`U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-KSB

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

                   FOR THE FISCAL YEAR ENDED DECEMBER 31, 2000

                        Commission File Number 000-27847

                      JACOBSON RESONANCE ENTERPRISES, INC.

                      NEVADA                      65-0684400
          (State or other jurisdiction of       (IRS Employer
           incorporation or organization)   Identification Number)

       8200 Jog Road, Suite 100, Boynton Beach, Florida      33437
          (Address of principal executive offices)         (Zip Code)

         Company's telephone number, including area code: (561) 477-8020

        SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT: NONE
          SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:

                          COMMON STOCK, $.001 PAR VALUE

Check whether the Company (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding
12 months (or for such shorter period that the Company was required to file such
reports), and (2) has been subject to filing requirements for the past 90 days.
Yes [X]  No [  ]

Check if disclosure of delinquent filers pursuant to Item 405 of Regulation S-B
is not  contained herein, and will not be contained, to the best of the
Company'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.  [ ]

The Company's revenues for fiscal year 2000 were $31,590.

The aggregate market value of the voting and non-voting common equity held by
non-affiliates of the Company is $11,161,856 based on the closing price of $0.28
as of April 2, 2001.*

As of April 2, 2001, the Company had a total of 55,636,298 shares of common
stock outstanding.

*Affiliates for the purpose of this item refer to the officers, directors,
and/or persons  or firms owning 5% or more of the Company's common stock, both
of record and beneficially.




                       DOCUMENTS INCORPORATED BY REFERENCE

The following documents are incorporated by reference:   None

                                                        Page


PART I....................................................1


         ITEM 1.  DESCRIPTION OF BUSINESS.................1
         ITEM 2.  DESCRIPTION OF PROPERTY................16
         ITEM 3.  LEGAL PROCEEDINGS......................16
         ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF
                  SECURITY HOLDERS.......................17


PART II..................................................18


         ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED
                  SHAREHOLDER MATTERS................... 18
         ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR
                        PLAN OF OPERATION............... 18

         ITEM 7.  FINANCIAL STATEMENTS.................. 22
         ITEM 8.  CHANGES IN AND DISAGREEMENTS WITH
                         ACCOUNTANTS ON ACCOUNTING AND
                         FINANCIAL DISCLOSURE........... 22


PART III................................................ 23

         ITEM 9.   DIRECTORS, EXECUTIVE OFFICERS,
                          PROMOTERS AND CONTROL PERSONS:
                          COMPLIANCE WITH SECTION 16(a)
                          OF THE EXCHANGE ACT........... 23

         ITEM 10.  EXECUTIVE COMPENSATION............... 24
         ITEM 11.  SECURITY OWNERSHIP OF CERTAIN
                          BENEFICIAL OWNERS AND
                          MANAGEMENT.................... 25

         ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED
                          TRANSACTIONS...................27
         ITEM 13.  EXHIBITS AND REPORTS ON FORM 8-K......28




                                  SPECIAL NOTE
                           FORWARD-LOOKING STATEMENTS

CERTAIN STATEMENTS CONTAINED IN THIS REPORT, INCLUDING, WITHOUT  LIMITATION,
STATEMENTS CONTAINING THE WORDS "BELIEVES," "ANTICIPATES,"  "EXPECTS" AND WORDS
OF SIMILAR IMPORT CONSTITUTE "FORWARD-LOOKING STATEMENTS" WITHIN THE
MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. SUCH
FORWARD-LOOKING STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS AND UNCERTAINTIES.

THE COMPANY'S ACTUAL RESULTS MAY DIFFER MATERIALLY FROM THOSE  ANTICIPATED IN
THESE FORWARD-LOOKING STATEMENTS AS A RESULT OF CERTAIN FACTORS, INCLUDING THE
SUCCESS AND SUBSEQUENT ACCEPTANCE OF NEW MEDICAL RESEARCH AND DEVELOPMENT;
THE REGULATORY FRAMEWORK OF THE HEALTH CARE INDUSTRY; THE COMPANY'S ABILITY TO
CREATE, SUSTAIN, MANAGE OR FORECAST ITS GROWTH; ITS ABILITY TO ATTRACT AND
RETAIN KEY PERSONNEL; ITS ABILITY TO PROTECT TECHNOLOGY; CHANGES IN ITS
BUSINESS STRATEGY OR DEVELOPMENT PLANS; COMPETITION; DEMOGRAPHIC CHANGES;
BUSINESS DISRUPTIONS; ADVERSE PUBLICITY; AND INTERNATIONAL, NATIONAL AND LOCAL
GENERAL ECONOMIC AND MARKET CONDITIONS.



                                     PART I

ITEM 1.  DESCRIPTION OF BUSINESS

THE COMPANY

        Jacobson Resonance Enterprises, Inc. (the "Company"), is in transition
from a development stage company to an operating company and has not had any
significant revenue from operations to date. The Company is a Nevada corporation
incorporated on March 6, 1988, and was originally known as Pioneer Services
International, Ltd. On June 4, 1996, the Company acquired Jacobson Resonance
Machines, Inc., a closely-held Florida corporation, in exchange for 57,220,000
shares of the Company's common stock, or a 92% equity interest in the Company.

        On July 30, 1998, the Company changed its name to Jacobson Resonance
Enterprises, Inc.

        The Company has and continues to engage in the development of
electromagnetic resonance technology patented by Dr. Jerry I. Jacobson
("Jacobson Resonance") for medical, commercial, agricultural and industrial
applications. Jacobson Resonance utilizes weak, low-frequency electromagnetic
fields to beneficially alter molecular characteristics. The Company is currently
negotiating, and will continue to use, joint venture and licensing
arrangements, as well as its own resources, to develop, manufacture, distribute
and market various applications of Jacobson Resonance.

THE TECHNOLOGY

        The principles behind Jacobson Resonance are derived from physics. Dr.
Jerry I. Jacobson, trained as a dentist and oral surgeon, developed an interest
in magnetotherapy through his extensive research and study of the work of Albert
Einstein. Dr. Jacobson filed a specification with the U.S. Patent Office
conceiving the idea of how quantum physics united with relativity. While Dr.
Jacobson's specification did not change quantum physics or relativity, he
demonstrated a practical way to unite them, adding a new dimension to quantum
physics.

        Dr. Jacobson has quantified gravity as it relates to matter. According
to Dr. Jacobson, energy, which equals mass times the speed of light squared,
also equals BVL-q where "B" stands for magnetic field, "V" for velocity, "L" for
length and "q" for a unit electrical charge of one coulomb. Dr. Jacobson
considers the Jacobson Resonance equation, mc2 = BVL-q, to be a fundamental law
of nature. Reduced to layperson terms, the right side of the equation equals
energy created by the interaction of any conductive body with a magnetic field.
The left side of the equation represents gravitational energy contained in a
mass within a conductor.

        With this newly discovered law of nature, Dr. Jacobson ventured into
terrain that was previously believed nonexistent. According to the laws of
quantum physics, the pico tesla fields and nanogauss fields (similar to the
magnetic profile of the brain, the heart and the liver) were too weak to produce
heat or trigger chemical reactions. It followed that living systems could not be
beneficially influenced. Dr. Jacobson set out to build a resonator machine
(the "Jacobson Resonator") that would track this new law of nature and, in due
course, discover the appropriate resonance for a patient. Once engaged, he
firmly believed that living systems could be beneficially influenced. The
challenge was connecting these very weak force-fields with biochemically induced
interactions.

        The Company is developing, manufacturing, distributing and marketing
various applications of Jacobson Resonance. The Company believes that it must
focus its attention and resources on particular applications of Jacobson
Resonance. The core application of Jacobson Resonance is medical, followed by
commercial, agricultural and industrial applications.

MEDICAL APPLICATIONS

        The Company designs and develops electromedical and electrotherapeutic
medical devices that  utilize Jacobson Resonance for the non-invasive treatment
of disease and musculoskeletal injury. Recognizing that atoms are
essentially magnets, and that electromagnetism holds atoms together, Jacobson
Resonance manipulates atoms through electromagnetically-induced resonances.
Put another way, Jacobson Resonance is a kind of vibrational medicine that
attempts to manipulate atoms in order to return balance, or homeostasis of
function, to the human body, which in turn can potentially ameliorate symptoms.
Jacobson Resonance is based on the principle of magnetotherapy.

        Magnetotherapy can treat human pathologies with magnetic force-fields.
In treating disease, Jacobson Resonance employs a weak electromagnetic
force-field in harmony with the human body's electromagnetic field toproduce
gravity waves and electromagnetically-induced vibrations, which in turn appear
to render viruses and bacteria incapable of invading healthy cells and allow
infected cells to regain normalcy.

        Magnetotherapy can provide cells with the stimulation necessary to
promote healing. In treating musculoskeletal injury, Jacobson Resonance attempts
to give the body's natural healing process a push,  by altering the
electromagnetic force-field of a patient to increase the rate of production of
regenerative tissues. The natural process of musculoskeletal tissue healing
involves a complex interaction of several physiological processes, which
include the stimulation of specific cells such as osteoblasts, fibroblasts and
endothelial cells. When an injury occurs, growth factors are produced at the
healing site which  stimulate selected cells to initiate the healing cascade.
In  most cases, these cells are able to initiate repair in response to an injury
and restore the musculoskeletal tissue to its original strength and structure.
Cell stimulation is a necessary component of tissue regeneration and is
dependent upon certain triggering events that activate the production of
connective tissue.

        While the Company is one of many engaged in magnetotherapy, the
Company's approach to magnetotherapy is substantially different from its
competitors in that Jacobson Resonance uniquely utilizes weak force-fields. Most
of the Company's competitors, including Biomagnetics, the Biomet division of
Electro-biology, Dispulse Corporation of America, Electropharmacology, Exogen,
Orthofix  and Orthologic, produce electromagnetic devices which utilize
magnetic fields more than one million times the strength of the Jacobson
Resonance fields. Strong force-fields can potentially jiggle very large masses
within biosystems, posing the risk of promoting tumorigenises and producing
cancer. By contrast, Jacobson Resonance uses magnetic force-fields that are
normal to the human body, utilizing very weak force-fields involving pico tesla
fields, nanogauss fields and even weaker force-fields. Pico tesla and
nanogauss fields are equivalent to the normal magnetic profiles of the brain,
the heart and other organs of the human body. Pico tesla fields are about
50,000,000 times weaker than the earth's geomagnetic field, and nanogauss
fields are about 500,000,000 times weaker. To place this in proper perspective,
magnetic resonance imaging ("MRI") systems routinely use magnetic force-fields
that are 20,000 times STRONGER than the earth's geomagnetic field.

        The Jacobson Resonators were originally fabricated at the Stennis Space
Center by NASA subcontractors and emit pico tesla and nanogauss force-fields.
These force-fields emit physiologic and benign non-ionizing electromagnetic
radiation, causing no impairment to atoms or their surrounding electrons. Most
human patients do not feel or sense the force-fields during treatment and, to
date, attendant effects have been limited to occasional tingling sensations.

        Currently, in treating human patients, the selection of the appropriate
electromagnetic field for a particular type of disorder involves a mathematical
calculation and requires trial based upon theory. Achieving resonance has
required time and patience because various critical molecules must be identified
for a particular disorder in order to reorder electrophysiological states back
to normalcy. The Company is attempting to produce a peripheral product, an
"intensity sweep" device, which, once perfected, will be able to scan hundreds
of weak electromagnetic fields in a matter of minutes and identify the fields
that provide resonance. This technology will eliminate the time-consuming
methodology currently employed to determine resonance. To the Company's
knowledge, there is no other commercially available apparatus or device that is
attempting to lock into the patient's magnetic force field and produce
vibrations which reinforce and re-establish the normal structure of molecules
and coherent communication between atoms. There is increasing research and
interest in the phenomena discovered by Dr. Jacobson. Much of this interest has
been ignited by Dr. Jacobson's many articles and extensive testing.

        The Company  believes that it must focus its attention and resources on
particular medical applications of Jacobson Resonance. The core medical
application of Jacobson Resonance is the treatment of chronic pain, including
osteoarthritis of the knee joint. Other, secondary medical applications which
are currently under research and development include the treatment of
Alzheimer's Disease, cardiac pacing, epilepsy, Parkinson's Disease and Multiple
Sclerosis.

JACOBSON RESONATORS FOR CHRONIC PAIN REDUCTION

        The Company is planning to use Jacobson Resonance for the reduction of
chronic pain. Osteoarthritis, rheumatoid arthritis, lower back injuries,
tendinitis, muscle spasms, sports injuries, carpal tunnel and tarsal tunnel
syndromes, neuropathy and migraine, tension, cluster, sinus and menstrual
headaches all cause chronic pain. Based on data developed by the National
Chronic Pain Outreach Association, an estimated 34 million people in the
United States of America suffer from chronic pain and approximately 50 million
work days are lost annually because of chronic pain.

        The Company currently utilizes seven different models of the Jacobson
Resonator for the reduction of chronic pain, four of which are designed for
clinical use. The largest clinical model is comprised of a pair of Helmholtz
coils that are seven feet in diameter and placed on a common axis three and a
half feet apart (to encompass a full human frame). The next largest clinical
model is comprised of a pair of Helmholtz coils that are four feet in diameter
(to treat patients who are lying down.). A third clinical model is comprised of
a pair of Helmholtz coils that are 22 inches in diameter and placed on a common
axis eleven inches apart, which can be expanded to 16 inches or 20 inches. The
fourth clinical model is comprised of a pair of Helmholtz coils that are 18
inches in diameter and placed on a common axis nine inches apart. The latter two
models can encompass a human head,
joint or portion of a limb.

        The clinical resonators require Food and Drug Administration clearance
before they can be commercially used in the United States of America. See
"Government Regulation." The Company has not yet received FDA approval for the
commercialization of its clinical resonators in the United States of America.
However, the FDA has determined that the pico tesla and nanogauss force-fields
generated by the Jacobson Resonator are of non-significant risk, which
determination permits the Company to conduct studies on human subjects while
gathering data on safety and effectiveness. The Company completed double blind
and randomized clinical studies in early 1999 and submitted to the FDA on May
27, 1999, its pre-market notification report for the 18-inch Jacobson Resonator
in the treatment of osteoarthritic pain of the knee. At the request of the FDA,
the Company filed an addendum to the report on September
17, 1999. The Company is currently awaiting the FDA response.

        The clinical resonators also require CE Marking before they can be
commercially used in the European Economic Union (see "Government Regulation.")
The Company has received approval in December 2000 for the CE Mark for
the commercialization of its clinical resonators in the European Economic Union.
Through its licensee, Serrato Europe, the Company is moving forward with full
commercialization initiatives in distribution and manufacturing in Europe.
Furthermore, the Company expects revenues from these activities in Europe to
commence by the end of 2nd quarter, 2001.  The Company has also received
commercialization approval by Health Canada for use and treatment of chronic
pain indications. Plans are well underway to have our licensee (Bio Resonance
Technology) opening several treatment centers in Canada on or by the end of 1st
quarter, 2001.

