<PAGE>

================================================================================

                United States Securities and Exchange Commission
                             Washington, D.C. 20549

                                    FORM 10-K

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

                     For the Fiscal Year ended June 30, 2000
                          Commission file Number 1-6537

                            ALL STAR GAS CORPORATION
             (Exact Name of Registrant as Specified in Its Charter)

             MISSOURI                                      43-1494323
----------------------------------            ---------------------------------
  (State or other jurisdiction                (IRS Employer Identification No.)
of Incorporation or Organization)

       P.O. Box 303, 119 West Commercial Street, Lebanon, Missouri, 65536
       ------------------------------------------------------------------
              (Address of Principal Executive Offices and Zip Code)

                                 (417) 532-3103
                        ---------------------------------
              (Registrant's Telephone Number, Including Area Code)

           Securities registered pursuant to Section 12(b) of the Act:

                               Title of Each Class
                     --------------------------------------
                      12-7/8% Senior Secured Notes Due 2000
                       9% Subordinated Debentures Due 2007

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

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of the Registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part II of this Form 10-K or any
amendment to this Form 10-K. (X)

Indicate by check mark whether the registrant (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 registrant was
required to file such reports) and (2) has been subject to such filing
requirements for the past 90 days. Yes___ No _X_

The aggregate market value of the voting stock held by non-affiliates of the
Registrant as of close of business on October 11, 2000 is: $116,480.

Shares of Common Stock, $0.001 par value, outstanding as of close of business on
October 11, 2000: 1,586,915.

Upon request, All Star Gas Corporation will furnish a copy of an exhibit listed
but not contained herein. A fee of $.05 per page, to cover the Company's costs
in furnishing exhibits requested will be charged. Please direct all requests to:
Corporate Secretary, 119 W. Commercial Street, Lebanon, Missouri 65536;
Telephone (417) 532-3103.



                                       1
<PAGE>


                                     PART 1


Items 1 and 2.  Business and Properties


Introduction

         All Star Gas Corporation ("All Star Gas" or the "Company") was founded
in 1963 and through its subsidiaries has been in operation for over 37 years.
The Company is engaged primarily in (a) the retail marketing of propane to
residential, agricultural, and commercial customers, (b) the retail marketing of
propane-related appliances, supplies, and equipment, and (c) the renting of
consumer propane storage tanks to residential and commercial customers under
various brand names, including All Star Gas and the names of numerous
predecessors. During the fiscal year ended June 30, 2000, All Star Gas supplied
propane to approximately 112,000 customers in 19 states from 125 retail service
centers. The Company experienced significant downsizing during fiscal year 2000
and, by June 30, 2000, the Company was servicing 56,000 customers in 8 states
from 56 retail service centers. These 56,000 customers accounted for 41 million
of the total 74 million gallons sold during fiscal year 2000.

         Propane, a hydrocarbon with properties similar to natural gas, is
separated from natural gas at gas processing plants and refined from crude oil
at refineries. It is stored and transported in a liquid state and vaporizes into
a clean-burning energy source that is recognized for its transportability and
ease of use relative to other forms of stand alone energy. Residential and
commercial uses include heating, cooking, water heating, refrigeration, clothes
drying, and incineration. Commercial uses also include metal cutting, drying,
container pressurization and charring, as well as use as a fuel for internal
combustion engines, such as over-the-road vehicles, forklifts, and stationary
engines. Agricultural uses include brooder heating, stock tank heating, crop
drying, tobacco curing, and weed control, as well as use as a motor fuel for
farm equipment and vehicles.

         Propane is recognized as a clean alternative transportation fuel
("ATF") by the Federal and state governments and is the most widely used ATF in
the United States. The Federal government has enacted certain mandates for use
of ATF's by government and private fleets under the Clean Air Act of 1990 and
Energy Policy Act of 1992. Federal and state governments have also provided
various economic incentives for use of ATF's which will positively impact
propane demand.

         The retail propane business is a "margin-based" business in which gross
profits depend on the excess of sales price over propane supply costs. Sales of
propane to residential and commercial customers, which account for the vast
majority of the Company's revenue, have provided a relatively stable source of
revenue for the Company. Sales to residential customers accounted for
approximately 64.4% of the Company's aggregate propane sales revenue and 76.3%
of its aggregate gross margin from propane sales in fiscal year 2000.
Historically, this market has provided higher margins than other retail propane
sales. Based on fiscal year 2000 propane sales revenue, the customer base
consisted of 21.7% commercial and 13.9% agricultural and other customers. While
commercial propane sales are generally less profitable than residential retail
sales, the Company has traditionally relied on this customer base to provide a
steady, noncyclical source of revenues. No single customer accounts for more
than 1.0% of revenue from sales.

         On August 15, 1995, the Company entered into a joint venture with
Northwestern Growth Corporation, a subsidiary of Northwestern Public Service
Corporation, to acquire the assets of Synergy Group Incorporated, the nation's
fifth largest LP gas distributor. On the same date, the Company acquired, for
$30,000, 30% of the common stock of SYN, Inc. ("Synergy"), the acquisition
entity. The Company entered into a Management Agreement pursuant to which the
Company provided all management of the retail facilities and accounting services
at the central office. In exchange for those services, the Company received a
$500,000 annual base management fee, an incentive management fee, and $3.25
million annual overhead reimbursement (adjusted annually for inflation). Unless
specifically referenced, all information contained herein excludes information
pertaining to the Synergy operations.


                                       2
<PAGE>

         On December 7, 1995, the Company entered into a joint venture with
Northwestern Growth Corporation, a subsidiary of Northwestern Public Service
Company to acquire the stock of Myers Propane Gas Company, a large Ohio LP gas
distributor. The Company acquired 49% of the common stock of Myers Acquisition
Company (Myers), the acquisition entity. The Company entered into a Management
Agreement pursuant to which the Company provided all management and
administrative services. In exchange for those services, the Company was
entitled to a management fee upon the attainment of certain performance goals.

         In December 1996, the Company and Northwestern Growth Corporation
(NGC), completed an agreement for the sale of various interests of the Company
in Synergy and Myers and the modification and termination of certain agreements
between NGC, Synergy and Myers on the one hand and the Company on the other
hand. The agreement terminated the management agreements pursuant to which the
Company provided management activities for Synergy and Myers effective December,
1996. The agreement resulted in a payment of $18 million to the Company
resulting in a gain reflected on the 1996 Statement of Operations of $16.9
million which is net of transaction and other costs and fees.

         In July 1999, the Company acquired Tres Hombres, Inc. The Company
issued 22,865 shares of stock previously held in treasury in exchange for all of
the outstanding common stock of Tres Hombres, Inc. Due to covenant requirements
established by its then existing working capital lender, the Company sold Tres
Hombres, Inc. in December 1999 recognizing a loss of approximately $363,000. The
sale was consummated through the receipt of a promissory note and assumption of
certain liabilities by the buyer.

         In March 2000, the Company offered to purchase by April 19, 2000 all
$127.2 million of its 12 7/8 % Senior Secured Notes due 2004 (the "Senior
Notes") and solicited consents for amendments of the indenture governing the
Senior Notes. The offered aggregate consideration for the purchase was $100
million, or $786 per $1,000 principal amount of the Senior Notes, without any
further accrual of interest. In April 2000, the Company amended and extended its
offer until May 5, 2000. In May 2000, the Company amended and extended its offer
to May 26, 2000. The amendment included the purchase, on a pro rata basis, of
60% of all Senior Notes outstanding. The offered aggregate consideration for the
purchase and consent was $60 million, or $786 per $1,000 principal amount of the
Senior Notes, without any accrual of interest.

         In order to obtain a portion of the funds necessary to consummate the
partial tender offer, from February 2000 through May 31, 2000, the Company sold
51 of its retail service centers located throughout the United States. The sales
price for the service center dispositions was approximately $82 million. In
connection with such sales, the Company recognized a gain of approximately
$47,000,000, resulting in an estimated tax liability of approximately
$10,000,000.

         All retail service centers disposed of during the fiscal years ended
June 30, 2000 and 1999 accounted for approximately 49.1% and 53.7% of the
Company's sales volume for the fiscal years ended June 30, 2000 and 1999,
respectively. The Company's Texas and Louisiana operations were disposed of in
September 1999, its Indiana, Michigan and Ohio facilities were disposed of in
February 2000, and nine operating locations in North Carolina were sold in March
2000. The Company's California, Nevada, Idaho, Washington and Oregon facilities
were disposed of in May 2000 and its remaining North Carolina facilities were
sold in July 2000. At June 30, 1999, the carrying value of the retail centers
disposed of was approximately 39% of the Company's total assets.

         On May 31, 2000 the Company successfully completed the partial tender
offer to purchase and retire 60% of the Senior Notes and received consents from
100% of the holders of the outstanding Senior Notes not owned by the Company for
certain amendments. Under terms of the amendments, the Company was permitted to
redeem the remaining $50,880,000 principal amount of the Senior Notes
outstanding at $786 per $1,000 principal amount without any accrual of interest,
or $40 million, by July 31, 2000 and the maturity date of the Senior Notes was
accelerated to July 31, 2000. In order to obtain a portion of the funds
necessary to pay the $40 million redemption amount, the Company intended to sell
additional service centers.

                                       3
<PAGE>

         On July 31, 2000, the Company did not enter into a definitive agreement
for the sale of certain of its assets, the proceeds of which were to be used in
part to redeem the Senior Notes. Therefore, as of such date, the Company is in
default with respect to the remaining $50,880,000 principal amount of its
outstanding Senior Notes. As a consequence, the Company was prohibited from
making the interest payment of $437,796 due July 31, 2000, after utilizing the
30 day grace period for the interest payment due on June 30, 2000, under the
Company's 9% Subordinated Debentures due 2007 (the "Subordinated Debentures").
Accordingly, the Company is also in default with respect to the $9,729,000
principal amount of its outstanding Subordinated Debentures.

