SECURITIES AND EXCHANGE COMMISSION

                              WASHINGTON, DC 20549

                                   FORM 10-QSB

                QUARTERLY REPORT UNDER SECTION 13 OR 15(d) of the
                             SECURITIES ACT OF 1934

                For the Quarterly period ended September 30, 2000
                         Commission File Number 0-31169

                     EAGLE ENVIRONMENTAL TECHNOLOGIES, LTD.
                    ----------------------------------------
             (Exact Name of Registrant as Specified in Its Charter)

            Nevada                                      88-0284209
-------------------------------------------          -----------------
(State or Other Jurisdiction of                        (IRS Employer
 Incorporation or Organization)                     Identification No.)


                  1380 Greg Street, Suite 220, Sparks, NV 89431
                -------------------------------------------------
               (Address of Principal Executive Offices) (Zip Code)

        Registrant's Telephone Number, Including Area Code (775) 331-6555


                    Common Stock, Par Value $0.001 Per Share

                    ----------------------------------------
                                (Title of Class)

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

[X] Yes  [ ] No

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date.

        Common Stock, Par

      Value $0.001 Per Share                                 14,526,147
      ----------------------                           -----------------------
           (Title of Class)                               (Number of Shares
                                                            Outstanding on
                                                          September 30, 2000
Traditional Small Business Disclosure Format (Check One):
[X] Yes  [ ] No



<PAGE>

ITEM 1.  Financial Statements

<TABLE>
<CAPTION>

                            Eagle Consolidated Report

                             Balance Sheet UNAUDITED

                                                 Sep/00        Sep/99         Inc/(Dec)     %
                                              -----------    -----------    ----------- -----------


                                     ASSETS

<S>                                           <C>            <C>            <C>             <C>
Current Assets:
    Cash                                      $     5,283    ($      425)   $     5,709     1342.2%
    Account Receivables                            12,070          2,093          9,977      476.7%
    Notes receivable Lone Eagle                         0        377,355       (377,355)    -100.0%
    Note Receivable, Related Parties                8,738              0          8,738
    Inventory                                         564              0            564
                                              -----------    -----------    ----------- -----------
    TOTAL Current Assets                           26,656        379,023       (352,368)     -93.0%
                                              -----------    -----------    ----------- -----------
Fixed Assets:
    Property & Equipment                           62,840         29,758         33,082      111.2%
    Vehicle Accum Deprn                            (4,792)             0         (4,792)
                                              -----------    -----------    ----------- -----------
    TOTAL Fixed Assets                             58,048         29,758         28,290       95.1%
                                              -----------    -----------    ----------- -----------
Other Assets:
    Other Assets                                  651,552      1,426,484       (774,933)     -54.3%
                                              -----------    -----------    ----------- -----------

    TOTAL Other Assets                            651,552      1,426,484       (774,933)     -54.3%
                                              -----------    -----------    ----------- -----------
       TOTAL ASSETS                           $   736,256    $ 1,835,266    ($1,099,010)     -59.9%
                                                             ===========    ===========    =======

                                   LIABILITIES

Current Liabilities:
    Accounts Payable                          $   504,706    $   320,258    $   184,448       57.6%
    Sales Tax Payable                               2,353              0          2,353
    Salaries and Wages Payable                     45,254         25,438         19,816       77.9%
    JAB Enterprises Inc.                           (4,710)       (14,830)        10,120       68.2%
    Lease payable IKON                             17,416         26,218         (8,802)     -33.6%
    Lease Payable Auto/Ford                        10,729         (2,282)        13,012      570.1%
                                              -----------    -----------    ----------- -----------
    TOTAL Current Liabilities                     575,748        354,802        220,946       62.3%
                                              -----------    -----------    ----------- -----------

Long-Term Liabilities:
    Notes Payable, Papas                           23,678         11,656         12,022      103.1%
    Notes Payable, JAB ENT                         56,496         (2,000)        58,496     2924.8%
    Notes Payable, Conv. Debenture
                                                                   9,000              0      9,000
                                              -----------    -----------    ----------- -----------
    TOTAL Long-Term Liabilities                    89,175          9,656         79,518      823.5%
                                              -----------    -----------    ----------- -----------
       TOTAL LIABILITIES                          664,923        364,458        300,464       82.4%
                                              -----------    -----------    ----------- -----------

