SECURITIES AND EXCHANGE COMMISSION
                      Washington, D.C. 20549


                          FORM 10-KSB



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

            For the fiscal year ended June 30, 2001

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

                 Commission file number 0-14859

                  GARB OIL & POWER CORPORATION
                  ----------------------------
      (Exact name of small business issuer in its charter)


          Utah                               87-0296694
          ----                               ----------
(State of other jurisdiction of             (I.R.S. Employer Ident. No.)
incorporation or organization)


                   1588 South Main Street, Suite 200
                      Salt Lake City, Utah 84115
                      --------------------------
               (Address of principal executive offices)


                            (801) 832-9865
                            --------------
            (Issuer's telephone number, including area code)


Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act: No par value
common stock

     Check whether the Issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for
such shorter period that the Issuer 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 Registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-
KSB or any amendment to this Form 10-KSB. [ ]

     State Issuer's revenues for its most recent fiscal year: None.

     As of September 20, 2001, 8,534,963 shares were held by non-affiliates
and the aggregate value of the common voting stock held by non-affiliates of
the Issuer, computed by reference to the average of the bid and ask prices on
such date, was $469,422.97.

     As of September 20, 2001, the Issuer had outstanding 20,000,000 shares of
common stock (no par value).

     Transitional Small Business Disclosure Format   Yes X  No
                                                        ---   ---

                                     PART I

ITEM 1. BUSINESS.

Business Development.
---------------------

     Garb Oil & Power Corporation (the "Company")was incorporated under the
laws of the State of Utah on September 11, 1972, under the name "Garb-Oil
Corporation."  The Company changed its name to "Garb Oil & Power Corporation
in 1985."

     No material business developments occurred during the most recent fiscal
year; however, certain material historical developments are discussed below
under the heading "Business" to the extent that management believes such a
discussion will promote a further understanding of the past, present and
intended business operations of the Company.

Business.
---------

     The Company is in the business of developing and marketing processes
that: (a) recover crumb rubber or other recyclable rubber, oil by-products,
commercially marketable char and steel from scrap tires, (b) recover, repair
and market truck tires of all sizes, and (c) utilize scrap tires and/or
municipal waste to generate steam for the production of electricity. In this
respect, the Company has designed a system that in management's opinion is
capable of recovering used rubber from large off road tires.

     In 1999, the Company acquired certain assets from its sister
corporation, Garbalizer Machinery Corporation ("GMC"), including the rights to
manufacture and sell Garbalizer tire shredders. In addition, the Company has
the rights to act as the non-United States agent for a third party's unproven
technology for the remediation of radioactive wastes and exclusive rights to
build its plants in the United States and abroad. The Company is in the
development stage.

     The Company received no revenues in the fiscal year ended June 30, 2001,
and at year end, its current liabilities exceeded its total assets by
approximately $1,045,159. The Company continues, as it has done in recent
years, to actively pursue sales of its OTR Tire Disintegrator System,
Garbalizer tire shredders and crumb rubber plants. These activities did not
result in any sales during fiscal 2001, and they may not result in any sales
during fiscal 2002.

     The Company has limited financial resources, and it is completely unclear
if the Company will be able to continue in business if it does not receive
significant additional cash from operations or financing activities. The
Company cannot give any assurances that its plans to generate cash will be
successful or that the Company can continue as an on going concern.

     OTR Tire Disintegrator System
     -----------------------------

     The Company has designed a system known as the "OTR Tire Disintegrator
System," which management believes will be capable of recovering used rubber
from large off road tires. In 1998, the Company substantially completed the
engineering and design of the OTR Tire Disintegrator System, but has not yet
constructed a commercially operating system. As discussed below, the Company
granted an option to a third party to acquire a license to utilize the OTR
Tire Disintegrator System in a stated territory.  The option holder may not be
successful in obtaining financing for that project.

     Commercially available tire shredders, including shredders made by the
Company, are designed to process standard automobile and truck tires, which
may include semi-trailer or over the road tires. Tires used on a variety of
off road equipment such as graders, bulldozers and mining equipment cannot be
processed directly by these shredders. Although these tires, which may weigh
from 400 pounds to nine tons each, are less numerous than standard tires, the
Company estimates that over 2,600,000 tons of large off road tires of all
sizes require disposal in the United States each year. Current methods of
disposal include land filling and surface disposal, which are accepted only
due to the lack of a viable alternative. Most states have passed laws
prohibiting land filling or storage of whole tires.

     The OTR Tire Disintegrator System uses mechanical means to remove the
exterior rubber from large off road tire carcasses without shredding. After
removal of non-rubber components, primary shredding and wire separation, the
resulting particles are then processed into crumb rubber during secondary
processing. The shredded particles could also be used as fuel or safely
disposed of in a landfill. However, mamagement believes that the rubber
particles will be of such high quality that landfill disposal or use as fuel
will be unnecessary.

     The Company has prepared what it believes to be the final design of the
OTR Tire Disintegrator System and has analyzed its expected performance. When
the first OTR Tire Disintegrator System is built, it is expected that only
slight modifications to the design will be required to maximize performance.
It is also possible, although the Company does not anticipate this, that the
OTR Tire Disintegrator System will not perform as planned when built.

     The Company has received United States Patent No.5,299,748 on the OTR
Tire Disintegrator System design which expires April 5, 2011, and Patent No.
5,590,838 which expires January 7, 2014. An additional patent improvement has
been filed and is currently pending in the United States. The additional
patent improvement was granted in Canada on July 6, 1999, as Canadian Patent
No. 2,178,326, and will expire on March 23, 2015.

     The Company announced the availability of the OTR Tire Disintegrator
System in July, 1992. Although the Company has received and continues to
receive numerous inquiries from potential buyers or users of the OTR Tire
Disintegrator System, it has not built or sold an OTR Tire Disintegrator
System. The Company's original intent was to retain ownership of the OTR Tire
Disintegrator System, allowing its use by persons who purchase an exclusive
territory from the Company and who agree to pay the Company a share of any
profits earned. However, the Company has decided to modify its requirements to
allow others to purchase and use the technology and machinery on a license and
royalty based upon gross sales.

     On April 28, 1997, the Company granted Giant Tire Recyclers, Inc.
("Giant") a Nevada corporation, an option to acquire a license to use the OTR
Tire Disintegrator System. The price of the option was $150,000. Giant could
have exercised the option at any time. In April, 1999, the Company and Giant
amended the option to provide that the option would expire if not exercised by
April 29, 2000, plus applicable notice and grace periods.  The option expired
in accordance with these terms, and all sums paid to the Company were retained
as liquidated damages in accordance with the terms of the option.

     The option, as amended, gives Giant the opportunity to purchase an
exclusive license to use the Company's OTR Tire Disintegrator System in the
states of Arizona, New Mexico and Nevada for a license fee of $1,315,000, less
option payments prior to the time of exercise. The license fee includes two
OTR Tire Disintegrator System machines and tools and equipment suitable to
operate a truck tire repair business. If the option is not exercised, the
agreement provides that amounts paid for the option are non-refundable. The
Company cannot predict whether Giant will exercise the option. The Company
believes Giant may require substantial additional financing in order to
exercise the option.

     Shredding Systems
     -----------------

     On March 19, 1999, the Company acquired a patented shredding system from
its sister company, GMC.  See Part II, Item 12 "Certain Relationships and
Related Transactions".  This system became available when GMC merged with a
Canadian Internet company, changed its name to "RecycleNet, Inc." and ceased
its shredder business.

     The Company acquired from GMC all of its then existing assets, including
the Garbalizer name and logo, patents, machinery designs and contract rights
in exchange for assumption of all then existing indebtedness of GMC in the
approximate amount of $500,000.

     The system known as the "Garbalizer Shredder" has a thirty year history
of shredding automobile and truck tires in the United States, Canada and
Europe.  During this period of time, GMC acquired fourteen United States and
six foreign patents all of which have expired except one United States patent.
United States patent No 4927088 expires on May 22, 2007.

     The Garbalizer Shredder employs a cutting method rather than the impact
method embodied in hammer mills and grinders.  This cutting method consists of
a rotatable shaft or pair of shafts, supported by bearings, upon which are
fixed a series of blade holders at 120 (Degree) or 180 (Degree) intervals
around the shaft. The blade holders to which blades are attached are
positioned along the length of the shaft so that their tips form a helix which
tends to position the tires for cutting.  Spacers to which no cutting blades
are attached are located between each blade holder mounted on the rotatable
shaft so that the rotating blades and the spacers form the cutting mechanism
of the Garbalizer Shredder.

     The shredding mechanism for all of the electric-driven models is
protected by fluid couplings, torque limiting couplings and overload relays in
the electrical control system. If non-shredable material is encountered within
the Garbalizer Shredders, the torque limiting or fluid coupling and relays
stop the machines and protect the Garbalizer Shredders from serious damage.
The rotatable shaft or shafts are driven by an electric motor or diesel
electric system through a system of gear reducers. The diesel electric-driven
mobile Garbalizer Shredder is protected from non-shredable items by similar
couplings and overload relays that stop the Garbalizer Shredder if it becomes
overloaded or jammed. If this happens on any of the Garbalizer Shredders, it
is simple to reverse the rotor and remove the item or items that jammed or
stopped the shredder. This and several additional unique and beneficial
features of the Garbalizer Shredder reduce the time and effort required for
maintenance.

     In operation, material to be shredded is placed on a conveyor and carried
to the top of the hopper where it falls by gravity upon the rotating blade or
blades or can be fed directly into the cutters by a patented controlled
feeding system. The rotating blades position the material and cut it as it is
forced between the stationary blades. The shredded material is then
transported away from the machine by conveyor to be used as tire derived fuel,
crumb rubber production or other processes that use shredded tires.

     Management believes that acquisition of the Garbalizer Shredder system
and related marketable items from GMC will benefit the Company by allowing it
to quote complete recycling systems more economically and efficiently.

     The Company's markets are the scrap tire disposal and recycling markets.
There are numerous companies worldwide that sell competitive products in these
markets. Management also believes that the design of the Garbalizer Shredder
is equivalent or superior to competitive designs.  However, some of the
competitors are larger and better financed than the Company, and certain
competitors may have a competitive advantage on the sale of stand alone
shredders with respect to marketing prowess, financing terms, cost and
perceived customer support.

     The Company advertises over the Internet and occasionally in printed
magazine publications. The Company has representatives in certain areas that
represent the Company on a percentage of sales basis.   The Garbalizer
Shredders are offered in mobile and stationary models of various capacities,
but there were no new product lines introduced during the past fiscal year.

     The Company can purchase mechanical, electrical, hydraulic components,
steel and other items that are used in manufacturing its products from
suppliers worldwide. Further, GMC determined that it could manufacture the
Garbalizer Shredders more economically on a contract basis with local machine
shops in lieu of its own manufacturing facilities and personnel. There are
several machine shops located near the Company's offices with the required
manufacturing and production capabilities to produce multiple shredders on a
timely basis. The Company intends to continue this practice in the future.