         The Company is seeking to mitigate the effects of its current short
term cash flow problems through a re-capitalization of both the Senior Notes and
the Subordinated Debentures. On June 30, 2000, the Company offered, to the
holders of the Subordinated Debentures, to exchange an aggregate principal
amount of up to $9,729,000 of its new 9% Accruing Subordinated Debentures due
2007 ("Accruing Subordinated Debentures") for a like principal amount of its
issued and outstanding 9% Subordinated Debentures. The Accruing Subordinated
Debentures will be unsecured obligations of the Company, maturing on December
31, 2007, and will bear interest accruing semiannually from January 1, 2000 at
the rate of 9% per year, payable on maturity. The payment of the principal of,
premium, if any, and interest on the Accruing Subordinated Debentures will be
subordinated in right of payment to the prior payment in full of all existing
and future senior indebtedness of the Company.

         By exchanging a bi-annual cash interest payment obligation under the
Subordinated Debentures for the accruing and compounding interest obligation
under the Accruing Subordinated Debentures, although beneficial from a cash flow
perspective in the short term, the Company will significantly increase its
aggregate interest obligations upon maturity of the Accruing Subordinated
Debentures. Furthermore, if the exchange offer for the Subordinated Debentures
is not accepted by all of the holders of Subordinated Debentures, the Company
will be required to continue to pay interest to such non-tendering holders
semiannually in addition to being required to pay all accrued interest payable
as of June 30, 2000 to such non-tendering holders.

         In the event that the Company fails to make any interest payment
otherwise payable pursuant to the Subordinated Debentures or the Accruing
Subordinated Debentures, the trustee and the holders of such indebtedness may
choose to pursue any and all remedies contained in the indenture or at law
relating to such indebtedness.

         The Company is currently negotiating with the holders of its Senior
Notes to restructure such indebtedness. Such restructuring may include an
exchange offer for a new class of Senior Notes and/or additional security for
the holders of the Senior Secured Notes such as a pledge of the stock in the
Company owned by the controlling shareholders and/or a security interest in
certain assets of the Company and its subsidiaries.

         There can be no assurances that the holders of the Senior Notes or the
Subordinated Debentures will approve any amendment or restructuring of the
Senior Notes or the Subordinated Debentures, respectively. If the holders of the
Senior Notes or Subordinated Debentures accelerate the Company's obligations
under such indebtedness, such events would have a material adverse effect on the
Company's liquidity and financial position. Under such circumstances, the
Company's financial position would necessitate the development of an alternative
financial structure. Considering the limited financial resources and the
existence of certain defaults, there can be no assurances that the Company would
succeed in formulating and consummating an acceptable alternative financial
structure. In addition, in light of the Company's current financial condition
and the existence of certain defaults, the Company may need to seek protection
under the federal bankruptcy laws.

         Sources of Supply. During fiscal year 2000, approximately 80% of the
Company's propane purchases of its propane supply were on a contractual basis
(generally, one year agreements subject to annual renewal). The Company's two
largest suppliers provide 20.8% and 15.2% of the total supply purchased by the
Company. Supply contracts do not, generally, lock in prices, but rather provide
for pricing in accordance with posted prices at the time of delivery or
established by current major storage points, such as Mont Belvieu, TX, and
Conway, KS. The Company has established relationships with a number of suppliers

                                       4
<PAGE>


and believes it would have ample sources of supply under comparable terms to
draw upon to meet its propane requirements if it were to discontinue purchasing
from its two major suppliers. The Company takes advantage of the spot market as
appropriate. The Company has not experienced a shortage that has prevented it
from satisfying its customer's needs and does not foresee any significant
shortage in the supply of propane.

         Distribution. The Company purchases propane at refineries, gas
processing plants, underground storage facilities, and pipeline terminals and
transports the propane by railroad tank cars and tank trailer trucks to the
Company's retail service centers, each of which has bulk storage capacity
ranging from 16,000 to 180,000 gallons. The Company is a shipper on all major
interstate LPG pipeline systems. The retail service centers have an aggregate
storage capacity of approximately 2.5 million gallons of propane, and each
service center has equipment for transferring the gas into and from the bulk
storage tanks. The Company operates 6 over-the-road tractors and 11 transport
trailers to deliver propane and consumer tanks to its retail service centers and
also relies on common carriers to deliver propane to its retail service centers.

         Deliveries to customers are made by means of 134 propane delivery
trucks owned by the Company. Propane is stored by the customers on their
premises in stationary steel tanks generally ranging in capacity from 25 to
1,000 gallons, with large users having tanks with a capacity of up to 30,000
gallons. Most of the propane storage tanks used by the Company's residential and
commercial customers are owned by the Company and leased, rented, or loaned to
customers.

         Operations. The Company has organized its operations in a manner that
the Company believes enables it to provide excellent service to its customers
and to achieve operating efficiencies. Personnel located at the retail service
centers in the various regions are primarily responsible for customer service
and sales.

         A number of functions are centralized at the Company's corporate
headquarters in order to achieve certain operating efficiencies as well as to
enable the personnel located in the retail service centers to focus on customer
service and sales. The corporate headquarters and the retail service centers are
linked via a computer system. Each of the Company's primary retail service
centers is equipped with a computer connected to the central management
information system in the Company's corporate headquarters. This computer
network system provides retail company personnel with accurate and timely
information on pricing, inventory, and customer accounts. In addition, this
system enables management to monitor pricing, sales, delivery, and the general
operations of its numerous retail service centers and to plan accordingly to
improve the operations of the Company. The Company makes centralized purchases
of propane through its corporate headquarters for resale to the retail service
centers enabling the Company to achieve certain advantages, including price
advantages, because of its status as a large volume buyer. The functions of cash
management, accounting, taxes, payroll, permits, licensing, asset control,
employee benefits, human resources, and strategic planning are also performed on
a centralized basis.

         Factors Influencing Demand. Because a substantial amount of propane is
sold for heating purposes, the severity of winter weather and resulting
residential and commercial heating usage have an important impact on the
Company's earnings. Approximately two-thirds of the Company's retail propane
sales usually occur during the five months of November through March. Sales and
profits are subject to variation from month to month and from year to year,
depending on temperature fluctuations.

         Competition. The Company encounters competition from a number of other
propane distributors in each geographic region in which it operates. The Company
competes with these distributors primarily on the basis of service, stability of
supply, availability of consumer storage equipment, and price. Propane competes
primarily with natural gas, electricity and fuel oil principally on the basis of
price, availability and portability.

         The Company also competes with suppliers of electricity. Generally
speaking, the cost of propane compares favorably to electricity allowing the
Company to enjoy a competitive advantage due to the higher costs of electricity.
Fuel oil does not present a significant competitive threat in the Company's


                                       5
<PAGE>

primary service areas due to the following factors: (i) propane is a
residue-free, cleaner energy source, (ii) environmental concerns make fuel oil
relatively unattractive, and (iii) fuel oil appliances are not as efficient as
propane appliances.

         Although propane is generally more expensive than natural gas on an
equivalent BTU basis comparison, propane serves as an alternative to natural gas
in rural areas where natural gas is not available. Propane is also utilized by
natural gas customers on a stand-by basis during peak demand periods. The costs
involved in building or connecting to a natural gas distribution system have
tempered natural gas growth in most of the Company's trade territory.

         Risks of Business. The Company's propane operations are subject to all
the operating hazards and risks normally incident to handling, storing, and
transporting combustible liquids, such as the risk of personal injury and
property damages caused by accident or fire.

         Effective July 1, 1999, the Company's comprehensive general, auto and
excess liability policy provides for losses of up to $101.0 million with a
$250,000 self-insured retention for general and excess liability losses with a
$1 million aggregate cap. The Company's combined auto and workers' compensation
coverage is fully insured with no self-insured retention. Previously, the
Company retained $250,000 per occurrence on the auto and worker's compensation
programs.

Regulation

         The Company's operations are subject to various federal, state, and
local laws governing the transportation, storage and distribution of propane,
occupational health and safety, and other matters. All states in which the
Company operates have adopted fire safety codes that regulate the storage and
distribution of propane. In some states these laws are administered by state
agencies, and in others they are administered on a municipal level. Certain
municipalities prohibit the below ground installation of propane furnaces and
appliances, and certain states are considering the adoption of similar
regulations. The Company cannot predict the extent to which any such regulations
might affect the Company, but does not believe that any such effect would be
material. It is not anticipated that the Company will be required to expend
material amounts by reason of environmental and safety laws and regulations, but
inasmuch as such laws and regulations are constantly being changed, the Company
is unable to predict the ultimate cost to the Company of complying with
environmental and safety laws and regulations.

         All Star Gas currently meets and exceeds Federal regulations requiring
that all persons employed in the handling of propane gas be trained in proper
handling and operating procedures. All employees have participated, or will
participate within 90 days of their employment date, in hazardous materials
training. The Company has established ongoing training programs in all phases of
product knowledge and safety including participation in the National Propane Gas
Association's ("NPGA") Certified Employee Training Program.

Employees

         As of September 30, 2000 the Company had approximately 293 employees,
none of whom was represented by unions. The Company has never experienced any
significant work stoppage or other significant labor problems and believes it
has good relations with its employees.

Item 3.  Legal Proceedings.

         The Company and its subsidiaries are defendants in various routine
litigation incident to its business, none of which is expected to have a
material adverse effect on the Company's financial position or results of
operations.


                                       6
<PAGE>

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

         The Company held its annual shareholder meeting on July 10, 2000. The
only matter presented for a vote was the re-election of Paul S. Lindsey as
director. Mr. Lindsey was re-elected with 1,586,891 votes cast in favor and no
votes cast against, withheld or abstaining. The term of office of the following
directors continued after the meeting: Paul S. Lindsey, Jr., Kristin L. Lindsey,
Jim J. Shoemake, and Bruce M. Withers, Jr.


                                     PART II

Item 5.  Market for Registrant's Common Equity and Related Stockholder Matters.

         As of September 24, 2000, the Company's Common Stock was held of record
by 9 shareholders. There is currently no active trading market in the Company's
Common Stock.

         As of September 24, 2000, there are outstanding warrants to purchase
175,536 shares of the Company's Common Stock. Each warrant represents the right
to purchase one share of the Company's Common Stock of $.01 per warrant. The
warrants are exercisable currently and will expire July 15, 2004.