                                     CAPITAL

       Common Stock                               132,955         78,812         54,143       68.7%
       Additional paid in Capital               1,783,176      2,218,751       (435,575)     -19.6%
       Retained Earnings                         (774,560)    (1,109,643)       335,083       30.2%
       Year-to-Date Earnings                   (1,070,239)       282,887     (1,353,126)    -478.3%
                                              -----------    -----------    ----------- -----------
       TOTAL CAPITAL                               71,333      1,470,807     (1,399,475)     -95.2%
                                              -----------    -----------    ----------- -----------

               TOTAL LIABILITIES & CAPITAL       $736,256     $1,835,266    $(1,099,010)     -59.9%
                                              ===========     ==========    =========== ===========
</TABLE>

                                       F-1

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

<PAGE>

<TABLE>
<CAPTION>

                            Eagle Consolidated Report

                           Income Statement UNAUDITED

                                                               3 Months           3 Months             Variance
                                                             Ended Sep/00        Ended Sep/99          Fav/(Unf)       % Var
                                                             ------------       ------------         ------------  ------------

<S>                                                          <C>                   <C>                 <C>             <C>
           Income

               Sales                                         $30,360               $1,500              $28,860         1924.0%
                                                             ------------       ------------         ------------  ------------
           TOTAL Income                                       30,360                1,500               28,860         1924.0%
                                                             ------------       ------------         ------------  ------------
           NET REVENUE                                        30,360                1,500               28,860         1924.0%
                                                             ------------       ------------         ------------  ------------
           GROSS PROFIT                                       30,360                1,500               28,860         1924.0%
                                                             ------------       ------------         ------------  ------------

           Expenses

               Payroll Costs

                  Officers Salaries                                0                9,700                9,700          100.0%
                  Employee Benefits                              551                  561                   10            1.8%
                                                             ------------       ------------         ------------  ------------
               TOTAL Payroll Costs                               551               10,261                9,710           94.6%
                                                             ------------       ------------         ------------  ------------
               Utilities                                         402                   25                 (377)         -1499%
               General Expenses                               20,789               84,342               63,553           75.4%
                                                             ------------       ------------         ------------  ------------
           TOTAL Expenses                                     21,743               94,628               72,885           77.0%
                                                             ------------       ------------         ------------  ------------
           OPERATING PROFIT                                    8,617              (93,128)             101,745          109.3%
                                                             ------------       ------------         ------------  ------------

           Other Income & Expenses

               Other Income & Expenses                         3,500               55,365              (51,865)         -93.7%
                                                             ------------       ------------         ------------  ------------
           TOTAL Other Income & Expenses                       3,500               55,365              (51,865)         -93.7%
                                                             ------------       ------------         ------------  ------------
           PROFIT BEFORE TAXES                                12,117              (37,763)              49,880          132.1%
                                                             ------------       ------------         ------------  ------------

           NET PROFIT                                        $12,117             ($37,763)             $49,880          132.1%
                                                             ============       ============         ============  ============
</TABLE>

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

                                       F-2

<PAGE>

<TABLE>
<CAPTION>

                            Eagle Consolidated Report

                           Income Statement UNAUDITED

                                                               9 Months            9 Months             Variance
                                                             Ended Sep/00        Ended Sep/99           Fav/(Unf)      % Var
                                                             ------------       ------------         ------------  ------------

<S>                                                             <C>                   <C>                 <C>           <C>
           Income

               Sales                                            $35,360               $4,000              $31,360       784.0%
                                                             ------------       ------------         ------------  ------------
           TOTAL Income                                          35,360                4,000               31,360       784.0%
                                                             ------------       ------------         ------------  ------------
           NET REVENUE                                           35,360                4,000               31,360       784.0%
                                                             ------------       ------------         ------------  ------------

           Cost of Goods Sold

               Cost of Goods Sold                                 3,021                    0               (3,021)
                                                             ------------       ------------         ------------  ------------
           TOTAL Cost of Goods Sold                               3,021                    0               (3,021)
                                                             ------------       ------------         ------------  ------------
           GROSS PROFIT                                          32,339                4,000               28,339       708.5%
                                                             ------------       ------------         ------------  ------------