        Quantum Resonance Technologies, Inc. ("QRTI"), builds the prototypes of
the Company's clinical and portable resonators and is also making the portable
resonators. Benvenutti Electrical Apparatus & Repair, Inc. ("B.E.A.R."),
an electrical apparatus manufacturer in Gulfport, Mississippi, collaborates with
QRTI and manufactures the Company's clinical resonators.

        The Company plans to distribute the clinical models of the Jacobson
Resonators in the United States of America through existing medical device
distributors. With respect to the portable models, the Company plans to
place them in chain stores and other locations outside the United States where
magnet therapy products are currently being sold. Currently, the Company is in
discussions and negotiations with several entities which will provide the
Company distribution and manufacturing of the resonators.

        Alfonso Serrato is leading the European initiative. Mr. Serrato is a
director of the Company and a former executive officer of Medtronic, Inc., a New
York Stock Exchange company that is a leading manufacturer and distributor of
medical devices around the world. Mr. Serrato worked for Medtronic, Inc., in
various capacities, including Vice President of Worldwide Manufacturing and Vice
President of Pacing Operations, for approximately 18 years until 1996.

        To date, the Company has entered into two agreements with Serrato
Enterprises L.L.C. ("Serrato Enterprises"), an entity controlled by Mr. Serrato.
In February 1999, the Company executed a ten-year license agreement with Serrato
Enterprises for the marketing and distribution of the Company's chronic pain
reduction products in Europe, Africa and the Middle East, excluding Israel and
the nations that formerly constituted the Union of Soviet Socialist Republics.
In January 2000, the Company executed a ten-year manufacturing agreement with
Serrato Enterprises, under which the Company will receive manufacturing
royalties based on type and production volume of resonators manufactured by
Serrato Enterprises.

        In October 1999, in anticipation of receiving CE-Marking for the
commercialization of its clinical resonators, the Company sponsored research and
development in Marbella, Spain.  The Company contracted with Compania
Aeronautica, S.A., a Spanish aircraft manufacturer, for the partial manufacture
of Jacobson Resonators, with final calibration and assembly completed by Serrato
Enterprises.

        At December 31, 2000, the Company was still in the development stage
and received no revenue from the aforementioned agreements.

OTHER PLANNED MEDICAL APPLICATIONS OF JACOBSON RESONANCE

        In addition to chronic pain treatment applications, the Company plans
to develop Jacobson Resonance for other medical applications. Researchers are
currently investigating the effects of Jacobson Resonance on Alzheimer's
Disease, cardiac pacing, epilepsy, fibromyalgia, rheumatoid arthritis,
osteoarthritis, migraine, lower back pain, soft tissue pain, multiple sclerosis,
chronic fatigue syndrome, nerve regeneration, angina and cancer. See Item 6,
"Management's Discussion and Analysis, Research and Development." The Company
is also examining the potential application of Jacobson Resonance to  veterinary
medicine, including the treatment of leg and back pain in horses. The
physiologic force-fields  of Jacobson Resonance can also be utilized in health
spa jacuzzis to provide invigorating effects, which might improve health and
well-being.

        In one completed study, Jacobson Resonance demonstrated effectiveness
in the treatment of cardiac arrhythmia in dogs. The Company believes that this
study can conceivably lead to the Jacobson Resonator becoming a required medical
device for every hospital emergency room. It hopes to license this use to a
larger medical products company for development, marketing and distribution.

        In February 2000, Dr. Jacobson received a U.S. Patent entitled, "Method
for Ameliorating the Aging Process and the Effects Thereof Utilizing
Electromagnetic Energy." He has licensed this patent to  the Company. The
magnetic fields covered by the patent are physiological and occur naturally in
the human body. Aging may be referred to as collective changes within a
biological system that can prevent  cellular functions, genetic information
transfer and chromatin structure. The Company plans to research how Jacobson
Resonance, through magnetic influence, can potentially enhance cellular
communications, cooperativity and reorient the spin angular momenta of basic
particles to slow down the aging process.

NON-MEDICAL APPLICATIONS OF JACOBSON RESONANCE

        In addition to medical applications, the Company has developed and
plans to continue developing Jacobson Resonance for use in commercial,
agricultural and industrial applications. Jacobson Resonance can restructure
water molecules to create greater inter-atomic communication and improve
absorption, coherence, cooperativity and harmony between systems, and stability.
Studies have demonstrated that resonated drinking water may improve digestion,
speed absorption of nutrients in the gastrointestinal tract and provide
ancillary benefits such as greater regularity, increased stamina and improved
circulation.

        In January 2000, the Company executed a licensing agreement with
RealPure Beverage Group, LLC, of Jackson, Mississippi, for the use of Jacobson
Resonance in multiple water and beverage products lines, including exclusive
marketing and distribution. Previously, B.E.A.R. built a new industrial model
of the Jacobson Resonator for theCompany consisting of three coils, each ten
feet in diameter, placed vertically and connected in series for water
resonation. RealPure will use this machine to resonate its water products. The
beverages scheduled for resonation include RealPure spring water, as well as a
new pediatric beverage, a new geriatric beverage and the new "Real Pro"
hi-energy sport drink.

        Preliminary research testing has shown that resonated water enhances
the rate of growth and increases the total weight of plants and fruits. See
Item 6, "Management's Discussion and Analysis, Research and Development."
Other potential agricultural applications include enhancing the health and
growth cycles of fish and shellfish, rice farming, forestry and lumber
operations, greenhouse facilities, citrus production, wine production and
landscaping.

        Resonation of cosmetics, nutraceuticals and pharmaceuticals should
promote their respective absorption rates and reduce their respective toxicity
to living systems. These studies are underway. In July 1999, the Company
announced the signing of a letter of intent for technology transfer and
licensing with O2 Marketing Group, Inc., amanufacturer of consumer-oriented
oxygen products for the cosmetics, nutraceutical and pharmaceutical industries.
The Company will grant O2 Marketing Group, Inc. an exclusive license to use
Jacobson Resonance for not less than ten years covering the Republic of
South Africa. O2 Marketing  Group, Inc., will grant the Company a license for
not less than ten years covering O2's pure-air system devices, technology and
products. Also, in February 2000, the Company signed a letter of intent with
Genesis Group International (GGIC) to license the use of Jacobson Resonance
in the development, distribution, marketing and sale of GGIC's all-natural and
resonated family of nasal sprays worldwide.

        Jacobson Resonance also has industrial applications. Resonated water
can potentially increase adhesion and bonding between mixtures of sawdust, sand
and cement. A licensing agreement is currently pending between the Company
and Enviro-Products, Ltd., a Canadian manufacturer of patented  composite cement
building blocks. Resonated water might also lead to the development of energy-
efficient home water purification systems by providing a cleaner, less
toxic environment and preventing calcium and other mineral deposits which
restrict pipes and damage appliances. Preliminary testing is being conducted
regarding the effects of resonation on primers and alloys; if resonance
promotes improved adhesion and surface protection with less degradation,
Jacobson Resonance can potentially be utilized in the marine, aerospace and
automotive painting and coating industries, as well as environmental and waste
management applications.

GOVERNMENT REGULATION

UNITED STATES OF AMERICA

        In the United States of America, the Company's four clinical Jacobson
Resonators for reduction of chronic pain and future clinical products, if any,
are extensively regulated as medical devices by the federal Food and Drug
Administration (the "FDA"). The FDA regulates the clinical testing,
manufacturing, labeling, distributing, and promoting of medical devices. Prior
to commercial sale in the United States, each of the Company's clinical products
must undergo an extensive regulatory approval process conducted by the FDA under
the Food, Drug and Cosmetic Act (the "FDC Act"). Noncompliance with applicable
requirements can result in failure to receive regulatory clearance or
approval of devices, total or partial suspension of production, fines,
injunctions, civil penalties, recall or seizure of products, and criminal
prosecution.

        Under the FDC Act, all medical devices are classified into three
classes: Class I, II or III. Classification identifies the level of regulatory
control that is necessary to assure the safety and effectiveness of a medical
device, as well as the marketing process (either pre-market notification under
510(k) or pre-market approval ("PMA")) the manufacturer must complete, unless
exempt, in order to obtain FDA clearance for marketing.

        Class I devices are subject to the least regulatory control because
they present minimal potential for harm to the user and are often simpler in
design than Class II or Class III devices. They are subject only to "general
controls," which require adherence to the requirements of (a) registration, (b)
medical device listing, (c) Good Manufacturing Practices, (d) labeling and (e)
pre-market notification. Class II devices are those for which general
controls alone are insufficient to assure safety and effectiveness, but for
which existing methods are available to provide such assurances, such as special
labeling requirements, mandatory performance standards and post-market
surveillance. Class III devices are subject to the most stringent regulatory
controls because insufficient information exists to assure safety and
effectiveness solely through general or special controls. They must satisfy
the PMA requirements.

        The portable models of the Jacobson Resonator are classified as Class I
devices because they are battery-operated, are of "non-significant risk" and
have no medical claims associated with them. As a result, they are not subject
to FDA approval before marketing, distribution and sale.

         After consultation with the FDA and subject to demonstration of
effectiveness through human clinical trials, the Company believes that its
clinical Jacobson Resonators will be classified as Class II devices. As Class
II devices, the clinical Jacobson Resonators will not be subject to PMA as
required of Class III devices, but will be subject to general controls and
special controls, including pre-market notification under 510(k). A 510(k) is a
pre-marketing submission made to the FDA to demonstrate that the device to be
marketed is as safe and effective as, or "substantially equivalent" to, a
legally marketed device that is not subject to PMA. Applicants must compare
their 510(k) device to one or more similar devices currently on the U.S. market
and make and support their substantial equivalency claims. The legally marketed
device(s) to which equivalence is drawn is known as the "predicate" device(s).
A device is deemed substantially equivalent to a predicate device if (a) it has
the same intended use as the predicate device, and (b) either has the same
technological characteristics as the predicate device, or has different
technological characteristics that do not raise new questions of safety and
effectiveness, and (c) the sponsor demonstrates that the device is as safe and
effective as the legally marketed device.

        Investigational Device Exemptions ("IDE") allow manufacturers to ship
and use unapproved medical devices intended solely for investigational use
involving human subjects. The IDE regulation applies to most clinical
studies in the U.S. that are undertaken to gather safety and effectiveness data
about a medical device. There are two categories of devices covered by the IDE
regulation: (1) Significant Risk devices and (2) Non-Significant Risk
("NSR") devices. Significant Risk devices require both FDA and Institutional
Review Board ("IRB") approval prior to initiation of a clinical study. NSR
devices require only IRB approval prior to initiation of a clinical study.
Clinical studies are often conducted to support pre-market notification or PMA.
Thus, an investigational device is one that has not been given 510(k) clearance
or PMA for marketing in the U.S. but is exempted from these requirements in
order to collect safety and effectiveness data. Investigational use also
includes clinical evaluation of certain modifications or new intended uses of
legally marketed devices. The FDA requires that all clinical evaluations of
investigational devices, unless exempt, have an approved IDE before the study is
initiated.

        The Company has not yet received FDA approval or clearance for the
commercialization of its clinical resonators in the United States. In 1997, the
Company filed its submission with the FDA seeking a determination that
the 18-inch clinical Jacobson Resonator qualified as an NSR device for the
treatment of osteoarthritis pain of the knee. On March 4, 1999, the FDA
determined that the Company's clinical study of the 18-inch clinical Jacobson
Resonator to demonstrate effectiveness was an NSR device study because the
resonator did not meet the definition of a Significant Risk device under the
applicable provision of the IDE. This determination in effect means that the
resonator meets the FDA requirements as to safety.

        In 1999, the Company completed double-blind and randomized clinical
studies to demonstrate effectiveness of the 18-inch Jacobson Resonator in the
treatment of osteoarthritis pain of the knee, and submitted its pre-market
notification report (510(k)) to the FDA on May 27, 1999. At the request of the
FDA, the Company filed an addendum to the report on September 17, 1999. The
Company is currently  awaiting the FDA response. The Company anticipates FDA
approval of its 18-inch clinical Jacobson Resonator for treatment of chronic
pain from osteoarthritis of the knee sometime in the second quarter or early
third quarter of 2001. There is not assurance that FDA approval will be granted
then, if at all.

        The Company has also entered into two consulting agreements to help and
guide the Company in FDA regulatory compliance and reimbursement issues with
Quintiles, Inc. and Regulatory Associates.

        The Company will be required to obtain FDA approval of a new pre-market
application or pre- market application supplement before making any change to
the Jacobson Resonators affecting the safety or effectiveness of the device
including, but not limited to, new indications for use of the device, changes in
the device's performanceor design specifications and device modifications and
future generation  products. New pre-market applications and pre-market
application supplements generally require submission of information needed to
support the proposed change and often require additional clinical data. The
Company may decide, or may have  to, obtain PMAs and PMA supplements for its
future  products or other uses. A  PMA application must be supported by
extensive data, including pre-clinical and  clinical trial data, to demonstrate
the safety and effectiveness of the device  for the uses specified in the PMA
application. The Company cannot guarantee that any PMA application relating to
the Jacobson Resonator that is filed will be  granted. If the Company does
obtain a PMA, it may be required to file PMA supplements for new or expanded
uses of the Jacobson Resonator and for any  material modifications to it. If a
PMA supplement is not accepted by the FDA for a new or expanded use or material
modification of the  Jacobson Resonator, the  Company must commence and complete
the entire pre-market approval process with respect to such use or modification.
The Company cannot guarantee that any PMA  supplement that it files will be
accepted.

        Any products manufactured or distributed by the Company pursuant to FDA
clearance or approval are subject to pervasive and continuous regulation by the
FDA, including record-keeping requirements, reports of adverse experience with
the use of the device, post-market surveillance, post- market registry, and
other actions as deemed necessary by the FDA. The FDA actively enforces
regulations prohibiting marketing of products for non-indicated uses. The
Company and its agents may promote products only for the products' approved
indications. The labeling and advertising of most FDA-regulated products,
including the Jacobson Resonators, are also subject to the jurisdiction of the
Federal Trade Commission, the Occupational Safety and Health Administration and
other governmental entities. The Company cannot guarantee that the FDA will not
impose regulations that could adversely affect its ability to market, sell, or
be reimbursed for the Jacobson Resonator. In addition, the Company cannot
guarantee that it will not become subject to FDA actions should physicians
prescribe the Jacobson Resonator for unapproved uses.