         No dividends on the Common Stock of the Company were paid during the
Company's 1999 or 2000 fiscal years. The indenture relating to the 12 7/8%
Senior Secured Notes due 2000 contain dividend restrictions that prohibit the
Company from paying common stock cash dividends. As a result, the Company has no
current intention of paying cash dividends on the Common Stock.

         If the Company restructures such indebtedness by exchanging the Senior
Notes for a new class of indebtedness, the Company would anticipate that the
indenture for the new indebtedness would contain similar dividend restrictions.
As a result, the Company has no current intention of paying dividends on the
Common Stock.

Item 6.  Selected Financial Data.

         The following table presents selected consolidated operating and
balance sheet data of All Star Gas as of and for each of the years in the
five-year period ended June 30, 2000. The financial data of the Company as of
and for each of the years in the five-year period ended June 30, 2000, were
derived from the Company's audited consolidated financial statements. The
financial and other data set forth below should be read in conjunction with the
Company's consolidated financial statements, including the notes thereto,
included with this report.



                                       7

<PAGE>

<TABLE>
<CAPTION>

                                                                               Year Ended June 30,
                                                                               -------------------
                                                               1996        1997        1998         1999        2000
                                                               ----        ----        ----         ----        ----
                                                                                    (Restated)   (Restated)
                                                                                    ----------   ----------
                                                                 (In thousands except ratios and per share amounts)
<S>                                                           <C>          <C>           <C>          <C>        <C>
Operating data:

   Operating revenue                                           $82,702      $94,543     $90,963       83,563     $80,617
   Gross profit (1)                                             39,384       41,468      47,124       45,592      34,192
   Operating expenses                                           27,987       28,853      33,340       32,057     (11,394)
   Depreciation & amortization.                                  6,770        6,867       9,723        9,776       8,169
   Operating income                                              4,627        5,748       4,061        3,759      37,417

   Interest expense:
      Cash interest                                             10,657       10,605      11,577       11,965      18,062
      Amortization of debt discount & expenses                   5,476        6,140       6,796        7,762       2,042
      Total interest expense                                    16,133       16,745      18,373       19,727      20,104
   Net income (loss) before extraordinary items (2)             (7,897)       2,222     (11,092)     (10,771)      9,421

Other operating data:

   Capital expenditures                                          9,988       18,444      19,444        4,563       5,442
   Proceeds from sale of retail service centers/other            6,177        5,478       2,821        3,131      91,646

   EBITDA  (3)                                                  11,002       13,347      13,444       12,988         646
   Basic & diluted income (loss) per share before
       Extraordinary items                                      ($5.00)       $1.41      $(6.99)      $(6.77)       $5.94

                                                                                     June 30,
                                                                                     --------
                                                               1996        1997        1998         1999        2000
                                                               ----        ----        ----         ----        ----
                                                                        (Restated)  (Restated)   (Restated)
                                                                        ----------  ----------   ----------
Balance sheet data:
   Total assets                                                $102,002    $110,311    $116,529     $106,975     $49,495
   Long-term debt (including current maturities)                122,858     127,870     143,709      147,710      61,074
   Stockholders' equity (deficit)                               (44,843)    (42,901)    (53,963)     (63,309)    (45,919)
</TABLE>

The 1996 and 1997 operating data and 1996 balance sheet data have not been
restated to give effect to the Tres Hombres acquisition as such information is
not available to the Company.

(1)  Represents operating revenue less the cost of products sold.
(2)  All Star Gas did not declare or pay dividends on its common stock during
     the five-year period ending June 30, 2000.
(3)  EBITDA consists of earnings before depreciation, amortization, interest,
     income taxes, and other non-recurring expenses. EBITDA is presented here
     because it is a widely accepted financial indicator of a highly leveraged
     company's ability to service and/or incur indebtedness. However, EBITDA
     should not be construed as an alternative either (i) to operating income
     (determined in accordance with generally accepted accounting principles) or
     (ii) to cash flows from operating activities (determined in accordance with
     generally accepted accounting principles).


                                       8
<PAGE>



Item 7. Management's Discussion and Analysis of Financial Condition and Results
of Operations

         The following discussion and analysis of the Company's results of
operations, financial condition and liquidity should be read in conjunction with
the historical consolidated financial statements of All Star Gas and the notes
thereto included in this Report.

Results of Operations

Fiscal Years Ended June 30, 2000 and June 30, 1999 (Restated)

         Operating revenue. Operating revenue decreased $3.0 million, or 3.5% to
$80.6 million in fiscal year 2000 as compared to $83.6 million in fiscal year
1999. The disposition of Tres Hombres, Inc. accounted for a $2.2 million
decrease in operating revenue in fiscal year 2000 compared to fiscal year 1999.
Propane sales decreased $340,000 in fiscal year 2000 compared to fiscal year
1999. Propane sales prices increased an average of $.21 per gallon over fiscal
year 1999. However, the Company experienced an 18% decrease in gallons sold from
fiscal year 1999. The decrease in gallons sold is primarily due to the
divestiture of retail service centers during fiscal year 2000. Comparing stores
that were operated by the Company during both fiscal years 2000 and 1999,
volumes decreased 3%. Also, a warmer than normal heating season was experienced
by the Company in its marketing territories. Heating degree days experienced by
the Company during fiscal year 2000 decreased 6% from fiscal year 1999.

         Cost of products sold. Costs of products sold increased $8.5 million or
22.3% to $46.4 million in fiscal year 2000 as compared to $37.9 million in
fiscal year 1999. This was primarily due to substantially higher propane product
costs experienced throughout the year. Propane costs increased an average of
$.20 per gallon over fiscal year 1999.

         Gross profit. The Company's gross profit decreased $11.4 million to
$34.2 million in fiscal year 2000 as compared to $45.6 million in fiscal year
1999. This decrease is primarily due to the decrease in gallons sold due to
divestitures of retail service centers and the significantly warmer than normal
heating season in the Company's marketing territories. Average propane margins
decreased 8% due to the inability to pass along higher product costs as rapidly
as they were incurred.

         General and administrative expenses. General and administrative
expenses increased $705,000 to $33.1 million in fiscal year 2000 as compared to
$32.4 million in fiscal year 1999. Insurance and liability claims increased $2.1
million due to increased costs on outstanding claims including a significant
increase in the Company's self-insurance reserve to cover anticipated losses on
two specific claims. Professional fees increased $734,000 mainly due to costs
associated with the sale of retail service centers, debt restructuring issues
and the Company's downsizing program during the year. Offsetting these
increases, salaries and employee benefit costs decreased $3.0 million due to the
divestiture of 66 retail service centers and the continued downsizing of the
Company's corporate office staffing levels.

         Provision for doubtful accounts. The provision for doubtful accounts
increased $237,000 from $227,000 in fiscal year 1999 to $464,000 in fiscal year
2000 due to the increased charge-offs as a percentage of accounts receivable
compared to fiscal 1999. An increase in the provision was deemed necessary in
order to bring the allowance for doubtful accounts to a level considered
adequate by the Company to provide for potential losses.

         Depreciation and amortization. Depreciation and amortization expense
decreased $1.6 million from $9.8 million in fiscal year 1999 to $8.2 million in
fiscal year 2000. The decrease is mainly due to the divestiture of 66 retail
service centers during fiscal year 2000.

                                       9
<PAGE>

         Interest expense. Interest expense increased $6.1 million to $18.1
million in fiscal year 2000 from $12.0 million in fiscal year 1999. The increase
is primarily due to effect of the interest rate increase under the terms of the
Company's 12 7/8% Senior Secured Notes due 2000.

Fiscal Years Ended June 30, 1999 (Restated) and June 30, 1998 (Restated)

         Operating revenue. Operating revenue decreased $7.4 million, or 8.1% to
$83.6 million in fiscal year 1999 as compared to $91.0 million in fiscal year
1998. The decrease was primarily due to a $6.6 million decrease in propane sales
which was the result of a 4% decrease in the gallons sold and a 10% lower
average propane sales price. Propane sales prices decreased an average of $0.36
per gallon under fiscal year 1998 which was the result of lower wholesale prices
which are discussed in the cost of products sold section. The decrease in
gallons is a direct result of the significantly warmer than normal weather
experienced by the Company in its marketing territories during the heating
season. Heating degree days experienced by the Company during fiscal year 1999
decreased 5% from fiscal year 1998.

         Cost of products sold. Cost of products sold decreased $5.9 million, or
13.4%, to $38.0 million in fiscal year 1999 as compared to $43.9 million in
fiscal year 1998. This was due to lower average wholesale propane costs and the
decrease in gallons sold outlined above. In fiscal year 1999, the propane
industry experienced higher than historical inventory levels in both the
domestic and Canadian markets. Combined with warmer winter weather, which
depressed demand and lowered crude oil prices, these large inventories have
resulted in significantly lower product costs.

         Gross profit. The Company's gross profit for the year decreased $1.5
million to $45.6 million in fiscal year 1999 as compared to $47.1 million in
fiscal year 1998. This decrease is primarily due to the decrease in gallons sold
due to the warmer than normal heating season in the Company's marketing
territories partially offset by a 3.1% improvement in operating margin.

         General and administrative expense. General and administrative expenses
decreased $900,000 to $32.4 million in fiscal year 1999 compared to $33.3
million in 1998. The majority of the decrease was due to a $372,000 decrease in
transportation costs as a result of the lower cost of fuel and small reductions
in various general and administrative expense categories resulting from the
continued downsizing of the Company's corporate office staffing levels.

         Provision for doubtful accounts. The provision for doubtful accounts
decreased $115,000, or 33.6%, from $342,000 in fiscal year 1998 to $227,000 in
fiscal year 1999. The decrease is a result of the enhanced credit and collection
effort, which reduced the Company's receivables and past due amounts.

         Depreciation and amortization. Depreciation and amortization expense
increased slightly to $9.8 million in fiscal year 1999 from $9.7 million in
fiscal year 1998. This increase is due primarily to the addition of fixed assets
through the acquisition of retail service centers occurring in the 1998 fiscal
year and the current period. Depreciation expense on modernization expenditures
and other asset purchases also contributed to the increase in fiscal year 1999.
During fiscal year 1999, the company utilized approximately $3.6 million for the
purchase of new consumer storage tanks and other property and equipment.