     The Garbalizer Shredder takes approximately four to five months to
construct. It is manufactured and assembled from stock alloy steel, gear
reducers, drive units and motors. Any heavy equipment machine shop with
standard machine technology can manufacture the shaft, blade holders, blades,
spacers, hopper, structural frame and supports for the Garbalizer Shredder
from standard alloy steel stock. The gear reducer, bearings, electric motor
and related drive components are standard items available from several
suppliers. The completed components are assembled into major units for
shipping to the installation site by truck or railroad flat car.  At the
site, the major units can be field assembled with local construction or
rigging workers who do not need previous experience with the Garbalizer
Shredder. Location of the manufacturing facilities in close geographical
proximity to the installation sites of potential customers is not
considered by management to be a significant factor.

     Crumb Rubber Plants
     -------------------

     The Company markets plants and equipment to process scrap passenger car
and light truck tires into crumb rubber.  The Company is marketing such plants
worldwide on a "turn-key" basis. The equipment for such plants will include
third party equipment, equipment made to the Company's specifications,
shredders and other items provided by the Company. The Company entered into an
agreement to sell one such plant in 1996, but the buyer defaulted.  As of the
date of this Report, the Company has not sold any crumb rubber plants.

     If the Company is successful in selling a crumb rubber plant, it will be
exposed to the risks of process engineering and equipment manufacturing
concerns, including potential contract, warranty and liability claims. The
Company has limited experience in engineering for or constructing  crumb
rubber plants. The Company relies on third parties including engineers and
sub-contractors for the supply of a majority of the equipment in the plant
and the actual assembly and construction labor.

     Trenergy Radioactive Waste Technology
     -------------------------------------

     On May 11, 1998, the Company entered into a Project Development and
Construction Agreement with Trenergy Inc. ("Trenergy"). Pursuant to the
Agreement, the Company has been engaged to provide consulting and analysis
regarding the potential commercial application of Trenergy's unproven claimed
technology to neutralize and remediate radioactive waste.

     Trenergy has reported to the Company that its technology has the
potential of neutralizing radioactive waste.  The Company has not verified
Trenergy's claims. If true, Trenergy's technology would involve a substantial
departure from current methodology and currently accepted scientific
principles. Trenergy has informed the Company that it has applied for a patent
on its technology.  Filing of a patent application does not indicate that any
third party has verified the validity of the technology.

     The Agreement with Trenergy is for five years, with renewal provisions,
and gives the Company the right to build all systems and plants for Trenergy
on a cost plus basis, which cannot exceed similar costs for similar projects.
The Company is designated as Trenergy's exclusive agent to exploit the
Trenergy technology outside of the United States, with the exception of the
Republic of Belarus, Ukraine, Romania, Macedonia, Greece and Hungary. Trenergy
and the Company intend to equally share license revenues from potential
licenses of the Trenergy technology in the Company's territory; provided that
Trenergy may negotiate the Company's compensation for licenses where Trenergy
had initial discussions with the licensee. No licenses for the Trenergy
technology have been granted as of the date of this Report, and it is possible
that no such licenses will be granted in the future.

     Trenergy may not be able to establish the scientific validity or
commercial viability of the Trenergy technology.  Neither Trenergy nor the
Company have the resources necessary to develop or evaluate the Trenergy
technology without infusion of substantial capital or the joint venturing with
third parties. Neither Trenergy nor the Company have any such arrangements in
place. The Company plans to use management time and financial resources
pursuing possible transactions with the Trenergy technology for which the
Company may receive no revenue.

Tire Repair and Resale Business
-------------------------------

     The Company's efforts have historically focused on reducing environmental
problems such as disposing of used tires by creating fuel, power or useful by-
products from the tires. Although such efforts have not resulted in commercial
operations, the Company's management has gained extensive knowledge of the
used tire distribution and disposal business through such efforts. On May 20,
1994, the Company formed Utah Truck Tires, Inc. ("UTTI") as a-majority owned
subsidiary to exploit the perceived demand for repaired and retreaded
commercial truck tires. Although UTTI did demonstrate that there was a demand
for these used tires, UTTI incurred operating losses due principally to
overhead costs and high carcass costs.  The Company believes that the repair
and resale business could be commercially viable if operated in conjunction
with a recycling plant, where overhead costs can be shared with other
operations and usable carcasses obtained at relatively low cost. In 1996,
UTTI ceased active operations.

     The Company is proposing joint ventures between used tire processing,
sales and purchasers of tire shredders or OTR Tire Disintegrator Systems. To
date, the Company does not have any agreements to establish such joint
ventures. As with any start-up operation, there is substantial uncertainty
regarding its ability to operate at a profit.

     The Company owns 55% of UTTI, which interest it received in exchange for
its expertise and other intangible capital contributions.  The remaining 45%
of UTTI is owned by an investor who loaned $165,000 of seed capital to UTTI
and who is an officer and a director of UTTI.

     Co-generation and Electrical Power Generation
     ---------------------------------------------

     Since 1982, the Company has been involved in planning and preparation for
plants generating electricity or process steam to be fueled by scrap tires.
Such plants may be built by the Company alone or in joint venture with others.
During the past fiscal year, the Company has concentrated its efforts on other
aspects of its business and has held only very preliminary discussions
regarding the  possibility  of  construction of such plants. To date the
Company has not built any plants.

     The design which the Company developed for these plants calls for scrap
tires to be shredded into hand sized pieces. The shredded tires are then
burned in a fluidized bed combustor to produce steam, which may be used for
the generation of electricity or may be used as process steam in nearby
industrial plants.

     The Company received permits to construct the Rialto Power Plant from the
South Coast Air Quality Management District, which determined that the project
met all existing applicable pollution requirements.  Based on this, the
Company believes that a plant could be engineered to meet current pollution
requirements. Although environmental permits were issued for the construction
of the Rialto project, litigation with private citizens regarding compliance
with California environmental laws delayed completion of the project. The
Company and its joint venture partner determined that continuing with the
project until the litigation was resolved would not be economically feasible,
and the project was abandoned. With respect to the electrical power generation
process, these types of difficulties are not uncommon. There can be no
assurance that plants planned by the Company in the future will not become
similarly embroiled in litigation.

     Pyrolysis
     ---------

     In addition to the direct use of tires as fuel, the Company has developed
and patented the Garb-Oil Processes for pyrolytic reduction of tires.

     Pyrolytic reduction of tires occurs when scrap tires are first shredded
into approximately three inch size pieces with a shredder developed by GMC.
The three inch pieces are then heated in an oxygen free environment (processed
in a Garb-Oil Pyrolytic Furnace) to reduce the shredded particles into
hydrocarbon gases and char. Part of the hydrocarbon gas is condensed to
recover oil by-products. The remaining gases, i.e., ethane, methane, butane
and propane, are stored for use as fuel in the pyrolytic system. The char is
crushed to liberate the metal for magnetic recovery to be sold to the steel
industry as scrap. The crushed char can be used as a carbon additive to
manufacture solid rubber products or used as additive in the polymer
industries or as low grade activated carbon.

      During 1981, a demonstration-test facility was built in Mountlake
Terrace, Washington. This test facility was used to test various construction
materials that would be used in full size commercial plants. The test facility
was later moved to Huntington, West Virginia. Although the test facility
reduces tires by pyrolysis as designed, there is no guarantee that a
full-scale production facility will ever be built or, if built, that it will
operate on an economically and technically sound basis. In 1981, the Company
licensed the pilot plant, but then terminated the license. During fiscal 1992,
the entire receivable plus accrued interest thereon was written off to bad
debt expense. The demonstration plant is being stored in Huntington, West
Virginia, while the Company attempts to find a purchaser for the plant.

     The pyrolysis process meets all environmental laws and regulations.
However, the permits needed to conduct this process are very hard to obtain
and are expensive. The Company has not commercially exploited the pyrolysis
technology to date and does not believe that the pyrolysis technology is
financially feasible without heavy subsidies from governmental sources or
other entities.

     Patents, Trademarks and Proprietary Data
     ----------------------------------------

     The Company has received two United States patents on the OTR Tire
Disintegrator System design. The patents expire in the years 2011 and 2014.
Additional patents are pending in the United States and Canada. The Company
does not hold patents on the plant and process to be used in connection with
its proposed electricity, co-generation plants or nuclear remediation.

     The Company owns the following unexpired patents in connection with the
Garb-Oil Pyrolysis Process:

United States Patents:
----------------------                                    Expired

Pyrolysis Process         Patent No. 4,402,791            09/30/00
Patent

     A foreign patent has also been granted in Canada.

     In connection with the Garbalizer Shredder design, the Company owns
United States patent No. 4,927,088 that expires on May 22, 2007, and Canadian
patent No. 1,137,949 that expired on December 21, 1999.

     In addition to the above patents, the Company filed the following patents
which relate to Tar Sand development, that have also expired:

         Hydropulper & Classifier for Tar       Patent No. 3,814,336
         Sand Application

         Improvement Patents for Tar Sands      Patents No. 4,361,476
         Process

     The Company plans to exploit these patents if and when the Board of
Directors of the Company determines that the financing and timing is
appropriate. It is not expected that such exploitation will occur in the
foreseeable future and accordingly, the patents have not been considered
important to the Company's immediate future.

     Employees
     ---------

     The Company's President, John C. Brewer, it's Chief Engineer, Bill
Anderson, and its employed secretary, each devote 40 hours or more per week to
the Company's business. All additional work is performed on a contract basis.
UTTI currently has no employees and has no plans to hire employees in the
foreseeable future.

     Additional personnel will be required when the Company expands its
business or enters into agreements for construction of power plants, crumb
rubber and OTR plants. The Company does not anticipate problems in finding
suitable additional personnel.

     The Company believes its relationship with its employees to be good. The
Company is not a party to any collective bargaining agreement.

     Research and Development
     ------------------------

     During the fiscal years ended June 30, 2001 and 2000, the Company did not
expend any funds on research and development activities.

     Environmental Regulation
     ------------------------

     Shredding and crumb rubber operations meet all environmental laws and
regulations, are clean and require very little effort to procure permits.
However, for power plants that use the shredded tires as fuel or pyrolysis
plant technology, the permitting process is much more difficult. Although both
of these processes meet all environmental laws and regulation, permits are
very hard to obtain. Further, due to risk assessments and other tests
required, permits can cost millions of dollars.

     UTTI does not believe that its activities result in any discharge or
pollutants in the air, water or soil. Any power plants built by the Company in
the future utilizing tires as fuel will be required to comply with state and
federal regulations regarding the discharge of pollutants into the atmosphere.
The Company believes that the plants will comply with such regulations.

     The Company's Rialto Power Corporation ("RPC") subsidiary was engaged in
litigation from 1987 until abandonment of the project in 1989 to determine
whether RPC complied with all necessary requirements to obtain environmental
permits which had been issued for the construction of its plant. Although on
all issues in which a final determination was rendered, RPC was found to have
satisfied all such requirements which the courts and administrative agencies
determined must be complied with, there is no assurance that the undecided
issues would have been resolved in RPC's favor, or that the decisions would
not have been overturned on further appeal, if RPC had attempted to continue
the project.

ITEM 2.  PROPERTIES.

      The Company's executive offices have been located at 1588 South Main
Street, Suite 200, Salt Lake City, Utah 84115, for the past year. The offices
occupy approximately 1400 square feet. The premises are being leased from Utah
Auto Dealers Association, an unrelated third party, on a five year lease. UTTI
leases space in Salt Lake City from a third party to store its equipment and
inventory pursuant to a month-to-month lease. During the year ended June 30,
2001, the Company and UTTI paid approximately $14,400 to lease these
facilities.