           Expenses

               Payroll Costs

                  Officers Salaries                              18,200               20,700                2,500        12.1%
                  Employee Benefits                               5,059                1,345               (3,715)     -276.2%
                                                             ------------       ------------         ------------  ------------
               TOTAL Payroll Costs                               23,259               22,045               (1,215)       -5.5%
                                                             ------------       ------------         ------------  ------------
               Advertising                                          798                    0                 (798)
               Utilities                                          2,306                  590               (1,716)     -290.8%
               General Expenses                                 692,208              202,243             (489,964)     -242.3%
                                                             ------------       ------------         ------------  ------------
           TOTAL Expenses                                       718,571              224,878             (493,693)     -219.5%
                                                             ------------       ------------         ------------  ------------
           OPERATING PROFIT                                    (686,233)            (220,878)            (465,354)     -210.7%
                                                             ------------       ------------         ------------  ------------

           Other Income & Expenses

               Other Income & Expenses                         (384,006)             503,765             (887,771)     -176.2%
                                                             ------------       ------------         ------------  ------------
           TOTAL Other Income & Expenses                       (384,006)             503,765             (887,771)     -176.2%
                                                             ------------       ------------         ------------  ------------
           PROFIT BEFORE TAXES                               (1,070,239)             282,887           (1,353,126)     -478.3%
                                                             ------------       ------------         ------------  ------------

           NET PROFIT                                       ($1,070,239)            $282,887          ($1,353,126)     -478.3%
                                                             ============       ============         ============  ============

</TABLE>

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

                                       F-3

<PAGE>

<TABLE>
<CAPTION>

                            Eagle Consolidated Report

                        Statement of Cash Flows UNAUDITED

                                                                        Sep/00                 Sep/99                Inc/(Dec)
                                                                       ---------             ---------               --------
           CASH FLOWS, OPERATIONS:

<S>                                                                       <C>                    <C>                   <C>
               Period Earnings:                                                                                    (1,018,043)
               Adjustments to Year-to-Date Earnings:
                  US BANK, Reno                                           (4,853)                2,075                 (6,928)
                  Checking, Sparks                                          (320)                 (500)                   180
                  Interest Receivable                                        529                     0                    529
                  Trade Receivables                                      (12,600)                    0                (12,600)
                  Travel Advances                                              0                  (900)                   900
                  Employee Advances                                            0                (1,193)                 1,193
                  Notes receivable Lone Eagle                                  0              (377,355)               377,355
                  Note Receivable, JAB                                    (8,738)                    0                 (8,738)
                  Inventory Account #1                                      (564)                    0                   (564)
                  Accounts Pay. Related Parties                            4,209                   450                  3,759
                  Loans, short term, other                                   400                     0                    400
                  Contract payables                                      231,520                33,477                198,043
                  Trade Payables                                         189,064               205,866                (16,802)
                  Deposits on Equipment                                   69,045                70,000                   (955)
                  Sales Tax Payable                                        2,353                     0                  2,353
                  Salaries and Wages Payable                              45,254                25,438                 19,816
                  JAB Enterprises Inc.                                    (4,710)              (14,830)                10,120
                  Lease payable IKON                                      17,416                26,218                 (8,802)
                  Lease Payable Auto/Ford                                 10,729                (2,282)                13,011
                                                                       ---------             ---------               --------
                    NET CASH FLOWS, OPERATIONS                                                                       (445,773)
                                                                                                                     --------
           CASH FLOWS, FINANCING and INVESTING:

                  Rights To Technology                                  (256,655)             (237,155)               (19,500)
                  Licenses for Zawcad                                   (391,417)                    0               (391,417)
                  Deposits                                                (3,380)           (1,189,229)             1,185,849
                  Furniture & Fixtures                                      (214)                    0                   (214)
                  Equipment                                              (61,130)              (55,386)                (5,745)
                  Equipment Accum. Deprn.                                 36,874                26,689                 10,185
                  Vehicles                                               (38,369)               (1,062)               (37,307)
                  Vehicle Accum Deprn                                      4,792                     0                  4,792
                  Notes Payable, Papas                                    23,678                11,656                 12,022
                  Notes Payable, JAB ENT                                  56,496                (2,000)                58,496
                  Notes Payable, Conv. Debenture                           9,000                     0                  9,000
                  Common Stock                                           132,955                78,812                 54,143
                  Additional paid in Capital                           1,783,176             2,218,751               (435,575)
                                                                       ---------             ---------               --------
                    NET CASH FLOWS, FINANCING and INVESTING                                                           444,729

