers  impressive  visibility  and  has  enabled  rapid  name
recognition.  It has been designed to be the  "flagship" of a national  chain of
community funeral homes and pre-arrangement  centers. This facility is currently
large  enough  to  accommodate  the  financial,   administrative   and  training
facilities that UCHI and its subsidiary will need for several years.

Item 3.  Legal Proceedings.

The Company is not a party to any material pending litigation nor is it aware of
any threatened legal proceeding.

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

No matters were  submitted to securities  holders during the year ended December
31, 2000.


<PAGE>

PART II

Item 5.  Market for Common Equity and Related Stockholder Matters

The stock does not trade on any  exchange or the OTC  market.  There is no known
public market for this security. As of March 28, 2001, there were 681 holders on
record of the Company's common stock, holding a total of 8,000,818 shares.

Item 6.  Management's Discussion and Analysis of Financial Condition and Results
         of Operations

(1)  Caution Regarding Forward-Looking Information

This annual report contains certain  forward-looking  statements and information
relating  to the  Company  that  are  based on the  beliefs  of the  Company  or
management as well as assumptions made by and information currently available to
the Company or management.  When used in this document,  the words "anticipate,"
"believe,"  "estimate," "expect" and "intend" and similar  expressions,  as they
relate  to  the   Company  or  its   management,   are   intended   to  identify
forward-looking  statements.  Such  statements  reflect the current  view of the
Company regarding future events and are subject to certain risks,  uncertainties
and assumptions, including the risks and uncertainties noted. Should one or more
of these risks or uncertainties  materialize,  or should underlying  assumptions
prove incorrect,  actual results may vary materially from those described herein
as anticipated,  believed,  estimated,  expected or intended.  In each instance,
forward-looking  information  should be considered in light of the  accompanying
meaningful cautionary statements herein.

(2)  General Information

United Community  Holdings,  Inc. was  incorporated  under the corporate name of
Professionalistics,  Inc.  on May 31,  1989,  under  the  laws of the  State  of
Delaware.  On December 17, 1998, the Company changed its state of  Incorporation
from Delaware to Nevada by means of a merger with and into a Nevada  corporation
formed solely for the purpose of effecting the reincorporation.  The Articles of
Incorporation  and  Bylaws  of  the  Nevada  corporation  are  the  Articles  of
Incorporation  and  Bylaws  of  the  surviving  corporation.  Such  Articles  of
Incorporation did not change the capital structure of the Company. The effect of
this action also changed the Company's name to United Community Holdings, Inc.

The Company's wholly-owned subsidiary, Rosemont Gardens Funeral Chapel-Cemetery,
Inc.  was  incorporated  on  March  4,  1994  under  the  laws of the  State  of
Mississippi.

United  Community  Holdings,  Inc.  and its  wholly-owned  subsidiary,  Rosemont
Gardens Funeral Chapel-Cemetery, Inc. are collectively referred to as "Company".

The  Company's  operations  consist of a funeral home and cemetery  operation in
Jackson, Mississippi.  Company personnel at the funeral service location provide
all  professional  services  related to funerals,  including  the use of funeral
facilities  and  motor  vehicles.  Funeral  related  merchandise  is sold at the
funeral service location. The Company sells prearranged funeral services whereby
a customer contractually agrees to the terms,  conditions and price of a funeral
to be performed at an unknown  future date at the time the contract is executed.
The Company's cemetery provides cemetery  interment rights (including  mausoleum
crypts and lawn  spaces)  and  certain  merchandise  including  stone and bronze
memorials and burial vaults. These items may be sold on either a pre- need or an
at-need basis. Company personnel at the cemetery site perform interment services
and provide management and maintenance of the cemetery grounds.

(3)  Results of Operations

Year ended December 31, 2000 compared to the year ended December 31, 1999
-------------------------------------------------------------------------

The  operations  for the year ended December 31, 2000 compared to the year ended
December  31,  1999 show a continued  maturation  and market  acceptance  of the
products  and  operations  of  the  Company's  Rosemont  subsidiary.  Recognized
revenues  for 2000 were  approximately  $352,000 as  compared  to  approximately
$400,000  for the  preceding  year.  The Company  recognizes  revenues  upon the
provision of funeral services, sale of funeral,  cemetery or related merchandise
or upon the  receipt of at least 25% of the  initial  sales  price for  cemetery
spaces and/or crypts.

<PAGE>

The Company  incurred  cost of sales and  providing  services  of  approximately
$158,000 and $183,000,  respectively,  for the years ended December 31, 2000 and
1999. Costs related to cemetery  merchandise and funeral services are recognized
at the time the service is  provided.  Sales  commissions,  for both at-need and
pre-need  funeral sales and sales of cemetery spaces and/or crypts,  are charged
to expense,  less a nominal  percentage,  in the month the  related  contract is
recorded.  The  allocated  cost of cemetery  spaces  and/or crypts is charged to
operations  at the  time  that at least  25% of the  initial  contract  price is
received by the Company in cash. Total commissions expense, principally incurred
on the sales of pre-need  contracts for funeral  services and/or cemetery spaces
or crypts was approximately $37,000 and $61,000,  respectively,  during 2000 and
1999.

The  Company  realized  gross  profits of  approximately  $194,000  (55.2%)  for
Calendar 2000 as compared to  approximately  $217,000 (54.3%) for Calendar 1999.
This  change  in gross  profit  percentage  is due to  management's  value-based
product  pricing  policies to provide quality funeral and burial services to the
general  public and the  direct  charge to  operations  for  commissions  at the
inception of a long-term  receivable  for either pre- need  funeral  services or
cemetery  spaces/crypts.  Periods in which there are high sales of new long-term
contracts  without either the provision of funeral services or the receipt of at
least 25% of the initial  contract price on cemetery spaces or crypts will cause
fluctuations  and lower gross profit  percentages  due to the Company's  revenue
recognition policies.

The  Company  continues  to  monitor  its  expenditures  for  general  operating
expenses,  principally  personnel costs and  professional  fees. The Company had
aggregate  general and  administrative  expenses of  approximately  $355,000 for
Calendar 2000 as compared to approximately  $344,000 for Calendar 1999. Interest
expense  increased by approximately  $21,000,  from  approximately  $188,000 for
Calendar  1999 to  approximately  $209,000 for Calendar  2000.  This increase in
interest  expense is principally  related the full  utilization of the Company's
$300,000 line of credit during the entire year. Depreciation and amortization is
relatively  constant based on the completion of the Rosemont visitors center and
related  placement  into  service  during  the  first  quarter  of 1998 and some
additions  to property and  equipment  during  1999.  During  2000,  the Company
expended  approximately  $26,000 on  additions  to property  and  equipment  and
further development of cemetery garden, mausoleum and columbarium facilities.