ITEM 3.  LEGAL PROCEEDINGS

     None; not Applicable.

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

     No matter was submitted to stockholders during the fourth quarter of the
fiscal year ended June 30, 2001.

                                     PART II


ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED SHAREHOLDER MATTERS

     The Company's common stock is traded in the over-the-counter market. The
representative bid and asked quotations are posted on the National Association
of Securities Dealers, Inc.'s ("NASD") OTC Bulletin Board under the symbol
"GARB." On September 20, 2001, there were approximately 635 holders of record
of the common stock of the Company, and management believes there were
approximately 1,000 beneficial owners.  During the years ended June 30, 2001,
2000 and 1999, the common stock was only sporadically traded. The following
table sets forth the range of high and low representative bid quotations for
the periods indicated as reported by National Quotation Bureau, LLC.

            Period
         (Fiscal Year)                       High          Low
         -------------                       ----          ---

         2000

         1st Quarter                         .11           .09
         2nd Quarter                         .10           .06
         3rd Quarter                         .18           .06
         4th Quarter                         .14           .08

         2001

         1st Quarter                         .14           .075
         2nd Quarter                         .10           .05
         3rd Quarter                         .07           .04
         4th Quarter                         .15           .04

     The foregoing quotations represent prices between dealers and do not
include retail mark-ups, mark-downs or commissions and may not represent
actual transactions.

     Dividends
     ---------

     No cash dividends have been paid by the Company in the past, and
dividends are not contemplated in the foreseeable future. Utah law currently
prohibits the payment of dividends since the Company's liabilities exceed its
assets.  Dividends will be dependent directly upon the earnings of the
Company, financial needs, and other similar unpredictable factors.  For the
foreseeable future, it is anticipated that any earnings that may be generated
from the operations of the Company will be used to finance its operations and
dividends will not be declared for shareholders.  The Company is not subject
to any contractual restrictions on the payment of dividends.

     Recent Sales of Unregistered Securities
     -----------------------------------------

      During the year ended June 30, 2000, the Company reflected the issuance
of 10,000 shares of its common stock that were never cancelled by its transfer
agent. The shares were valued at $0.10 per share. No underwriting commissions
or similar fees were paid in connection with the sale. The Company believes
the offer and sale was exempt from registration requirements of Section 5 of
the Securities Act of 1933, as amended, pursuant to Section 4(2) thereof.

     There were no sales of "restricted securities" during the fiscal years
ended June 30, 1999 or 2001.

     Sales of "restricted securities" under Rule 144 of the Securities and
Exchange Commission by members of management and other could have a
substantial adverse effect on the present limited market for the Company's
common stock.

ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

     Plan of Operation
     -----------------

     The Company is considered to be in the development stage.  Therefore,
management cannot say with certainty when significant revenues will be
received from the Company's business.

     The auditor's report accompanying the Company's financial statements for
the year ended June 30, 2001, contains the following statement: "As discussed
in Note 1 to the financial statements, the Company's operating losses since
inception and the deficit accumulated during the development stage raise
substantial doubt about their ability to continue as a going concern. The
consolidated financial statements do not include any adjustments that might
result from the outcome of this uncertainty."

     As discussed further in Part II, Item 12, in exchange for the Company's
assumption of GMC's net liabilities, Garbalizer Corporation of America
("GCA")transferred 1,061,668 shares of RecycleNet, Inc. ("RecycleNet") common
stock to the Company. As of June 30, 2001, the Company had none of these
shares remaining.  Management is pursuing other avenues of generating cash or
revenues during the next twelve months. The Company is pursuing sales of the
crumb rubber plants on which the Company  would earn a commission. The Company
is also attempting to interest purchasers of Garbalizer Shredders in
establishing used tire joint ventures. The Company continues to pursue the
licensing or leasing of the OTR Tire  Disintegrator System, and is exploring
the synergies of its  businesses - such as offering to joint venture a
UTTI-type  operation with the purchaser of a crumb rubber plant.  If any of
such potential transactions occur, management believes that the Company would
have sufficient resources to operate for the next twelve months. There is no
assurance that the Company will be able to obtain cash flow from operations or
to obtain additional financing.  If these are not available to the Company,
the Company may not be able to continue operations. While management remains
hopeful that one or more transactions will proceed, no assurances can be
expressed as to the Company's continuing viability in the absence of revenues.
Substantially all of the Company's existing  liabilities,  other than trade
payables and deferred revenue, are owed to John Brewer or other shareholders
of the Company.

     Result of Operations
     --------------------

     Operating expenses for the Company have been paid in part from
short-term unsecured notes from shareholders. At June 30, 2001, the Company
had a deficit in working capital (current liabilities in excess of current
assets) of $1,081,229.  The working capital deficit at June 30, 2000 was
$918,715.  The decrease in working capital was caused by the continued accrual
of salary, accounts payable for expenses which the Company was unable to pay
in cash and additional short-term unsecured notes incurred as part of the
assumption of GMC liabilities.

     Other than its short term office lease and loans payable to affiliates,
the Company is not subject to any material commitments or capital
expenditures. UTTI is obligated to its minority owner in the principal
amount of $165,000. Such loan is now due on demand. The Company also made
advances to UTTI to pay its operating expenses during its start-up phase.

     During the year ended June 30, 2001, the Company received proceeds from
the sale of RecycleNet common stock.  The proceeds include $271,611 of cash
fro the sale of 1,420,697 shares during the year ended June 30, 2001.

     The Company incurred a loss from operations before other income (expense)
and extraordinary items during the year ended June 30, 2001 of ($221,453)
compared a loss of ($202,551) for the year ended June 30, 2000.  Total
expenses for 2001 were $221,453 compared to $202,551 in 2000.  Salaries and
wages were $91,757 for 2001 compared to $102,414 for 2000.  Rental expenses
were $14,400 in 2001 and $23,256 in 2000.  If any of the Company's plans for
revenue producing activities come to fruition, expenses will rise accordingly.

     Net loss for the year ended June 30, 2001 was ($320,573) compared to net
gain of $177,022 for the year ended June 30, 2000.  On a per share basis, the
net loss for the year ended June 30, 2001 was ($0.02) compared to net gain of
$0.01 in 2000.  Operating losses are expected to continue until such time, if
ever, as the Company receives revenues from the sale of shredders, crumb
rubber plants, the lease or license of the OTR Tire Disintegrator System, or
other operations.  There is no assurance that the Company will ever be
profitable.

     UTTI is 55% owned by the Company and operates at a loss.  UTTI's losses
have exceeded the equity capital contributed by the minority shareholder.
Therefore, in preparing its consolidated statements of operations, the Company
does not adjust its consolidated net loss by the minority shareholder's
interest in the UTTI loss.

     Liquidity
     ---------

     During the year ended June 30, 2000, the Company had a net decrease in
cash of $20,832.  The sale of RecycleNet's common stock was the primary source
of cash from investing activities.

ITEM 7.  FINANCIAL STATEMENTS.

<PAGE>
          GARB OIL & POWER CORPORATION AND SUBSIDIARIES
                  (A Development Stage Company)

                CONSOLIDATED FINANCIAL STATEMENTS

                         June 30, 2001
<PAGE>
                         C O N T E N T S

Independent Auditors' Report - HJ & Associates, LLC. . . . . . . . . . F-2

Consolidated Balance Sheet   . . . . . . . . . . . . . . . . . . . . . F-3

Consolidated Statements of Operations and Comprehensive Income . . . . F-5

Consolidated Statements of Stockholders' Equity (Deficit). . . . . . . F-7

Consolidated Statements of Cash Flows. . . . . . . . . . . . . . . .  F-10

Notes to the Consolidated Financial Statements . . . . . . . . . . .  F-12
<PAGE>








To the Stockholders
Garb Oil and Power Corporation and Subsidiaries
(A Development Stage Company)
Salt Lake City, Utah

We have audited the accompanying consolidated balance sheet of Garb Oil &
Power Corporation and Subsidiaries (a development stage company) as of June
30, 2001, and the related consolidated statements of operations and
comprehensive income (loss), stockholders' equity (deficit), and cash flows
for the years ended June 30, 2001 and 2000 and from inception on January 14,
1981 through June 30, 2001.  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.
The financial statements for the period from inception on January 14, 1981
through June 30, 1999 were audited by other auditors whose report dated
September 10, 1999  expressed an unqualified opinion on these statements.  Our
opinion on the statements of operations, stockholders' equity (deficit) and
cash flows for the period January 14, 1981 (inception) through June 30, 2001,
insofar as it relates to amounts for prior periods through June 30, 1999, is
based solely on the report of other audits.

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

In our opinion, based on our audits, the consolidated financial statements
referred to above present fairly, in all material respects, the consolidated
financial position of Garb Oil & Power Corporation and Subsidiaries as of June
30, 2001 and the consolidated results of their operations and their cash flows
for the years ending June 30, 2001 and 2000, in conformity with accounting
principles generally accepted in the United States of America.

The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern.  The Company is a
development stage enterprise engaged in developing technology related to
production of electricity by burning used rubber, and pyrolysis (extraction of
oil, carbon and steel from used tires).  As discussed in Note 1 to the
consolidated financial statements, the Company's operating losses since
inception and the deficit accumulated during the development stage raise
substantial doubt about its ability to continue as a going concern.
Management's plans concerning these matters are also described in Note 1.  The
consolidated financial statements do not include any adjustments that might
result from the outcome of this uncertainty.




HJ & Associates, LLC
Salt Lake City, Utah
September 7, 2001
                               F-2
<PAGE>
<TABLE>
          GARB OIL & POWER CORPORATION AND SUBSIDIARIES
                  (A Development Stage Company)
                   Consolidated Balance Sheet
                         June 30, 2001

<CAPTION>
                              ASSETS

                                                           June 30,
                                                             2001
<S>                                                     <C>
CURRENT ASSETS

     Cash in bank                                             $   13,174
     Investment in available-for-sale securities                 152,600
                                                              ----------
          Total Current Assets                                   165,774

PROPERTY AND EQUIPMENT

     Engineering drawings                                          2,500
     Office equipment                                             11,658
     Tools and equipment                                          30,099
     Building improvements                                         8,022
     Less: accumulated depreciation                              (47,035)
                                                              ----------
          Total Property and Equipment                             5,244
                                                              ----------
OTHER ASSETS

     Prepaid expenses                                                300
     Assets held for resale                                       30,232
     Patents - net of accumulated amortization                       294
                                                              ----------
          Total Other Assets                                      30,826

          TOTAL ASSETS                                        $  201,844
                                                              ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
                               F-3
<PAGE>
<TABLE>
          GARB OIL & POWER CORPORATION AND SUBSIDIARIES
                  (A Development Stage Company)
             Consolidated Balance Sheet (Continued)
                          June 30, 2001

<CAPTION>
          LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

                                                     June 30,
                                                      2001
<S>                                              <C>
CURRENT LIABILITIES

     Accounts payable                           $  52,453
     Notes payable - related parties              519,937
     Accrued interest                             218,033
     Accrued expenses                                 580
     Wages payable                                456,000
                                                ---------
          Total Current Liabilities             1,247,003
                                                ---------
          Total Liabilities                     1,247,003
                                                ---------
STOCKHOLDERS' EQUITY (DEFICIT)