         Interest expense. Interest expense increased approximately $400,000 to
$12.0 million in fiscal year 1999 from $11.6 million in fiscal year 1998
primarily due to the increased mortgage obligation debt service resulting from
recent acquisitions and interest costs associated with the Company's working
capital facility.

Liquidity and Capital Resources

         The Company's liquidity requirements have arisen primarily from funding
its working capital needs, capital expenditures, and debt service requirements.
Historically, the Company has met these requirements from cash flows generated
by operations and from borrowings under its working capital facility.

                                       10
<PAGE>

         Cash flow used in operating activities was $18.1 million in fiscal year
2000 compared to cash flow provided by operating activities of $4.0 million in
fiscal year 1999. This change was due to a number of factors. First, operating
income decreased $10.7 million (excluding gains on sales of assets) from fiscal
year 1999 to fiscal year 2000 mainly due to the $11.4 million decrease in gross
profit which is a result of the significant disposition of retail service
centers during fiscal year 2000. Secondly, the Company has increased its levels
of inventory and decreased its accounts payable and certain accrued liabilities.

         Cash flow used in investing activities was $85.5 million in fiscal year
2000 compared to cash flow used in investing activities of $355,000 in fiscal
year 1999. This change is primarily due to the $88.5 million increase in
proceeds from sales of retail service centers and other assets during fiscal
year 2000.

         Cash flow used in financing activities was $68.3 million in fiscal year
2000 compared to cash flow used in financing activities of $3.2 million in
fiscal year 1999. This change is mainly due to the $4.5 million increase in the
repayments on the working capital facility and the $60 million principal payment
made on the Company's Senior Secured Notes due 2000 during fiscal year 2000.

         The Company is seeking to mitigate the effects of its current short
term cash flow problems through a re-capitalization of both the Senior Notes and
the Subordinated Debentures. On June 30, 2000, the Company offered, to the
holders of the Subordinated Debentures, to exchange an aggregate principal
amount of up to $9,729,000 of its new 9% Accruing Subordinated Debentures due
2007 ("Accruing Subordinated Debentures") for a like principal amount of its
issued and outstanding 9% Subordinated Debentures. The Accruing Subordinated
Debentures will be unsecured obligations of the Company, maturing on December
31, 2007, and will bear interest accruing semiannually from January 1, 2000 at
the rate of 9% per year, payable on maturity. The payment of the principal of,
premium, if any, and interest on the Accruing Subordinated Debentures will be
subordinated in right of payment to the prior payment in full of all existing
and future senior indebtedness of the Company.

         By exchanging a bi-annual cash interest payment obligation under the
Subordinated Debentures for the accruing and compounding interest obligation
under the Accruing Subordinated Debentures, although beneficial from a cash flow
perspective in the short term, the Company will significantly increase its
aggregate interest obligations upon maturity of the Accruing Subordinated
Debentures. Furthermore, if the exchange offer for the Subordinated Debentures
is not accepted by all of the holders of Subordinated Debentures, the Company
will be required to continue to pay interest to such non-tendering holders
semiannually in addition to being required to pay all accrued interest payable
as of July 31, 2000 to such non-tendering holders.

         In the event that the Company fails to make any interest payment
otherwise payable pursuant to the Subordinated Debentures or the Accruing
Subordinated Debentures, the trustee and the holders of such indebtedness may
choose to pursue any and all remedies contained in the indenture or at law
relating to such indebtedness.

         The Company is currently negotiating with the holders of its Senior
Notes to restructure such indebtedness. Such restructuring may include an
exchange offer for a new class of Senior Notes and/or additional security such
as a pledge of the stock in the Company owned by the controlling shareholders
and/or a security interest in certain assets of the Company and its
subsidiaries.

         There can be no assurances that the holders of the Senior Notes or the
Subordinated Debentures will approve any amendment or restructuring of the
Senior Notes or the Subordinated Debentures, respectively. If the holders of the
Senior Notes or Subordinated Debentures accelerate the Company's obligations
under such indebtedness, such events would have a material adverse effect on the
Company's liquidity and financial position. Under such circumstances, the
Company's financial position would necessitate the development of an alternative
financial structure. Considering the limited financial resources and the
existence of certain defaults, there can be no assurances that the Company would
succeed in formulating and consummating an acceptable alternative financial
structure. In addition, in light of the Company's current financial condition
and the existence of certain defaults, the Company may need to seek protection
under the federal bankruptcy laws.

                                       11
<PAGE>

         As a result of the Company's significant disposition of retail service
centers during fiscal 2000, the Company has incurred a $9.7 million federal tax
liability that was due September 15, 2000. The Company was unable to pay the
obligation when due. The Internal Revenue Service (the "IRS") may attempt
collection by various means including placing liens on Company assets and
seizing bank accounts.

Impact of Recent Accounting Pronouncements

         The Financial Accounting Standards Board recently adopted Statement of
Financial Accounting Standards (SFAS) 133, Accounting for Derivative Financial
Instruments and Hedging Activities, and SFAS 138, Accounting for Certain
Derivative Financial Instruments and Certain Hedging Activities. These
Statements establish accounting and reporting standards for derivative
instruments, including certain derivative instruments embedded in other
contracts, and for hedging activities. The Company will apply SFAS 133 and 138
beginning the first quarter of its fiscal year ending June 30, 2001, on a
prospective basis.

         Derivative financial instruments held by the Company as of July 1,
2000, consist of forward purchase commitments for LP gas. Management has
determined that the Company will elect not to apply the normal purchases and
normal sales exception and the hedge accounting provisions of the new standards
to those derivative financial instruments held at June 30, 2000. Instead, those
instruments will be recorded at their fair value with subsequent changes in fair
value included in earnings.

         The Company will recognize the existing derivative financial
instruments at their fair value as of July 1, 2000, net of related deferred
income taxes, as a cumulative effect of change in accounting principle. The
cumulative effect is not currently determinable as management has not yet
completed the process of determining the amount thereof. Management believes
that the adoption of these statements will not have a material adverse impact on
the Company's financial statements.

Impact of Year 2000

         The Company believes successful remediation of mission-critical systems
has been completed in a timely manner. The Company has not experienced any
significant operational or financial problems related to the Year 2000
compliance. Management presently believes that the year 2000 Issue will not pose
any future operational problems.

         THE ESTIMATES AND CONCLUSIONS HEREIN ARE FORWARD-LOOKING STATEMENTS AND
ARE BASED ON MANAGEMENT'S BEST ESTIMATES OF FUTURE EVENTS. RISKS OF COMPLETING
THE PLAN INCLUDE THE AVAILABILITY OF RESOURCES, THE ABILITY TO DISCOVER AND
CORRECT THE POTENTIAL YEAR 2000 SENSITIVE PROBLEMS WHICH COULD HAVE A SERIOUS
IMPACT ON CERTAIN OPERATIONS AND THE ABILITY OF THE COMPANY'S SERVICE PROVIDERS,
CUSTOMERS AND SUPPLIERS TO BRING THEIR SYSTEMS INTO YEAR 2000 COMPLIANCE.




                                       12
<PAGE>


Item 8.  Financial Statements and Supplementary Data.

      See the Consolidated Financial Statements included elsewhere herein.












                                       13

<PAGE>


Item 9.  Changes in and Disagreements With Accountants on Accounting and
Financial Disclosure.
         None

                                    PART III

Item 10.  Directors and Executive Officers of the Registrant.

         The directors and executive officers of the Company are as follows:

<TABLE>
<CAPTION>

                                                                     Position Held with the Company
      Name                                  Age                         And Principal Occupation
      ----                                  ---                      ------------------------------
<S>                                        <C>          <C>
Paul S. Lindsey, Jr.                         55      Chairman of the Board, Chief Executive Officer, and President since
                                                     June 1994; previously Vice Chairman of the Board (1987 to 1994) and
                                                     Chief Operating Officer (1988 to 1994); term as director expires
                                                     2000
Kristin L. Lindsey                           52      Director/Executive Vice President since Oct. 1996; previously
                                                     Director/Vice President to June 1994; previously pursued charitable
                                                     and other personal interest; term as director expires 2002
Bruce M. Withers, Jr.                        73      Director since June 1994; previously Chairman and Chief Executive
                                                     Officer of Trident NGL Holding, Inc. (since August 1991) and
                                                     President of the Transmission and Processing Division of Mitchell
                                                     Energy Corporation (1979 to 1991); term as director expires 2002
Jim J. Shoemake                              62      Director since June 1994; partner of Guilfoil, Petzall & Shoemake
                                                     (since 1970); term as director expires 2001
Valeria Schall                               46      Executive Vice President since October, 1996, Treasurer since July,
                                                     previously Vice President since 1992; Corporate Secretary since
                                                     1985 and Assistant to the Chairman since 1987
Bradley L. Beneke                            46      Senior Vice President - Operations since April 2000; Vice President
                                                     since April 2000; previously Pricing Director since June 1995;
                                                     previously Regional Manager since September 1991.
Robert C. Heagerty                           53      Sr. Vice President since September 1997, previously Divisional Vice
                                                     President since June 1993; previously Regional Manager since
                                                     December 1986.
J. Greg House, Sr.                           43      Vice President - Management Information Systems since June, 1996;
                                                     previously Director-MIS since September 1994 and Manager-MIS Paul
                                                     Mueller Co. since 1987.
Andrew J. Stevens                            44      Assistant Vice President-Treasurer since April 2000; previously;
                                                     Assistant Vice President-Financial Analysis since April 1999;
                                                     Previously director of Budgets and LPG Supply since July 1997;
                                                     Previously Budget Director since April 1995; previously Regional
                                                     Manager since August 1992.
</TABLE>

                                       14
<PAGE>

         Each director will serve for a term of three years. Officers of the
Company are elected by the Board of Directors of the Company and will serve at
the discretion of the Board, except for Mr. Lindsey, Ms. Lindsey and Ms. Schall
who are employed pursuant to an Employment Agreement that expires June 24, 2004,
September 24, 2004 and September 24, 2004, respectively.