The principal  source of cash to support daily  operations is the  collection of
contractual  receivables for both prearranged  funeral services and the sales of
cemetery  spaces or crypts.  This area  continues  to  experience  growth in the
number and dollar amount of contracts placed in effect on a cumulative basis and
the related cash flows therefrom.  Additionally,  during 2000, the Company began
to sell certain long-term contract  receivables  related to prearranged  funeral
contracts and cemetery sales to unrelated finance companies on a recourse basis.
The purchasing entity manages all collection activities related to the long-term
contract  receivables and the Company remains  contingently liable to repurchase
the  accounts  in the event  that  certain  defaults  occur,  as defined by each
purchasing  entity.  This new arrangement also contributed to the cash available
to support daily operations.

Earnings  per  share  declined  slightly  from  $(0.06)  per  share  for 1999 to
approximately $(0.07) per share for 2000.

Year ended December 31, 1999 compared to the year ended December 31, 1998
-------------------------------------------------------------------------

The  operations  for the year ended December 31, 1999 compared to the year ended
December  31,  1998 show a continued  maturation  and market  acceptance  of the
products  and  operations  of  the  Company's  Rosemont  subsidiary.  Recognized
revenues  for 1999 were  approximately  $400,000 as  compared  to  approximately
$251,000  for the  preceding  year.  The Company  recognizes  revenues  upon the
provision of funeral services, sale of funeral,  cemetery or related merchandise
or upon the  receipt of at least 25% of the  initial  sales  price for  cemetery
spaces and/or crypts.


<PAGE>

The Company  incurred  cost of sales and  providing  services  of  approximately
$183,000 and $168,000,  respectively,  for the years ended December 31, 1999 and
1998. Costs related to cemetery  merchandise and funeral services are recognized
at the time the service is  provided.  Sales  commissions,  for both at-need and
pre-need  funeral sales and sales of cemetery spaces and/or crypts,  are charged
to expense,  less a nominal  percentage,  in the month the  related  contract is
recorded.  The  allocated  cost of cemetery  spaces  and/or crypts is charged to
operations  at the  time  that at least  25% of the  initial  contract  price is
received by the Company in cash. Total commissions expense, principally incurred
on the sales of pre-need  contracts for funeral  services and/or cemetery spaces
or crypts was approximately $61,000 and $78,000,  respectively,  during 1999 and
1998.

The Company  realized  gross  profits of  approximately  $217,000  (54.286%) for
Calendar 1999 as compared to  approximately  $83,000 (33.09%) for Calendar 1998.
This  change  in gross  profit  percentage  is due to  management's  value-based
product  pricing  policies to provide quality funeral and burial services to the
general  public and the  direct  charge to  operations  for  commissions  at the
inception of a long-term  receivable  for either pre- need  funeral  services or
cemetery  spaces/crypts.  Periods in which there are high sales of new long-term
contracts  without either the provision of funeral services or the receipt of at
least 25% of the initial  contract price on cemetery spaces or crypts will cause
fluctuations  and lower gross profit  percentages  due to the Company's  revenue
recognition policies.

The  Company  continues  to  monitor  its  expenditures  for  general  operating
expenses,  principally  personnel costs and  professional  fees. The Company had
aggregate  general and  administrative  expenses of  approximately  $344,000 for
Calendar 1999 as compared to approximately  $481,000 for Calendar 1998. Interest
expense  decreased by approximately  $48,000,  from  approximately  $236,000 for
Calendar  1998 to  approximately  $188,000 for Calendar  1999.  This decrease in
interest  expense  is  directly  related  to  the  1998  debt  restructuring  of
short-term borrowings into a long-term debt agreement and/or periodic reductions
in the Company's line of credit during the year as cash collections on long-term
receivables for funeral services and/or cemetery spaces or crypts allowed during
1999.  Depreciation  and  amortization  is  relatively  constant  based  on  the
completion of the Rosemont  visitors  center and related  placement into service
during the first  quarter of 1998 and some  additions to property and  equipment
during 1999.

The principal  source of cash to support daily  operations is the  collection of
contractual  receivables for both prearranged  funeral services and the sales of
cemetery  spaces or crypts.  This area  continues  to  experience  growth in the
number and dollar amount of contracts placed in effect on a cumulative basis and
the related cash flows therefrom.

Earnings per share  improved  from  $(0.09) per share for 1998 to  approximately
$(0.06) per share for 1999.

(4)  Liquidity and capital resources

The Company is  principally  dependent upon cash flows related to the collection
of long-term contract  receivables  related to prearranged funeral contracts and
sales of cemetery  spaces and/or crypts.  During 2000, the Company began to sell
certain long-term contract  receivables related to prearranged funeral contracts
and cemetery  sales to unrelated  finance  companies  on a recourse  basis.  The
purchasing  entity  manages all collection  activities  related to the long-term
contract  receivables and the Company remains  contingently liable to repurchase
the  accounts  in the event  that  certain  defaults  occur,  as defined by each
purchasing entity.

The Company had negative cash flows from operations of approximately $(445,000),
$(530,000),  $(735,000)  and $(608,000) for the each of the years ended December
31, 2000,  1999,  1998 and 1997,  respectively.  The operating  cash deficits in
excess of cash collected on long-term  receivables  for funeral  services and/or
cemetery spaces or crypts were supported  through advances on the Company's bank
line  of  credit  or  through  controlling  shareholder  advances.  The  Company
completed the development of the initial  cemetery  garden,  visitors center and
other funeral related  buildings during 1998. The Company  continues the process
of  constructing  Phase II to its  Mausoleum  and the second and third  cemetery
gardens as  internally  generated  funds  permit and consumer  demand  requires.
Management  is of  the  opinion  that  it has  sufficient  cemetery  spaces  and
mausoleum  crypts to meet  current  demands and  construct  additional  capacity
within the parameters of existing cash flows.

During  the  third  quarter  of 1998,  the  Company  entered  into a  $2,220,000
long-term  note  payable  to a bank.  The note  bears  interest  at 8.00% and is
payable in monthly  installments of approximately  $18,569,  including interest.
Any unpaid  principal  and interest is due at the note's  maturity in June 2003.
The note is  secured  by land,  accounts  receivable  from  prearranged  funeral
contracts and cemetery  property sales  contracts and the personal  guarantee of
the Company's  controlling  shareholder.  The proceeds of this note were used to
refinance various short-term notes payable by the Company.

<PAGE>

The Company has identified no significant  capital  requirements for the current
annual period.  Liquidity requirements mandated by future business expansions or
acquisitions,  if any are specifically identified or undertaken, are not readily
determinable  at this  time as no  substantive  plans  have been  formulated  by
management.