     Common stock; (no par value) 20,000,000
      shares authorized; 20,000,000 shares
      authorized and outstanding, respectively  2,654,811
     Treasury stock; 185,000 shares at cost       (16,584)
     Unrealized (loss) on available-for-sale
      securities                                  (40,525)
     Accumulated deficit - prior to development
      stage                                       (27,178)
     Accumulated deficit during the development
      stage                                    (3,615,683)
                                               ----------
          Total Stockholders' Equity (Deficit) (1,045,159)
                                               ----------
          TOTAL LIABILITIES AND STOCKHOLDERS'
            EQUITY (DEFICIT)                   $  201,844
                                               ==========
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
                               F-4
<PAGE>
<TABLE>
          GARB OIL & POWER CORPORATION AND SUBSIDIARIES
                  (A Development Stage Company)
  Consolidated Statements of Operations and Comprehensive Income (Loss)
<CAPTION>
                                                                  From
                                                                Inception
                                                                   of the
                                                               Development
                                                                 Stage on
                                                                January 14,
                                 For the Years Ended           1981 Through
                                       June 30,                  June 30,
                              2001              2000              2001

<S>                        <C>             <C>             <C>
REVENUES

 Tire sales                   $        -  $       -        $  117,932
 Equipment sales                       -          -           595,723
 Other revenues                        -          -           402,333

  Total Revenues                       -          -         1,115,988

EXPENSES

 Cost of sales                         -          -            60,020
 Cost of equipment                     -          -           473,837
 Bad debt                              -          -           266,750
 Salary and wages                    91,757   102,414       1,594,703
 Sales commissions                     -          -            27,785
 Office                              10,270     8,066         164,420
 Rent                                14,400    23,256         254,291
 Telephone                            5,018     4,283         111,316
 Professional fees                   17,478    26,930         497,112
 Finders' fee                          -          -           145,000
 Insurance                            6,338     5,652          94,499
 Taxes and licenses                   4,359     5,361         114,381
 Travel                               3,124     3,836         224,270
 Promotion and entertainment           -          -            14,053
 Testing                               -          -            27,073
 Advertising                          6,126     1,269         151,942
 Amortization                           932       932          53,966
 Depreciation                         7,859     7,300          70,750
 Consulting fee                        -          -            19,737
 Stockholders' meetings                -          -               670
 Parking                               -          330          11,544
 Subcontractors                        -          -            40,138
 Auto expense                          -          -             4,417
 Repairs and maintenance               -          -             3,982
 Other                               53,792    12,922          82,323

  Total Expenses                   $221,453  $202,551      $4,508,979
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
                               F-5
<PAGE>
<TABLE>
          GARB OIL & POWER CORPORATION AND SUBSIDIARIES
                  (A Development Stage Company)
Consolidated Statements of Operations and Comprehensive Income (Loss)
(Continued)
<CAPTION>
                                                                  From
                                                                Inception
                                                                   of the
                                                               Development
                                                                 Stage on
                                                                January 14,
                                 For the Years Ended           1981 Through
                                       June 30,                  June 30,
                              2001               2000              2001
<S>                        <C>              <C>            <C>
OPERATING LOSS             $(221,453)   $(202,551)         $(3,392,991)

OTHER INCOME (EXPENSES)

 Write-off and abandonment
  of assets                      -            -               (431,690)
 Gain on sale of assets      (56,200)     288,241              339,965
 Interest income                 -            -                147,810
 Interest expense            (42,920)     (65,978)            (325,258)
 Minority interest in losses
 of subsidiary                   -            -                  5,383
 Income from expired option      -        150,000              150,000

  Total Other Income
  (Expense)                  (99,120)     372,263             (113,790)

INCOME (LOSS) BEFORE
 EXTRAORDINARY ITEMS         (320,573)    169,712           (3,506,781)

EXTRAORDINARY ITEMS

 Loss on extinguishment of
 debt                            -            -               (116,212)
 Gain on forgiveness of debt     -          7,310                7,310

  Total Extraordinary Gain
  (Loss)                         -          7,310             (108,902)

NET INCOME (LOSS)            (320,573)    177,022           (3,615,682)

OTHER COMPREHENSIVE INCOME

 Unrealized income (loss) on
  available for sale
  securities                 (123,469)   (207,681)              40,525

  Total Other Comprehensive
   Income (Loss)             (123,469)   (207,681)              40,525

COMPREHENSIVE INCOME (LOSS) $(444,042)  $ (30,659)         $(3,575,158)

BASIC INCOME (LOSS) PER
SHARE                      $    (0.02)  $    0.01

WEIGHTED AVERAGE NUMBER
 OF SHARES OUTSTANDING    19,485,825   17,943,299
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
                               F-6
<PAGE>
<TABLE>
          GARB OIL & POWER CORPORATION AND SUBSIDIARIES
                  (A Development Stage Company)
    Consolidated Statements of Stockholders' Equity (Deficit)
<CAPTION>
                                                       Unrealized
                                                        Gain on
                                       Common Stock    Investment  Accumulated
                                    shares    Amount In Securities  Deficit
<S>                             <C>           <C>         <C>      <C>
Balance, January 14, 1981       12,833,333     $ 61,894   $     -  $(27,178)
Stock issued to satisfy current
 liabilities:
  June 1983 - $2.94 per share       82,000      240,889         -       -
Stock issued to satisfy related
 party liabilities:
  November 1993-$0.20 per share     64,310       12,882         -       -
  December 1993-$0.14 per share     87,000       12,200         -       -
  November 1994-$0.21 per share     25,000        5,342         -       -
Stock issued for services:
  May 1981-$0.20 per share           5,000        8,000         -       -
  May 1983-$1.50 per share          50,000       75,000         -       -
  August 1992-$0.15 per share       25,000        3,750         -       -
  December 1992-$0.15 per share      4,000          600         -       -
  November 1994-$0.21 per share      4,000          855         -       -
  January 1995-$0.21 per share      76,167       16,276         -       -
  February 1995-$0.21 per share     10,000        2,137         -       -
Stock issued for cash:
  March 1981-$0.70 per share        10,000        7,000         -       -
  April 1981-$0.42 per share       192,834       80,000         -       -
  June 1981-$1.31 per share         27,518       35,945         -       -
  March 1983-$0.75 per share        14,000       10,500         -       -
  April 1983-$1.00 per share        50,000       50,000         -       -
  June 1983-$3.04 per share         30,000       91,272         -       -
  September 1984-$1.00 per
    share                          200,000      200,000         -       -
  November 1984-$0.95 per share    105,470      100,000         -       -
  April 1986-$1.27 per share       770,000      980,000         -       -
  May 1992-$0.234 per share        208,334       50,000         -       -
  December 1992-$0.15 per share     50,000        7,500         -       -
  February 1993-$0.15 per share    100,000       15,000         -       -
  March 1993-$0.15 per share       100,000       15,000         -       -
  May 1993-$0.15 per share         100,000       15,000         -       -
  June 1993-$0.25 per share        100,000       25,000         -       -
  August 1993$0.20 per share       100,000       20,000         -       -
  October 1993-$0.07 to $0.15
    per share                      250,000       25,000         -       -
  November 1993-$0.25 per share     20,000        5,000         -       -
  December 1993-$0.15 to $0.20
    per share                      180,000       32,500         -       -
  January 1994-$0.25 per share      20,000        5,000         -       -
  February 1995-$0.20 per share     50,000       10,000         -       -
  March 1995-$0.20 to $0.22
    per share                      263,000       56,500         -       -
  May 1995-$0.25 per share          20,000        5,000         -       -
  June 1995-$0.20 per share         25,000        5,000         -       -
  Contributed capital                -          356,402         -       -
  Purchase of treasury stock         -              -           -       -
  Retirement of treasury stock     (10,000)     (10,009)        -       -
Net loss from January 14, 1981
  through June 30, 1995              -              -           -       -
Balance, June 30, 1995          16,241,966  $ 2,632,435   $     -  $(27,178)
</TABLE>
<TABLE>
          GARB OIL & POWER CORPORATION AND SUBSIDIARIES
                  (A Development Stage Company)
    Consolidated Statements of Stockholders' Equity (Deficit)
<CAPTION>
                                         Deficit        Treasury
                                      Accumulated         Stock
                                       During the        Number
                                      Development          of
                                         Stage           Shares      Amount
<S>                                  <C>            <C>         <C>
Balance, January 14, 1981             $       -       $     -    $       -
Stock issued to satisfy current
 liabilities:
  June 1983 - $2.94 per share                 -             -            -
Stock issued to satisfy related
 party liabilities:
  November 1993-$0.20 per share               -             -            -
   December 1993-$0.14 per share              -             -            -
   November 1994-$0.21 per share              -             -            -
 Stock issued for services:
  May 1981-$0.20 per share                    -             -            -
  May 1983-$1.50 per share                    -             -            -
  August 1992-$0.15 per share                 -             -            -
  December 1992-$0.15 per share               -             -            -
  November 1994-$0.21 per share               -             -            -
  January 1995-$0.21 per share                -             -            -
  February 1995-$0.21 per share               -             -            -
Stock issued for cash:
  March 1981-$0.70 per share                  -             -            -
  April 1981-$0.42 per share                  -             -            -
  June 1981-$1.31 per share                   -             -            -
  March 1983-$0.75 per share                  -             -            -
  April 1983-$1.00 per share                  -             -            -
  June 1983-$3.04 per share                   -             -            -
  September 1984-$1.00 per
    share                                     -             -            -
  November 1984-$0.95 per share               -             -            -
  April 1986-$1.27 per share                  -             -            -
  May 1992-$0.234 per share                   -             -            -
  December 1992-$0.15 per share               -             -            -

  February 1993-$0.15 per share               -             -            -
  March 1993-$0.15 per share                  -             -            -
  May 1993-$0.15 per share                    -             -            -
  June 1993-$0.25 per share                   -             -            -


  August 1993$0.20 per share                  -            -            -
  October 1993-$0.07 to $0.15
    per share                                 -            -            -
  November 1993-$0.25 per share               -            -            -
  December 1993-$0.15 to $0.20
    per share                                 -            -            -
  January 1994-$0.25 per share                -            -            -

  February 1995-$0.20 per share               -            -            -
  March 1995-$0.20 to $0.22
    per share                                 -            -            -
  May 1995-$0.25 per share                    -            -            -
  June 1995-$0.20 per share                   -            -            -
Contributed capital                           -            -            -
Purchase of treasury stock                              10,000      (10,009)
Retirement of treasury stock                  -        (10,000)     (10,009)
Net loss from January 14, 1981
  through June 30, 1995                (2,829,005)         -            -
Balance, June 30, 1995                 (2,829,005)         -            -
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
                               F-7
<PAGE>
<TABLE>
          GARB OIL & POWER CORPORATION AND SUBSIDIARIES
                  (A Development Stage Company)
Consolidated Statements of Stockholders' Equity (Deficit) (Continued)
<CAPTION>
                                                       Unrealized
                                                        Gain on
                                       Common Stock    Investment  Accumulated
                                    shares    Amount In Securities  Deficit
<S>                             <C>           <C>         <C>      <C>
Balance, June 30, 1995               16,241,966 $2,632,435  $     - $(27,178)