                  Net Increase (Decrease) in CASH                                                                      (1,044)
                            CASH and CASH EQUIVALENTS

                    Beginning of the Period                                                                             1,150
                                                                                                                     --------

                            CASH and CASH EQUIVALENTS

                    Current                                                                                               106
                                                                                                                     --------

                  CASH and CASH EQUIVALENTS:

                  Checking, Other AW                                                                                      106
                                                                                                                     ------------
                    TOTAL CASH and CASH EQUIVALENTS                                                                       106
                                                                                                                     ============
</TABLE>

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

                                       F-4

<PAGE>

                     EAGLE ENVIRONMENTAL TECHNOLOGIES, LTD.
                        (A DEVELOPMENT STAGE CORPORATION)
            NOTES TO THE CONSOLIDATED UNAUDITED FINANCIAL STATEMENTS
                               SEPTEMBER 30, 2000

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

ORGANIZATION:

Eagle Environmental  Technologies,  Ltd. (the "Company") was incorporated in the
State of Nevada  on June 15,  1990 for the  purpose  of  acquiring,  developing,
testing, and marketing high technological developments for the protection of the
environment.  In June of 1990, the Company issued 3,000,000 shares of its common
stock for $8,400 cash. On July 12, 1991 the Company merged with Cholla  Precious
Metals,   Inc.,  for  876,667  shares  of  the  Company's  common  stock.  (Post
consolidation number)

On March 12,  1992,  the Company  issued  100,000  shares of common  stock to an
individual  for  his  current  and  future  rights  in the  development  of tire
recycling, Biomass technology and improvements to the Chemstasis technology. The
Company is  involved  with other  technologies  through the  execution  of joint
venture or value-added resale agreements. See note 3.

On December 31, 1997 the Board voted to issue 165,500  shares as collateral  for
purchase of another company, American Water Technologies (AWT). The purchase was
never consummated and AWT had refused to return the stock.  Eagle put a block on
this  stock and  started  legal  proceedings  to  collect  the  stock  which was
completed  on  September  1, 2000 with the stock  being  returned  to Eagle.  On
September 30, 1999 Eagle issued  1,779,167 shares as collateral for the purchase
of a company.  This purchase was never  consummated  and the  stockholders  have
refused to return  stock.  Eagle has  placed a block on this  stock and  started
proceedings  to collect  this  stock.  This has been  reconciled  by the changes
listed  in the  ZawCad  technology  license  agreement  between  Eagle  and  JAB
Enterprises.

On August 8, 1994 the Company  completed all Securities and Exchange  Commission
requirements to publicly trade its stock.  The Company  currently  trades on the
Electronic "Over the Counter" (OTC) Exchange (Symbol EGVR).

On July 26, 2000, the Company completed its filing of the 10SB12G,  Registration
Statement, to become a fully reporting company with the SEC. The statute time of
60 days ended on September 23, 2000, which completes the standard process. There
is a comment period during and often after the 60 days,  which will be completed
by the Company as needed. This change in stature of the company will enhance its
visibility  to the  public  and the  stockbrokers  that  trade in the  company's
shares.

PRINCIPLES OF CONSOLIDATION

The accompanying consolidated financial statements include the accounts of Eagle
Environmental  Technologies  Ltd., and its wholly owned  subsidiary,  Lone Eagle
Technology  Site, Inc. All significant  intercompany  balances and  transactions
have been  eliminated from the balance sheets and carried as "off balance sheet"
amounts.