Item 11.  Executive Compensation

Executive Compensation

         The following table provides compensation information for each of the
years ended June 30, 2000, 1999 and 1998, for (i) the Chief Executive Officer of
the Company, (ii) the four other executive officers of the Company who are most
highly compensated and whose total compensation exceeded $100,000 for the most
recent fiscal year (of which there were only two) and (iii) those persons who
are no longer executive officers of the Company but were among the four most
highly compensated and whose total compensation exceeded $100,000 for the most
recent year (of which there were none).

                           Summary Compensation Table

<TABLE>
<CAPTION>

                                                          Annual Compensation
Name and Principal                                        -------------------
 Position at End of Fiscal           Fiscal                                     Other Annual              All Other
 Year 2000                            Year        Salary        Bonus           Compensation            Compensation
--------------------------           ------       ------        -----           ------------            ------------
<S>                                  <C>           <C>         <C>                <C>                    <C>
Paul S. Lindsey, Jr.                   2000       $400,000       -----              -----                    -----
Chief Executive Officer,               1999       $400,000       -----              -----                    -----
Chairman of the Board                  1998       $400,000                          -----                    -----
And President

Valeria Schall                         2000       $100,000      $30,000             -----                    -----
Executive Vice President               1999       $100,000      $30,000             -----                    -----
                                       1998       $100,000      $35,000             -----                    -----

Kristin L. Lindsey                     2000       $100,000      $30,000             -----                    -----
Executive Vice President               1999       $100,000      $30,000             -----                    -----
And Director                           1998       $100,000      $35,000             -----                    -----

</TABLE>

Employment Agreement

         On June 24, 1999, the Company entered into an employment agreement with
Mr. Lindsey. The agreement has a five-year term and provides for the payment of
an annual salary of $400,000 and reimbursement for reasonable travel and
business expenses. The agreement requires Mr. Lindsey to devote substantially
all of his time to the Company's business. The agreement is for a term of five
years, but is automatically renewed for one year unless either party elects to
terminate the agreement at least four months prior to the end of the term or any
extension. The agreement may be terminated by Mr. Lindsey or the Company, but if
the agreement is terminated by the Company and without cause, the Company must
pay one year's salary as severance pay.

                                       15

<PAGE>


Incentive Stock Option Plan

         There were no options granted to the named officer nor exercised by him
during fiscal year 2000 and no unexercised options held by him as of the end of
the 2000 fiscal year.

Compensation Committee Interlocks and Insider Participation

         A compensation committee was formed in July 1994, consisting of Messrs.
Withers and Shoemake. Mr. Lindsey makes the initial recommendation concerning
executive compensation for the executive officers of the Company, other than
recommendations concerning his own and his wife's compensation, which are then
approved by the compensation committee. The compensation committee determines
the compensation of Mr. Lindsey's wife and, subject to the employment agreement
described above, Mr. Lindsey.

Director Compensation

         During the last completed fiscal year, the directors of All Star Gas
received an annual fee of $25,000, payable quarterly, for their services.

Item 12.  Security Ownership of Certain Beneficial Owners and Management

         The table below sets forth information with respect to the beneficial
ownership of shares of Common Stock of the Company as of September 24, 2000, by
persons owning more than five percent of any class, by all directors of the
Company, by the individuals named in the Summary Compensation Table owning
shares, and by all directors and executive officers of the Company as a group.

                                            Number of Shares
Name of Beneficial Owner (1)               Beneficially Owned         Percent
----------------------------               ------------------         -------
Paul S. Lindsey, Jr. (2)                          1,546,548             73.7
Kristin L. Lindsey (2)                              762,125             36.3
Valeria Schall                                       97,927              4.7
Bruce M. Withers, Jr.                                57,500              2.7
Jim J. Shoemake                                      57,500              2.7
All directors and executive                       1,918,404             91.5
  Officers as a group (8 persons)(3)

-----------------
(1)  The address of each of the beneficial owners is c/o All Star Gas
     Corporation, P.O. Box 303, 119 W. Commercial Street, Lebanon, Missouri
     65536.
(2)  Mr. Lindsey's shares consist of 784,423 shares owned by the Paul S.
     Lindsey, Jr. Trust established January 24, 1992 and 762,125 shares owned by
     the Kristin L. Lindsey Trust established January 24, 1992. Mr. Lindsey has
     the power to vote and to dispose of the shares held in the Kristin L.
     Lindsey Trust. Mrs. Lindsey's shares consist of the shares owned by the
     Kristin L. Lindsey Trust. Mrs. Lindsey disclaims ownership of the shares
     held by her husband in the Paul S. Lindsey, Jr. Trust.
(3)  The amounts shown include the shares beneficially owned by Mr. Lindsey and
     Mrs. Lindsey as set forth above, and 371,856 shares owned by other
     executive officers.

                                       16
<PAGE>

Item 13.  Certain Relationships and Related Transactions.

         Mrs. Kristin L. Lindsey, who beneficially owns approximately 36.3% of
the Company's outstanding Common Stock and is a Director of the Company, is the
majority stockholder in a company that supplies paint and labels to the Company.
The Company's purchases of paint and labels from this company totaled $225,000
in fiscal year 2000 and $250,000 in fiscal year 1999.

         The Company has entered into an agreement with each shareholder (all of
whom are directors or employees of the Company) providing the Company with a
right of first refusal with respect to the sale of any shares by such
shareholders. In addition, the Company has the right to purchase from such
shareholders all shares they hold at the time of their termination of employment
with the Company at the then current fair market value of the shares. The fair
market value is determined in the first instance by the Board of Directors and
by an independent appraisal (the cost of which is split between the Company and
the departing shareholder) if the departing shareholder disputes the board's
determination.

         Over the past fiscal year, the Company received advances bearing
interest at a rate of 12% from its Chief Executive Officer in the amount of $3.8
million which have a remaining balance of $0 at October 13, 2000.

         Effective July 2, 2000, the Company acquired Tres Hombres, Inc., a
restaurant chain substantially owned by the principal shareholder of the
Company. The transaction was consummated through an exchange of voting common
stock and was accounted for in a manner similar to a pooling of interests. The
Company sold the assets of Tres Hombres during fiscal 2000.


                                       17

<PAGE>


                                     PART IV


Item 14.  Exhibits, Financial Statement Schedules, and Reports on Form 8-K

            (a)(1)   Financial Statements
                      Report of Independent Accountants
                      Consolidated Balance Sheets as of June 30, 2000 and 1999
                        (Restated)
                      Consolidated Statement of Operations for the Years Ended
                        June 30, 2000, 1999 (Restated), and 1998 (Restated)
                      Consolidated Statements of the Stockholders' Equity
                        (Deficit) for the Years Ended June 30, 2000, 1999
                        (Restated), and 1998 (Restated)
                      Consolidated Statements of Cash Flows for the Years Ended
                         June 30, 2000, 1999 (Restated), and 1998 (Restated)

            (a)(2)   Financial Statement Schedules

                      Schedule II Valuation and qualifying accounts

            (a)(3)   Exhibits

<TABLE>
<CAPTION>

Exhibit
No.               Description
-------           -----------
<S>               <C>
3.1               Articles of Incorporation of the Company (incorporated herein by reference to Exhibit 3.1 to
                  the Company's Registration Statement on Form S-1 (No. 33-53343)

3.2               Certificate of Amendment of the Certificate of Incorporation of the Company, dated April 26,
                  1994, relating to the change of name (incorporated herein by reference to Exhibit 3.2 to the
                  Company's Registration Statement on Form S-1 (No. 33-53343)

3.3               By-laws of the Company (incorporated herein by reference to Exhibit 3.3 to the Company's
                  Registration Statement on Form S-1 (No. 33-53343)

4.1               Indenture between All Star Gas Corporation and J. Henry Schroder Bank & Trust company,
                  Trustee, relating to the 9% Subordinated Debentures due December 31, 2007, and the form of
                  9% Subordinated Debentures due December 31, 2007, (incorporated herein by reference to
                  Exhibit 4(a) to the All Star Incorporated and Exco Acquisition Corp. (Commission File No.
                  2-83683) Registration Statement on Form S-14 with the Commission on May 11, 1983); and First
                  Supplemental Indenture thereto between All Star Gas Corporation (now known as EGOC) and IBJ
                  Schroder Bank & Trust Co., dated as of December 13, 1989, (incorporated herein by reference
                  to Exhibit 4(c) to All Star Gas Corporation (now known as EGOC) Registration Statement on
                  Form 8-B filed with the Commission on February 1, 1990)

</TABLE>

                                       18
<PAGE>

<TABLE>
<CAPTION>
<S>               <C>
4.2               Indenture between the Company and Shawmut Bank Connecticut, National Association, Trustee,
                  relating to the 12-7/8% Senior Secured Notes due 2004, including the 12-7/8% Senior Secured
                  Notes due 2004, the Guarantee and the Pledge Agreement (incorporated herein by reference to
                  Exhibit 4.2 to the Registrant's Annual Report on Form 10-K for the year ended June 30, 1994)

4.3               Warrant Agreement (incorporated herein by reference to Exhibit 4.3 to the Registrant's
                  Annual Report on Form 10-K for the year ended June 30, 1994)

4.4               Supplemental Indenture between the Company and State Street Bank and Trust Company (as
                  successor to Shawmut Bank Connecticut, National Association), dated May 30, 2000, relating
                  to the 12-7/8% Senior Secured Notes due 2000, the First Amendment to the 12-7/8% Senior
                  Secured Notes due 2000, dated May 30, 2000 and the Security Agreement between All Star Gas
                  Inc. of Colorado and State Street Bank and Trust Company, dated May 30, 2000

10.1              Shareholder Agreement, dated as of October 28, 1988, by and among All Star Gas Acquisition
                  Corporation and Robert W. Plaster Trust, Robert W. Plaster, Trustee; Paul S. Lindsey, Jr.;
                  Stephen R. Plaster Trust, Lynn C. Hoover, Trustee; Cheryl Plaster Schaefer Trust, Lynn C.
                  Hoover, Trustee; Robert L. Wooldridge; Gwendolyn B. VanDerhoef; Dwight Gilpin; Luther Henry
                  Gill; Valeria Schall; Floyd J. Waterman; Larry W. Bisig; Larry Weis; Robert Heagerty; Murl
                  J. Waterman; Earl L. Noe; Thomas Flak; Michael Kent St. John; James E. Acreman; Carolyn
                  Rein; Dan Weatherly; Nina Irene Craighead; Joyce Sue Kinnett; Edwin H. McMahon; Paul
                  Stahlman; Ralph Wilson; Alan Simer; Ferrell Stamper; and All Star Gas Corporation Employee
                  Stock Ownership Plan, Robert W. Plaster, Trustee (incorporated herein by reference to
                  Exhibit 10.1 to the Company's Registration Statement on Form S-1 (No. 33-53343)