Stock issued for services:
  September 1995-$0.13 per share         20,000      2,684        -      -
Stock issued for cash:
  July 1995-$0.25 per share              40,000     10,000        -      -
  December 1995-$0.10 per share         250,000     25,000        -      -
  May 1996-$0.12 to $0.25 per
    share                                90,000     16,000        -      -

Net loss for the period ended
  June 30, 1996                             -          -          -      -

Balance, June 30, 1996               16,641,966  2,686,119        -  (27,178)
Stock issued for services:
  May 1997-$0.15 per share               86,333     12,949        -      -
Stock issued for cash:
  January 1997-$0.15 per share          300,000     45,000        -      -

Net loss for the period ended
  June 30, 1997                             -          -          -      -

Balance June 30, 1997                17,028,299  2,744,068        -  (27,178)

Net loss for the period ended
  June 30, 1998                             -          -          -      -

Balance June 30, 1998                17,028,299  2,744,068        -  (27,178)

Stock issued for services:
  October 1998-$0.09 per share           5,000         450        -      -
Stock issued for cash
  January 1999-$0.05 to $0.10
    per share                          770,000      47,000        -      -
  February 1999-$0.10 per share        130,000      13,000        -      -
Distribution from majority
  shareholder                              -      (473,060)       -      -
Change in unrealized gain on
 investment in securities, net of tax      -           -      290,625    -

Net loss for the period ended
 June 30, 1999                             -           -          -      -

Balance June 30, 1999               17,933,299 $ 2,331,458  $ 290,625$(27,178)
</TABLE>
<PAGE>
<TABLE>
          GARB OIL & POWER CORPORATION AND SUBSIDIARIES
                  (A Development Stage Company)
    Consolidated Statements of Stockholders' Equity (Deficit)
<CAPTION>
                                         Deficit        Treasury
                                      Accumulated         Stock
                                       During the        Number
                                      Development          of
                                         Stage           Shares      Amount
<S>                                  <C>            <C>         <C>
Balance, June 30, 1995               $(2,829,005)   $       -     $      -

Stock issued for services:
  September 1995-$0.13 per share             -              -            -
Stock issued for cash:
  July 1995-$0.25 per share                  -              -            -
  December 1995-$0.10 per share              -              -            -
  May 1996-$0.12 to $0.25 per
    share                                    -              -            -

Net loss for the period ended
  June 30, 1996                         (124,871)           -            -

Balance, June 30, 1996                (2,953,876)           -            -
Stock issued for services:
  May 1997-$0.15 per share                   -              -            -
Stock issued for cash:
  January 1997-$0.15 per share               -              -            -

Net loss for the period ended
  June 30, 1997                         (177,298)           -            -

Balance June 30, 1997                 (3,131,174)           -            -

Net loss for the period ended
  June 30, 1998                         (217,439)           -            -

Balance June 30, 1998                 (3,348,613)           -            -

Stock issued for services:
  October 1998-$0.09 per share               -              -            -
Stock issued for cash
  January 1999-$0.05 to $0.10
    per share                                -              -            -
  February 1999-$0.10 per share              -              -            -
Distribution from majority
  shareholder                                -              -            -
Change in unrealized gain on
 investment in securities, net of tax        -              -            -

Net loss for the period ended
 June 30, 1999                          (123,519)           -            -

Balance June 30, 1999                $(3,472,132)     $     -      $     -
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
                               F-8
<PAGE>
<TABLE>
          GARB OIL & POWER CORPORATION AND SUBSIDIARIES
                  (A Development Stage Company)
Consolidated Statements of Stockholders' Equity (Deficit) (Continued)
<CAPTION>
                                                       Unrealized
                                                        Gain on
                                       Common Stock    Investment  Accumulated
                                    shares    Amount In Securities  Deficit
<S>                             <C>           <C>         <C>      <C>
Balance June 30, 1999              17,933,299  $2,331,485  $ 290,625 $(27,178)

Issuance of common stock for
  lost treasury shares at $0.10 per
  share                                10,000       1,000        -        -

Change in unrealized gain on
  investment in securities,
  net of tax                              -           -     (207,681)     -

Net income for the period ended
  June 30, 2000                           -           -          -        -

Balance, June 30, 2000             17,943,299  $2,332,458 $   82,944 $(27,178)

Issuance of common stock for
available for sale securities       2,056,701     300,000        -        -

Purchase of treasury stock                -           -          -        -

Issued treasury stock for
available for sale securities             -        22,353        -        -

Issued treasury stock for services        -           -          -        -

Change in unrealized gain on
investment in securities, net of tax      -           -     (123,469)     -

Net loss for the period ended
June 30, 2001                             -           -          -        -

Balance, June 30, 2001             20,000,000  $2,654,811 $  (40,525)$(27,178)
</TABLE>
<TABLE>
          GARB OIL & POWER CORPORATION AND SUBSIDIARIES
                  (A Development Stage Company)
    Consolidated Statements of Stockholders' Equity (Deficit)
<CAPTION>
                                         Deficit        Treasury
                                      Accumulated         Stock
                                       During the        Number
                                      Development          of
                                         Stage           Shares      Amount
<S>                                  <C>            <C>         <C>
Balance June 30, 1999                $(3,472,132)   $      -     $     -
Issuance of common stock for
  lost treasury shares at $0.10 per
  share                                      -             -           -
Change in unrealized gain on
  investment in securities,
  net of tax                                 -             -           -

Net income for the period ended
  June 30, 2000                          177,022           -           -

Balance, June 30, 2000               $(3,295,110)   $      -     $     -

Issuance of common stock for
available for sale securities                -             -           -

Purchase of treasury stock                   -         485,000     (45,858)

Issued treasury stock for
available for sale securities                -        (200,000)     19,516

Issued treasury stock for services           -        (100,000)      9,758

Change in unrealized gain on
investment in securities, net of
tax                                          -             -           -

Net loss for the period ended
June 30, 2001                           (320,573)          -           -

Balance, June 30, 2001              $ (3,615,683)    $ 185,000   $  16,584
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
                               F-9
<PAGE>
<TABLE>
          GARB OIL & POWER CORPORATION AND SUBSIDIARIES
                  (A Development Stage Company)
              Consolidated Statements of Cash Flows
<CAPTION>
                                                                  From
                                                                Inception
                                                                   of the
                                                               Development
                                                                 Stage on
                                                                January 14,
                                 For the Years Ended           1981 Through
                                       June 30,                  June 30,
                              2001              2000               2001

<S>                         <C>                <C>           <C>
CASH FLOWS FROM OPERATING ACTIVITIES

Net income (loss)             $(320,573)        $ 177,022     $(3,615,683)
Adjustments to reconcile
 net cash provided by
 (used in) operating
 activities:
Depreciation and amortization     8,791             8,232         124,716
Bad debt expense                    -                 -           266,750
Gain on sale of asset               -                 -            (5,364)
Gain on sale of available-
for-sale securities              56,200               -           (46,360)
Write-off
and abandonment of assets           -                 -           431,690
Loss on extinguishment of debt      -                 -           116,212
Stock issued for services and
interest                            -                 -           122,701
Treasury stock issued for
services                          9,758               -             9,758
Available for sale securities
issued for services                 -                 -            52,560
Treasury stock expensed             -               1,000           1,000
Changes in current assets and
liabilities:
Accrued interest receivable         -                 -           (24,250)
Accounts receivable                 -                 -            11,645
Accounts receivable -
 related party                      -                 -          (150,344)
Contract receivable                 -                 -          (242,500)
Income tax refund receivable        -                 -               537
Inventory                           -                 -            62,494
Prepaid expenses                   (300)              -              (300)
Accounts payable                (12,609)           (8,936)         44,835
Deferred income                     -            (150,000)        (22,000)
Advances payable -
related party                       -                 -          (120,106)
Accrued expenses                 (1,700)           (1,489)         (4,944)
Accrued payroll                  48,000            48,000         456,000
Accrued interest payable         28,019            27,420         408,696
Other current liabilities           -                 -           240,954

  Net Cash Provided (Used)
  by Operating Activities      (184,414)          101,249      (1,881,303)

CASH FLOWS FROM INVESTING ACTIVITIES

Construction in progress            -                 -        (2,937,790)
Cash acquired from Garbalizer
Machinery                           -                 -               899
Net (advances) payments (to)
/from related party             (60,603)           (4,314)       (148,526)
Purchase of treasury stock      (45,858)              -           (55,867)
Increase (decrease) of other
 assets                             -                 -        (1,956,733)
Purchase of property and
equipment                        (2,500)           (6,818)        (69,730)
Proceeds from sale of
available for sale securities   272,543               -           322,543
Proceeds from sales of assets       -                 -             9,500

  Net Cash Provided (Used)
  by Investing Activities      $163,582          $(11,132)    $(4,835,734)
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
                               F-10
<PAGE>
<TABLE>
          GARB OIL & POWER CORPORATION AND SUBSIDIARIES
                  (A Development Stage Company)
        Consolidated Statements of Cash Flows (Continued)
<CAPTION>
                                                                  From
                                                                Inception
                                                                   of the
                                                               Development
                                                                 Stage on
                                                                January 14,
                                 For the Years Ended           1981 Through
                                       June 30,                  June 30,
                                 2001             2000             2001

<S>                            <C>                <C>           <C>
CASH FLOWS FROM FINANCING ACTIVITIES

Net proceeds from (payments
on) notes payable -
  related party                 $      -          $ (70,000)     $   229,841
Proceeds from bank loans               -                -          4,636,647
Sale of common stock                   -                -          2,007,217
Contribution to capital by
parent company                         -                -            356,402
Principal payments on bank loans       -                -           (500,000)

  Net Cash Provided (Used) by
  Financing Activities                 -            (70,000)       6,730,107

NET INCREASE (DECREASE) IN CASH AND
 CASH EQUIVALENTS                  (20,832)          20,117           13,100

NET CASH AND CASH EQUIVALENTS AT
 BEGINNING OF PERIOD                34,006           13,889               74

NET CASH AND CASH EQUIVALENTS AT
 END OF PERIOD                   $  13,174         $ 34,006         $ 13,174

SUPPLEMENTAL DISCLOSURE OF CASH
 FLOW INFORMATION:

Treasury stock issued for
available for sale securities    $  41,869         $    -           $ 41,869
Common stock issued for available
for sale securities              $ 300,000         $    -           $300,000
Related party payable issued for
available for sale securities    $ 180,000         $    -           $180,000
Securities issued for debt       $     -           $ 70,000         $ 70,000
Cash paid for interest           $  14,187         $ 37,902         $156,745
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
                               F-11
<PAGE>
          GARB OIL & POWER CORPORATION AND SUBSIDIARIES
                  (A Development Stage Company)
            Notes to Consolidated Financial Statements
                          June 30, 2001

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES

     a.  Organization

     Garb Oil & Power Corporation (Garb Oil) is a majority owned subsidiary
     of Garbalizer Corporation of America and was dormant at January 13,
     1981.  Since January 14, 1981, Garb Oil has been considered to be in the
     development stage.  Development stage activities have consisted of
     raising capital, purchasing property and developing technology related
     to production of electricity by the burning of used rubber, pyrolysis
     (extraction of oil, carbon, and steel from used tires), the recovery of
     used rubber from large off-the-road tires and repair and sale of used
     truck tires.