USE OF ESTIMATES:

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

                                       F-5

<PAGE>

                     EAGLE ENVIRONMENTAL TECHNOLOGIES, LTD.
                        (A DEVELOPMENT STAGE CORPORATION)
            NOTES TO THE CONSOLIDATED UNAUDITED FINANCIAL STATEMENTS
                               SEPTEMBER 30, 2000

EARNINGS PER SHARE:

The earnings per share  calculation  is based on the weighted  average number of
shares  outstanding  during the period,  8,566,859  in 1999,  5,139,125  in '98,
2,919,585 in '97 and 1,755,962 in 1996. Stock options or convertible  debentures
or warrants are not included in the calculation since they are anti-dilutive.

DIVIDEND POLICY:

The Company has not paid  dividends  and any  dividends  that may be paid in the
future  will  depend upon the  financial  requirements  of the Company and other
relevant factors.

EQUIPMENT:

Equipment is recorded at cost and  depreciation  is computed using a 5-year life
on a straight-line basis.

INCOME TAX:

Because of losses sustained since inception, no provision for Federal income tax
was made.

NATURE OF BUSINESS:

The Company is a "Technology Systems  Integrator".  The company gains ownership,
licenses or rights to market  various  technologies  independently.  The company
uses the  various  rights  to the  technologies  to form a new  "solution  based
system"  for  a  customer  to  solve  a  particular  environmental  problem.  By
investigating existing waste handling, disposal equipment and water purification
systems,  the company  develops  more  sophisticated  types of systems for waste
handling  and  disposal  procedures  and  products.  By  operating as a "Systems
Integrator",  several types of technology  may be combined with the company's to
perfect a complete solution for a customer.

NOTE 2 - RIGHTS TO TECHNOLOGY:

The  merger  with  Cholla  Precious  Metals,  Inc.,  included  total  rights  to
Chemstasis  Technology.  The technology is to enable the Company to economically
and easily destroy undesirable toxic and hazardous waste materials, and is still
under early development.

With the purchase of the sub license from Zawtech International/JAB  Enterprises
Inc.,  the  company is able to use the  ZawCAD  technology  in coating  removal,
cutting  or  drilling  processes,  worldwide.  The  process  works  similar to a
water-jet process but without developing the waste stream. See Note 9, below

NOTE 3 - JOINT VENTURES AND AGREEMENTS:

In 1994, the Company entered into a joint venture with Research Institute of the
Electrical  Industry,  the largest research institute in Hungary, to form a U.S.
Corporation, Plasma Environmental Technologies,  Inc., (formally Eagle AM Master
Inc, Reno, NV) to sell waste elimination  systems  throughout the Americas.  The
systems use Plasma  Technology to destroy highly toxic wastes by the application
of  high  temperature.  The  units  using  the  Plasma  Technology  systems  are
manufactured  by  EPOS,  (now   Hungaroplasma)  one  of  the  largest  specialty
manufacturers in Hungary

The Company  entered  into an  additional  agreement  with Plasma  Environmental
Technologies,  Inc., to market the Plasma Technology. Pursuant to the agreement,
the Company  implemented a regional  licensing  program  whereby  Canada and the
United States were divided into 10 regions for marketing  purposes.  The Company
intends to license specific companies to service each region in return for a fee
and minority interest.

                                      F-6

<PAGE>

                     EAGLE ENVIRONMENTAL TECHNOLOGIES, LTD.
                        (A DEVELOPMENT STAGE CORPORATION)
            NOTES TO THE CONSOLIDATED UNAUDITED FINANCIAL STATEMENTS
                               SEPTEMBER 30, 2000

In November  1996,  the company  formed a joint venture  company,  Plasma Energy
Processing Inc, with Palota Kornyezelvedelmi KFT of Hungary, to produce a larger
version of the Plasma system than  available  from the Canadian  firm PETI.  The
company owns 50% of the stock at this time.  The equipment has not been built or
tested under the USA EPA standards, so no sales have been made.

Under the  licensing  agreement,  Intercommerce  Inc. has agreed to purchase the
rights to market Plasma Technology.  Intercommerce Inc. and will pay the Company
$2,000,000,  by a  promissory  note to be paid over 10 years  (with  interest at
12%).  The  agreements  are  contingent and will be finalized in the future upon
delivery of the equipment that is not yet scheduled.