Additionally,  management is of the opinion that there is  additional  potential
availability  of incremental  mortgage debt and the  opportunity for the sale of
additional   common  stock  through  either  private   placements  or  secondary
offerings.

(5)  Year 2000 Considerations

The Year 2000 (Y2K) date change was believed to affect  virtually  all computers
and  organizations.   The  Company  undertook  a  comprehensive  review  of  its
information  systems,  including  personal  computers,  software and  peripheral
devices,  and its  general  communications  systems.  The  Company has no direct
electronic  links with any customer or supplier.  In addition,  the Company held
discussions with certain of its software  suppliers with respect to the Y2K date
change. The Company was not required to modify or replace  significant  portions
of its computer hardware or software and approximately  $2,500,  principally for
computer  software and hardware,  was expended for costs associated with the Y2K
date change compliance did not have a material effect on the Company's financial
position or its results of operations.

The Company monitored its significant suppliers,  shippers,  customers and other
external  business  partners related to their readiness for the Y2K date change.
To date, the Company has not  experienced  any adverse effect from the advent of
Year 2000. However, there can be no assurance that all of the Company's systems,
and the systems of its suppliers, shippers, customers or other external business
partners will not experience  unforseen  problems during the Year 2000 or future
periods.

Item 7.  Financial Statements

The required  financial  statements  are included in this document  beginning on
page F-1.

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

  None

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

The directors and officers of UCHI are listed below with information about their
respective backgrounds.

Name                       Age       Position
----                       ---       --------

James F. Robinson          74        Chairman of the Board, President &
                                     Chief Executive Officer

Jeffrey D. Aldridge        39        Vice President, Chief Operating Officer and
                                     Director

Margaret R. Lauro          43        Secretary, Treasurer, and  Chief  Financial
                                     Officer

Sheila A. Gates            46        Sales Manager and Director


Directors are elected to serve until the next annual meeting of the shareholders
of UCHI or until their  successors  have been  elected and  qualified.  Officers
serve at the discretion of the Board of Directors.  None of the Directors  serve
as directors of any public or reporting corporations except as disclosed below.

Mr. Robinson was elected to his current  positions with UCHI in January 1999. He
has been  President  and Chief  Executive  Officer of Rosemont  Gardens  Funeral
Chapel-Cemetery,  Inc.  since 1994 when it was founded by him. From 1957 to 1995
he served as President and Chief  Executive  Officer of Protective  Service Life
Insurance  Co.,  Jackson,  Mississippi,  which  specializes in life and accident
insurance.  He has been involved in the funeral  business in various  capacities
for more than 40 years.  He has a  Science  degree  from St.  Louis  College  of
Science, St. Louis, Missouri. Mr. Robinson is the father of Mrs. Lauro.

<PAGE>

Mrs.  Lauro was elected to her current  positions with UCHI in January 1999. She
has been Secretary and Treasurer of Rosemont  Gardens  Funeral  Chapel-Cemetery,
Inc.  since  1995.  From 1980  until 1995 she was  Secretary  and  Treasurer  of
Protective  Service Life  Insurance Co. She has a BBA degree in accounting  from
Mississippi State University. Mrs. Lauro is the daughter of Mr. Robinson.

Mr.  Aldridge was elected to his current  positions  with UCHI in January  1999.
Since 1996,  he has served as the officer in charge of  Corporate  Planning  and
Development for Rosemont Memorial Gardens. For the previous five years he served
as a financial  analyst for PRC  Environmental  Management,  Inc. (Aiken,  South
Carolina) and Vitro Corporation  (Silverdale,  Washington).  He has a BBA degree
from Georgia State University.

Ms.  Gates has been the Sales  Manager of  Rosemont  Gardens  since 1995 and was
elected as a  director  during  2000.  In  previous  years,  Ms.  Gates has been
involved in sales of various insurance,  funeral and cemetery  products.  She is
also an apprentice funeral director at Rosemont Gardens.

No director or officer of UCHI has been the subject of any order,  judgment,  or
decree of any court or any  regulatory  agency  enjoining  him from acting as an
investment advisor, underwriter, broker or dealer in the securities industry, or
as an affiliated person,  director or employee of an investment  company,  bank,
savings  and loan  association,  or  insurance  company or from  engaging  in or
continuing  any conduct or practice in  connection  with any such activity or in
connection  with the purchase or sale of any  securities nor has any such person
been the subject of an order of state authority  barring or suspending the right
of such a person to be engaged in such  activities or to be associated with such
activities.

No director or officer of UCHI has been  convicted  in any  criminal  proceeding
(excluding traffic  violations) or is the subject of a criminal proceeding which
is  currently  proceeding.  No director or officer of UCHI is the subject of any
legal  proceeding  involving  UCHI  or the  performance  of his  duties  as such
director or officer.

Item 10.  Executive Compensation

UCHI neither paid nor accrued any form of  compensation  in any amount to or for
its executive officers or directors for the fiscal years ended December 31, 2000
and 1999.

Item 11.  Security Ownership of Certain Beneficial Owners and Management.

The following  information table sets forth certain information regarding UCHI's
common stock owned on March 27, 2000 by (1) any person  (including  any "group")
who is known by UCHI to own beneficially more than 5% of its outstanding  Common
Stock, (2) each director and executive  officer,  and (3) all executive officers
and directors as a group.


<PAGE>



Name and Address                           Shares Owned            Percentage
----------------                           ------------            ----------

James F.  Robinson                          7,201,000                  90%
3935 Interstate 55 South
Jackson MS 39212

None of the other officers and directors of UCHI or its subsidiary own any stock
in UCHI.

Executive Officers and Directors as         7,201,000                  90%
a group (five persons)

Item 12.  Certain Relationships and Related Transactions.

  None

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

Reports on Form 8-K
  None

Exhibits

   27.1  Financial Data Schedule

--------------------------------------------------------------------------------

                                   SIGNATURES
                                   ----------

In accordance  with Section 13 and 15(d) of the Exchange Act, the Registrant has
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized, on the __th day of April, 2001.