     The accompanying consolidated financial statements include Garb Oil and
     its wholly-owned subsidiary, Rialto Power Corporation (which was
     dissolved by the State of California), and its 55% owned subsidiary,
     Utah Truck Tire, Inc.; which are collectively referred to as the
     Company.  The following is a summary of the significant accounting
     policies.

     b.  Use of Estimates

     The preparation of financial statements in conformity with generally
     accepted accounting principles requires management to make estimates and
     assumptions that affect the reported amounts of assets and liabilities
     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.

     c.  Basis of Presentation - Going Concern

     The accompanying consolidated financial statements have been prepared on
     a going concern basis, which contemplates the realization of assets and
     the satisfaction of liabilities in the ordinary course of business.  As
     shown in the consolidated financial statements, during the years ended
     June 30, 2001 and 2000, the Company has incurred a net loss of $320,573
     and a net income of $177,022, respectively, and as of June 30, 2001, the
     Company's deficit accumulated during the development stage was
     $3,615,683.  These factors, among others, indicate that the Company may
     be unable to continue as a going concern for a reasonable period of
     time.  The consolidated financial statements do not include any
     adjustments relating to the recoverability and classification of
     recorded asset amounts or the amount and classification of liabilities
     that might be necessary should the Company be unable to continue as a
     going concern.  The Company's ability to continue as a going concern is
     dependent upon its ability to generate sufficient cash flows to meet its
     obligations on a timely basis, to obtain additional financing as may be
     required, and ultimately to attain successful operations.  Management is
     continuing its efforts to obtain the necessary financing as may be
     required to generate sufficient cash flows for future operations.
     During the year ended June 30, 1999, the Company received RecycleNet
     common shares in conjunction with the reorganization and sale of
     Garbalizer Machinery Corporation.  Management intends to continue to
     sell the shares received in the transaction and use the funds received
     from the sale of the securities to fund current and future operations.
                               F-12
<PAGE>
          GARB OIL & POWER CORPORATION AND SUBSIDIARIES
                  (A Development Stage Company)
            Notes to Consolidated Financial Statements
                          June 30, 2001


NOTE 1 -   ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES
     (Continued)

     d.  Principles of Consolidation

     The consolidated financial statements include the accounts of Garb Oil
     and its subsidiaries.  All significant intercompany accounts and
     transactions have been eliminated in consolidation.  The Company has
     recognized all of the losses of Utah Truck Tire in its statement of
     operations, with no offset to minority interest.

     e.  Patents

     Patents are carried at cost and are being amortized over a 17-year life.

     f.  Property and Equipment

     Property and equipment is recorded at cost and is depreciated using the
     straight-line method based on the expected lives of the assets which
     range from five to ten years.

     The Company records impairment losses when indicators of impairment are
     present and undiscounted cash flows estimated to be generated by those
     assets are less than the assets' carrying amount.

     g.  Advertising Costs

     The Company expenses all advertising costs as incurred.  Advertising
     expense was $6,126 and $1,269 for the years ending June 30, 2001 and
     2000, respectively.

     h.  Income Taxes

     The Company recognizes the amount of income taxes payable or refundable
     for the current year and recognizes deferred tax assets and liabilities
     for the future tax consequences attributable to differences between the
     financial statement amounts of certain assets and liabilities and their
     respective tax bases.  Deferred tax assets and liabilities are measured
     using enacted tax rates expected to apply to taxable income in the years
     those temporary differences are expected to be recovered or settled.
     Deferred tax assets are reduced by a valuation allowance to the extent
     that uncertainty exists as to whether the deferred tax assets will
     ultimately be realized.
                               F-14
<PAGE>
          GARB OIL & POWER CORPORATION AND SUBSIDIARIES
                  (A Development Stage Company)
            Notes to Consolidated Financial Statements
                          June 30, 2001

NOTE 1 -   ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES
     (Continued)

     i.  Basic Income (Loss) Per Share

       The following is an illustration of the reconciliation of the
       numerators and denominators of the basic loss per share calculation:


                                                 For the
                                               Years Ended
                                                 June 30,
                                            2001      2000

       Net income (loss) (numerator)      $(320,573) $ 177,022


       Weighted average shares outstanding
         (denominator)                   20,000,000  17,943,299

       Basic income (loss) per share     $    (0.02) $     0.01

       j.  Financial Instruments

       Cash equivalents include highly liquid short-term investments with
       original maturities of three months or less, readily convertible to
       known amounts of cash.  The amounts reported as cash and equivalents,
       receivables, other assets, trade accounts payable, deferred revenue
       and notes payable to related parties are considered to be reasonable
       approximations of their fair values.  The fair value estimates
       presented herein were based on market information available to
       management as of June 30, 2001.  The use of different market
       assumptions and/or estimation methodologies could have a material
       effect on the estimated fair value amounts.  The reported fair values
       do not take into consideration potential expenses that would be
       incurred in an actual settlement.

       k.  Pronouncements Issued Not Yet Adopted

       In July, 2001, the Financial Accounting Standards Board issued two
       statements - Statement 141, Business Combinations, and Statement 142,
       Goodwill and Other Intangible Assets, which will potentially impact
       the Company's accounting for its reported goodwill and other
       intangible assets.

       Statement 141:

          Eliminates the pooling method for accounting for business
          combinations.

          Requires that intangible assets that meet certain criteria be
          reported separately from goodwill.

          Requires negative goodwill arising from a business combination to
          be recorded as an extraordinary gain.
                               F-15
<PAGE>
          GARB OIL & POWER CORPORATION AND SUBSIDIARIES
                  (A Development Stage Company)
            Notes to Consolidated Financial Statements
                          June 30, 2001


NOTE 1 -   ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES
       (Continued)

       k.  Pronouncements Issued Not Yet Adopted (Continued)

       Statement 142:

          Eliminates the amortization of goodwill and other intangibles that
          are determined to have an indefinite life.

          Requires, at a minimum, annual impairment tests for goodwill an
          other intangible assets that are determined to have an indefinite
          life.

       Upon adoption of these Statements, the Company is required to:

          Re-evaluate goodwill and other intangible assets that arose from
          business combinations entered into before July 1, 2001.  If the
          recorded other intangibles assets do not meet the criteria for
          recognition, they should be reclassified to goodwill.  Similarly,
          if there are other intangible assets that meet the criteria for
          recognition but were not separately recorded from goodwill, they
          should be reclassified from goodwill.

          Reassess the useful lives of intangible assets and adjust the
          remaining amortization periods accordingly.

          Write-off any remaining negative goodwill.

       The Company has not yet completed its full assessment of the effects
       of these new pronouncements on its financial statements and so is
       uncertain as to the impact.  The standards generally are required to
       be implemented by the Company in its 2002 financial statements.

NOTE 2 -  INVESTMENT IN SECURITIES AND OTHER COMPREHENSIVE INCOME

       The RecycleNet shares owned by the Company are classified as
       available-for-sale and are stated at fair value.

       Proceeds from sales of securities and the resulting gross realized
       gains and losses were as follows:
                                               For the Years Ending
                                                     June 30,
                                               2001            2000

       Proceeds from sales of securities     $  272,543   $ 288,241

       Gross realized gains                  $        -   $ 288,241
       Gross realized (losses)                  (56,200)          -

       Net (Loss) from Sale of Investments   $  (56,200)  $ 288,241
                               F-16
<PAGE>
          GARB OIL & POWER CORPORATION AND SUBSIDIARIES
                  (A Development Stage Company)
            Notes to Consolidated Financial Statements
                          June 30, 2001

NOTE 2 -  INVESTMENT IN SECURITIES AND OTHER COMPREHENSIVE INCOME (Continued)

       Other comprehensive income is only relevant for the year ending June
       30, 2001 and for the period from inception through June 30, 2001 and
       consists of the change in net unrealized holding gains and losses on
       securities classified as available for sale and their related income
       tax benefit as follows:

                                      Before-Tax    Tax      Net-of-Tax
                                        Amount      Benefit     Amount


       For the year ended June 30, 2001:

       Unrealized net holding gains       $ 82,944   $     -     $ 82,944
       Reclassification adjustment
         for net loss included in
         net loss                         (123,469)        -     (123,469)

            Other comprehensive income    $(40,525)  $     -     $(40,525)

       Cumulative for the period January
         14, 1981 (date of inception)
         through June 30, 2001:

       Unrealized net holding gains       $ 82,944   $     -     $ 82,944
       Reclassification adjustment for
         net losses included in net loss  (123,469)        -     (123,469)

            Other comprehensive income    $(40,525)  $     -     $(40,525)

       A current provision for income taxes has not been assessed against
       the unrealized gain on securities since the current NOL's of the
       Company would offset these gains (See Footnote 1i).

NOTE 3 - UTAH TRUCK TIRE, INC.

       Utah Truck Tire, Inc. was formed May 20, 1994, and on May 24, 1994,
       the Company was issued 55% (55 shares) of the outstanding shares of
       Utah Truck Tire, Inc. in exchange for the Company's experience,
       expertise and reputation in dealing with tire and rubber products.
       The remaining 45% (45 shares) was issued to a director of Utah Truck
       Tire, Inc. for a commitment to loan Utah Truck Tire, Inc. $150,000
       (see Note 5).  Utah Truck Tire, Inc. is currently dormant, having no
       revenues and incurring minimal expenses during the years ended June
       30, 2001 and 2000.  Utah Truck Tire, Inc. was primarily in the
       business of selling retread diesel truck tires.
                               F-17
<PAGE>
          GARB OIL & POWER CORPORATION AND SUBSIDIARIES
                  (A Development Stage Company)
            Notes to Consolidated Financial Statements
                          June 30, 2001

NOTE 4 - PAYABLE TO RELATED ENTITIES, OFFICERS AND SHAREHOLDERS

       During the year ended June 30, 2001, notes payable - related parties
       increased $119,397.  The change is due to payments on the cash loan
       to John Brewer and a payable recorded for $180,000 for available for
       sale securities.

       During the period July 1998 through March 1999 and for the years
       ended June 30, 1998 and 1997, the Company made non-interest bearing
       advances to Garbalizer Machinery Corporation (GMC), a sister
       corporation, in the amounts of $34,094, $27,521, and $34,771,
       respectively.  Payments on these advances totaled $60,573, $14,091,
       and $9,164 for the years ended June 30, 1999, 1998 and 1997.  As
       discussed in Note 2, in March 1999, GMC merged with an unrelated
       company and transferred all assets and liabilities to the Company
       which include the above mentioned receivable totaling $221,953.  The
       related party receivable/payable has been eliminated in the
       accompanying financial statements.

       Prior to July 1, 1992 through June 30, 1999, the Company borrowed
       $68,147, which includes $1,434, $24,403 and $1,438 during the three
       years ending June 30, 1999, 1998 and 1997, from an officer under a
       note payable for various purchases on behalf of the Company.  As part
       of the assumption of GMC's liabilities, the Company assumed an
       additional $103,215 payable to this officer for various purchases on
       behalf of GMC.  The Company paid all interest charges (currently at
       approximately 9%), relating to these purchases.  These payables were
       due on demand, but as of June 30, 1999, no principal payments had
       been made.