        As a medical device manufacturer registered with the FDA whose products
are listed with the FDA, the Company's products and facilities will be subject
to inspection on a routine basis by the FDA with regard to product designs,
manufacturing, testing, control, process validation and similar activities.
Future inspections could result in adverse findings and harm the Company's
ability to manufacture and market its Jacobson Resonators, which in turn
would significantly harm the Company's business.

        The process of obtaining FDA and other required regulatory approvals is
lengthy, expensive and uncertain. Regulatory approvals may include regulatory
restrictions on the indicated uses for which a product may be marketed. The
Company cannot guarantee that the FDA will approve its current or future
products in a timely manner, if at all. If the Company experiences delays or
failure in obtaining such approvals, or if previously granted approvals are
rescinded, or if the Company fails to comply with existing or future regulatory
requirements, then its business, financial condition, results of operations and
cash flows will be materially and adversely affected. Furthermore,even if such
approvals are granted, the  Company cannot guarantee that it will be successful
in commercializing or achieving market acceptance of the Jacobson Resonators for
the treatment of chronic pain or any other applications.The Company's inability
to commercialize successfully the Jacobson Resonators will severely harm its
business.

        The Company is also subject to numerous federal, state, and local laws
relating to such matters as safe working conditions, manufacturing practices,
environmental protection, fire- hazard control, and disposal of hazardous or
potentially hazardous substances. The Company cannot guarantee that it will not
be required to incur significant costs to comply with such laws and regulations
in the future, or that such  laws or regulations will not have a material
adverse effect upon its business, financial conditions, results of operations,
or cash flows.

EUROPE

        In order to market and sell the Jacobson Resonator or any future
products in foreign markets, the Company must comply with foreign government
regulations. These laws differ substantially from country to country. In order
to market and sell the Jacobson Resonators in the European Union, the resonators
must bear CE Marking, which it hasdone so effective December 2000. The actual
CE Marking consists of the letters "CE" which a manufacturer affixes to its
products for access to the European market; the letters "CE" are an abbreviation
of the French phrase "Conformite Europeene." CE Marking on a medical device
indicates that a manufacturer has complied with all of the requirements of the
Medical Device Directive.  The Company's CE Marking license is 2001-01-0303 CP.

        The Essential Requirement require every non-European medical device
manufacturer exporting to Europe to appoint an Authorized European Address, or
agent, to ensure that the responsibility for compliance with Medical Device
Reporting is delegated to a party who resides in Europe and is subject to
European law. The authorized European agent serves as an interface between a
manufacturer and governmental authorities and must verify whether the
manufacturer is in compliance with the European vigilance system, which covers
both post-market surveillance and adverse-incident reporting. The selection of
an authorized European agent by a manufacturer is significant because
the agent is required to have access to all confidential product documentation
and master files of the manufacturer. The Company has selected Serrato
Enterprises, LLC of Spain and Serrato Europe, located in Geneva, Switzerland,
entities controlled by Alfonso Serrato, a director of the Company, to function
as its authorized representative, manufacturer and licensee.

        The Medical Device Directive classifies all medical devices into one of
four classes, based upon a risk analysis which considers the design, method of
manufacturing and intended use of a medical device. Class I is comprised of the
least dangerous devices, and is subject to less restrictions than Class III,
which is comprised of the most dangerous devices. Between Classes I and III are
Class IIa and Class IIb. The Class of a medical device determines  "Conformity
Assessment Procedure," or the procedure by which conformity with Essential
Requirements will be assessed. A procedural option for minimal risk devices
includes self-certification, where the manufacturer itself prepares a
"Declaration of Conformity" to the Essential Requirements and self-affixes the
CE Marking to the device. Higher risk devices, on the other hand, require that
the assessment be performed and certified for "quality assurance" in
collaboration with a recognized European "notified body."  The clinical
Jacobson Resonators are considered Class IIb, which is a moderate risk
classification.  As such, limited third-party assessment is required.

        Members of the European Union must accept CE Marking for marketing
medical devices without imposing further requirements related to product safety
and performance. However, National Competent Authorities, which are required
to enforce compliance with the requirements of the Medical Device Directive,
can restrict, prohibit, and recall devices with CE Marking if considered unsafe.
Such a decision must be confirmed by the European Commission to be valid.
Member countries may impose additional requirements as long as they do not
violate the Medical Device Directive or constitute technical barriers to trade.

        The Company cannot say with certainty that the European Union or any
foreign regulatory authority will grant CE Marking privileges to its future
products in a timely manner, if at all. If the Company experiences delays
or failure in obtaining such approvals, or if previously granted approvals are
rescinded, or if the Company fails to comply with existing or future regulatory
requirements, then its business, financial condition, results of
operations and cash flows will be materially and adversely affected.

RESEARCH AND DEVELOPMENT

        Current university studies of the effects of Jacobson Resonance upon
biological systems consist of the following:

         1.       Alzheimer's Disease - Mississippi Baptist Health Systems
                  Hospitals is currently conducting a clinical study, "The
                  Utilization of Low Frequency Pico Tesla Range Magnetic Fields
                  for Treatment Symptom of Patients With Alzheimer's Disease,"
                  under the supervision of James L. Parker, M.D.,
                  Board Certified Diplomat in Neuro-Opthalmology and Neurology.
                  Pre-clinical studies have shown that
                  the Jacobson Resonator can affect the regeneration of damaged
                  neuronal cells.

         2.       Nerve repair, growth and regeneration - Cornell University
                  Medical College in New York City has completed in vitro
                  sciatic nerve studies in mice, which demonstrated that
                  application of Jacobson Resonance stimulated growth, repair
                  and regeneration of damaged sciatic nerves of mice. Jacobson
                  Resonance especially enhanced the growth, repair and
                  egeneration of the myelin sheath without disturbing the
                  integrity of the cellular and subcellular structures. Similar
                  in vitro studies are ongoing in mice. The principal
                  investigator is Dr. Brij Saxena, a Professor of Endocrinology
                  and Biochemistry at the college, the Director of the Division
                  of Reproductive Endocrinology in the Department of Obstetrics
                  and Gynecology at Cornell Medical Center /New York Hospital,
                  and a member of the Company's Scientific Advisory Board.

         3.       Nerve regeneration - A study on the effect of Jacobson
                  Resonance upon a chemically induced motor neuropathy model in
                  mice is ongoing at Cornell University Medical College and
                  Fairleigh Dickinson University. The principal co-investigators
                  are the husband and wife team of Dr. Brij Saxena and Dr.
                  Anjali Saxena, Professor of Biology and a neuro-scientist at
                  Fairleigh Dickinson University. Positive data has been
                  demonstrated in vitro and in vivo.

         4.       Cardiac Pacing - The Department of Cardiovascular Research of
                  the University of Oklahoma Health Sciences Center is
                  conducting studies in dogs and has determined that Jacobson
                  Resonance is effective in the treatment of cardiac arrhythmia
                  in dogs. The principal co-investigators are Dr. Benjamin
                  Scherlag, Research Director of the Cardiovascular Laboratory,
                  and Dr. William Yamanashi, Research Professor of Medicine and
                  a Medical Physicist. Drs. Scherlag and Yamanashi are both
                  members of the Company's Scientific Advisory Board.

         5.       Angina - Quantitative pain studies in rats to determine
                  whether Jacobson Resonance can reduce angina are occurring at
                  the University of Oklahoma Medical School. The initial data
                  appears promising. The principal investigator is Dr. Robert
                  Foreman, Chairman of Physiology.

         6.       Vegetable growth enhancement - The Vegetable Improvement
                  Center of Texas A&M University conducted a pilot study in
                  late 1998 of the effects of resonated spring water on growth
                  and fruiting of yellow crookneck squash.  Because of the
                  promising results of this study, the center conducted a second
                  study involving cucumber, radish and squash in 1999. The
                  results remain promising and studies will continue. The
                  principal investigator is Dr. Leonard Pike, the Director of
                  the Vegetable Improvement Center.

         7.       Epilepsy - A double blind and randomized clinical pilot study
                  was recently completed at the University of Oklahoma Health
                  Sciences Center to determine whether Jacobson Resonance can
                  reduce the frequency and severity of epileptic seizures. The
                  principal investigator was Dr. Kalarickal J.Oommen, Associate
                  Professor of Neurology and Director of Epilepsy Research. The
                  data from the study appears promising and the double blind
                  clinical trials are ongoing.

         8.       Cancer - In early October 1999, the Company announced that the
                  Veterinary Pharmacology Research Laboratory at Mississippi
                  State University has begun in vitro cancer research using the
                  22-inch clinical model of the Jacobson Resonator. The research
                  will evaluate the influence of electromagnetic fields in the
                  pico tesla range of strength upon cancer cells. The principal
                  investigator is Dr. Cody Coyne.

         9.       Osteoarthritis - A double blind randomized clinical study is
                  ongoing at Mississippi State University. The principal
                  investigator is John Lamberth, Ph.D. of the University's
                  Department of Health, Physical Education, Recreation and
                  Sports.

         10.      Osteoarthritis, Osteoporosis and Wound Healing - A basic
                  science study, entitled "Analgesic Effect of Low Level
                  Electromagnetic Fields on Osteoarthritic Knees: Determination
                  of Underlying Biological Mechanisms," is ongoing at
                  Mississippi State University, in vitro, to examine the effects
                  of Jacobson Resonance on chondrocytes and other molecules
                  significant to osteoarthritis, osteoporosis
                  and wound healing. The principal investigator is Steven H.
                  Elder, Ph.D. of the University's Agricultural and Biological
                  Engineering Department.

         During the years ended December 31, 2000 and 1999, the Company spent
$190,895 and $280,550, respectively, on research and development activities.
Since the Company's inception on June 4, 1996 through December 31, 2000, the
Company has spent a total of $952,381 on research and development activities.
During the fiscal year 2001 the Company expects to spend  approximately $460,000
during the year in research and development.

INTELLECTUAL PROPERTY

         The Company is the exclusive licensee of Jacobson Resonance from Dr.
Jacobson, who is the sole owner of all patents issued or pending. Dr. Jacobson
is also the majority owner of all relevant Jacobson Resonance intellectual
property. The Company has the exclusive rights to pursue whatever applications
of Jacobson Resonance that it wants. In return, the Company is obligated to pay
Dr. Jacobson, via employment agreement, a royalty on revenues, depending
upon the application.

         Legal standards relating to the validity of patents covering medical
devices and biotechnological inventions and the scope of claims made under such
patents are still developing. For this reason, the Company cannot guarantee
any of the following:

         1.   that patent applications will result in the issuance of patents in
              foreign countries;

         2.   that any patents licensed to the Company will be free from
              challenge and that if challenged, they
              would be held to be valid;

         3.   that any such patents will provide commercially significant
              protection to the Company's technology, products, and processes;
              or

         4.   that others will not develop substantially equivalent proprietary
              information that is not covered by patents to which the Company
              has rights, or that others will not otherwise obtain access to the
              Company's know-how.

         The Company has not received any notices alleging, and is not aware of,
any infringement by the Company of any other entity's patents. However, because
of the volume of patents issued and patent applications filed relating to
medical devices, the Company cannot guarantee that current and potential
competitors and other third parties have not filed or will not file patent
applications, or have not received or will not receive patents, relating to
materials or processes it uses or propose to use. Accordingly, the Company
cannot guarantee that its products do not infringe any patents or proprietary
rights of third parties.

         If another party claims subject matter identical to or overlapping with
subject matter Dr. Jacobson has claimed in a United States patent or patent
application, the Company may decide or be required to participate in
interference proceedings in the United States Patent and Trademark Office to
determine priority of invention. Loss of such an interference proceeding would
deprive the Company of patent protection sought or previously obtained by
Dr. Jacobson. Participating in such proceedings could result in substantial
costs, regardless of whether the eventual outcome is favorable.

         In addition to patent protection, the Company relies on trade secrets,
proprietary know-how, and confidentiality and assignment of invention agreements
with its consultants and medical advisors to protect its intellectual property.
The Company cannot say with certainty that any intellectual property that it has
will provide it with a competitive advantage or will not be challenged or
circumvented by its competitors. The Company cannot say with certainty that its
confidentiality and assignment of invention agreements will not be breached or
that it would have adequate remedies for any such breach. Finally, the Company
cannot say with certainty that its proprietary know-how and intellectual
property will not become known or be independently discovered by others.

         Litigation may be necessary to defend against claims of infringement,
to enforce patents and copyrights issued or licensed to the Company, or to
protect trade secrets. If the Company must litigate such issues, it may be
forced to incur substantial costs and to devote substantial resources and time.
The Company furthermore cannot guarantee that it would prevail in such
litigation, should it arise. In addition, if any relevant claims of third-party
patents are upheld as valid and enforceable, the Company could be prevented from
selling its products or otherwise be required to obtain licenses from the owners
of such patents. The Company cannot guarantee that such licenses would be
available, or, even if available, would be on acceptable terms to it. If the
Company is forced to incur substantial costs in litigation or fails to obtain a
license, its business, financial condition, results of operations, and cash
flows may be materially and adversely affected.

COMPETITION

         The development of electromedical and electrotherapeutic medical
devices that can emit a weak electromagnetic field in resonance with the human
body's electromagnetic field is in its infancy. To the Company's knowledge,
there are only two groups of scientists in the world that are dealing with the
pico tesla magnetic fields.

         One group is at Democrition University of Trace, Alexandroupolis,
Greece. They are primarily engaged in research, but some treatment is being
performed for epilepsy and Parkinson's Disease. The supervising professor is
Dr. Photios Anninos, the Director of Medical Physics for Democrition University,
who is also a member of the Company's Scientific Advisory Board.

         The only other known party working on force-fields this weak is Dr.
Reuven Sandyk, a medical physician in Long Island, New York. Dr. Sandyk is a
neurologist and he has been treating patients with Parkinson's, Alzheimer's
and Multiple Sclerosis. To the Company's knowledge, Dr. Sandyk has not secured
an FDA registration number for his resonator device and does not appear to be
inclined to go into commercial production with this apparatus. His
resonator is merely an extension of his neurological practice.

         Both Dr. Sandyk and Dr. Anninos engage in exploratory research as an
extension of their respective practices. Dr. Sandyk, the only U.S.-based group,
does not appear to be inclined to navigate the time-consuming and expensive
route of securing FDA approval for his apparatus, which is a mandatory
precondition for pursuing commercial production of the device. Dr. Anninos,
on the other hand, limits his focus predominantly to epilepsy. Both Dr. Sandyk
and Dr. Anninos employ devices with multiple small coils producing heterogeneous
fields which, in the opinion of Dr. Jacobson, is not the correct approach.
         Dr. Richard Markoll has established around the world about 150 clinics
focusing primarily on the treatment of osteoarthritis using magnetic
force-fields that are approximately one million to ten million times more
powerful than the force-fields emitted by the Jacobson Resonator. Dr. Markoll
seems to be content with limiting himself to this area. These clinics have been
in operation for many years. Dr. Markoll has secured a CE Mark but he has not
obtained FDA approval.