Dated: April 3, 2001                             UNITED COMMUNITY HOLDINGS, INC.
       -------------

                                                       by: /s/ James F. Robinson
                                                           ---------------------
                                                               James F. Robinson
                                 Chairman, President and Chief Executive Officer

Pursuant to the requirements of The Securities Exchange Act of 1934, this report
has been signed  below by the  following  persons in the  capacities  and on the
dates indicated:

/s/ James F. Robinson                                          April 3, 2001
---------------------
James F. Robinson
Chairman, President and Chief Executive Officer
(Principal Executive Officer)

/s/ Jeffrey D. Aldridge                                        April 3, 2001
-----------------------
Jeffrey D. Aldridge
Vice President, Chief Operating Officer & Director

/s/ Margaret R. Lauro                                          April 3, 2001
---------------------
Margaret R. Lauro
Secretary, Treasurer and Chief Financial Officer
(Principal Accounting Officer)

/s/ Sheila A. Gates                                            April 3, 2001
-------------------
Sheila A. Gates
Director


<PAGE>

                                UNITED COMMUNITY
                                 HOLDINGS, INC.
                                 AND SUBSIDIARY

                              Financial Statements
                                       and
                                Auditor's Report

                           December 31, 2000 and 1999






                              S. W. HATFIELD , CPA
                          certified public accountants

                      Use our past to assist your future sm


<PAGE>

                 UNITED COMMUNITY HOLDINGS, INC. AND SUBSIDIARY

                                    CONTENTS

                                                                            Page
                                                                            ----

Report of Independent Certified Public Accountants                           F-3

Consolidated Financial Statements

   Consolidated Balance Sheets
     as of December 31, 2000 and 1999                                        F-4

   Consolidated Statements of Operations and Comprehensive Income
     for the years ended December 31, 2000 and 1999                          F-6

   Consolidated Statement of Changes in Shareholders' Equity
     for the years ended December 31, 2000 and 1999                          F-7

   Consolidated Statements of Cash Flows
     for the years ended December 31, 2000 and 1999                          F-8

   Notes to Consolidated Financial Statements                                F-9







                                                                             F-2

<PAGE>

S. W. HATFIELD, CPA
certified public accountants

Member:    American Institute of Certified Public Accountants
               SEC Practice Section
               Information Technology Section
           Texas Society of Certified Public Accountants


               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
               --------------------------------------------------



Board of Directors and Shareholders
United Community Holdings, Inc.

We have audited the accompanying consolidated balance sheets of United Community
Holdings, Inc. (a Nevada corporation) and Subsidiary as of December 31, 2000 and
1999 and the related  consolidated  statements of operations  and  comprehensive
income,  changes  in  shareholders'  equity and cash flows for each of the years
then ended.  These consolidated  financial  statements are the responsibility of
the Company's  management.  Our responsibility is to express an opinion on these
consolidated financial statements based on our audits.

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

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

                                                    S. W. HATFIELD, CPA

Dallas, Texas
March 23, 2000

                      Use our past to assist your future sm
(secure mailing address)                   (overnight delivery/shipping address)
P. O. Box 820395                               9002 Green Oaks Circle, 2nd Floor
Dallas, Texas  75382-0395                               Dallas, Texas 75243-7212
214-342-9635 (voice)                                          (fax) 214-342-9601
800-244-0639                                                      SWHCPA@aol.com
                                       F-3

<PAGE>
<TABLE>
<CAPTION>

                 UNITED COMMUNITY HOLDINGS, INC. AND SUBSIDIARY
                           CONSOLIDATED BALANCE SHEETS
                           December 31, 2000 and 1999


                                     ASSETS
                                     ------

                                                                      2000           1999
                                                                  -----------    -----------
<S>                                                               <C>            <C>
Current assets
   Cash on hand and in bank                                       $     7,732    $     8,583
   Restricted cash                                                     89,305         58,920
   Accounts receivable-at need, net of allowance
     for doubtful accounts of $12,500 and $12,500, respectively        56,700          4,359
   Other current assets                                                10,245          9,109
                                                                  -----------    -----------

     Total current assets                                             163,982         80,971
                                                                  -----------    -----------


Property and equipment - at cost
   Buildings                                                        2,354,061      2,354,061
   Roads, common cemetery areas and landscaping                       347,325        338,504
   Vehicles, equipment and office furnishings                         258,626        248,635
                                                                  -----------    -----------
                                                                    2,960,012      2,941,200
   Accumulated depreciation                                          (539,072)      (369,991)
                                                                  -----------    -----------
                                                                    2,420,940      2,571,209
   Land                                                               107,580        107,580
                                                                  -----------    -----------

     Net property and equipment                                     2,528,520      2,678,789
                                                                  -----------    -----------


Other assets
   Cemetery property - at cost                                      1,100,594      1,111,977
   Prearranged funeral contracts                                    1,205,145      1,420,878
   Long-term receivables for cemetery property sales                  244,364        353,770
   Other                                                               10,557         14,597
                                                                  -----------    -----------

     Total other assets                                             2,560,660      2,901,222
                                                                  -----------    -----------

     TOTAL ASSETS                                                 $ 5,253,162    $ 5,660,982
                                                                  ===========    ===========

</TABLE>



                                  - Continued -

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

                                                                             F-4

<PAGE>

                 UNITED COMMUNITY HOLDINGS, INC. AND SUBSIDIARY
                     CONSOLIDATED BALANCE SHEETS - CONTINUED
                           December 31, 2000 and 1999


                      LIABILITIES AND SHAREHOLDERS' EQUITY
                      ------------------------------------

                                                        2000           1999
                                                    -----------    -----------
Current liabilities
   Notes payable                                    $   300,000    $   400,000
   Current maturities of long-term debt                  72,033         68,451
   Accounts payable and other accrued liabilities       122,086         88,451
                                                    -----------    -----------

     Total current liabilities                          494,119        556,902
                                                    -----------    -----------


Long-term liabilities
   Long-term debt, net of current maturities          2,069,875      2,136,045
   Deferred prearranged funeral contract revenues     1,939,573      1,912,748
   Deferred cemetery property sale revenues             426,667        393,728
                                                    -----------    -----------

     Total liabilities                                4,930,234      4,999,423
                                                    -----------    -----------


Commitments and contingencies

Shareholders' Equity
   Preferred stock - $0.00001 par value
     10,000,000 shares authorized
     None issued and outstanding                           --             --
   Common stock - $0.00001 par value
     50,000,000 shares authorized
     8,000,818 shares issued and outstanding                 80             80
   Additional paid-in capital                         3,148,824      2,954,705
   Accumulated deficit                               (2,825,976)    (2,293,226)
                                                    -----------    -----------

     Total shareholders' equity                         322,928        661,559
                                                    -----------    -----------

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY          $ 5,253,162    $ 5,660,982
                                                    ===========    ===========




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

                                                                             F-5

<PAGE>
<TABLE>
<CAPTION>

                 UNITED COMMUNITY HOLDINGS, INC. AND SUBSIDIARY
         CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
                     Years ended December 31, 2000 and 1999


                                                           2000           1999
                                                       -----------    -----------
<S>                                                    <C>            <C>
Revenues
   Funeral revenues                                    $   217,315    $   172,327
   Cemetery sales                                          117,313        206,685
   Finance charge and related revenues                      17,013         21,442
                                                       -----------    -----------
     Total revenues                                        351,641        400,454
                                                       -----------    -----------