10.2              1995 Stock Option Plan of All Star Gas Company (incorporated herein by reference to Exhibit
                  10.2 to the Registrant's Annual Report on Form 10-K for the year ended June 30, 1995)

10.3              Employment Agreement between the Company and Paul S. Lindsey, Jr. (incorporated herein by
                  reference to Exhibit 10.7 to the Company's Registration Statement on Form S-1 (No. 33-53343)

10.4              Tax Indemnification Agreement between the Company and Energy (incorporated herein by
                  reference to Exhibit 10.10 to the Company's Registration Statement on Form S-1 (No.
                  33-53343)

10.5              Management Agreement between All Star Gas Company, Northwestern Growth Corporation and SYN,
                  Inc. dated May 17, 1995 (incorporated herein by reference to Exhibit 10.13 to the
                  Registrant's Annual Report on Form 10(k) for the year ended June 30, 1995)

10.6              Agreement Among Initial Stockholders and SYN, Inc. dated May 17, 1995 (incorporated herein
                  by reference to Exhibit 10.14 to the Registrant's Annual Report on Form 10(k) for the year
                  ended June 30, 1995).

</TABLE>


                                       19
<PAGE>

<TABLE>
<CAPTION>
<S>               <C>
10.7              Waiver Agreement dated April 29, 1995 by and among All Star Gas Corporation, SYN, Inc., Paul
                  S. Lindsey, Jr. Northwestern Growth Corporation, All Star Energy Corporation, Robert W.
                  Plaster, and Stephen R. Plaster (incorporated herein by reference to Exhibit 10.15 to the
                  Registrant's Annual Report on Form 10-K for the year ended June 30, 1995).

10.8              7/1/96 Agreement Amending Amended and Restated Agreement Among Initial Stockholders and Syn
                  Inc. (incorporated herein by reference to Exhibit 10.22 to the Registrant's Annual Report on
                  Form 10(k) for the year ended June 30, 1997).

10.9              11/3/95 Agreement Among Initial Stockholders and Mac Inc. (incorporated herein by reference
                  to Exhibit 10.25 to the Registrant's Annual Report on Form 10(k) for the year ended June 30,
                  1996).

10.10             11/3/95 Management Agreement between NWPS, Myers Acquisition Company and Empire
                  (incorporated herein by reference to Exhibit 10.26 to the Registrant's Annual Report on Form
                  10(k) for the year ended June 30, 1996)

10.11             7/31/95 Agreement Amending Management Agreement (incorporated herein by reference to Exhibit
                  10.28 to the Registrant's Annual Report on Form 10(k) for the year ended June 30, 1996).

10.12             7/31/95 Agreement Amending and Reinstating Agreement Among Initial Stockholders and Syn Inc.
                  (incorporated herein by reference to Exhibit 10.29 to the Registrant's Annual Report on Form
                  10(k) for the year ended June 30, 1996).

10.13+            Propane Sales Agreement dated April 9, 1996, between All Star Gas Corporation and Warren
                  Petroleum Company (incorporated herein by reference to Exhibit 10.30+ to the Registrant's
                  Annual Report on Form 10(k) for the year ended June 30, 1996).

10.14+            Amendment to Supply Contract dated August 15, 1994, between All Star Gas Corporation and
                  Phillips 66 Company (incorporated herein by reference to Exhibit 10.31+ to the Registrant's
                  Annual Report on Form 10(k) for the year ended June 30, 1996).

10.15+            Supply Contract dated April 1, 1996, between All Star Gas Corporation and Conoco, Inc.
                  (incorporated herein by reference to Exhibit 10.32+ to the Registrant's Annual Report on
                  Form 10(k) for the year ended June 30, 1996).

10.16+            Liquefied Petroleum Gas Contract dated July 1, 1996 between All Star Gas Corporation and
                  Shell Anacortes Refining Company (incorporated herein by reference to Exhibit 10.34+ to the
                  Registrant's Annual Report on Form 10(k) for the year ended June 30, 1996).

10.17+            Liquefied Petroleum Gas Contract dated July 1, 1996 between All Star Gas Corporation and
                  Shell Oil Company (incorporated herein by reference to Exhibit 10.35+ to the Registrant's
                  Annual Report on Form 10(k) for the year ended June 30, 1996).

</TABLE>
                                       20
<PAGE>

<TABLE>
<CAPTION>
<S>                 <C>
10.18+            Propane Sales Agreements between All Star Gas Corporation and Warren Petroleum Company
                  (incorporated herein by reference to Exhibit 10.36+ to the Registrant's Annual Report on
                  Form 10(k) for the year ended June 30, 1996).

10.19+            Liquefied Petroleum Gas Contract dated June 1, 1996 between All Star Gas Corporation and
                  Shell Oil Company (incorporated herein by reference to Exhibit 10.37+ to the Registrant's
                  Annual Report on Form 10(k) for the year ended June 30, 1996).

10.20             December 31, 1997, Lease of Aircraft Agreement between Paul S. Lindsey, LLC, and All Star
                  Gas Corporation (incorporated herein by reference to Exhibit 10.37 to the Registrant's
                  Annual Report on Form 10(k) for the year ended June 30, 1998)

10.21             Financing Agreement by and among All Star Gas Corporation and Ableco Finance LLC dated March
                  12, 1999 (incorporated herein by reference to Exhibit 10 to the Registrant's Quarterly
                  Report on Form 10 (q) for the quarter ended March 31, 1999.

21.1              Subsidiaries of the Company

27.1              Financial Data Schedules

+                 Confidential treatment has been requested. The copy filed as an exhibit omits the
                  information subject to the confidentiality request.
</TABLE>

                  (b)  Reports on Form 8-K
                           January 14, 2000
                           February 25, 2000
         `                 March 1, 2000
                           April 17, 2000
                           April 20, 2000
                           May 5, 2000
                           May 12, 2000
                           May 24, 2000
                           May 30, 2000
                           June 30, 2000
                           July 31, 2000
                           August 31, 2000
                           September 29, 2000

                  (c)  Exhibits
                           See (a)(3) above.

                  (d)  Financial Statements
                           See (a)(1) above.



                                       21
<PAGE>


                                   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.

                                        All Star Gas Corporation


                                        By: /s/  Paul S. Lindsey, Jr.
                                            -------------------------
                                            Paul S. Lindsey, Jr.

Dated:  October 13, 2000

         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 dates indicated.

          Signature                              Capacity in which Signed
          ---------                              ------------------------

/s/ Paul S. Lindsey, Jr.                       Chief Executive Officer and
------------------------------                 Chairman of the Board
    Paul S. Lindsey, Jr.

/s/ Willis D. Green                            Controller, Principal Financial
------------------------------                 Accounting Officer
    Willis D. Green


/s/ Kristin L. Lindsey                         Director
------------------------------
    Kristin L. Lindsey

/s/ Bruce M. Withers, Jr.                      Director
------------------------------
    Bruce M. Withers, Jr.

/s/ Jim J. Shoemake                            Director
------------------------------
    Jim J. Shoemake




                                       22





<PAGE>

                            All Star Gas Corporation

            Accountants' Report and Consolidated Financial Statements

                          June 30, 2000, 1999 and 1998



<PAGE>

                            ALL STAR GAS CORPORATION

                             JUNE 30, 2000 AND 1999

                                    CONTENTS
                                                                          Page

INDEPENDENT ACCOUNTANTS' REPORT..........................................   1

CONSOLIDATED FINANCIAL STATEMENTS
   Balance Sheets........................................................   3
   Statements of Operations .............................................   4
   Statements of Stockholders' Equity (Deficit)..........................   5
   Statements of Cash Flows..............................................   6
   Notes to Financial Statements.........................................   7

INDEPENDENT ACCOUNTANTS' REPORT ON
   SUPPLEMENTARY INFORMATION.............................................  26

SUPPLEMENTARY INFORMATION
   Consolidated Schedules of Sales and Gross Profit......................  27
   Consolidated Schedules of General and
    Administrative Expenses..............................................  28



<PAGE>

                         Independent Accountants' Report

Board of Directors and Stockholders
All Star Gas Corporation
Lebanon, Missouri

    We have audited the accompanying consolidated balance sheets of ALL STAR GAS
CORPORATION as of June 30, 2000 and 1999, and the related consolidated
statements of operations, stockholders' equity (deficit) and cash flows for each
of the three years in the period ended June 30, 2000. 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 audits.

    We conducted our audits in accordance with generally accepted auditing
standards. 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 audits provide a reasonable basis for our opinion.

    In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of ALL STAR GAS
CORPORATION as of June 30, 2000 and 1999, and the results of its operations and
its cash flows for each of the three years in the period ended June 30, 2000, in
conformity with generally accepted accounting principles.

    The accompanying financial statements have been prepared assuming the
Company will continue as a going concern. As discussed in Note 2, the Company
has previously suffered recurring losses from operations and has net working
capital and stockholders' equity deficiencies at June 30, 2000. As also
discussed in Note 2, the Company is in default with respect to its Senior
Secured Notes due 2004 and 9% Subordinated Debentures due 2007 and has incurred
a significant federal tax liability as a result of retail service center
dispositions in fiscal 2000 that it was unable to pay when due. These matters
raise substantial doubt about the Company's ability to continue as a going
concern. Management's plans in regard to these matters are also described in
Note 2. The financial statements do not include any adjustments that might
result from the outcome of these uncertainties.


<PAGE>


Board of Directors and Stockholders
All Star Gas Corporation
Page 2



     As discussed in Note 16, the consolidated balance sheet as of June 30,
1999, and the consolidated statements of operations, stockholders' equity
(deficit) and cash flows for the years ended June 30, 1999 and 1998, have been
retroactively restated to reflect the acquisition of Tres Hombres, Inc.