         Finally, there is a company in Japan called Nikken, which produces
permanent magnets. These are very strong magnets which emit force-fields that
are millions and even billions of times stronger than the force-fields emitted
by the Jacobson Resonator. These magnets claim to improve circulation or to
treat pain. To the Company's knowledge, these claims have not been medically
substantiated and the FDA has never passed on the validity of these treatments.
The Company does not regard these permanent magnets as a true competitor.

         In sum, the Jacobson Resonator does not appear to face direct
competition in either the United States of America or abroad.

EMPLOYEES

         The Company has five full-time employees, three of whom are executive
officers. They are Dr. Jerry I. Jacobson, Ms. Debra Jacobson and Mr. Frank
Chaviano. The Company also has four part-time sales, marketing and financial
consultants. There are no collective bargaining agreements and no employment
contracts in force.

ITEM 2.  DESCRIPTION OF PROPERTY

         The Company is currently leasing office space in Boynton Beach,
Florida, on a five-year lease basis, and in Juno Beach, Florida, pursuant to a
lease that will expire on August 31, 2001. The Boynton Beach office has 4,300
square feet of space and a current annual rent of approximately $73,000. The
Juno Beach office has 350 square feet of space and a current annual rent of
approximately $14,000.

ITEM 3.  LEGAL PROCEEDINGS

         The Company, via press release on March 9, 2001, has reported that the
intellectual property six year dispute and litigation between Dr. Jerry
Jacobson, Chairman of the Board of JRSE and largest stockholder, and Messieurs
Eric Hewko and Patrick Casey has concluded.  An outside settlement was reached
on March 2, 2001.  Dr. Jacobson had filed for personal bankruptcy and on
December 6, 2000, this case was dismissed.

         Under the terms of the settlement agreement, Dr. Jacobson continues to
retain controlling and majority interest in JRSE, a new five year employment
agreement with JRSE has been put in place and exclusive licensing rights on any
pending, issued or in progress patents are to go to JRSE.  In  addition, Dr.
Jacobson was required to give an aggregate of 12 million shares,  one percent
(1%) of future royalties and one million dollars to Messrs. Hewko and Casey.
(The million dollars is the responsibility of both the Company
and Jacobson.)

         Messrs. Hewko and Casey also assigned any and all intellectual property
rights of a patent (Therapeutic Treatment of Mammals) in perpetuity to the
\Company for an aggregate of three  million warrants issued as payment
consideration (value) of their one third  ownership interest. Dr. Jacobson
received six million warrants under the same terms for his two-thirds ownership
interest. The warrants are exercisable  at a price of $0.30 until April 6, 2008
at which time the warrants will expire  if not exercised. The warrants are
subject to certain anti-dilution provisions which shall cause the warrants to be
adjusted. Such dilution events  include merger, consolidation, recapitalization,
reorganization,  reclassification, stock split or stock dividend. As of the date
hereof, none of these events have occurred so as to cause an adjustment to the
warrants issued  pursuant to the Stock Warrant Agreement.

         Additionally, the Company further received from Dr. Jacobson and
Messrs. Hewko and Casey any and all additional indications and methodologies
relating to the patent worldwide and US Patent 5,198,181 from Dr. Jacobson
which relates to the use of resonance technology to control Thermo Nuclear
Fusion power has also been granted to JRSE.

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

         During the fourth quarter of the fiscal year covered by this report,
no matters were submitted to a vote of security holders through the solicitation
of proxies or otherwise.


                                     PART II

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED SHAREHOLDER MATTERS

         The Company's Common Stock is traded on the OTC Bulletin Board(R) under
the Symbol "JRSEOB." The following table sets forth the range of the high and
low sales prices for the Common Stock on the OTC Bulletin Board(R) for
each calendar quarter of 2000 and 1999. The source of the following information
is America Online (AOL) quotation services. These prices reflect inter-dealer
prices, without retail markup, mark-down or commission and may not
represent actual transactions.

      QUARTER ENDING                     HIGH                       LOW

      December 31, 2000                  $0.62                     $0.16
      September 30, 2000                 $0.97                     $0.37
      June 30, 2000                      $2.06                     $0.59
      March 31, 2000                     $3.62                     $1.37

      December 31, 1999                  $0.34                     $0.13
      September 30, 1999                 $1.56                     $0.23
      June 30, 1999                      $3.12                     $1.53
      March 31, 1999                     $2.60                     $0.21

         As of April 3, 2001, the Company had 681 shareholders of record.

         The Company has not declared or paid any dividends on its Common Stock.
The Company currently intends to retain future earnings to fund the development
and growth of its business, and therefore does not anticipate paying any cash
dividends in the foreseeable future. Any future determination to declare and pay
dividends will be made by the Board of Directors of the Company in light of the
Company's earnings, financial position, capital requirements, credit agreements
and such other factors as the Board of Directors deems relevant.

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

         Certain statements contained in this report, including, without
limitation, statements containing the words "believes," "anticipates," "expects"
and words of similar import constitute "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act of 1995.
Such forward-looking statements involve known and unknown risks and
uncertainties. The Company's actual results may differ materially from those
anticipated in these forward-looking statements as a result of certain factors,
including the success and subsequent acceptance of new medical research and
development; the regulatory framework of the health care industry; the Company's
ability to create, sustain, manage or forecast its growth; its ability to
attract and retain key personnel; its ability to protect technology; changes in
its business strategy or development plans; competition; demographic changes;
business disruptions; adverse publicity; and international, national and local
general economic and market conditions.

PLAN OF OPERATION

         The Company is in the development stage and anticipates receiving
revenues from licensing operations in the 2nd quarter of 2001. It incurred
losses of $3,941,952 and $3,657,966 for the years ended December 31, 2000 and
1999, respectively.  It has incurred losses of $9,159,838 since its inception in
1996.  Of that amount, $4,199,016 represents the non-cash expense resulting from
the issuance of common stock and options to purchase common stock to members of
the Company's management and third parties for services rendered and interest.

2000 Operations Compared to 1999

         The net loss increased by approximately $284,000, from 1999 to 2000
primarily as a result of an increase in payroll costs of approximately $300,000.
Other significant items include settlement costs aggregating $1,870,000 in
2000 relative to patent litigation of Dr. Jacobson that the Company has
etermined that it was in the best interest of the Company to bear responsibility
for such costs. In 1999, approximately $2,000,000 was attributable to the
value of options and warrants issued in connection with debt.

         In early May 2000, the Company launched its marketing campaign for
resonated drinking products at The Brett Favre Forward Foundation Charity
Celebrity Golf Tournament in Biloxi, Mississippi. Brett Favre is the official
spokesperson for the resonated Spring Water and Real-Pro Hi-Energy Sports Drink
produced by RealPure Beverage Group, LLC, a licensee of the Company. The Company
has begun receiving limited royalties from RealPure. At the end of August 2000,
at the Company's annual shareholders meeting in Las Vegas, Nevada, the President
of RealPure Beverage Group, Mr. David Cox, provided the Company with marketing
and distribution plans covering 2001 product development and distribution
efforts. Of particular interest would be the introduction during 2001 of a
pediatric supplement beverage to aid newborns and infants in the assimilation
and digestion of food as well as to provide energy and reduce gas.

         In addition, the Company received approval and CE Mark from the
European Union, thus allowing distribution and commercialization of its
resonators for chronic pain of the knee (including arthritis) indications. The
Company has also received approval by Health Canada in November 2000, allowing
the Company to begin commercialization initiatives in Canada. The first medical
centers in Canada are expected to be operational by the end of 1st quarter
of 2001.  Additional health clearances and approvals have been granted and
received by the Company for use and distribution of resonators in Australia,
Mexico, Finland and Norway. It also expects FDA approval of its 18-inch
clinical Jacobson Resonator sometime in mid 2001 for treatment of chronic pain
from osteoarthritis of the knee, and treatment of the entire spectrum of chronic
pain sometime in late 2001 or early 2002. Receipt of this approval will
allow the Company's distribution network to make, market, distribute and sell
those clinical products on a commercial basis in the United States of America.
In other news, the Company's agricultural and aquacultural initiatives have
shown tremendous potential and interest in the Pan Asian market. As a result,
the Company is working on licensing and joint venture opportunities in the
region, from which is expects to generate additional revenue. Research at Texas
A&M University, Mississippi State University and the University of Oklahoma have
shown positive results that Jacobson Resonance Technology can beneficially
affect the growth cycle of vegetables and fruits. The foregoing combination of
events is expected to generate ongoing revenue for the Company and therefore
bring it out of the development stage into the operating stage during the middle
of 2001.

         Other possible sources of revenue for the Company during 2001 include
          the following:

         1.       Licensing revenue from a larger medical products company for
                  the development, marketing and distribution rights in
                  connection with the use of Jacobson Resonance in the treatment
                  of cardiac arrhythmia. The Company thinks that interest in
                  such licensing arrangement will be generated by the
                  publication of the results of the completed research in
                  cardiac pacing at the University of Oklahoma Health Sciences
                  Center that Jacobson Resonance is effective in the treatment
                  of cardiac arrhythmia on dogs.

         2.       Licensing revenue from Genesis Group International ("GGIC")
                  for the use of Jacobson Resonance in  the development,
                  distribution, marketing and sale of GGIC's all-natural and
                  resonated family of nasal sprays worldwide. The Company signed
                  a letter of intent with GGIC in February 2000.

         3.       Licensing revenue from O2 Marketing Group, Inc., a
                  manufacturer of consumer-oriented oxygen products for the
                  cosmetics, nutraceutical and pharmaceutical industries, for an
                  exclusive license to use Jacobson Resonance for not less than
                  ten years covering the Republic of South Africa. The
                  Company has a letter of intent with O2 and is currently
                  negotiating a definitive license arrangement.

         4.       Licensing revenues from Palmer Natural Products, Inc. and
                  Perfect Living Systems, Inc., two nutraceutical laboratories
                  and formulary companies located in souther California. These
                  companies plan to use Jacobson Resonance technology and
                  equipment on the formulary of multiple nutraceuticals, as well
                  as client-specific products, for manufacture, marketing,
                  distribution and sale. The Company signed a letter of intent
                  with these companies in April 2000.

         5.       Licensing revenue from existing licensee for
                  building/construction and the environment from Enviro
                  Brick and Block Ltd. The Company has had a signed licensing
                  exclusive agreement since August 2000.

         6.       Licensing revenue from Comercializadora de Calidad S.A. of
                  Guatemala, for the distribution of resonators and the
                  establishment of treatment centers throughout Panama, El
                  Salvador, Costa Rica and Guatemala. The Company signed a
                  letter of intent with the Guatemalan distributor in March 2000.
         7.       Increases in revenue from its existing licensees for the
                  clinical Jacobson Resonators because of additional FDA
                  approvals and CE Marking. The Company also plans to seek CE
                  Marking of the other two clinical models of the Jacobson
                  Resonator. These approvals would broaden the product line in
                  both the United States of America and Europe, and would
                  broaden applications for the clinical Jacobson
                  Resonators in the United States of America.

         The Company will continue both use and product research and development
for Jacobson Resonance. The Company estimates that the currently ongoing
university research will require about $460,000 of the Company's funds for the
year 2001. It anticipates continued prototyping of additional models of the
Jacobson Resonator for varying uses if additional funds become available for
that purpose. It estimates that the costs to the Company of such prototyping
will be approximately $150,000.

LIQUIDITY AND CAPITAL RESOURCES AS OF DECEMBER 31, 2000

         The Company's cash on hand at December 31, 2000, was $218,770, as
compared to $579,518 at December 31, 1999. Revenues for 2000 were $31,590, as
compared to $22,021 for 1999. The Company had a net loss of $3,941,952 for
2000, as compared to a net loss of $3,657,966 for 1999, an increase of $283,986
Approximately $2,000,000 relates to non-cash financing costs as a result of the
Company's sale of convertible debentures and warrants to purchase common
stock in early June 1999. In 2000, the Company incurred costs of approximately
$1,870,000 of settlement costs relating to patent litigation of Dr. Jacobson.
This decrease was offset by an increase in payroll costs of approximately
$300,000.

         The Company's primary source of funds during 1999 was a private
offering of $999,100 in original principal amount of 2% Convertible Debentures
Due June 2, 2004, and warrants to purchase 900,000 shares of its common stock at
$.001 per share. The debentures were convertible at the option of the holders at
any time into shares of common stock at the lesser of (1) $3.00 per share or (2)
75% of the average closing bid price per share for the five trading days
immediately preceding the conversion date, subject to a minimum conversion price
of $0.50 per share. Interest on the debentures was payable at conversion or
maturity in the form of either cash or shares of common stock, at the option of
the Company. The Company received net offering proceeds of $891,390. All of the
debentures, plus accrued interest, were converted into 1,862,876 shares of
common stock and all of the warrants were exercised during 1999.

         Since the beginning of 2000, the Company has received approximately
$1,218,000 from the sale of securities and the exercise of stock options. During
the first quarter of 2001, the Company received proceeds from the sale of
stock of $105,000. The Company anticipates that its existing resources will be
sufficient to fund its plan of operation through 2001. By the latter part of
2001, the Company expects to be generating sufficient revenue to fund its plan
of operation.  However, if the Company by that time is not generating any
revenue or is generating insufficient revenue for such funding, then the Company
may have to seek additional funds through either debt or equity financing. The
Company's financial statements include an explanatory paragraph about the
Company's ability to continue as a going concern.

ITEM 7.  FINANCIAL STATEMENTS

         Financial Statements contained in this report reflect no change from
the preceding year in any accounting principles or practices or in the method of
application of those principles or practices.


JACOBSON RESONANCE ENTERPRISES, INC.
                          (a development stage company)


                                    CONTENTS
--------------------------------------------------------------------------------

                                                                           F-1
Independent Auditor's Report                                               F-2

Financial Statements:

   Balance Sheet                                                           F-3
   Statement of Operations                                                 F-4
   Statement of Changes in Stockholders' Equity (Deficiency)           F-5 - F-6
   Statement of Cash Flows                                                 F-7
   Notes to Financial Statements                                      F-8 - F-17



INDEPENDENT AUDITOR'S REPORT




To the Board of Directors
Jacobson Resonance Enterprises, Inc.