Cost of sales and direct expenses
   Allocated cost of cemetery spaces and crypts             36,001         22,566
   Cost of cemetery merchandise and funeral services        85,056         99,757
   Sales commissions                                        36,563         60,759
                                                       -----------    -----------
     Total cost of sales and direct expenses               157,620        183,082
                                                       -----------    -----------

Gross profit                                               194,021        217,372
                                                       -----------    -----------

Operating expenses
   General and administrative expenses                     355,261        343,725
   Interest expense                                        208,965        188,394
   Depreciation and amortization                           169,082        164,746
                                                       -----------    -----------
     Total operating expenses                              733,308        696,865
                                                       -----------    -----------

Loss from operations                                      (539,287)      (479,493)

Other income (expense)
   Interest and other income                                 6,537         14,575
                                                       -----------    -----------

Loss before income taxes                                  (532,750)      (464,918)

Income taxes                                                  --           (2,053)
                                                       -----------    -----------

Net Loss                                                  (532,750)      (466,971)

Other comprehensive income                                    --             --
                                                       -----------    -----------

Comprehensive Loss                                     $  (532,750)   $  (466,971)
                                                       ===========    ===========

Net loss per weighted-average share
   of common stock outstanding - Basic                 $     (0.07)   $     (0.06)
                                                       ===========    ===========

Weighted-average number of shares
   of common stock outstanding - Basic                   8,000,818      8,000,818
                                                       ===========    ===========

</TABLE>

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

                                                                             F-6

<PAGE>
<TABLE>
<CAPTION>

                 UNITED COMMUNITY HOLDINGS, INC. AND SUBSIDIARY
            CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
                     Years ended December 31, 2000 and 1999



                                    Common stock         Additional
                                    ------------          paid-in     Accumulated
                              # shares       Amount       capital       deficit         Total
                            -----------   -----------   -----------   -----------    -----------
<S>                         <C>           <C>           <C>           <C>            <C>
Balances at
   January 1, 1999            8,000,818   $        80   $ 2,777,070   $(1,826,255)   $   950,895

Shareholder contributions          --            --         177,635          --          177,635

Net loss for the year              --            --            --        (466,971)      (466,971)
                            -----------   -----------   -----------   -----------    -----------

Balances at
   December 31, 1999          8,000,818            80     2,954,705    (2,293,226)       661,559

Shareholder contributions          --            --         194,119          --          194,119

Net loss for the year              --            --            --        (532,750)      (532,750)
                            -----------   -----------   -----------   -----------    -----------

Balances at
   December 31, 2000          8,000,818   $        80   $ 3,148,824   $(2,825,976)   $   322,928
                            ===========   ===========   ===========   ===========    ===========

</TABLE>





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

                                                                             F-7

<PAGE>
<TABLE>
<CAPTION>

                 UNITED COMMUNITY HOLDINGS, INC. AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                     Years ended December 31, 2000 and 1999


                                                                           2000         1999
                                                                         ---------    ---------
<S>                                                                      <C>          <C>
Cash flows from operating activities
   Net loss for the year                                                 $(532,750)   $(466,975)
   Adjustments to reconcile net loss to net
     cash provided by operating activities
       Depreciation and amortization                                       173,122      168,786
       Allocated cost of cemetery spaces and crypts                         18,482       22,568
       (Increase) Decrease in:
         Accounts receivable                                               (52,341)       7,257
         Other assets                                                       (1,136)       3,612
       Increase (Decrease) in:
         Accounts payable and other accrued liabilities                     33,635      (21,516)
         Deferred revenues                                                 (84,320)    (243,667)
                                                                         ---------    ---------

Net cash used in operating activities                                     (445,308)    (530,035)
                                                                         ---------    ---------

Cash flows from investing activities
   Transfers (to)/from trust funds and restricted cash                     (30,385)      (6,125)
   Capital expenditures for property, equipment and cemetery property      (25,912)     (95,381)
   Cash collected on prearranged funeral contract receivables              243,553      215,517
   Cash collected on long-term receivables for cemetery property sales     225,670      225,792
                                                                         ---------    ---------

Net cash used in investing activities                                      412,926      339,803
                                                                         ---------    ---------

Cash flows from financing activities
   Net activity on bank line of credit                                    (100,000)      35,000
   Principal (paid) received on long-term note payable                     (54,939)      (2,448)
   Principal repayments on long-term lease payables                         (7,649)     (12,699)
   Contributed capital by shareholder                                      194,119      177,635
                                                                         ---------    ---------

Net cash provided by financing activities                                   31,531      197,488
                                                                         ---------    ---------

Increase (Decrease) in cash                                                   (851)       7,256

Cash at beginning of year                                                    8,583        1,327
                                                                         ---------    ---------

Cash at end of year                                                      $   7,732    $   8,583
                                                                         =========    =========

Supplemental disclosure of interest and income taxes paid
     Interest paid for the year                                          $ 207,062    $ 190,043
                                                                         =========    =========
     Income taxes paid for the year                                      $    --      $    --
                                                                         =========    =========

Supplemental disclosure of non-cash investing and financing activities
   Vehicle acquired with long-term debt                                  $    --      $  21,082
                                                                         =========    =========

</TABLE>



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

                                                                             F-8

<PAGE>

                 UNITED COMMUNITY HOLDINGS, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE A - ORGANIZATION AND DESCRIPTION OF BUSINESS

United Community  Holdings,  Inc. was  incorporated  under the corporate name of
Professionalistics,  Inc.  on May 31,  1989,  under  the  laws of the  State  of
Delaware.  On December 17, 1998, the Company changed its state of  Incorporation
from Delaware to Nevada by means of a merger with and into a Nevada  corporation
formed solely for the purpose of effecting the reincorporation.  The Articles of
Incorporation  and  Bylaws  of  the  Nevada  corporation  are  the  Articles  of
Incorporation  and  Bylaws  of  the  surviving  corporation.  Such  Articles  of
Incorporation did not change the capital structure of the Company. The effect of
this action also changed the Company's name to United Community Holdings, Inc.

The Company's wholly-owned subsidiary, Rosemont Gardens Funeral Chapel-Cemetery,
Inc.  was  incorporated  on  March  4,  1994  under  the  laws of the  State  of
Mississippi.

United  Community  Holdings,  Inc.  and its  wholly-owned  subsidiary,  Rosemont
Gardens Funeral Chapel-Cemetery, Inc. are collectively referred to as "Company".