                                        /s/ BAIRD, KURTZ & DOBSON
                                        ----------------------------------------
                                        BAIRD, KURTZ & DOBSON




Springfield, Missouri
August 25, 2000, except for Notes 2 and 5
    as to which the date is September 29, 2000

<PAGE>

                            ALL STAR GAS CORPORATION

                           CONSOLIDATED BALANCE SHEETS

                             JUNE 30, 2000 AND 1999
                      (In Thousands, Except Share Amounts)

                                     ASSETS
<TABLE>
<CAPTION>

                                                                                  1999
                                                               2000            (Restated)
                                                              -------          ----------
<S>                                                           <C>              <C>
CURRENT ASSETS
   Cash                                                       $   432           $  1,323
   Trade receivables, less allowance
     for doubtful accounts; 2000 - $300, 1999 - $526            2,226              4,262
   Current maturities of note receivable                           45                 --
   Inventories                                                  4,121              4,854
   Prepaid expenses                                                91                974
   Refundable income taxes                                         --                749
   Deferred income taxes                                          150                300
                                                              -------           --------
         Total Current Assets                                   7,065             12,462
                                                              -------           --------

PROPERTY AND EQUIPMENT, At Cost
   Land and buildings                                           4,568             12,132
   Storage and consumer service facilities                     37,134             77,505
   Transportation, office and other equipment                  16,393             31,165
                                                              -------           --------
                                                               58,095            120,802
   Less accumulated depreciation                               24,777             43,378
                                                              -------           --------
                                                               33,318             77,424
                                                              -------           --------

OTHER ASSETS
   Debt acquisition costs, net of amortization                    823              3,718
   Excess of cost over fair value of net assets
     acquired, at amortized cost                                6,176             11,261
   Note receivable                                                927                 --
   Other                                                        1,186              2,110
                                                              -------           --------
                                                                9,112             17,089
                                                              -------           --------

                                                              $49,495           $106,975
                                                              =======           ========
</TABLE>

<PAGE>

                 LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
<TABLE>
<CAPTION>

                                                                                   1999
                                                                 2000            (Restated)
                                                               --------          ----------
<S>                                                            <C>               <C>
CURRENT LIABILITIES
   Checks in process of collection                             $  1,028           $  1,884
   Current maturities of long-term debt                          57,897              2,252
   Accounts payable                                               3,460              2,415
   Accrued salaries                                                 723              1,560
   Accrued interest                                               8,034              4,171
   Accrued expenses                                               1,480                973
   Customer prepayments                                           5,008              9,027
   Due to related parties                                            --              1,430
   Income taxes payable                                           9,948                 --
                                                               --------           --------
         Total Current Liabilities                               87,578             23,712
                                                               --------           --------

LONG-TERM DEBT                                                    3,177            145,458
                                                               --------           --------

DEFERRED INCOME TAXES                                             2,788                794
                                                               --------           --------

ACCRUED SELF-INSURANCE LIABILITY                                  1,871                320
                                                               --------           --------

STOCKHOLDERS' EQUITY (DEFICIT)
   Common; $.001 par value; authorized 20,000,000
     shares; issued June 30, 2000 and 1999,
     14,291,020 shares                                               14                 14
   Common stock purchase warrants                                 1,227              1,227
   Additional paid-in capital                                    28,574             28,574
   Retained earnings (deficit)                                   12,180             (5,210)
                                                               --------           --------
                                                                 41,995             24,605

   Treasury stock, at cost; 12,704,105 shares                   (87,914)           (87,914)
                                                               --------           --------
                                                                (45,919)           (63,309)
                                                               --------           --------

                                                               $ 49,495           $106,975
                                                               ========           ========
</TABLE>

See Notes to Consolidated Financial Statements

                                       -3-
<PAGE>

                            ALL STAR GAS CORPORATION

                      CONSOLIDATED STATEMENTS OF OPERATIONS

                    YEARS ENDED JUNE 30, 2000, 1999 AND 1998
                    (In Thousands, Except Per Share Amounts)

<TABLE>
<CAPTION>
                                                                           1999                1998
                                                         2000            (Restated)          (Restated)
                                                       --------          ----------          ----------
<S>                                                    <C>               <C>                 <C>
OPERATING REVENUE                                      $ 80,617           $ 83,563            $ 90,963

COST OF PRODUCT SOLD                                     46,425             37,971              43,839
                                                       --------           --------            --------

GROSS PROFIT                                             34,192             45,592              47,124
                                                       --------           --------            --------

OPERATING COSTS AND EXPENSES
   Provision for doubtful accounts                          464                227                 342
   General and administrative                            33,082             32,377              33,338
   Depreciation and amortization                          8,169              9,776               9,723
   Gain on sale of assets                               (44,940)              (547)               (340)
                                                       --------           --------            --------
                                                         (3,225)            41,833              43,063
                                                       --------           --------            --------

OPERATING INCOME                                         37,417              3,759               4,061
                                                       --------           --------            --------

OTHER INCOME (EXPENSE)
   Interest expense                                     (18,062)           (11,965)            (11,577)
   Amortization of debt discount                         (2,042)            (7,762)             (6,796)
   Restructuring proposal costs                              --                 --                (910)
                                                       --------           --------            --------
                                                        (20,104)           (19,727)            (19,283)
                                                       --------           --------            --------

INCOME (LOSS) BEFORE INCOME TAXES                        17,313            (15,968)            (15,222)

PROVISION (CREDIT) FOR INCOME TAXES                       7,892             (5,197)             (4,130)
                                                       --------           --------            --------

INCOME (LOSS) BEFORE EXTRAORDINARY ITEM                   9,421            (10,771)            (11,092)

EXTRAORDINARY ITEM
   Gain on extinguishment of debt, net of income
     taxes of $4,630                                      7,969                 --                  --
                                                       --------           --------            --------

NET INCOME (LOSS)                                      $ 17,390           $(10,771)           $(11,092)
                                                       ========           ========            ========

BASIC AND DILUTED INCOME (LOSS)
   PER COMMON SHARE BEFORE
   EXTRAORDINARY ITEM                                  $   5.94           $  (6.79)           $  (6.99)

BASIC AND DILUTED INCOME PER COMMON
   SHARE ON EXTRAORDINARY ITEM                             5.02                 --                  --
                                                       --------           --------            --------

BASIC AND DILUTED INCOME (LOSS) PER
   COMMON SHARE                                        $  10.96           $  (6.79)           $  (6.99)
                                                       ========           ========            ========
</TABLE>

See Notes to Consolidated Financial Statements

                                       -4-
<PAGE>


                            ALL STAR GAS CORPORATION

            CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)

                    YEARS ENDED JUNE 30, 2000, 1999 AND 1998
                                 (In Thousands)

<TABLE>
<CAPTION>

                                                Common                                                         Total
                                                Stock        Additional                                     Stockholders'
                                  Common       Purchase       Paid-In        Retained       Treasury           Equity
                                   Stock       Warrants       Capital        Earnings         Stock           (Deficit)
                                  ------       --------      ----------      --------       ---------         ---------
<S>                               <C>          <C>           <C>             <C>             <C>              <C>
BALANCE, JULY 1, 1997              $14          $1,227         $27,119       $ 16,653        $(87,914)        $(42,901)

CAPITAL CONTRIBUTED
   TO TRES HOMBRES,
   INC.                             --              --              30             --              --               30

NET LOSS                            --              --              --        (11,092)             --          (11,092)
                                   ---          ------         -------       --------        --------         --------

BALANCE, JUNE 30, 1998              14           1,227          27,149          5,561         (87,914)         (53,963)

CAPITAL CONTRIBUTED
   TO TRES HOMBRES,
   INC.                             --              --           1,425             --              --            1,425

NET LOSS                            --              --              --        (10,771)             --          (10,771)
                                   ---          ------         -------       --------        --------         --------

BALANCE, JUNE 30, 1999              14           1,227          28,574         (5,210)        (87,914)         (63,309)


NET INCOME                          --              --              --         17,390              --           17,390
                                   ---          ------         -------       --------        --------         --------

BALANCE, JUNE 30, 2000             $14          $1,227         $28,574       $ 12,180        $(87,914)        $ 45,919)
                                   ===          ======         =======       ========        ========         ========
</TABLE>

See Notes to Consolidated Financial Statements

                                       -5-
<PAGE>


                            ALL STAR GAS CORPORATION

                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                    YEARS ENDED JUNE 30, 2000, 1999 AND 1998
                                 (In Thousands)
<TABLE>
<CAPTION>

                                                                                              1999               1998
                                                                          2000             (Restated)         (Restated)
                                                                        --------           ----------         ----------
<S>                                                                     <C>                 <C>               <C>
CASH FLOWS FROM OPERATING ACTIVITIES
   Net income (loss)                                                    $ 17,390            $(10,771)          $(11,092)
   Items not requiring (providing) cash:
     Depreciation                                                          6,406               7,643              7,731
     Amortization                                                          3,423               9,895              8,788
     Gain on sale of assets                                              (44,940)               (547)              (340)
     Extraordinary gain on extinguishment of debt                         (7,969)                 --                 --
     Deferred income taxes                                                 2,144              (4,099)            (2,597)
   Changes in:
     Trade receivables                                                      (563)                583                 93
     Inventories                                                          (2,085)              2,099                332
     Prepaid expenses and other                                            1,228              (1,541)               739
     Accounts payable and customer prepayments                            (4,265)                352              1,735
     Accrued expenses and self-insurance                                  11,151                 355               (450)
                                                                        --------            --------           --------
         Net cash provided by (used in) operating activities             (18,080)              3,969              4,939
                                                                        --------            --------           --------

CASH FLOWS FROM INVESTING ACTIVITIES
   Proceeds from sales of retail service centers and other assets         91,646               3,131              2,821
   Acquisition of retail service centers                                    (601)               (601)            (4,435)
   Purchases of property and equipment                                    (4,120)             (3,655)            (7,566)
   Advances from (to) related parties                                     (1,430)                770              1,505
                                                                        --------            --------           --------
         Net cash provided by (used in) investing activities              85,495                (355)            (7,675)
                                                                        --------            --------           --------