NOTE 4 - NOTES RECEIVABLE

The Company had the following notes receivable 1999:

Notes receivable from Plasma  Environmental  Technologies,  Inc for $17,683 with
interest at 10% per annum. Management believes the note to be collectable.

NOTE 5 - ACCRUED EXPENSES:

The Company has accrued  unpaid  wages to Jerry Wilmot in the amount of $27,000,
and accrued rent due to JAB in the amount $1,920.

NOTE 6 - NOTES PAYABLE, RELATED PARTIES

                                                              1999        1998

A non interest bearing note payable to related parties,      56,408      105,000
A non-interest bearing Note Payable to BBTC for services:    -0-          20,000

NOTE 7 - CAPITAL LEASE

Future  minimum  payments  for a copier  under a  non-cancelable  lease exist at
December 31. 1999

                                              2000     8,687

                                              2001     8,687

                                              2002     8,687

                                              2003     1,327

Total minimum lease payments:                         27,388
         Amount representing interest                  3,938
                                                     -------

Present value of net, current portion:                23,450
         Current portion                               8,687
                                                     -------

                                                      14,763

Future minimum payments for a Ford Explorer under a  non-cancelable  lease exist
at December 31. 1999

                                              2000     6,230
                                              2001     6,230
                                              2002     3,116

Total minimum lease payments:                        15,576
         Amount representing interest                    551
                                                    --------

Present value of net, current portion:                15,025
         Current portion                               6,230
                                                     -------

                                                       8,795
                                      F-7

<PAGE>

                     EAGLE ENVIRONMENTAL TECHNOLOGIES, LTD.
                        (A DEVELOPMENT STAGE CORPORATION)
            NOTES TO THE CONSOLIDATED UNAUDITED FINANCIAL STATEMENTS
                               SEPTEMBER 30, 2000

NOTE 8 - NOTE PAYABLE: EMPLOYMENT CONTRACTS, STOCK OPTIONS:

The Company signed modified employment agreements with individuals and corporate
entities to act as chairman,  president  chief  executive,  corporate  treasurer
(CFO),  corporate  secretary and marketing  officer,  for compensation  totaling
$590,000 per year. A pool of compensation is to be set aside equal to 25% of net
cash flow or net pre-tax profits,  whichever is lesser,  as incentive bonuses to
be paid to the above  entities.  The entities have elected not to be compensated
on these contracts  until the Company has a positive cash flow from  operations,
therefore,  the Company did not accrue a liability on these contracts during the
years previously.  The employment  agreements also contain stock options in lieu
of part of their  salaries at a purchase  price equal to 70% of the then current
market value.

NOTE 9 - RELATED PARTY TRANSACTIONS:

The  Company  rents  office  space  from  JAB   Enterprises,   Inc.,  a  related
corporation,  for $960 per month.  The company has entered  into an agreement to
receive  worldwide  license  rights  for  the  ZawCAD  technology  from  Zawtech
International  Inc.  The  company  paid in stock  for the  rights  at a value of
$391,417.  The  agreement  was entered into in 1999 and finalized in 2000 and is
currently reflected in the balance sheets.

NOTE 10 GOING CONCERN

The interim 2000 financial statements of the Company have been prepared assuming
that the  Company  will  continue as going  concern as of  September  2000.  The
Company is  currently  generating  limited  revenue and  substantial  capital is
necessary to market the Chemstasis  Technology,  Plasma  technology,  WaterClear
Technology and the Zawcad Technology.  If additional capital is not secured from
the public  offering of the stock,  from its current  shareholders,  or from the
marketing  agreements discussed in Note 3, then there is substantial doubt about
the company's ability to continue as a going concern.

The company  currently has orders for the ZawCAD  equipment from Lockheed Martin
Corporation for delivery in fourth quarter 2000. The company has contracted with
EDC Engineering in Santa Fe, NM to construct the equipment.  All re-designs have
been completed and the manufacturing has begun.

The company has a pending  agreement with Osmonics Inc, the  manufacturer of the
WaterClear for the company to continue the manufacturing of the equipment to the
Eagle specifics. The final agreement is expected in the fourth quarter of 2000.