The  Company's  operations  consist of a funeral home and cemetery  operation in
Jackson, Mississippi.  Company personnel at the funeral service location provide
all  professional  services  related to funerals,  including  the use of funeral
facilities  and  motor  vehicles.  Funeral  related  merchandise  is sold at the
funeral service location. The Company sells prearranged funeral services whereby
a customer contractually agrees to the terms,  conditions and price of a funeral
to be performed at an unknown  future date at the time the contract is executed.
The Company's cemetery provides cemetery  interment rights (including  mausoleum
crypts and lawn  spaces)  and  certain  merchandise  including  stone and bronze
memorials and burial vaults. These items may be sold on either a pre- need or an
at-need basis. Company personnel at the cemetery site perform interment services
and provide management and maintenance of the cemetery grounds.

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

NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

1.   Cash and cash equivalents
     -------------------------

     The  Company  considers  all cash on hand  and in  banks,  certificates  of
     deposit and other highly-liquid investments with maturities of three months
     or less, when purchased, to be cash and cash equivalents.

     Cash  overdraft  positions may occur from time to time due to the timing of
     making bank deposits and releasing checks, in accordance with the Company's
     cash management policies.

2.   Accounts receivable
     -------------------

     In the normal course of business,  the Company extends  unsecured credit to
     its  at-need  customers  which are  regionally  concentrated  in and around
     Jackson,  Mississippi.  Because of the credit risk involved, management has
     provided an allowance for doubtful  accounts  which reflects its opinion of
     amounts  which  will  eventually  become  uncollectible.  In the  event  of
     complete  non-performance,  the  maximum  exposure  to the  Company  is the
     recorded amount of trade accounts  receivable shown on the balance sheet at
     the date of non- performance.



                                                                             F-9

<PAGE>

                 UNITED COMMUNITY HOLDINGS, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

3.   Inventory
     ---------

     Inventory  consists  of  funeral  merchandise  and  cemetery  property  and
     merchandise  and are  stated  at the  lower of cost or  market,  using  the
     first-in, first-out method.

4.   Property, plant and equipment
     -----------------------------

     Property and  equipment are recorded at  historical  cost.  These costs are
     depreciated  over the  estimated  useful  lives of the  individual  assets,
     generally  four (4) to  twenty-five  (25)  years,  using the  straight-line
     method.

     Maintenance and repairs are charged to expense  whereas  renewals and major
     replacements are capitalized. Gains and losses from disposition of property
     and equipment are recognized as incurred and are included in operations.

     For the years ended  December  31, 1999 and 1998,  depreciation  expense of
     approximately   $164,540  and  $128,453,   respectively,   was  charged  to
     operations.

5.   Funeral operations
     ------------------

     Funeral revenue is recognized  when the funeral  service is performed.  The
     Company's trade  receivables,  when recorded,  will consist  principally of
     funeral services already performed. An allowance for doubtful accounts will
     be  provided  based on  historical  experience.  In the  event of  complete
     non-performance, the maximum exposure to the Company is the recorded amount
     of trade  accounts  receivable  shown on the  balance  sheet at the date of
     non-performance.

     The Company sells prearranged funeral services and funeral merchandise that
     provide for the delivery of price  guaranteed  services and  merchandise at
     prices prevailing when the agreement is signed.  Revenues and related costs
     associated  with sales of  prearranged  funeral  contracts are deferred and
     later   recognized  when  the  funeral   service  is  actually   performed.
     Prearranged  funeral services and merchandise are generally financed either
     through  trust  funds or escrow  accounts,  depending  on State  Regulatory
     requirements,  established by the Company or through  insurance.  Principal
     amounts  deposited in trust funds or escrow  accounts are  available to the
     Company as funeral  services are  performed and  merchandise  is delivered.
     These amounts may be refundable to the customer in those  situations  where
     state law provides for the return of those  amounts  under the  purchaser's
     option  to  cancel  the  contract.   Certain   jurisdictions   provide  for
     non-refundable  trust funds or escrow  accounts where the Company  receives
     such amounts upon cancellation by the customer.

     The Company  recognizes  as revenue on a current  basis all  dividends  and
     interest earned, and net capital gains realized, by all prearranged funeral
     trust  funds or escrow  accounts,  except in those  states  where  earnings
     revert  to  the  customer  if a  prearranged  funeral  service  or  funeral
     merchandise contract is canceled. Principal and earnings are withdrawn only
     as  funeral  services  and  merchandise  are  delivered  or  contracts  are
     canceled,  except in  jurisdictions  that permit  earnings to be  withdrawn
     currently and in unregulated jurisdictions where escrow accounts are used.



                                                                            F-10

<PAGE>

                 UNITED COMMUNITY HOLDINGS, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

5.   Funeral operations - continued
     ------------------------------

     Commissions   and  other  related  direct   marketing   costs  relating  to
     prearranged  funeral services and prearranged funeral merchandise sales are
     expensed as paid,  subject to a nominal  percentage  which is withheld  and
     paid at the time the service is performed.  Other indirect costs, including
     telemarketing  and  advertising  costs,  are  expensed  in the period  when
     incurred.

     Funeral  services sold at the time of need are recorded as funeral  revenue
     in the period performed.

6.   Cemetery operations
     -------------------

     Cemetery  revenue  is  accounted  for in  accordance  with  the  principles
     prescribed  for  accounting  for  sales of real  estate.  Those  principles
     require,  among other things,  the receipt of a certain portion  (generally
     25%) of an  installment  sale price prior to  recognition of any revenue or
     cost  on  a  contract.   The  Company   recognizes  income  currently  from
     unconstructed mausoleum crypts sold to the extent the Company has available
     inventory.

     Costs  related to the sales of cemetery  mausoleum  or lawn crypts  include
     property and other costs related to cemetery  development  activities which
     are  charged  to  operations  using  the  specific  identification  method.
     Allowances  for  customer  cancellations  are  provided at the date of sale
     based upon historical experience. Costs related to merchandise are based on
     actual costs  incurred or  estimates of future costs  necessary to purchase
     the merchandise, including provisions for inflation when required.

     Pursuant to  applicable  state law, all or a portion of the  proceeds  from
     each sale of  cemetery  merchandise  may also be  required  to be paid into
     trust  funds until such  merchandise  is  purchased  by the Company for the
     customer. The Company recognizes realized trust income on these merchandise
     trusts in current  cemetery  revenues  as trust  earnings  accrue to defray
     inflation costs recognized related to the unpurchased cemetery merchandise.

     Additionally,  pursuant to perpetual  care  contracts  and laws, a portion,
     generally 15.0%, of the total sales price of cemetery property is deposited
     into perpetual care trust funds or escrow accounts.  In addition,  in those
     jurisdictions  where trust or escrow  arrangements are neither  statutorily
     nor  contractually  required,  the Company typically on a voluntary basis a
     portion,  generally  15.0%,  of the sale price into  escrow  accounts.  The
     income from these funds,  which have been established in most jurisdictions
     in which the Company operates cemeteries,  is used for maintenance of these
     cemeteries,  but principal,  including in some jurisdictions,  net realized
     capital gains, must generally be held in perpetuity. Accordingly, the trust
     fund  corpus is not  reflected  in the  financial  statements,  except  for
     voluntary escrow funds established by the Company.  The Company  recognizes
     and withdraws  currently all dividend and interest income earned and, where
     permitted, capital gains realized by perpetual care funds.