We have audited the accompanying  balance sheet of Jacobson  Resonance Inc.
(a development stage company) as of December 31, 2000, and the related
statements of operations, stockholders' equity (deficiency), and cash flows
for each of the two years in the period then ended. These financial statements
are the responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with 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
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 audit provides a
reasonable basis for our opinion. In our opinion, the financial statements
referred to above present fairly, in all material respects, the financial
position of Jacobson Resonance Enterprises, Inc. as of December 31, 2000 and the
results of its operations and its cash flows for each of the two years in the
period then ended in conformity with accounting principles generally accepted in
the United States of America.

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 1 to the
financial statements, the Company has suffered recurring losses and has no
significant revenue from operations which raise substantial doubt about its
ability to continue as a going concern. Management's plan in regard to these
matters is also described in Note 1. The financial statements do not include
any adjustments that might result from the outcome of
this uncertainty.


GOLDSTEIN GOLUB KESSLER LLP
New York, New York

February 28, 2001




                      JACOBSON RESONANCE ENTERPRISES, INC.
                         A DEVELOPMENT STAGE ENTERPRISE
                                  BALANCE SHEET
                                December 31, 2000

                                                            ASSETS

CURRENT ASSETS
    Cash and Cash Equivalents                                                                                       $   218,770

    Accounts Receivable
                                                                                                                         21,688
    Due from Officer/Shareholder
                                                                                                                         50,000
    Prepaid Expenses and Other
                                                                                                                         42,237
                                                                                                                         ------

        Total Current Assets
                                                                                                                        332,695

Property and Equipment, at Cost,  (Net of
    Accumulated Depreciation of $56,438)
                                                                                                                        188,830

Deposits
                                                                                                                          1,395
Due from Officer/Shareholder, Net of Allowance for Doubtful Amounts of $200,000
                                                                                                                              -
Deferred Income Tax Asset, Net of Valuation Allowance of $  1,968,000
                                                                                                                              -
                                                                                                                         -------
        Total Assets                                                                                                $   522,920
                                                                                                                    ===========

                                           LIABILITIES AND STOCKHOLDERS' DEFICIENCY

CURRENT LIABILITIES
    Accounts Payable and Accrued Expenses                                                                           $   175,350
    Litigation Settlement Payable
                                                                                                                      1,000,000
    Deposits on Common Stock to be Issued
                                                                                                                         69,397
                                                                                                                         ------

        Total Current Liabilities
                                                                                                                      1,244,747

Commitments and Contingencies

STOCKHOLDERS' DEFICIENCY
    Preferred Stock $.001 Par Value, 5,000,000 Shares Authorized;
        Issued and Outstanding, 30,000 Shares
                                                                                                                             30
    Common Stock, $.001 Par Value, 300,000,000 Shares Authorized;
        Issued and Outstanding, 54,815,336
                                                                                                                         54,815
    Additional Paid in Capital
                                                                                                                      8,427,840
    Deficit Accumulated During the Development Stage                                                                (9,159,838)
                                                                                                                    -----------


                                                                                                                      (677,153)
                                                                                                                      ---------

    Common  Stock in Treasury, at cost (600,000 Shares)
                                                                                                                          (600)
    Subscriptions Receivable
                                                                                                                       (44,074)
                                                                                                                       --------

        Stockholders' Deficiency
                                                                                                                      (721,827)
                                                                                                                      ---------

        Total Liabilities and Stockholders' Deficiency                                                             $   522,920
                                                                                                                   ===========







                      JACOBSON RESONANCE ENTERPRISES, INC.
                         A DEVELOPMENT STAGE ENTERPRISE
                            STATEMENTS OF OPERATIONS



                                                                                                              For the Period
                                                                                                                   From
                                                                                                               June 4, 1996
                                                                                                               (Inception)
                                                                        For the Year Ended                          To
                                                                           December 31,                     December 31, 2000
                                                             -----------------------------------------    -----------------------
                                                                    2000                  1999                 (unaudited)
                                                             -------------------    ------------------

REVENUE                                                             $   31,590            $   22,021               $    178,743
                                                                    -----------           -----------              ------------

COSTS AND EXPENSES:
    General and Administrative                                        2,020,186             1,413,636                 4,654,592

    Research and Development                                            190,895               280,550                   952,381
    Settlement Costs                                                  1,870,000                    -                  1,870,000

    Financing Costs                                                       1,196             2,094,158                 2,095,704
                                                                    -----------           -----------              ------------



        Total Operating Expenses                                     4,082,277             3,788,344                 9,572,677
                                                                    -----------           -----------              ------------



Other Income
    Interest                                                            48,601                29,776                     95,381

    Gain of Sales of Resonance Equipment                                60,134                78,581                    138,715
                                                                    -----------           -----------              ------------

        Total Other Income                                            108,735               108,357                    234,096
                                                                    -----------           -----------              ------------

NET LOSS                                                           $(3,941,952)          $(3,657,966)             $  (9,159,838)
                                                                    ===========           ===========              =============

PER SHARE INFORMATION:

Net Loss Per Share:
    Basic                                                           $    (0.08)           $    (0.11)
                                                                    ===========           ===========
    Diluted                                                         $    (0.08)           $    (0.11)
                                                                    ===========           ===========
Shares Used to Compute Net Loss Per Share
    Basic                                                           48,449,884            34,120,883
                                                                   ===========            ==========
    Diluted                                                         48,449,884            34,120,883
                                                                   ===========            ==========



                      JACOBSON RESONANCE ENTERPRISES, INC.
                         A DEVELOPMENT STAGE ENTERPRISE
            STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIENCY)
               For the Period from Inception to December 31, 2000




                                                       COMMON STOCK                           PREFERRED STOCK
                                         ---------------------------------------- ---------------------------------------
                                               ISSUED               AMOUNT              ISSUED              AMOUNT
                                         ------------------- -------------------- ------------------- -------------------

Issuance of Founders Stock at

    Par $.001                             57,220,000           $57,220                  -               $    -


Recapitalization - June 4, 1996
                                           4,905,000            4,905                   -                    -

Issuances of Common Stock at $.10
    Per Share
                                          10,000,000           10,000                   -                    -

Issuances of Common Stock at $1.750
    Per Share
                                              18,857               19                   -                    -

Purchase of Treasury Stock at Cost
                                                  -                -                    -                    -

Conversation of Common Stock to
                                         (45,000,000)         (45,000)              45,000                   45
    Preferred Stock

Net Loss
                                                  -                -                   -                     -


Balance, December 31, 1996 (unaudited)    27,143,857         $ 27,144               45,000               $  45


Issuance of Common Stock for
    Services Rendered at Prices
    Between $.15 and $1.75 Per Share
                                              40,114               40                  -                    -

Issuances of Common Stock from
    Private Placement at Prices
    Between $.15 and $.25 Per Share
                                             760,000              760                  -                    -

Issuances of Common Stock out
of Proceeds of Subscription
    Receivable
                                                  -                -                   -                    -

Net Loss
                                                  -                -                   -                    -


Balance, December 31, 1997 (unaudited)    27,943,971          $ 27,944             45,000               $   45





                          DEFICIT
                         ACCUMULATED
     ADDITIONAL            DURING                                                       STOCKHOLDERS'
      PAID-IN            DEVELOPMENT         SUBSCRIPTION           TREASURY                EQUITY
      CAPITAL               STAGE             RECEIVABLE             STOCK               (DEFICIENCY)
-------------------- -------------------  ------------------- -------------------- ------------------------



  $    (57,220)       $       -              $       -              $       -             $       -


        (4,905)               -                      -                      -                     -


        990,000               -                (526,550)                    -                473,450


         32,981               -                       -                     -                 33,000


              -               -                       -                   (600)                 (600)


         44,955               -                       -                     -                     -


             -          (292,325)                     -                     -               (292,325)

   $  1,005,811       $ (292,325)             $ (526,550)            $    (600)         $    213,525



         12,744               -                       -                     -                 12,784


        139,240               -                       -                     -                140,000


              -               -                    5,000                    -                  5,000


              -         (315,319)                     -                     -               (315,319)

   $  1,157,795       $ (607,644)             $ (521,550)            $    (600)         $     55,990





                      JACOBSON RESONANCE ENTERPRISES, INC.
                         A DEVELOPMENT STAGE ENTERPRISE
            STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIENCY)
               For the Period from Inception to December 31, 2000



                                                             COMMON STOCK               PREFERRED STOCK

                                                          ISSUED        AMOUNT        ISSUED        AMOUNT

Balance, December 31, 1997 (unaudited)                  27,943,971    $  27,944      $  45,000         45


Reacquisition of Common Shares and
    Collection of Subscription Receivable               (3,000,000)      (3,000)            -          -

Cash Collection of Subscription Receivable                      -            -              -          -

Issuance of Common Stock from Private
    Placement at a Price of $.15 per Share               4,675,850        4,676             -          -

Issuance of Common Stock from Private
    Placement at a Price of $.35 per Share               2,017,999        2,018             -          -

Issuance of Common Stock for Services
    Rendered at Prices between $.15 and $.35
    Per Share                                              663,223          663             -          -

Fair Value of Options Issued to Consultants                     -            -              -          -

Net Loss                                                        -            -              -          -

 Balance December 31, 1998                              32,301,043       32,301         45,000         45

Issuance of Common Stock for Services
    Rendered at Prices between $.18
    and $2.69 per Share                                  1,313,903        1,314             -          -

Issuance of Common Stock for
    Repayment of Debt                                      291,305          291             -          -

Issuance of Common Stock for
    Conversion of Warrants                                 900,000          900             -          -

Sales of Shares at $.20 per Share                          500,000          500             -          -

Beneficial Conversion Feature on Convertible
Debentures                                                      -            -              -          -

Issuance of Common Stock for
    Conversion of Debentures                             1,862,876        1,863             -          -

Net Loss                                                        -            -              -          -

 Balance December 31, 1999                              37,169,127       37,169         45,000         45

Issuance of Common Stock for Services

  Rendered at Prices between $.21 and $1.52
per Share                                                  385,342          385             -          -


Sales of Shares a $.13 to $.65 per Share                 2,120,867        2,121             -          -


Fair Value of Options Issued to Consultants                     -            -              -          -

Fair Value of Options Issued on Settlement                      -            -              -          -

Issuance of  Common Stock for Exercise of
Options                                                    140,000          140             -          -

Issuance of Common Stock Upon Conversion of
  Preferred Stock                                       15,000,000       15,000        (15,000)       (15)

Net Loss                                                        -            -              -          -

Balance December 31, 2000                               54,815,336      $54,815         30,000      $  30
                                                       ============   ===========   ============   ===========




                          DEFICIT
                         ACCUMULATED
     ADDITIONAL            DURING                                                       STOCKHOLDERS'
      PAID-IN            DEVELOPMENT         SUBSCRIPTION           TREASURY                EQUITY
      CAPITAL               STAGE             RECEIVABLE             STOCK               (DEFICIENCY)
-------------------- -------------------  ------------------- -------------------- ------------------------


 $  1,157,795           $ (607,644)           $  (521,550)        $ (600)                 $  55,990




    (450,000)                   -                 450,000             -                     (3,000)


          -                     -                  27,476             -                     27,476



     659,294                    -                      -              -                    663,970



     690,156                    -                      -              -                    692,174




     176,415                    -                      -              -                    177,078


       2,063                    -                      -              -                     2,063


          -               (952,276)                    -              -                  (952,276)
   ------------         ------------               ------------   ------------        ------------


   2,235,723            (1,559,920)               (44,074)          (600)                 663,475




     420,375                    -                      -               -                  421,689



      60,883                    -                      -               -                   61,174



   1,754,100                    -                      -               -                1,755,000


      99,500                    -                      -               -                  100,000


     333,332                    -                      -               -                  333,332



     902,194                    -                      -               -                 904,057


          -             (3,657,966)                    -               -             (3,657,966)
 ------------         ------------               ------------   ------------        ------------


    ,806,107            (5,217,886)               (44,074)           (600)              580,761



     378,555                    -                      -               -                378,940


   1,095,497                    -                      -               -              1,097,618


     242,031                    -                      -               -                242,031


     870,000                    -                      -               -                870,000


      50,635                    -                      -               -                 50,775



     (14,985)                   -                      -               -                     -





          -             (3,941,952)                    -               -             (3,941,952)


 $ 8,427,840          $ (9,159,838)             $ (44,074)         $ (600)           $ (721,827)






                      JACOBSON RESONANCE ENTERPRISES, INC.
                         A DEVELOPMENT STAGE ENTERPRISE
                            STATEMENTS OF CASH FLOWS
                                                                                                                 For the Period From
                                                                                                                   June 4, 1996
                                                                                  For the Year Ended                 (Inception)
                                                                                      December 31,                      To
                                                                               2000                 1999          December 31, 2000
                                                                         ------------------  -----------------  --------------------
                                                                                                                    (unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES:
------------------------------------
    Net Loss                                                               $ (3,941,952)       $ (3,657,966)         $ (9,159,838)
    Adjustments to Reconcile Net Loss to Net Cash Flows
        From (Used in) Operating Activities:
            Depreciation                                                         34,990              13,707                56,438
            Amortization                                                             -                7,742                 7,742
            Allowance for Doubtful Amounts Due from Officer/Shareholder         200,000                  -                200,000
            Write off of Licensing Costs                                             -              126,582               126,582
            Fair Value of Common Stock Issued for Services Rendered             378,940             421,689               990,709
            Fair Value of Common Stock Issued for Interest Expense                   -                6,649                 6,781
            Stock Issued for Conversion of Warrants Attributed to Interest           -            1,754,100             1,754,100
            Beneficial Conversion Feature of Debentures                              -              333,332               333,332
            Fair Value of Options Issued                                      1,112,031                  -              1,114,094

        Changes is Operating Assets and Liabilities:
            Accounts Receivable                                                 (21,688)                 -                (21,688)
            Prepaid Expenses and Other                                          (10,920)            (10,683)              (42,237)
            Accounts Payable and Accrued Expenses                                27,196             104,378               175,350
            Litigation Settlement Payable                                     1,000,000                  -              1,000,000
            Deposits                                                                 -                2,600                (1,395)
                                                                            ------------           ------------        ------------

Net Cash Flows Used in Operating Activities                                  (1,221,403)           (897,870)           (3,460,030)
                                                                            ------------           ------------        ------------

CASH FLOWS FROM INVESTING ACTIVITIES:
-------------------------------------
    Purchase of  Property and Equipment                                       (107,135)            (121,898)             (245,268)
    Advances to Officers                                                      (250,000)                                  (250,000)
    Payment for Licensing Costs                                                     -               (34,784)             (126,582)
                                                                            ------------           ------------        ------------

Cash Flows Used in Investing Activities                                       (357,135)            (156,682)             (621,850)
                                                                            ------------           ------------        ------------