       Prior to June 30, 1996, a shareholder advanced to the  Company
       $35,000 under short-term, non-interest bearing notes which were due
       on demand.  During the year ended June 30, 1997, an additional
       $10,000 was advanced.  During the year ended June 30, 1998, $5,000 of
       interest was added to these advances.  As part of the assumption of
       GMC's liabilities, the note which was due on demand.  During the
       period ending June 30, 2000, the Company issued RecycleNet shares to
       extinguish the note.

       Prior to June 30, 1996, the Company borrowed $165,000 from an
       officer.  Interest accrues at the rate of 12% and the amount is due
       on demand and is unsecured.  No payments had been made as of June 30,
       2000.

       As part of the assumption of GMC's liabilities, the Company assumed a
       $10,000 note payable from a shareholder.  This note was paid for as
       of June 30, 2000 as the Company issued the shareholder shares of
       RecycleNet stock.

       As part of the assumption of GMC's liabilities, the Company assumed a
       12% note payable from an individual with an outstanding balance of
       $68,493.  The note was originally for $150,000 and was due in 1992.
       The Company has not made any principal payments since assuming this
       note.

       During the year ended June 30, 1995, the Company borrowed $12,000
       from a shareholder under short term, non-interest bearing notes
       payable which were due on demand.  An additional $10,000 was loaned
       to the Company during the year ended June 30, 1997.  During 1998, the
       notes were converted to a payment on an option agreement as discussed
       in Note 7.
                               F-18
<PAGE>
          GARB OIL & POWER CORPORATION AND SUBSIDIARIES
                  (A Development Stage Company)
            Notes to Consolidated Financial Statements
                          June 30, 2001


NOTE 5 - INCOME TAXES

       The Company does not have a current or deferred provision for income
       taxes for the years ended June 30, 2001 or 2000.  The following
       presents the components of the deferred tax asset for the Company.


                                                        June 30,
                                                   2001           2000

       Benefit of operating loss carryforwards    $ 866,900    $ 744,673
       Inventory reserve                                  -       11,277
       Accrued salaries                            (177,840)    (152,184)
       Accrued interest                             (85,033)     (45,152)
       Depreciation                                    (374)       2,093
       Accrued related parties expenses            (132,575)           -

       Benefit of capital loss carryforward          21,918            -

       Total deferred tax assets                    492,996      560,707
       Less: valuation allowance                   (492,996)    (560,707)

       Net Deferred Tax Asset                     $       -     $      -

       The valuation allowance has decreased $67,711 and $419,437 for the
       years ended June 30, 2001 and 2000, respectively.  The decrease in
       valuation during 2000 is due to the utilization of federal and state
       NOL's offset by the increase in various accruals to
       officers/shareholders to be paid and deducted for tax purposes in
       future periods.  The Company and its subsidiaries have federal net
       operating loss carryforwards of $1,918,732 that expire, if unused, in
       years 2002 through 2021.

       The following is a reconciliation of the income tax at the federal
       statutory tax rate with the provision for income taxes for the years
       ended:

                                                          June 30,
                                                   2001             2000


       Income tax expense (benefit) at statutory
         Rate (34%)                                 $      -      $  60,187

       Change in deferred tax asset valuation           (200)       (66,029)
       State tax net of federal benefit                  200          5,842
       Effect due to change in tax rates                   -              -
       Other                                               -              -

              Provision for Income Taxes            $      -      $       -
                               F-19
<PAGE>
          GARB OIL & POWER CORPORATION AND SUBSIDIARIES
                  (A Development Stage Company)
            Notes to Consolidated Financial Statements
                          June 30, 2001


NOTE 6 - COMMITMENTS

       During the year ended June 30, 2001, the Company signed an
       Confidentiality & Non-Circumvention agreement with Micron
       Manufacturing for the purpose of building equipment for Garb Oil to
       import to North America for sale to the scrap tire processing
       industry.  Micron Manufacturing will engineer a pilot model of the
       shredder.  Once the pilot model is complete, a formal agreement will
       be signed.

       On April 28, 1997, the Company granted Giant Tire Recyclers, Inc.
       (Giant), a Nevada corporation, an option to acquire a license to use
       the Company's OTR disintegrator system.  The price of the option was
       set at $150,000 payable as follows:  1) an initial payment of
       $15,000, and 2) the remaining $135,000 was due within ten months of
       the execution of the agreement.  The Company received $150,000 as of
       June 30, 1998 consisting of $128,000 in cash and assigned $22,000 as
       a payment on a note payable to a shareholder.  Giant may exercise the
       option at any time.  The option was initially to expire in April
       1999, but an extension was granted through April 2000.  The above
       contract gives Giant the opportunity to purchase an exclusive license
       to use the Company's OTR Disintegrator System for a license fee of
       $1,315,000, less option payments prior to the time of exercise.  The
       contract has since expired and, accordingly, the $150,000 has been
       recorded as income.

       The Company executed an employment agreement with its President on
       May 1, 1986.  The agreement is of a continuing nature and specifies
       no date of termination.  Under the terms of the agreement, the
       President's salary is $48,000 per year and is reviewed by the Board
       of Directors annually.

NOTE 7 - INVESTMENT IN RIALTO POWER CORPORATION

       The Company entered into a joint venture with DITT, S.A., a French
       Corporation (DITT), on December 2, 1985, for the purpose of
       constructing a 35-megawatt electrical generating plant fueled by
       scrap tires (the project).  The Company received 50% of the common
       stock of Rialto Power Corporation (Rialto), a corporation formed for
       the purpose of the joint venture, in exchange for equipment and other
       assets.  The remaining 50% of the common stock of Rialto was issued
       to DITT in consideration of an arrangement whereby DITT would arrange
       and guarantee a $4,000,000 line of credit from a bank to Rialto and
       construct a power plant.

       Rialto had drawn the entire line of credit as of May 1987 at which
       time the joint venture agreement was terminated.  Pursuant to the
       termination of the agreement, DITT transferred to Garb Oil all of its
       stock in Rialto making Garb Oil the sole shareholder of Rialto.  The
       line of credit was called by the bank and, under the terms of the
       line of credit, DITT, as guarantor, paid the bank.  As consideration
       for this payment, Rialto executed a note payable at 10% to DITT
       collateralized by all of the assets of Rialto.  The note was due on
       December 31, 1988.
                               F-20
<PAGE>
          GARB OIL & POWER CORPORATION AND SUBSIDIARIES
                  (A Development Stage Company)
            Notes to Consolidated Financial Statements
                          June 30, 2001



NOTE 7 - INVESTMENT IN RIALTO POWER CORPORATION (Continued)

        In November 1989, Rialto agreed to convey the collateralized assets
        to DITT in satisfaction of the note and related interest payable.
        Such assets represented substantially all costs of the project.  The
        carrying value of the related assets and liabilities at the date of
        the conveyance were as follows:

        Land                                        $           1,384,126
        Construction in progress                                2,937,790
        Other assets                                              140,633

        Total assets conveyed                                   4,462,549
        Less: note and related interest payable                 4,346,337

        Loss Recognized on Extinguishment of Debt$                116,212

        Due to the ongoing legal actions regarding certain permits issued
        with respect to the Rialto project and the adverse effect of related
        delays, the Company could not proceed with any further construction
        or development of the project.  The State of California dissolved
        Rialto Power Company.  The Company may pursue the construction of
        other waste-to-energy projects in areas believed to have more
        favorable regulatory environments.  The Company does not have any
        firm agreements for the construction of such additional plants.

NOTE 8 - OPERATING LEASES

        The Company shares office space with Garbalizer Corporation of
        Amercia under a lease agreement on a month-to-month basis.  The
        Company also leases facilities on a month-to-month basis.  Rental
        expense relating to these operating leases was $14,400 and $23,256
        for the years ended June 30, 2001 and 2000, respectively.
                               F-21
<PAGE>
          GARB OIL & POWER CORPORATION AND SUBSIDIARIES
                  (A Development Stage Company)
            Notes to Consolidated Financial Statements
                          June 30, 2001


NOTE 9 - SUPPLEMENTAL CASH FLOWS

        During the year ended June 30, 2001, the Company issued 200,000
        shares of treasury stock for 669,897 common shares of RecycleNet
        Corporation, Inc. valued at $41,869.

        During the year ended June 30, 2001, the Company issued 2,056,701
        shares of common stock for 400,000 common shares of RecycleNet
        Corporation, Inc. valued at $300,000.

        During the year ended June 30, 2001, the Company agreed to trade
        2,000,000 shares of common stock for 2,000,000 common shares of
        RecycleNet Corporation, Inc.  The Company received the 2,000,000
        common shares of RecycleNet but has not yet issued the 2,000,000
        shares of Company common stock.  Accordingly, a related party
        payable was recorded in the amount of $180,000 for the value of the
        shares.

        During the year ended June 30, 2000, the Company issued available-
        for-sale securities for the extinguishment of $70,000 of debt.

        During the year ended June 30, 1999, the Company and The Company's
        majority shareholder, Garbalizer Corporation of America (GCA), were
        parties to the reorganization and sale of GCA's subsidiary,
        Garbalizer Machinery Corporation (GMC).  See Note 2 for a discussion
        of the acquisition.

        During the year ended June 30, 1998, the holders of a $22,000 note
        payable applied the balance as a payment on an option agreement it
        purchased from the Company in 1997.

        During the year ended June 30, 1997, the Company issued 86,333
        shares of common stock valued at $12,949 for services rendered.
                               F-22
<PAGE>

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

     Not applicable except as previously reported.

                                    PART III

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

      The term of office of each director is one (1) year or until his
successor is elected at the Company's annual meeting and qualified. The term
of office for each officer of the Company is at the pleasure of the Board of
Directors.  The Board of Directors has no nominating, auditing or compensation
committee.

     Identification of Directors and Executive Officers
     --------------------------------------------------

     The following table sets forth the names, ages, and positions with the
Company of the directors and officers of the Company.

              Name                   Age       Position
              ----                   ---       --------
         John C. Brewer              79        President, Chairman of
                                               the Board of Directors
                                               and Director

         Bill Vee Anderson           50        Vice-President, Director

         Charles Laver               78        Secretary and Director


     John C.  Brewer has been the President and a director of the Company
since January, 1981, and from 1972 until January, 1981, was President and a
director of the Company's predecessor Garb-Oil Corporation. Mr. Brewer also
serves as President, Chairman of the Board of Directors and a director of
GCA which was the majority shareholder of the Company. Until March, 1999, Mr.
Brewer was a director of, and Garbalizer Corporation of America was the
majority  shareholder  of, GMC  Corporation, a public non-reporting company.
Mr. Brewer devotes approximately 40 hours per week to the Company as well as
additional time to his other business interests.

     Bill Vee Anderson has been Vice President and a director of the Company
since September 1993. He has been employed by the Company as a Chief Engineer
since February 1990. Prior to joining the Company, Mr. Anderson spent five
years as a Design Engineer at Sperry Univac. Prior to that, he was a Design
Engineer with Bell Telephone Laboratories. Mr. Anderson declared personal
bankruptcy in July, 1992, and agreed to a payment plan whereby his creditors
have been or will be paid the full amount of his indebtedness.

     Charles Laver, CPA,  has been the Secretary and a director of the Company
since January, 1981, and from 1972 until January, 1981, was Secretary and a
director of Garb-Oil Corporation. Mr. Laver's principal occupation for the
last 30 years has been a self-employed Certified Public Accountant. Mr. Laver
will devote such time as may be necessary from time to time as an officer and
a director of the Company including  but not  limited  to regular  and
special meetings of the board of directors.