     A portion of the sales of cemetery  property and  merchandise is made under
     installment  contracts  bearing  interest  at 9.75%.  Finance  charges  are
     recognized  as a component  of  cemetery  revenue  under the  straight-line
     method over the terms of the related installment receivables.

     Commissions  and other related direct  marketing costs relating to cemetery
     spaces or  mausoleum  crypts  are  expensed  as paid,  subject to a nominal
     percentage  which  is  withheld  and paid at the  time  the  related  sales
     contract  service  is  paid  in  full.  Other  indirect  costs,   including
     telemarketing  and  advertising  costs,  are  expensed  in the period  when
     incurred.


                                                                            F-11

<PAGE>

                 UNITED COMMUNITY HOLDINGS, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

7.   Organization costs
     ------------------

     Costs related to the formation  and  organization  of the Company have been
     capitalized  and are being  amortized  over a five year  period,  using the
     straight-line method.

8.   Income taxes
     ------------

     The Company filed a separate  corporate  federal  income tax return through
     December 31,  1998.  Due to the change in control  occurring  in 1998,  the
     Company  has  no net  operating  loss  carryforwards  available  to  offset
     financial statement or tax return taxable income in future periods.

     Rosemont,  with the consent if its former sole  shareholder,  elected under
     the Internal  Revenue Code to be taxed as an  "Subchapter  S  corporation",
     through  December  31,  1998.  In  lieu  of  corporate  income  taxes,  the
     shareholder  of a  "Subchapter  S  corporation"  is taxed  directly  on the
     Company's taxable income. Accordingly,  no provision,  benefit or liability
     for income taxes is included in the accompanying financial statements.

     The Company uses the asset and liability  method of  accounting  for income
     taxes. At December 31, 2000 and 1999, respectively,  the deferred tax asset
     and deferred  tax  liability  accounts,  as recorded  when  material to the
     financial  statements,  are entirely  the result of temporary  differences.
     Temporary  differences  represent  differences in the recognition of assets
     and  liabilities  for  tax  and  financial  reporting  purposes,  primarily
     accumulated depreciation and amortization,  allowance for doubtful accounts
     and vacation accruals.

     As of December 31, 2000 and 1999, the Company's deferred tax asset is fully
     reserved.

9.   Income (Loss) per share
     -----------------------

     Basic  earnings  (loss) per share is computed  by  dividing  the net income
     (loss) by the weighted-average  number of shares of common stock and common
     stock  equivalents  (primarily  outstanding  options and warrants).  Common
     stock equivalents  represent the dilutive effect of the assumed exercise of
     the  outstanding  stock  options and  warrants,  using the  treasury  stock
     method.  The calculation of fully diluted earnings (loss) per share assumes
     the dilutive effect of the exercise of outstanding  options and warrants at
     either the  beginning  of the  respective  period  presented or the date of
     issuance, whichever is later. As of December 31, 2000 and 1999, the Company
     had no  warrants  and  options  outstanding  which  could be  deemed  to be
     dilutive.

10.  Accounting standards to be adopted
     ----------------------------------

     Upon  the  adoption  of a  formal  stock  compensation  plan,  the  Company
     anticipates   using  the  "fair  value  based  method"  of  accounting  for
     compensation  based  stock  options  pursuant  to  Statement  of  Financial
     Accounting  Standards No. 123,  "Accounting for Stock-Based  Compensation".
     Under the fair value based  method,  compensation  cost will be measured at
     the grant date of the respective option based on the value of the award and
     will be recognized as a charge to operations over the service period, which
     will usually be the respective vesting period of the granted option(s).





                                                                            F-12

<PAGE>
<TABLE>
<CAPTION>

                 UNITED COMMUNITY HOLDINGS, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTE C - LONG-TERM RECEIVABLES

The Company's long-term receivables related to prearranged funeral contracts and
cemetery  sales  are  anticipated  to be  collected  pursuant  to  contractually
scheduled payments as follows:

               Year ending         Funeral     Cemetery       Total
              December 31,        Contracts      Sales      Principal
              ------------       ----------   ----------   ----------
                  2001           $  128,814   $   67,452   $  196,266
                  2002              120,250       52,815      173,065
                  2003              114,404       42,774      157,178
                  2004              107,103       28,441      135,544
                  2005              104,897       18,226      123,123
               Thereafter           629,677       34,656      664,333
                                 ----------   ----------

                  Total          $1,205,145   $  244,364   $1,449,509
                                 ==========   ==========   ==========

NOTE D - CEMETERY PROPERTY

Cemetery  property  consists of the  following  at  December  31, 2000 and 1999,
respectively:

                                                      2000            1999
                                                  -----------     -----------
   Developed cemetery gardens, net of
     spaces sold with revenue recognition         $    74,782     $    82,802
   Cemetery gardens in development                     27,390          27,390
   Mausoleum crypts, net of crypts sold               340,948         344,311
   Undeveloped                                        657,474         657,474
                                                  -----------     -----------

     Total                                        $ 1,100,594     $ 1,111,977
                                                  ===========     ===========

NOTE E - NOTES PAYABLE

Notes  payable  consist  of  the  following  at  December  31,  2000  and  1999,
respectively:

                                                                  2000       1999
                                                                 --------   --------
<S>                                                              <C>        <C>
$300,000 revolving line of credit payable to a bank. Interest
   at the Bank's prime rate (9.63% at December 31, 2000).
   Interest payable monthly.  Principal and  unpaid interest
   due at  maturity  in  October  2000.  Secured by land,
   accounts receivable from prearranged funeral contracts
   and cemetery property sales contracts and the personal
   guarantee of the Company's majority shareholder.              $300,000   $   --

$400,000 revolving line of credit payable to a bank. Interest
   at the Bank's prime rate (8.50% at December 31, 1999).
   Interest payable monthly.  Principal and unpaid interest
   due at maturity in March 2000. Secured by land,
   accounts receivable from prearranged funeral contracts
   and cemetery  property sales contracts and the personal
   guarantee of the Company's majority shareholder.                  --     $400,000
                                                                 --------   --------

     Total notes payable                                         $300,000   $400,000
                                                                 ========   ========