CASH FLOWS FROM FINANCING ACTIVITIES:
-------------------------------------
    Purchase of Treasury Stock                                                                           -                  (600)
    Proceeds from Note Payable                                                                           -                 60,000
    Proceeds from Issuance of Debentures                                                            890,490               890,490
    Proceeds from Exercise of Warrants                                                                  900                   900
    Proceeds from Exercise of Options                                           50,775                                     50,775
    Proceeds from Common Stock to be Issued                                     69,397                                     69,397
    Proceeds from Issuance of Common Stock
        From Subscription Receivable                                                                     -                653,976
    Proceeds from Issuance of Common Stock                                   1,097,618              100,000             2,575,712
                                                                            ------------           ------------        ------------

Net Cash Flows Provided by Financing Activities                              1,217,790              991,390             4,300,650
                                                                            ------------           ------------        ------------


Net Increase (Decrease) in Cash and Cash Equivalents                          (360,748)             (63,162)              218,770

Cash and Cash Equivalents - Beginning of Period                                579,518              642,680                    -
                                                                            ------------           ------------        ------------

Cash and Cash Equivalents - End of Period                                   $  218,770           $  579,518           $   218,770
                                                                            ============           ============        ============

NONCASH INVESTING AND FINANCING ACTIVITIES:
-------------------------------------------

    Issuance of Common Stock for Repayment of Debt                          $       -            $   60,000           $    60,000
                                                                            ============         ==============       ============

    Subscriptions Receivable for Issuance of Common Stock                   $       -            $       -            $   698,050
                                                                            ============         ==============       ============

    Conversion of Debentures into Common Stock                              $       -            $1,000,000           $ 1,000,000
                                                                            ============         ==============       ============












                      JACOBSON RESONANCE ENTERPRISES, INC.
                          (a development stage company)

                          NOTES TO FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

1.    OPERATION AND SUMMARY   The Company was incorporated on March 6, 1988
                              in the state of Nevada as Pioneer Services
      OF SIGNIFICANT          International, Ltd. ("Pioneer"). The Company is
                              in the development stage and its purpose was to
      ACCOUNTING POLICIES     locate suitable business ventures to acquire.  On
                              June 4, 1996, the board of directors of Pioneer
                              voted to acquire 100% of the outstanding shares of
                              Jacobson Resonance Machines, Inc. in exchange for
                              the issuance of 57,220,000 shares of its common
                              stock. The Company and Jacobson Resonance
                              Machines, Inc. had no activity prior to the
                              acquisition. In 1998, the Company changed its name
                              to Jacobson Resonance Enterprises, Inc.

                              As a result of the exchange of stock, the former
                              stockholders of Jacobson Resonance Machines,
                              Inc. owned 57,220,000 restricted common shares or
                              92% after the recapitalization of the Company.
                              Accordingly, this transaction was treated, for
                              financial reporting purposes, as a reverse
                              acquisition in which Jacobson Resonance Machines,
                              Inc. was recapitalized by providing 4,905,000
                              shares of Pioneer Services International, Ltd.
                              common stock to Pioneer's existing stockholders.
                              The 1996 stockholders' equity section reflects the
                              change in the capital structure due to the reverse
                              acquisition. As a result, $4,905 was transferred
                              to common stock from additional paid-in capital.

                              The Company is a bio-tech and  bio-medical
                              enterprise involved in the development of
                              resonance and electro-magnetic equipment,
                              process and applications.  Applications for
                              the use of resonance technology in the medical,
                              food, agricultural, recreational, pharmaceutical,
                              and environmental industries are currently being
                              pursued.

                              The Company is in the development stage and its
                              operations are subject to all of the risks
                              inherent in an emerging business enterprise. The
                              accompanying financial statements have been
                              prepared assuming the Company will continue as a
                              going concern. As shown in the financial
                              statements, the Company has a stockholders'
                              deficiency and has incurred losses of $3,941,952
                              and $3,657,966 for the years ended December 31,
                              2000 and 1999, and $9,159,838 since its inception
                              in 1996. The Company has had limited revenue
                              during those years. There is no assurance that the
                              Company will not encounter substantial delays and
                              expenses related to financing the successful
                              completion of its product development and
                              marketing efforts and/or other unforeseen
                              difficulties. The Company will be required to
                              expand its management and administrative
                              capabilities in order to manage the aforementioned
                              items as well as respond to competitive
                              conditions, and will require additional funds. The
                              Company may seek such funds through additional
                              equity financing, debt financing, collaborative
                              arrangement or from other sources.Such funds may
                              not be available on terms acceptable to the
                              Company. These factors indicate that the Company
                              may not be able to continue as a going concern.
                              Based on the Company's current plans and
                              assumptions, the Company believes its cash on-hand
                              and planned subsequent financing will be
                              sufficient to fund its anticipated operations
                              through fiscal 2001 and that it will be successful
                              in marketing related resonance products. The
                              financial statements do not include adjustments
                              relating to the recoverability and classification
                              of recorded assets.

                              Net loss per common share is based upon the
                              weighted-average number of common  shares
                              outstanding during the year. Potential common
                              stock is excluded from the computation of net loss
                              per share since their inclusion would be
                              antidilutive.


                              Cash and cash equivalents consist of cash and
                              highly liquid debt instruments with an
                              original maturity of less than three months.

                              Property and equipment are stated at cost.
                              Depreciation is provided for by the
                              straight-line method over the estimated useful
                              lives of the related assets.

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

                              Research and development costs are charged  to
                              operations when incurred and are included in
                              operating expenses.

                              The Company has elected to apply Accounting
                              Principles Board "APB" Opinion No. 25 and the
                              related interpretations in accounting for its
                              common stock options issued to employees and has
                              adopted the disclosure only provisions of SFAS No.
                              123 Accounting for Stock-Based Compensation.

                              Financial instruments which potentially subject
                              the Company to concentrations of credit risk are
                              primarily cash and accounts receivable. The
                              Company invests its excess cash in high quality
                              short-term liquid money market instruments with
                              major financial institutions and the carrying
                              value approximates market value. The Company
                              does not have significant trade receivables. The
                              Company maintains cash in bank accounts which, at
                              times, may exceed federally insured limits. The
                              Company has not experienced any losses on these
                              accounts.

                              Management does not believe that any recently
                              issued, but not yet effective, accounting
                              standards if currently adopted would have a
                              material effect on the accompanying financial
                              statement.

                              Revenue from the sale of resonance equipment is
                              recorded when the equipment is shipped.

                              The Company has charged operations for costs
                              representing legal expenses associated with the
                              application to obtain certain patents awarded to
                              the Company's principal stockholder.  The Company
                              has a licensing agreement for the use of the
                              patents.  This stockholder received approximately
                              $4,000 in royalties from the Company during 1999.



 2.    PROPERTY AND EQUIPMENT:Property and equipment at December 31, 2000, at
        cost, consists of:

                                                                                                         Depreciation/
                                                                                                          Amortization
                                                                                                           Period

                              ------------------------------------------------------------------------------------------------------
                              Furniture and fixtures                                       $ 37,688       3 to 5 years
                              Resonance equipment                                           207,580            5 years
                              ------------------------------------------------------------------------------------------------------
                                                                                            245,268
                              Less accumulated depreciation                                 (56,438)
                              ------------------------------------------------------------------------------------------------------
                                                                                           $188,830
                              ======================================================================================================


                              Depreciation expense for the years ended December
                              31, 2000 and 1999 amounted to $34,990 and $13,707,
                              respectively.


3.    SUBSCRIPTION            The Company has a note receivable in the amount of
      RECEIVABLE:             $44,074 for the outstanding balance due for a
                              subscription receivable that has been treated as
                              a reduction of stockholders' equity.


4.    COMMITMENTS AND         The Company is currently leasing office space
      CONTINGENCIES           in Juno Beach, Florida pursuant to a
                              non-cancelable operating lease, which expires
                              August 2001 at a rate of $1,150 per month. The
                              Company also leases office space under a
                              non-cancelable operating lease in Boynton Beach,
                              Florida at the rate of $6,100 per month through
                              March 2005. Rent expense for the years ended
                              December 31, 2000 and 1999 amounted to $88,022 and
                              $101,029, respectively.

                              The approximate minimum lease payments are as
                              follows:

                              Year ending December 31,


                                          2001                     $87,000
                                          2002                      73,000
                                          2003                      73,000
                                          2004                      73,000
                                          2005                      18,000
                                        --------------------------------------
                                                                 $324, 000
                                        ======================================
5.    STOCK OPTION PLAN:    In November 1998, the Company's board of directors
                            approved the 1998 Stock Option Plan (the "Plan").
                            The Plan authorizes the granting of both incentive
                            stock options and nonstatutory stock options up to a
                            total of 10,000,000 shares. The option price for
                            nonstatutory stock options may be less than, equal
                            to, or greater than the market price on the date the
                            option is granted, whereas for incentive stock
                            options, the price will be at least 100% of the fair
                            market value. Compensation expense, representing the
                            difference between the exercise price and the fair
                            market price at date of grant, is recognized over
                            the vesting or service period. For all the periods
                            presented all of the options were granted at an
                            exercise price equal to the fair market value of the
                            Company's common stock at the date of grant. The
                            board of directors granted 1,903,500 options to
                            eligible persons. The right to exercise the options
                            vests annually as follows:

                              (1)   The right to exercise the options and to
                                    acquire 50% of the shares of stock
                                    underlying the options vests at the date
                                    granted.

                              (2)   The right to exercise the option and
                                    acquire 30% of the shares of  stock
                                    underlying the options vests one year after
                                    the date it is granted.

                              (3)   The right to exercise the option and
                                    acquire 10% of the shares of stock
                                    underlying the options vests two years after
                                    the date it is granted.

                              (4)   The right to exercise the option and
                                    acquire 10% of the shares of stock
                                    underlying the options vests three years
                                    after the date it is granted.

                              A summary of the status of the Company's options
                              under the Plan as of December 31, 2000 and 1999,
                              and changes during the years then ended, is
                              presented below:
                                                                         2000                         1999

                              -----------------------------------------------------------------------------------------
                                                                                Weighted-                   Weighted-
                                                                   Number        Average       Number        Average
                                                                     of         Exercise         of         Exercise
                                                                   Shares         Price        Shares         Price
                              -----------------------------------------------------------------------------------------
                              Outstanding at beginning
                               of year                              998,500      $. 29        608,500          $.35

                              Granted                               905,000      $. 92        390,000          $.20

                              Exercised                            (140,000)     $. 35

                              -----------------------------------------------------------------------------------------
                                 Outstanding at end of year       1,763,500      $. 61        998,500         $ .29
                              =========================================================================================

                              Options exercisable at
                               year-end                           1,172,150      $. 56        681,800         $ .31
                              =========================================================================================

                              Weighted-average fair
                              =========================================================================================
                               value of options granted
                              =========================================================================================
                               during the year                 $    438,133                $   72,618
                              =========================================================================================

                              The weighted average fair value per share
                              calculated using the Black-Scholes method for
                              options granted during the years ended December
                              31, 2000 and 1999 amounted to $.48 and $.19.

                              The following table summarizes information about
                              fixed stock options under the Plan outstanding at
                              December 31, 2000:

                                                               Options Outstanding               Options Exercisable
                                                                    Weighted-
                                                                     Average     Weighted-                    Weighted-
                                                                    Remaining     Average                      Average
                                Range of            Number        Contractual   Exercise        Number       Exercise
                              Exercise Prices      Outstanding        Life         Price       Exercisable      Price
                             ------------------------------------------------------------------------------------------

                              $.20 - $.35             923,500          3.00      $.29             752,150         $.29

                              $.50                    340,000          4.50      $.50             170,000         $.50

                              $1.28                   500,000          4.50        $1.28          250,000        $1.28
                              -----------------------------------------------------------------------------------------

                                                    1,763,500                                   1,172,150
                              =========================================================================================


                          In December 2000, in connection with the settlement
                          described in Note 7, the Company authorized the
                          issuance to the Company's major shareholder/officer of
                          6,000,000 warrants to purchase the Company's common
                          stock at $.30 per share. The warrants expire in 2008.

                          Had compensation expense for the Company's stock
                          option plans and the warrants issued to the
                          shareholder/officer been determined based on the fair
                          value of the options at the grant dates, consistent
                          with SFAS No. 123 the Company's net loss and net loss
                          per share amounts would have been as follows:

                              December 31,                                                  2000                  1999
                            --------------------------------------------------------------------------------------------

                              Net loss:
                                As reported                                          $(3,941,952)       $   (3,657,966)

                                Pro forma                                             (6,120,085)           (3,730,584)

                              Basic and diluted
                                loss per share:

                                  As reported                                           $(.08)                   $(.11)

                                  Pro forma                                              (.13)                    (.11)
                            --------------------------------------------------------------------------------------------

                           The fair value for these options  was estimated
                           at the date of grant using a  Black-Scholes option
                           pricing model with the following weighted-average
                           assumptions for the years ended December 31, 2000 and
                           1999, respectively,  risk-free interest rates of
                           6.0% and 6.3%, dividend yields of 0% and 0%,
                           volatility factors of the  expected market price of
                           the  Company's common stock of 142.85% and 243.41%,
                           and an expected life of the options of five years.

                           The  Black-Scholes option  pricing model was
                           developed for use in estimating  the fair value of
                           traded options which have no vesting  restrictions
                           and are fully transferable.  In addition,  option
                           pricing models require  the  input  of  highly
                           subjective  assumptions including  the  expected
                           stock  price volatility. Because the Company's
                           employee stock options have characteristics
                           significantly  differentfrom those of traded  options
                           and because changes in the subjective  input
                           assumptions  can materially affect the fair value
                           estimate, in management's pinion the existing models
                           do not necessarily provide a reliable single measure
                           of the fair value of its employee stock options.

                           On January 2, 2001, the Company issued 525,000
                           stock options  at $.22 per share to employees  and
                           consultants.  Of the 525,000 options issued, 305,000
                           have been issued to non-employees and have been
                           valued  using the  Black-Scholes  option  pricing
                           model.  Accordingly,  in  January  2001, the Company
                           recorded a charge to operations of $63,166.


6.       STOCKHOLDERS' EQUITY:During  May  1997,  the  Company's  board of
                              directors  authorized  the  conversion  of
                              45,000,000  shares of its common stock into 45,000
                              shares of its Preferred Stock.  These shares
                              belonged to the Company's  president.  The shares
                              were converted at a conversion rate of 1 share of
                              Preferred  stock for 1,000 shares of common stock.
                              Each  share of Preferred Stock is convertible into
                              1,000 shares of common stock as follows:  1/3 at
                              the option of the  holder  beginning  three  years
                              from  issuance,  1/3 at the option of the holder,
                              beginning four years from issuance, and the final
                              1/3 beginning five years from issuance.  The May
                              1997  conversion  has been  accounted for as if it
                              had occurred as of December 31, 1996.  On May 18,
                              2000, an officer of the Company  converted  15,000
                              shares of preferred stock into 15,000,000 shares
                              of common stock.