     Compliance With Section 16(a)
     -----------------------------

     Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's directors and executive officers, and persons who own more than ten
percent of a registered class of the Company's equity securities, to file with
the Securities and Exchange Commission initial reports of ownership and
reports of changes in ownership of Common Stock and other equity securities of
the Company. Officers, directors and greater than ten-percent shareholders are
required by Securities and Exchange Commission regulations to furnish the
Company with copies of all Section 16(a) forms they file.

      To the Company's knowledge, based solely on review of the copies of such
reports furnished to the Company and written representations that no other
reports were required, during the fiscal year ended June 30, 2001, there were
no Section 16(a) filing requirements applicable to its officers, directors and
greater than ten-percent beneficial owners.

ITEM 10. EXECUTIVE COMPENSATION

     The following information concerning the compensation of the Company's
Chief Executive Officer for the fiscal years ended June 30, 2001 and 2000
compensation for the directors and other executive officers is not required to
be presented as no such director's or executive officer's salary and bonus
exceeded $100,000.


                         SUMMARY COMPENSATION TABLE


                                            Annual Compensation
Name and Principal Position      Fiscal Year                 Salary ($)
---------------------------      -----------                 ----------
John C. Brewer                      2001                        $48,000
President and CEO                   2000                         48,000

     No person received any form of non-cash compensation from the Company in
the fiscal year ended June 30, 2001 or currently receives any such
compensation. The Company does provide medical insurance to Mr. Brewer.

     During the current fiscal year, the Company is paying and it is
anticipated that the Company will continue to pay a salary to Mr. Brewer in
the amount of $48,000 per annum for 40 hours per week of Mr. Brewer's time.
The Company has an Employment Agreement with Mr. Brewer (See Part III, Item
13).  All or substantially all of such compensation is currently being accrued
rather than paid in cash. The Company does provide medical insurance to Mr.
Brewer.

     Other than as set forth above, the Company has no employment agreements
with any of its officers or directors and has no retirement, profit sharing,
pension or insurance plans covering them.

     The Company issued no options during the fiscal years ended June 30, 2001
or 2000, and none are outstanding.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The following table sets forth certain information with respect to the
beneficial ownership of the Company's common stock as of September 20, 2001
(i) each person known by the Company to own more than five percent (5%) of the
Company's outstanding stock, (ii) each  director of the Company and (iii) all
officers and directors as a group.

Name and Address                             Amount      Percent of Class

Garbalizer Corporation                     10,388,291     51.9%
of America (Note 1)
Newhouse Office Building, Suite 507
Salt Lake City, Utah

A/S Parkveien 55                            1,050,000      5.3%
Christiania Bank
P.O. Box 1166 (Note 2)
Sentrum 0107 Oslo 1, Norway

John C. Brewer (Note 3)                    10,388,291     51.9%
Newhouse Office Building, Suite 507
Salt Lake City, Utah

Charles Laver (Note 4)                     10,409,037     52.0%
Newhouse Office Building, Suite 507
Salt Lake City, Utah

Bill Anderson                                   6,000       *
Newhouse Office Building, Suite 507
Salt Lake City, Utah

All directors and                          10,415,037     52.1%
officers as a group
(3 individuals)

               * less than 1%

      (1) John C. Brewer beneficially owns 98% of the outstanding common
stock of GCA.

      (2) In September, 1988 A/S Parkveien 55 filed a Schedule 13D stating
its beneficial ownership of 1,800,000 shares owned of record and beneficially
by it. The Schedule 13D also indicates that an additional 478,000 shares (3.3%
of the class) were beneficially owned by two Norwegian corporations having
common control or ownership with A/S Parkveien 55. During a prior fiscal year,
1,500,000 shares held of record by A/S Parkveien 55 at the time of the
Schedule 13D filing were transferred of record to Christiana Bank, Oslo,
Norway and neither A/S Parkveien 55 nor the other corporations listed on the
Schedule 13D currently own shares of record. A/S Parkveien 55 did not inform
the Company of a change in beneficial ownership as result of such change in
record ownership and the table therefore reflects beneficial ownership stated
in the Schedule 13D as adjusted for subsequent sales by Christiana Bank.

     (3) Consists of 10,388,291 shares held by GCA in which Mr. Brewer may be
deemed to share beneficial ownership as a result of his position as a director
and principal shareholder of GCA.

     (4) Consists of 10,388,291 shares held by GCA in which Mr. Laver may be
deemed to share beneficial ownership as a result of his position as a director
of GCA, and 20,746 shares owned of record by Mr. Laver.

     The Company is unaware of any arrangements which may result in a change
in control of the Company.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

     On March 19, 1999 the Company acquired all rights to the Garbalizer
Shredder and related assets from GMC in exchange for assumption of
liabilities. In connection with the sale, GMC was reorganized into
RecycleNet. The reorganization was accomplished by GMC transferring  all
of its assets and liabilities to the Company, by merging with RecycleNet
in exchange for approximately 90% of its common stock being issued to
the former RecycleNet shareholders and by GMC changing its name to
"RecycleNet, Inc." Prior to the change in control, Garbalizer Corporation of
America ("GCA") owned a majority of the GMC shares and the Board of Directors
of the Company was the same as the Board of Directors of GMC. GCA retained
approximately 10% of the common stock of RecycleNet after the reorganization.
Although the persons acquiring control of GMC are not affiliated with the
Company, the terms of the sale of assets to the Company were not determined at
arms length. The Company assumed $473,060 more in liabilities than assets on
the acquisition, which was accounted for as a distribution from GCA to the
Company. In exchange for the Company's assumption of GMC's net liabilities,
GCA transferred 1,061,668 shares of RecycleNet common stock to the Company.
The common shares of RecycleNet received from GCA were recorded with a zero
basis which was the historical cost of GCA's investment in GMC.

     During the period July 1998 through March 1999 and for the years ended
June 30, 1998 and 1997, the Company made non-interest bearing advances to GMC
in the amounts of $34,094, $27,521, and $34,771, respectively. Payments on
these advances totaled $60,573, $14,091, and $9,164 for the years ended June
30, 1999, 1998 and 1997.  As discussed above, in March 1999, GMC merged with
an unrelated Company and transferred all assets and liabilities to the
Company, which include the above mentioned receivable totaling $221,953.

     Prior to June 30, 1996, a shareholder advanced to the Company  $35,000
under short-term, non-interest bearing notes which were due on demand. During
the year ended June 30, 1997 an additional $10,000 was advanced. During the
year ended June 30, 1998, $5,000 of interest was added to these advances. As
part of the assumption of GMC's liabilities, the Company assumed an
additional $10,000 short-term,  non-interest bearing note which was due
on demand.  During the period ending June 30, 2000, the Company issued
RecycleNet common stock to extinguish the note.

     As part of the assumption of GMC's liabilities, the Company assumed a
$10,000 note payable from a shareholder.  The note was paid for as of June 30,
2000, as the Company exchanged shares of RecycleNet common stock.

     As part of the assumption of GMC's liabilities, the Company assumed a 12%
note payable from an individual with an outstanding balance of $68,493. The
note was originally for $150,000 and was due in 1992. The Company has not made
any principal payments since assuming this note.


     The Company's President is entitled to an annual salary of $48,000.
During 1993 through 2001, substantially all of such salary was accrued rather
than paid in cash. Such accrued wages are unsecured and do not bear interest.
As of June 30, 2001, the balance of accrued salary to the President was
$456,000. This is in addition to the $106,453 owed to the Company's President
for advances to the Company.  As part of the assumption of GMC's liabilities,
the Company assumed an additional $103,215 payable to this officer for various
purchases on behalf of GMC. The Company paid all interest charges (currently
at approximately 9%) relating to these purchases.  These payables were due on
demand; however, as of June 30, 2001, no principal payments had been made.

ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K

         a. The following financial statements and schedules are filed
herewith.

                          Garb Oil & Power Corporation

          Consolidated Balance Sheet - June 30, 2001

          Consolidated  Statements of  Operations and Comprehensive Income
          for the Years Ended June 30, 2001, 2000 and for the Period
          from January 14, 1981 (Date of Inception of the Development
          Stage)to June 30, 2001

          Consolidated  Statements of Stockholders' Equity (Deficit)  - For
          the period from Inception of the Development Stage
          (January 14, 1981) through June 30, 2001

          Consolidated Statements of Cash Flows For the Years Ended
          June 30, 2001, 2000 and for the Period from January
          14, 1981 (Date of Inception of the Development Stage) to
          June 30, 2001

          Notes

         b.  During the fourth quarter of the year reported. the Company
filed no Forms 8-K.

         c. The following exhibits are filed herewith or incorporated  herein
by reference from prior filings. The Securities and Exchange Commission No.
refers to the Exhibit  Table in Item 601 of Regulation S-B.

Section  Exhibit
  No.    No.    Description                 Location
------   -----  -------------------------   -------------------------
  3        3.1  Articles of Incorporation   Exhibit 3.1 of Registration
                (as amended)                Statement on  Form 10, File
                                            No. 0-14859

  3        3.2  By-Laws                     Exhibit 3.2 of Registration
                                            Statement on Form 10, File
                                            No. 0-14859

 10       10.1  Employment Agreement with   Exhibit 10.5 of Registration
                John Brewer                 Statement on Form 10, File
                                            No. 0-14859

 10       10.2  Agreement with Giant Tire   Exhibit 10.4 of Form 10-KSB
                Recyclers, Inc.             for June 30, 1997

 10       10.3  Project Development and     Exhibit 10.1 of Form 8-K
                Construction Agreement      dated May 11, 1998
                with Trenergy, Inc.

 10       10.4  Extension Agreement with    Exhibit 10.4 of the 10KSB
                Giant Tire Recyclers, Inc.  for June 30, 1997

 10       10.5  Agreement between           Exhibit 10.5 of the 10KSB
                Garbalizer Machinery        for June 30, 1999
                Corporation and the
                Company

 21       21.1  List of Subsidiaries        Exhibit 21.1 of Form 10-KSB
                                            for June 30, 1995



                                   SIGNATURES

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

                                      GARB OIL & POWER CORPORATION



                                      By: /s/ John C. Brewer
                                      ------------------------------
                                      John C. Brewer, President

     DATED this 26th day of September, 2001

     In accordance with the Exchange Act, this Report has been signed below by
the following persons on behalf of the Registrant and in the capacities and on
the date indicated.

         1. By its principal executive officer.



        Date: 9/26/2001               /s/ John C. Brewer
                                      ------------------------------
                                      John C. Brewer, President

         2. And by its  principal  financial  officer and  principal
accounting officer.


        Date: 9/26/2001               /s/ Charles Laver
                                      ------------------------------
                                      Charles Laver, Treasurer

         3. And by a majority of its Board of Directors.


        Date: 9/26/2001               /s/ John C. Brewer
                                      ------------------------------
                                      John C. Brewer, Director


        Date: 9/26/2001               /s/ Charles Laver
                                      ------------------------------
                                      Charles Laver, Director


        Date: 9/26/2001               /s/ Bill Vee Anderson
                                      ------------------------------
                                      Bill Vee Anderson, Director