</TABLE>



                                                                            F-13

<PAGE>
<TABLE>
<CAPTION>

                 UNITED COMMUNITY HOLDINGS, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

NOTE F - LONG-TERM DEBT

Long-term debt consists of the following at December 31, 2000 and 1999

                                                                   2000           1999
                                                               -----------    -----------
<S>                                                            <C>            <C>
$2,220,000 note payable to a bank.  Interest at 8.00%.
   Payable in monthly installments of approximately
   $18,569, including interest.  Any unpaid principal
   and interest is due at maturity in June 2003.  Secured
   by land, accounts receivable from prearranged funeral
   contracts and cemetery property sales contracts and
   the personal guarantee of the Company's shareholder         $ 2,107,991    $ 2,156,808

$21,082 installment note payable to a bank.  Interest at
   7.25%.  Payable in monthly installments of approximately
   $655, including interest.  Final maturity in August 2002
   Secured by a vehicle                                             12,886         19,008

$23,500 capital lease payable to a finance company
   Interest at 15.6%.  Payable in monthly installments of
   approximately $539, including interest.  Final maturity
   in December 2003.  Secured by furniture and equipment            14,031         18,571

$14,850 capital lease payable to a finance company
   Interest at 18.9%.  Payable in monthly installments of
   approximately $530, including interest.  Final maturity
   in December 2001.  Secured by furniture and equipment             7,000         10,109
                                                               -----------    -----------

     Total long-term debt                                        2,141,908      2,204,496

     Less current maturities                                       (72,033)       (68,451)
                                                               -----------    -----------

     Long-term portion                                         $ 2,069,875    $ 2,135,045
                                                               ===========    ===========

Future maturities of long-term debt are as follows:            Year ending
                                                               December 31,  Principal due

                                                                   2001       $    72,033
                                                                   2002            69,036
                                                                   2003         2,000,839
                                                                              -----------

                                                                   Total      $ 2,141,908
                                                                              ===========

</TABLE>


                                                                            F-14

<PAGE>

                 UNITED COMMUNITY HOLDINGS, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTE G - TRUST FUNDS AND RESTRICTED CASH

Pursuant to State law or Company policy,  certain portions of contracts  related
to the  sales of  prearranged  funeral  services  and  funeral  merchandise  and
cemetery spaces,  mausoleum crypts and related  merchandise are deposited into a
common  trust,  as of  December  31,  2000 and  1999 to  provide  funds  for the
fulfillment of the underlying  contracts  and/or  perpetual care of the cemetery
property.

The Company  recognizes as revenue on a current basis all dividends and interest
earned, and net capital gains realized,  by all prearranged  funeral trust funds
or escrow accounts, except in those states where earnings revert to the customer
if a prearranged  funeral service or funeral  merchandise  contract is canceled.
The Company  recognizes  realized  trust income on these  merchandise  trusts in
current  cemetery  revenues as trust earnings  accrue to defray  inflation costs
recognized  related  to  the  unpurchased  cemetery  merchandise.   The  Company
recognizes and withdraws  currently all dividend and interest income earned and,
where permitted, capital gains realized by perpetual care funds.

As of December 31, 2000 and 1999, the trust funds and resultant  restricted cash
consist of the following components:

                                                              2000      1999
                                                             --------  --------

Trust cash                                                   $    374  $    820
Marketable securities, at fair market value                    56,261    23,057
  Unrealized (gains) losses on marketable securities          113,017    96,222
Amounts due to trust funds from future contract collections   (80,347)  (61,179)
                                                             --------  --------

Restricted cash                                              $ 89,305  $ 58,920
                                                             ========  ========

Marketable securities are considered available-for-sale. All unrealized gains or
losses are excluded from earnings  until such time that such gains or losses are
realized  upon the sale of the  underlying  security.  For purposes of computing
realized gains and losses, the specific identification method is used.

As of December 31, 2000 and 1999,  the marketable  securities  held in the trust
funds consist entirely of equity securities and are summarized as follows:

                                                  2000        1999
                                                 --------    --------

     Aggregate fair value                        $  6,263    $ 23,057
     Gross unrealized holding gains              $   --      $   --
     Gross unrealized holding losses             $113,016    $ 96,222
     Amortized cost basis                        $119,279    $119,279




                                                                            F-15

<PAGE>
<TABLE>
<CAPTION>

                 UNITED COMMUNITY HOLDINGS, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTE H - CONTINGENCIES

During 2000, the Company began to sell certain  long-term  contract  receivables
related to prearranged funeral contracts and cemetery sales to unrelated finance
companies on a recourse  basis.  The  purchasing  entity  manages all collection
activities related to the long-term contract receivables and the Company remains
contingently  liable  to  repurchase  the  accounts  in the event  that  certain
defaults occur, as defined by each purchasing  entity.  To provide for potential
collection  problems,  each purchasing  entity  maintains a reserve fund ranging
between 15.0% and 25.0% of the amounts  collected.  As of December 31, 2000, the
following summarizes the activity on sold long-term contracts receivable:

       Contingent liability for sold accounts                $203,900
                                                             ========
       Reserves held by the contract purchaser
         which are included in current accounts
         receivable in the accompanying balance sheet        $ 55,547
                                                             ========


NOTE I - SELECTED FINANCIAL DATA (Unaudited)

The following is a summary of the quarterly  results of operations for the years
ended December 31, 2000 and 1999, respectively.

                          Quarter ended  Quarter ended  Quarter ended  Quarter ended    Year ended
                            March 31,       June 30,    September 30,   December 31,   December 31,
                          -------------  -------------  -------------  -------------   ------------
<S>                        <C>            <C>            <C>            <C>            <C>
2000
----
   Funeral revenues        $    39,461    $    56,497    $    52,106    $    69,251    $   217,315
   Cemetery sales               21,357         34,852         30,712         30,392        117,313
   Gross profit                 40,214         57,281         55,515         41,011        194,021
   Net earnings
     from operations          (131,983)      (139,518)      (133,912)      (133,874)      (539,287)
   Basic and fully
     diluted earnings
     per share                   (0.02)         (0.02)         (0.02)         (0.02)         (0.07)
   Weighted-average
     number of shares
     issued and outstanding  8,000,818      8,000,818      8,000,818      8,000,818      8,000,818

1999
----
   Funeral revenues        $    43,391    $    42,883    $    42,285    $    43,768    $   172,327
   Cemetery sales               77,295         35,147         39,790         54,453        206,685
   Gross profit                 75,297         34,255         42,058         65,762        217,372
   Net earnings
     from operations           (81,122)      (149,006)      (122,802)      (126,563)      (479,493)
   Basic and fully
     diluted earnings
     per share                   (0.01)         (0.02)         (0.02)         (0.02)         (0.06)
   Weighted-average
     number of shares
     issued and outstanding  8,000,818      8,000,818      8,000,818      8,000,818      8,000,818

</TABLE>

                                                                            F-16