                              In 1997,  the Company  issued  40,114  shares of
                              common stock for services  with a fair value of
                              $12,784.  The  Company  completed a private
                              placement  of 760,000  shares of common stock for
                              net proceeds of $140,000.

                              The Company  completed two private  placements
                              during 1998. In March 1998, the Company issued
                              4,404,663 shares of common stock pursuant to a
                              private  placement for a price of $.15 per share.
                              In  connection  with this private placement,  the
                              Company also issued 271,187 shares for commissions.

                              In June  1998,  there  was a  second  private
                              placement  whereby  the  Company  issued
                              2,017,999  shares  for a price of $.35 per  share.
                              Each  share  includes  a warrant to purchase
                              additional  common shares at a price of $.45 per
                              share for a four-year period ending December 2002.
                              Fees paid relating to this private  placement were
                              $14,126 and have been charged to additional
                              paid-in  capital.  In addition,  40,360  warrants
                              were issued  to purchase  40,360 common shares at
                              $.35 per  share.  The  warrants  expire December
                              2002 and were issued for services relating to the
                              private placement.

                              The  Company  reacquired  3,000,000  common shares
                              issued  in 1996  and  cancelled  a subscription
                              receivable  in the amount of $450,000 for the
                              purchase of such shares and received a note
                              receivable  in the amount of $71,550.  During the
                              year ended  December 31, 1998, $27,476 was
                              collected from the note.

                              During 1998, the Company  issued 663,223 common
                              shares for services.  The services were charged to
                              operations  and have been recorded at the quoted
                              market value at the date of issuance.  Included in
                              the  shares  are  140,000  shares  pursuant  to  a
                              continuing  agreement  for  endorsements  at a
                              quoted  market value of $.35 per share. At
                              December 31, 1999, the Company included in accrued
                              expenses and charged  operations for $68,250,
                              which  represented  the value  attributable  to
                              195,000  shares of common  stock to be
                              issued. The continuing agreement requiring
                              personality  endorsements  provides for the
                              issuance of 195,000  shares of common stock in
                              1999 and 205,000  shares of common stock
                              in 2000.

                              In addition,  the Company  issued an aggregate of
                              142,857  options to purchase common shares during
                              the 1998 year at $.35 per share (the quoted market
                              value) for a three-year period  ended  October 15,
                              2001.  The  value of the  options  using  the
                              Black-Scholes formula amounted to $37,142 and was
                              charged to operations.

                              At various dates during the year ended December
                              31, 1999, the Company issued  1,313,903
                              common  shares  for  services.   The  services
                              for consultants   and  for  officers'compensation
                              were charged to  operations  and have been
                              recorded at the quoted market value at the date of
                              issuance which aggregated $421,689.

                              On November 30, 1998, the Company  received a
                              short-term  loan in the amount of $60,000
                              from a related  party.  This loan was due and
                              payable on November  30,  1999  together with
                              interest  which  accrued  at 7% per  annum.  The
                              holder of the note was given an option to convert
                              the note and any accrued  interest at any time
                              prior to maturity into fully-paid  shares of the
                              Company's  common stock,  par value $.001 per
                              share at a rate of $.21 per share,  the quoted
                              market  value at November 30,  1998.  During 1999,
                              the  notes and accrued interest of $1,174 were
                              converted into 291,305 common shares.

                              In 1999, the Company issued  $1,000,000 in 2%
                              convertible  debentures due June 2, 2004,
                              and warrants to purchase  900,000  shares of its
                              common  stock at $.001 per share.  The Company
                              received net proceeds of  approximately  $890,000
                              after costs which are being amortized over the
                              term of the debentures.  As a result of the
                              conversion  feature (75% of the quoted market of
                              the common stock) and the  beneficial  aspect to
                              the recipient, the  Company   recognized  an
                              interest   charge  of  $333,332.   The  debentures
                              were  immediately  convertible and the $333,332 of
                              interest has been charged to operations in
                              June 1999.

                              Additionally,  the warrants to purchase  900,000
                              shares of the Company's  common stock were
                              exercised  for $900 when the market  price was
                              $1.95 a share.  As these  warrants were  issued
                              and  exercised  at the  time  of the  issuance  of
                              the  debentures,  the  difference  between the
                              market value and the warrant exercise price was
                              also considered a beneficial  conversion price for
                              accounting purposes.  Accordingly,  this
                              transaction resulted in a $1,754,100 charge to
                              interest expense in June 1999.

                              On July 16,  1999,  $100,000 of principal  plus
                              interest  was  converted  into 144,645 shares of
                              common  stock;  on July 22,  1999,  $225,000 of
                              principal  plus  interest was converted  into
                              63,892 shares of common stock;  August 6, 1999,
                              $549,280 of principal
                              plus interest was converted into  1,102,466
                              shares of common stock and on November 12,
                              1999,  the remaining  $124,280 of principal and
                              interest  were  converted  into 251,873 shares of
                              the Company's common stock for an aggregate of
                              1,862,876 shares.

                              In December  1999, the Company  entered into an
                              agreement to sell  5,000,000  restricted
                              shares of its common  stock to an investor at the
                              price of $.20 per share.  Payments for such shares
                              began in 1999 and were to  continue  to be made to
                              the  Company at various times in 2000. As of
                              December 31, 1999,  this investor had purchased
                              500,000  shares of common stock for $100,000.  In
                              addition,  the Company granted this investor an
                              option to purchase  2,222,222 shares of its common
                              stock at a price of $.45 per share. This option
                              requires  the  investor to advise the  Company of
                              his intent to  exercise  the option by January 31,
                              2001,  and  exercise  and  execute  the option on
                              or before  June 30, 2001 according to a defined
                              schedule.  During February 2000, the investor
                              purchased 300,000 shares for an  aggregate of
                              $60,000. The investor did not notify the Company
                              of his intention  to  exercise  the  options.
                              Accordingly, the Company has cancelled the
                              options.  In the Company's opinion, this investor
                              has not met defined  terms of the agreement and
                              the Company does not intend to issue any
                              additional  shares  under this agreement.

                              In addition to the foregoing,  between January and
                              April 2000 the Company sold 1,670,867 shares of
                              common stock for an aggregate of  $1,017,618
                              pursuant to private  placements. In connection
                              with certain of the sales,  the Company granted an
                              aggregate of 1,241,117 options to purchase
                              1,241,117  shares of which 307,693  options are
                              exercisable at $.85 and 933,424 at $.90 per share.

                              Between,  February and April 2000,  the Company
                              issued 335,342 shares of common stock to employees
                              and consultants for services.  The Company has
                              recorded a charge to operations for the fair value
                              of these shares on the dates of their  issuances,
                              which amounted to $368,000.

                              On April 4, 2000 the Company issued  options to
                              purchase  599,000 shares of common stock to
                              employees and consultants. These options are
                              exercisable at $1.28 per share. Of  the  599,000
                              options issued, 99,000 have been granted  to
                              non-employees  and have been valued using the
                              Black-Scholes option pricing model which has
                              resulted in a charge to operations of $55,301.

                              On September 15, 2000, the Company  issued options
                              to purchase  690,000 shares of common stock to
                              employees and consultants at an option price per
                              share of $.50. Of the 690,000 options issued,
                              350,000 have been issued to non-employees  and
                              have been valued using  the  Black-Scholes option
                              pricing model which has resulted in a charge  to
                              operations of $143,500.

                              In August 2000 the Company increased its
                              authorized shares to 300,000,000.

                              On  December 5, 2000, the Company issued  options
                              exercisable at $.32 to purchase 215,000 shares of
                              common  stock to employees  and  consultants.  Of
                              the total  issued, 150,000 have been issued to
                              non-employees  and have been valued using the
                              Black-Scholes option pricing model which has
                              resulted in a charge to operations of $43,230.

                              Additionally,  the Company  issued  40,000 shares
                              of common stock for an aggregate of $16,000 on
                              February 16, 2000 and 100,000 shares of common
                              stock for an aggregate  of $34,775 on May 9, 2000
                              upon exercise of outstanding options.

                              In October 2000, the Company sold 150,000 shares
                              of its common  stock for $20,000 pursuant to the
                              terms of an agreement.

                              Pursuant to a private placement memorandum,  the
                              Company collected $69,397 in the third quarter of
                              2000 for 165,232 shares of common stock to be
                              issued.

                              On December 18, 2000, the Company  issued 50,000
                              shares of common stock to employees and
                              consultants for services rendered. The Company has
                              recorded a charge to operations for the fair value
                              of these shares on the date of issuance  which
                              amounted to $10,940.

                              See Note 5 for warrants  granted to
                              shareholder/officer and Note 7 for warrants issued
                              in conjunction with litigation of principal
                              shareholder.

                              The  following  is a summary of  changes in
                              outstanding warrants and of options (not included
                              under the Plan) issued in connection  with debt
                              offerings and other services during the period
                              ended December 31, 1999 and December 31, 2000.

                                                                     2000                            1999

                                                                         Weighted-                          Weighted-
                                                           Number         Average           Number          Average
                                                               of         Exercise              of          Exercise
                                                           Shares            Price          Shares            Price
                            --------------------------------------------------------------------------------------------
                              Outstanding at beginning
                              of year                       4,423,438        $.45         2,201,216       $  .44

                              Granted                      10,840,117        $.38         3,122,222       $  .32

                              Exercised                             -                      (900,000)      $ .001

                              Cancelled                    (2,222,222)       $.36                -            -
                            --------------------------------------------------------------------------------------------

                              Outstanding at end of year   13,041,333        $.39         4,423,438       $  .45
                            ============================================================================================


                              Of the total  warrants  outstanding  at December
                              31, 2000,  4,041,333  expire on various dates from
                              2003 through 2005 and 9,000,000 expire in 2008.

7. DUE FROM OFFICER/          During the second quarter,  the Company loaned
   SHAREHOLDERS AND           $200,000 to the majority  stockholder and officer.
   SETTLEMENT OF              The loan bears interest at the prime rate.  The
   LITIGATION:                loan and any interest  accrued on the loan are due
                              on May 13, 2002. The officer had declared personal
                              bankruptcy which the court  dismissed  and
                              accordingly  at December 31, 2000 the Company has
                              recorded an  allowance for doubtful accounts for
                              the entire balance.

                              The  majority  stockholder  and officer of the
                              Company was involved in  litigation.  The
                              litigation was settled which required him to
                              transfer  12,000,000 shares of common stock of the
                              Company to the plaintiffs.  In addition,  the
                              settlement required the stockholder and officer to
                              submit to the  Company  the  licensing  rights to
                              patents  owned by this officer and the plaintiffs.

                              As part of the settlement,  in December 2000 the
                              plaintiffs  gave the Company  licensing rights to
                              various patents.  The Company also gave these
                              plaintiffs  warrants to purchase 3,000,000 shares
                              of common  stock at $.30 per share  through  April
                              2008. The warrants have been valued using  the
                              Black-Scholes option pricing model with the value
                              of $870,000 attributable to the warrants charged
                              to operations.

                              The stockholder  and the Company  negotiated and
                              the stockholder received warrants to purchase
                              6,000,000 shares of the Company's stock at $.30
                              per share. These warrants have been valued at
                              $1,740,000 using the Black-Scholes  pricing model
                              and are reflected on a pro forma  basis in Note 5.
                              In connection with this settlement and based upon
                              approval of the Company's  Board of Directors and
                              the Agreed Order Dismissing Case and Providing
                              Relief from the Automatic Stay (Dr. Jacobson's
                              personal bankruptcy) both Dr. Jacobson and the
                              Company agreed to pay the plaintiffs the sum of
                              $1,000,000 by July 15, 2001 (as  amended).
                              Accordingly, the Company who was not previously a
                              party to this litigation accrued and charged
                              operations $1,000,000 at December 31, 2000.

                              During the second quarter another officer
                              received a loan of $50,000 from the Company. This
                              loan bears interest at the rate of 6.5% per annum.
                              The loan was due September 10, 2000 and has been
                              extended  to January 6, 2002.  The loan is secured
                              by this officer's common stock of the Company.


8.    INCOME TAXES:           The Company has net operating loss carryforwards
                              of approximately  $5,787,000 available to reduce
                              future taxable income which expire in various
                              years through 2020.

                              The utilization of the net loss  carryforwards may
                              be limited as a result of cumulative changes in
                              the Company's stock ownership.

                              Deferred income taxes reflect the impact of net
                              operating loss carryforwards. In recognition of
                              the uncertainty regarding the ultimate amount of
                              income tax benefits to be derived from the
                              Company's net operating loss carryforwards, the
                              Company has recorded a valuation  allowance  for
                              the entire amount of the deferred tax asset. The
                              deferred income tax asset is comprised of the
                              following at December 31, 2000:


                              Gross deferred tax asset resulting from net operating
                               loss carryforwards                                                $  1,968,000
                              Valuation allowance                                                  (1,968,000)

                              ---------------------------------------------------------------------------------
                              Net deferred income tax asset                                      $       - 0 -
                              =================================================================================

                              The reconciliation of the effective income tax rate to the federal statutory rate is as follows:

                              December 31,                                                     2000          1999
                              ---------------------------------------------------------------------------------

                              Federal income tax rate                                         (34.0)%       (34.0)%

                              Valuation allowance on net operating loss carryforward           34.0          34.0

                              ---------------------------------------------------------------------------------
                              Effective income tax rate                                           0%            0 %
                              =================================================================================

8.    SUBSEQUENT EVENTS:      In the first quarter of 2001,  the Company  issued
                              808,144 shares of common stock which included,
                              165,232 shares issued for the $69,397 of deposits
                              on common stock, 433,800 shares at $.25 related to
                              a private placement  and 210,112  shares under a
                              continuing agreement for endorsement.



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

         There were no changes in nor disagreements with accountants.



                                    PART III

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

         The following table sets forth the names and ages of the Directors and
Executive Officers of the Company, as well as the positions held by such
persons:

         Name                        Age               Position (1)

         Dr. Jerry I. Jacobson (2)  55        Chairman of the Board, President
                                              and Chief Executive Officer

         Alfonso Serrato            56        Director

         Debra M. Jacobson (2)      49        Senior Vice President and Director

         Sidney Paul Martin         43        Director

         Frank A. Chaviano          52        Senior Vice President and Chief
                                              Operating Officer
___________________

(1)      All Directors and Officers are elected for terms of one year and until
         their successors have been elected and qualified.  Vacancies in the
         existing Board are filled by majority vote of the remaining Directors.
         Board members are serving without compensation. Officers serve at the
         pleasure of the Board.