                                   F-8

<PAGE>

                     EAGLE ENVIRONMENTAL TECHNOLOGIES, LTD.
                        (A DEVELOPMENT STAGE CORPORATION)
            NOTES TO THE CONSOLIDATED UNAUDITED FINANCIAL STATEMENTS
                               SEPTEMBER 30, 2000

MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS

FINANCIAL

The  following   discussion   should  be  read  in  conjunction  with  Company's
Consolidated Financial Statements and Notes included in this report.

RESULTS OF OPERATIONS, comparison of periods, September 2000 and September 1999

Gross  sales  increased  $28,860  during  the  current  period due to the recent
approval  and  sale  of  the  Company's  WaterClear(TM)  equipment  line  to the
California  school.  Further orders for similar equipment are pending at another
school and the California Fish and Game Department.

Sales of the ZawCAD  equipment  have not yet been  finalized,  as  deliveries on
previous orders,  (those placed prior to the Company  obtaining the license) are
not  scheduled to be  completed  until the first  quarter of next year.  Certain
engineering,  marketing  and design  costs have been  included in the  reflected
expenses for this period and the previous quarters of 2000.

General  expenses show a decline of 75.4% for the current period due to deposits
and  purchases  made in 1999 to open the new Sparks  office/warehouse  facility.
Year to date  expenses  show an  increase  of 242.3% in this  area.  Most of the
changes  and office  equipment  purchases  are  complete  at this time and it is
expected  that  overall,  non-operating,  expenses  will  not  increase  for the
remainder of 2000.

Major  adjustments  on the  balance  sheet  were due to changes in the method of
accounting of the funds advanced to the subsidiary,  Lone Eagle Technology Site,
Inc., (Texas), for the processing facility in Texas City, Texas, being taken off
of the balance  sheet and carried as an "off  balance  sheet"  asset.  The final
determination of the status of the processing  facility has not yet been made by
the Texas  Bankruptcy  Court.  Until that is completed,  the Company will not be
able to move on the acquisition.

In 2000, the added license  acquisition of the ZawCAD  technology rights was the
largest  asset  change to the balance  sheet.  The purchase was based on a stock
issuance at .22 cents per share,  which  increased the common stock  calculation
and diluted the existing amount of shares by 1,779,167.

Liquidity: The company's liquidity increase during the current period was due to
the recent equipment  sales. The company is negotiating a lease/credit  line for
equipment purchase - resale use during the fourth quarter. This is for the cyclo
mill equipment that the company feels it can get  operational  within the fourth
quarter to improve its year-end cash flow captions.

                                       F-9

<PAGE>

ITEM 2:  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

Plan of Operation

         Statements   contained   herein  that  are  not  historical  facts  are
forward-looking  statements  as that term is defined by the  Private  Securities
Litigation  Reform  Act  of  1995.   Although  the  Company  believes  that  the
expectations  reflected in such forward-looking  statements are reasonable,  the
forward-looking  statements  are subject to risks and  uncertainties  that could
cause  actual  results to differ  from those  projected.  The  Company  cautions
investors  that  any  forward-looking  statements  made by the  Company  are not
guarantees of future  performance and that actual results may differ  materially
from  those in the  forward-looking  statements.  Such  risks and  uncertainties
include, without limitation: well established competitors who have substantially
greater financial resources and longer operating histories, regulatory delays or
denials,  the  Company's  ability to  compete as a start-up  company in a highly
competitive market, and access to sources of capital.

         During the last quarter of 2000 and the first half of 2001, the Company
plans to focus on  continuing  its  efforts to secure  the  newest  technologies
available,  to secure the best expertise and team available, to develop the most
cost  effective  technologies  for the  treatment  of toxins  and  wastes in the
environment,  and to complete the  development of its  intellectual  properties.
Unless a client  base is  established,  the  Company  will be  forced to rely on
investment financing to meet its short and long term cash requirements.

         Management  believes  that demand for its services  will be high in the
disposal of toxic  wastes.  The USA leads the world in  production of consumable
goods and the  utilization  and  disposal  of their  remains.  The ever  growing
stringency  of  anti-  pollution   regulations  and  their  enforcement  by  the
regulators has put the  manufacturing  industry in a very  precarious  position.
Manufacturing plants are avoiding discharge of their wastes by transporting them
to centralized treatment facilities. There is increased awareness of the hazards
from polluted water, both on wildlife and humans,  and greater emphasis is being
placed on finding  cost  effective  methods to clean up our water  systems.  The
Company offers  manufacturing  plants and others an on-site process for disposal
of toxic wastes at a lower cost.