(2)      Dr. Jerry I. Jacobson and Debra M. Jacobson are husband and wife.


         DR. JERRY I. JACOBSON has been the Chairman, President and Chief
Executive Officer of the Company since June 1996 and of its privately-held
predecessor since March 1995. Dr. Jacobson holds a Bachelor of Arts degree in
Philosophy from Brooklyn College of the City University of New York and D.D.S.
and D.M.D degrees from Temple University. He has also received extensive
informal training in physics after auditing 25 courses at different
universities in the New York City metropolitan area. Dr. Jacobson has also been
a student of Albert Einstein's work throughout his life. Since his discovery of
a new law of nature, Dr. Jacobson has focused his science, denoted as
Jacobson Resonance, on medical therapy for more than a decade. His publishing
credits include more than 60 articles, more than 15 abstracts, three book
chapters and two books. He holds seven issued, allowed or pending United States
of America patents, for three of which there are currently patents issued or
pending in 75 foreign countries.

         ALFONSO SERRATO has been a Director of the Company since June 1998. Mr.
Serrato worked for Medtronic, Inc., a New York Stock Exchange company that is a
leading manufacturer and distributor of medical devices around the world, from
1978 until 1996 in various capacities. His positions included Vice President of
Worldwide Manufacturing and Vice President of Pacing Operations. He is the
controlling person of Serrato Enterprises, L.L.C., a licensee of the Company and
the entity that is spearheading the Company's European initiatives.

         DEBRA M. JACOBSON has been a Director, the Treasurer and the Secretary
of the Company since August 1996 and Senior Vice President of the Company since
September 1999. She has been married to Dr. Jacobson and served as his
private secretary for approximately 25 years. As Dr. Jacobson has suffered from
glaucoma for over 20 years, Ms. Jacobson has been invaluable as a research
assistant and editor. Previously, Ms. Jacobson worked as a flight attendant for
Eastern Airlines and as a secretary. She is a graduate of the prestigious
Katherine Gibbs SecretarialSchool in New York, New York.

         FRANK A. CHAVIANO joined the Company as Vice President in 1997 and
subsequently became Senior Vice President and Chief Operating Officer.
Previously, Mr. Chaviano served from 1996 to 1997 as Senior Vice President of
American Healthcorp responsible for physician practice management and
development. From 1994 until 1996, he was Senior Vice President of Integrated
Health Services, Inc., and from 1992 until 1994, he was Senior Vice President of
Integracare, Inc. In those positions Mr.  Chaviano assisted with the acquisition
and development of more than 100 medical practices.

         SIDNEY PAUL MARTIN has been a Director of the Company since January 8,
2001. Mr. Martin is a well-known and respected agric-business entrepreneur with
multiple farms and interests in timber, land and cattle. A former educator, he
holds Bachelor's and Master's degrees from Mississippi State University. Mr.
Martin's family farms have long been recognized for quality management and
conservation practices throughout the southeastern United States. Mr. Martin
is a registered securities dealer and is associated with Carlton Associates,
NASDAQ, for the last five years.

ITEM 10.  EXECUTIVE COMPENSATION

         Dr. Jacobson, the Company's Chief Executive Officer, does not receive
any cash compensation from the Company. None of the executive officers of the
Company received more than $119,000 cash in annual salary and bonus in any of
the last three full fiscal years of the Company.  However, Dr. Jacobson and each
of the other directors and executive officers of the Company have received
various stock issuances and stock option grants from the Company. During 2000,
the Company advanced $200,000 to Dr. Jacobson. The Company provided an allowance
for the entire balance on the December 31, 2000 balance sheet.  Please see
"Item 11: Security Ownership of Certain Beneficial Owners and Management."

ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

         The following table sets forth, as of April 3, 2001, the beneficial
ownership of the voting securities of the Company by each person beneficially
owning more than 5% of such securities, by each of the directors and
executive officers of the Company, and by the directors and executive officers
of the Company as a group.

Name and Address of                                     Amount and Nature of
Beneficial Owner (1)                                  Beneficial Ownership (2)

Dr. Jerry I. Jacobson                                 30,000 shares of Series A
                                                 Convertible Preferred Stock (3)

                                           11,592,146 shares of common stock (4)

Alfonso Serrato                                       1,020,495 (5)

Debra M. Jacobson                                     1,893,628 (6)

Frank A. Chaviano                                       385,294 (7)

Sidney Paul Martin                                       60,000

Eric and Vanessa Hewko                                6,000,000 (8)
761 Doris Road South
North Palm Beach, FL 33408

Hewko/Casey Investments                               6,000,000 (8)
515 N Flagler Drive, 19th Floor
West Palm Beach, FL 33401

All directors and executive officers                 14,951,563
as a group (5 persons)
_______________________________



(1)      The address of each director or executive officers in the table is c/o
         Jacobson Resonance Enterprises, Inc., 8200 Jog Road, Suite 100,
         Boynton Beach, FL 33437.

(2)      For all entries in the table other than the one for Dr. Jerry I.
         Jacobson, the figures represent beneficial ownership of shares of the
         Company's common stock.

(3)      Each share of the Series A Convertible Preferred Stock is entitled to
         1,000 votes on all matters submitted to a vote of the Company's
         shareholders. As a result, Dr. Jacobson controls 51% of the combined
         voting power of the Company's outstanding shares of preferred and
         common stock. The Series A Convertible Preferred Stock is not entitled
         to any dividends and has a liquidation preference equal to its par
         value, which is a total of $30.00. At the option of Dr. Jacobson, up to
         one-third of the outstanding shares of the Series A Convertible
         Preferred Stock can be converted into shares of the Company's common
         stock beginning in May of the years 2001 and 2002.  The conversion
         ratio is 1,000 shares of common stock for each share of preferred
         stock.

(4)      This figures includes 11,592,146 shares owned of record by Dr. Jacobson
         and 700,000 shares which are owned by Dr. Jacobson's children.
         Together, Dr. and Ms. Jacobson and children beneficially own 13,485,774
         shares, or 24% of the outstanding shares of the Company's common stock.
         This figure excludes 200,000 shares owned of record by the
         Perspectivism Foundation, of which Dr. Jacobson is the founder and a
         director. Dr.Jacobson disclaims any beneficial interest in those
         shares. In addition, Dr. Jacobson received 6,000,000 warrants (the
         "Warrants") for assignment of his two-thirds interest in a patent
         relating to Therapeutic Treatment of Mammals. The Warrants
         must be adjusted in the event of merger, consolidation,
         recapitalization, reorganization, stock split or stock dividend.
         Such events have not occurred since the issuance of the Warrants.

(5)      This figures includes 1,020,495 shares owned of record by Mr. Serrato,
         542,857 shares subject to warrants held by Mr. Serrato, and 29,000
         shares subject to options granted to Mr. Serrato.  This figure excludes
         12,000 shares subject to options granted to Mr. Serrato. It also
         excludes 28,571 shares owned of record by Mr. Serrato's wife and 28,571
         shares subject to warrants held by her.  Mr. Serrato disclaims any
         beneficial interest in those shares.

(6)      This figure includes 597,200 shares owned of record by Mrs. Jacobson
         and 130,000 shares subject to options granted to Ms. Jacobson. This
         figure excludes 50,000 shares subject to options granted to Ms.
         Jacobson. It also does not include beneficial ownership of shares of
         the Company's common stock by Dr. Jerry I.Jacobson, the husband of Ms.
         Jacobson, as to which shares Ms. Jacobson disclaims any beneficial
         interest. Together, Dr. and Ms. Jacobson and children beneficially own
         13,485,774 shares, or 24% of the outstanding shares of the Company's
         common stock. This figure also excludes 275,000 shares owned of record
         by the Perspectivism Foundation, to which Ms. Jacobson donated the
         shares and of which Ms. Jacobson is a director. Ms. Jacobson disclaims
         any beneficial interest in those shares.

(7)      This figure includes shares owned of record by Mr. Chaviano and shares
         subject to options granted to Mr. Chaviano. It excludes 100,000 shares
         subject to options granted to Mr. Chaviano.

(8)      Eric and Vanessa Hewko and Hewko/Casey Investments also own an
         aggregate of 3,000,000 Warrants for a one-third interest in a patent
         relating to Therapeutic Treatment of Mammals. The Warrants must be
         adjusted in the event of merger, consolidation, recapitalization,
         reorganization, stock split or stock dividend.
         Such events have not occurred since the issuance of the Warrants.

         ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

                  The Company is the exclusive licensee of Jacobson Resonance
         from Dr. Jacobson, who is the majority owner of all patents issued or
         filed. Dr. Jacobson is also the majority owner of all relevant Jacobson
         Resonance intellectual property. The Company has extended the exclusive
         rights to pursue whatever  applications of Jacobson Resonance that it
         wants through 2007. In return, the Company is obligated to pay
         Dr. Jacobson a 3% or 4% royalty on revenues, depending upon the
         application.

                  To date, the Company has entered into two agreements with
        Serrato Enterprises L.L.C. ("Serrato Enterprises"), an entity controlled
        by Alfonso Serrato, a director of the Company. In March 1999, the
        Company entered into a ten-year license agreement with Serrato
        Enterprises for the marketing and distribution of the Company's chronic
        pain reduction products in Europe, Africa and the Middle East, excluding
        Israel and the nations that formerly constituted the Union of Soviet
        Socialist Republics. The stated term of the agreement runs through the
        year 2008 and contains two automatic renewals thereafter of five years
        each, but is subject to earlier termination by either party upon at
        least 90 days' prior written notice to the other party. The Company is
        to receive a sales royalty of 16% of gross sales payable on a quarterly
        basis within 30 days after the end of each calendar quarter. The Company
        is also to receive a manufacturing license override fee of $1,000 for
        each 18" and 22" Jacobson Resonator and $1,500 for each seven foot
        Jacobson Resonator ordered by and delivered to the licensee. These fees
        are payable within 45 days of initial shipment of the product from the
        manufacturing facility.

                  In October 1999, the Company entered into an additional and
        separate ten-year license agreement with Serrato Enterprises for the
        manufacturing (as opposed to the marketing and distribution) of the
        Company's chronic pain reduction products in Europe, Africa and the
        Middle East, excluding Israel and the nations that formerly constituted
        the Union of Soviet Socialist Republics. The stated term of the
        agreement runs through the year 2009 and contains two automatic renewals
        thereafter of five years each, but is subject to earlier termination by
        either party upon at least 180 days' prior written notice to the other
        party. The Company is to receive manufacturing royalties of $1,000 for
        each 18" and 22" Jacobson Resonator, $1,500 for each 4' and 7' Jacobson
        Resonator and $2,000 for each industrial and/or non-medical use Jacobson
        Resonator manufactured and delivered by the licensee. These royalties
        are payable on a quarterly basis within 30 days after the end of each
        calendar quarter.

                  Mr. Serrato in November 1998 made a $60,000 one-year loan to
        the Company with interest at 7% per annum. He had the option at any time
        to convert the loan and any accrued interest into shares of the
        Company's common stock at $0.21 per share, which approximated the fair
        market value of the Company's common stock at the time the loan was
        made. In March 1999, he converted the loan and accrued interest into
        291,305 shares of the Company's common stock.

                  From time to time since late 1997 on approximately a quarterly
        basis, the Company has issued shares of its common stock to its
        executive officers either in lieu of cash compensation or as bonuses.
        Debra Jacobson, a director as well as an executive officer of the
        Company, has received stock in most of these issuances. The following
        table sets forth pertinent information on the issuances to Ms. Jacobson:

                           Number of            Value Per       Aggregate
          Date               Shares               Share           Value


         November 1997         5,000           $   0.15         $      750

         July 1998            83,334               0.35              29,167

         October 1998         25,000               0.25               6,250

         December 1998        30,000               0.25               7,500

         March 1999           98,572               0.35              34,500

         May 1999            200,000               0.35              70,000

         September 1999      100,000               0.21              21,000

        December 1999         85,294               0.18              15,353

        December 1999        100,000               0.21              21,000

         February 2000       100,000               2.16             216,000



ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K

(a)      Exhibits:  See Exhibit Index.

(b)      Reports on Form 8-K: The Company did not file any Current Reports on
         Form 8-K during the fiscal quarter ended December 31, 2000.



                                   EXHIBIT INDEX

Exhibit               Exhibit
Number               Description


3.1               Articles of Incorporation, as amended *
3.2               Bylaws, as amended *
4.1               Specimen Common Stock Certificate *
4.2               Specimen Series A Convertible Preferred Stock Certificate *
4.3               Specimen 1998 Warrant Agreement *
4.4               Specimen 1998 Placement Agent Warrant Agreement *
4.5               Specimen 2% Convertible Debenture *
10.1              Patent License Agreement Dated October 6, 1999, Between Dr.
                  Jerry I. Jacobson and the Company *
10.2              License Agreement Dated February 23, 1999, Between the Company
                  and Serrato Enterprises L.L.C. *
10.3              1998 Stock Option Plan *
10.4              License Agreement Dated October 15, 1999, Between the Company
                  and Serrato Enterprises L.L.C. **
10.5              Distribution Agreement Dated December 29, 1999, Between the
                  Company and Akron Bio-Medical Corporation **
10.6              License Agreement Dated December 29, 1999, Between the Company
                  and ABM Manufacturing, Inc. **
10.7              License Agreement Dated December 31, 1999, Between the Company
                  and REALPURE Beverage Group, LLC **
10.8              License Agreement Dated August 27, 2000, Between the Company
                  and Enviro Wood Fibre Block & Brick, Inc.
27                Financial Data Schedule

-----------------------------
*    Filed as Exhibits to the Company's Form 10-SB filed on October 27, 1999.
**  Filed as Exhibits to the Company's Form 10K-SB filed on April 24, 2000.



                                   SIGNATURES

         Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

                  Date: April 3, 2001       JACOBSON RESONANCE ENTERPRISES, INC.
                  (Registrant)

                                            By:  /s/  JERRY I. JACOBSON
                                               ---------------------------------
                                             Jerry I. Jacobson, Chairman of the
                                              Board and Chief Executive Officer

         Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the date indicated.


                  Date: April 3, 2001       By:  /s/  JERRY I. JACOBSON
                                               ---------------------------------
                                        Jerry I. Jacobson, Chairman of the Board
                                                     and Chief Executive Officer

                  Date: April 3, 2001       By:  /s/  DEBRA M. JACOBSON
                                       -----------------------------------------
                                        Debra M. Jacobson, Director, Senior Vice
                                              President, Treasurer and Secretary
                                   (Principal Financial and Accounting Officer)`