                                        2

<PAGE>

         Unless  revenues  increase,  the  Company  will not be able to meet its
short-term or long-term cash requirements. Current revenues and financing likely
will be adequate  through  December  31,  2000.  The Company  will have to raise
additional funds after that point.  Though management has successfully  obtained
such financing in the past, there is no assurance that investment financing will
be available in the future. And if it is, additional  investment  financing will
result in a dilution of current shareholder equity.

         The  Company  will  continue  to improve  its  intellectual  properties
through its research and development  efforts.  The Company plans to protect its
developments  through appropriate patent  applications.  If the Company receives
the  appropriate  patent and  copyright  approvals,  which is not  certain,  the
Company  expects  to be able  to  capitalize  on the  anticipated  trend  in the
industry for technologies the Company employs.  Additional  development  efforts
and  expansion  into new  markets  depend on the  Company's  ability  to develop
revenue streams.

PART II

OTHER INFORMATION

ITEM 1:  Legal Proceedings

         The  Company is not party to,  and none of the  Company's  property  is
subject to, any pending or threatened  legal,  governmental,  administrative  or
judicial  proceedings  that  will  have a  materially  adverse  effect  upon the
Company's financial condition or operation, except as disclosed below:

         The Company is bringing suit against Dakota Partners,  Bismarck,  North
Dakota.  The case has not yet been  filed.  The Company is seeking the return of
funds  resulting from a liquidation of assets by a lienholder for a loan made to
the Company's  subsidiary,  Lone Eagle  Technology  Site, Inc. The partners were
overpaid by the  liquidation  and have not returned the overpaid sum of $25,000,
plus over-charges of $50,000.

         The  Company  is   investigating   facts  on  a  suit  against   Plasma
Environmental  Technologies  Inc.  Canada.  PETI has  granted  the  Company  the
exclusive  marketing rights to its Plasma equipment by contract and its offering
circulars,  and  then  tried to  disclaim  the  commitment.  The  Company  would
seek-reaffirmation  of  the  agreements  and  cash  to  pay  legal  expenses  of
approximately $10,000.

         The Company has filed a suit against American Water  Technologies Inc.,
Stockton,  California  and its president Paul Chapman for damages and the return
of issued  purchase money stock of 165,500 shares.  AWT was a corporation  which
the Company planned to acquire. Purchase contracts were signed and the Company

                                        3

<PAGE>

paid a cash  deposit  of  $10,000,  plus  the  stock,  to  purchase  100% of the
outstanding  shares of AWT. AWT failed to produce audited financial  statements,
failed to disclose numerous tax authority debts and  misrepresented its business
condition.  AWT  failed to  deliver  its  shares  to the  Company.  The  Company
terminated the agreement and made demand that its shares be returned.

ITEM 2:  Changes in Securities and Use of Proceeds

         None.

ITEM 3:  Defaults Upon Senior Securities

         None.

ITEM 4:  Submission of Matters to a Vote of Security Holders

         No matters have been submitted to a vote of the security holders during
the  period  covered  by this  report  through  the  solicitation  of proxies or
otherwise.

ITEM 5:  Other Information

         None.

ITEM 6:  Exhibits and Reports on Form 8-K

A.       Exhibits

   (2)   Plan of acquisition, reorganization, liquidation or
succession:
         NONE.

   (3)   (i)  Articles of Incorporation *
          (ii) By-laws *

* Incorporated by reference from the Registrant's Form 10-SB.

B.       Reports on Form 8-K.


         The  Registrant  did not file  reports on Form 8-K  during the  quarter
covered by this report.

                                        4

<PAGE>

                                   Signatures

                                   ----------


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

Dated: November 20, 2000.

                                    EAGLE ENVIRONMENTAL
                                    TECHNOLOGIES, LTD.

                                    By:   /s/ Brian D. Wilmot
                                       -----------------------
                                              Brian D. Wilmot
                                              President