CASH FLOWS FROM FINANCING ACTIVITIES
   Increase (decrease) in working capital facility                        (4,756)               (294)             4,500
   Principal payments on purchase obligations                             (2,812)             (3,810)            (2,355)
   Proceeds from issuance of long-term debt obligations                      118                 695                373
   Increase (decrease) in checks in process of collection                   (856)                202                182
   Principal payment on subordinated debentures                               --                 (13)                --
   Principal payment on senior secured notes                             (60,000)                 --                 --
                                                                        --------            --------           --------
         Net cash provided by (used in) financing activities             (68,306)             (3,220)             2,700
                                                                        --------            --------           --------

INCREASE (DECREASE) IN CASH                                                 (891)                394                (36)

CASH, BEGINNING OF YEAR                                                    1,323                 929                965
                                                                        --------            --------           --------

CASH, END OF YEAR                                                       $    432            $  1,323           $    929
                                                                        ========            ========           ========
</TABLE>
See Notes to Consolidated Financial Statements

                                       -6-

<PAGE>


                            ALL STAR GAS CORPORATION

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                          JUNE 30, 2000, 1999 AND 1998

NOTE 1: NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT
        ACCOUNTING POLICIES

Nature of Operations

     The Company's principal operation is the sale of liquefied propane (LP)
gas. Most of the Company's customers are owners of residential single or
multifamily dwellings who make periodic purchases on unsecured credit. Such
customers are located throughout the United States with the larger number
concentrated in the central and western states and along the Pacific coast.
During the first half of 2000, the Company also operated a restaurant chain
(Note 16).

Estimates

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

Principles of Consolidation

     The consolidated financial statements include the accounts of All Star Gas
Corporation and its wholly owned subsidiaries. All significant intercompany
transactions and balances have been eliminated in consolidation.

Revenue Recognition Policy

     Sales and related cost of product sold are recognized upon delivery of the
product or service.

Inventories

     Inventories are valued at the lower of cost or market. Cost is determined
by the first-in, first-out method for retail operations and specific
identification method for wholesale operations. At June 30, the inventories
were:

                                      -7-
<PAGE>

                            ALL STAR GAS CORPORATION

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                          JUNE 30, 2000, 1999 AND 1998

NOTE 1: NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT
        ACCOUNTING POLICIES (Continued)

Inventories (Continued)

                                                          2000           1999
                                                          -----         ------
                                                             (In Thousands)

     Gas and other petroleum products                     $2,832        $2,003
     Gas distribution parts, appliances and equipment      1,289         2,851
                                                          ------        ------

                                                          $4,121        $4,854
                                                          ======        ======

Property and Equipment

     Depreciation is provided on property and equipment on the straight-line
method over estimated useful lives of 3 to 33 years.

Income Taxes

     Deferred tax liabilities and assets are recognized for the tax effects of
differences between the financial statement and tax bases of assets and
liabilities. A valuation allowance is established to reduce deferred tax assets
if it is more likely than not that a deferred tax asset will not be realized.

Amortization

     Debt acquisition costs are being amortized on a straight-line basis over
the terms of the debt to which the costs are related as follows: the 1994 senior
secured note costs (originally $5,143,000) are amortized over ten years; and the
costs of the 1999 revolving credit facility (originally $1,279,000) were
amortized over three years.

     Amortization of discounts on debentures and notes (Note 5) is on the
effective interest, bonds outstanding method.

     The majority of the excess of cost over fair value of net assets acquired
relates to a transaction originating prior to July 1, 1994, and is being
amortized on the straight-line basis over 25 years. Excess of cost over fair
value of net assets on subsequent acquisitions is amortized on the straight-line
basis over five years.

                                      -8-
<PAGE>

                            ALL STAR GAS CORPORATION

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                          JUNE 30, 2000, 1999 AND 1998

NOTE 1: NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT
        ACCOUNTING POLICIES (Continued)

Income (Loss) Per Common Share

     Income (loss) per common share is computed by dividing net income (loss) by
the weighted average number of common shares and, except where anti-dilutive,
common share equivalents outstanding, if any. The weighted average number of
common shares outstanding used in the computation of earnings per share was
1,586,915 for each of the periods ended June 30, 2000, 1999 (restated) and 1998
(restated).

Futures Contracts and Purchase Commitments

     The Company uses commodity futures contracts to reduce the risk of future
price fluctuations for LP gas inventories and contracts. Gains and losses on
futures contracts purchased as hedges are deferred and recognized in cost of
sales as a component of the product cost for the related hedged transaction. In
the statement of cash flows, cash flows from qualifying hedges are classified in
the same category as the cash flows from the items being hedged. The Company
also routinely makes purchase commitments for the delivery of LP gas
inventories, particularly during its peak winter selling season. At June 30,
2000 and 1999, the Company had approximately $11,949,000 and $872,000,
respectively, in outstanding commitments to purchase LP gas for inventory. As of
June 30, 2000, the Company's open positions on futures contracts are immaterial,
and at June 30, 1999, the Company had no open positions on futures contracts.

Impact of Recent Accounting Pronouncements

     The Financial Accounting Standards Board recently adopted Statement of
Financial Accounting Standards (SFAS) 133, Accounting for Derivative Financial
Instruments and Hedging Activities, and SFAS 138, Accounting for Certain
Derivative Financial Instruments and Certain Hedging Activities. These
Statements establish accounting and reporting standards for derivative
instruments, including certain derivative instruments embedded in other
contracts, and for hedging activities. The Company will apply SFAS 133 and 138
beginning with the first quarter of its fiscal year ending June 30, 2001, on a
prospective basis.

                                      -9-
<PAGE>

                            ALL STAR GAS CORPORATION

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                          JUNE 30, 2000, 1999 AND 1998

NOTE 1: NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT
        ACCOUNTING POLICIES (Continued)

Impact of Recent Accounting Pronouncements (Continued)

     Derivative financial instruments held by the Company as of July 1, 2000,
consist of forward purchase commitments for LP gas. Management has determined
that the Company will elect not to apply the normal purchases and normal sales
exception and the hedge accounting provisions of the new standards to those
derivative financial instruments held at June 30, 2000. Instead, those
instruments will be recorded at their fair value with subsequent changes in fair
value included in earnings.

     The Company will recognize the existing derivative financial instruments at
their fair value as of July 1, 2000, net of related deferred income taxes, as a
cumulative effect of change in accounting principle. The cumulative effect is
not currently determinable as management has not yet completed the process of
determining the amount thereof. Management believes that the adoption of these
statements will not have a material adverse impact on the Company's financial
statements.

Segment Information

     The principal business of the Company is the sale of LP gas. During the
first half of 2000, the Company also operated a restaurant chain (Note 16). The
Company has no significant assets other than those used in its principal
business. The LP gas operation is the Company's only reportable segment.
Selected information is not presented separately for the Company's reportable
segment, as there is no material difference between that information and the
corresponding information in the consolidated financial statements.

Reclassification

     During the fourth quarter of fiscal year 2000, the Company recorded a
reclassification adjustment that increased additional paid-in capital and
decreased retained earnings (deficit) by $1,455,000 for capital contributed to
Tres Hombres, Inc. (Note 16) in 1999 and 1998. This adjustment had no effect on
net income.

                                      -10-
<PAGE>

                            ALL STAR GAS CORPORATION

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                          JUNE 30, 2000, 1999 AND 1998

NOTE 2: MANAGEMENT'S CONSIDERATION OF GOING CONCERN MATTERS

     The Company reported income from operations during fiscal 2000 primarily
due to the gains recognized on the sale of certain retail service centers (Note
15). The Company had previously suffered recurring losses from operations and
continues to have net working capital and net stockholders' equity deficiencies.
On July 31, 2000, the Company went into default with respect to the remaining
40% of its Senior Secured Notes due 2004 (Note 5) and, consequently, went into
default with respect to its 9% Subordinated Debentures due 2007 (Note 5).

     Also, as a result of the Company's significant disposition of retail
service centers during fiscal 2000, the Company has incurred a $9.7 million
federal tax liability that was due September 15, 2000. The Company was unable to
pay the obligation when due. The Internal Revenue Service (the "IRS") may
attempt collection by various means including placing liens on Company assets
and seizing bank accounts.

     The financial statements have been prepared assuming the Company will
continue as a going concern, realizing assets and liquidating liabilities in the
ordinary course of business. Management is undertaking several strategies for
mitigating these conditions during the coming year. These include the ongoing
plan of strategic geographic consolidation of service centers, disposing of
nonstrategic or marginal locations, merging small acquisitions into existing
markets, and reduction of general and administrative expenses. Also, the Company
is in negotiations with the holders of both the Senior Secured Notes and the
Subordinated Debentures seeking to restructure these debts and replace the
current indentures with new indentures. It is also in negotiations with the IRS
for a workout plan to settle the current tax obligation. Although not currently
planned, realization of assets in other than the ordinary course of business to
meet liquidity needs could incur losses not reflected in these financial
statements.

NOTE 3: RELATED PARTY TRANSACTIONS

     During 2000, 1999 and 1998, the Company has purchased $225,000, $250,000
and $189,000, respectively, of paint from a corporation owned by the spouse of
the Company's principal stockholder.

                                      -11-
<PAGE>

                            ALL STAR GAS CORPORATION

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                          JUNE 30, 2000, 1999 AND 1998

NOTE 3: RELATED PARTY TRANSACTIONS (Continued)

     In December 1996, the Company acquired a 10% ownership interest in Propane
Resources Transportation, Inc. (PRT). PRT provides transport services for a
portion of the Company's propane delivery needs resulting in freight charges
paid to PRT during 2000, 1999 and 1998 of $1,157,000, $773,000 and $768,000,
respectively.

     During the year ended June 30, 1997, the Company acquired a 39% interest in
Propane Resources Supply and Marketing, LLC (PRSM) for $263,000. The Company's
investment is stated at amortized cost plus equity in the affiliate's
undistributed net income since acquisition. The Company sells LP gas to PRSM on
a regular basis. The Company paid consulting fees of $250,000, $150,000 and
$200,000 to PRSM during 2000, 1999 and 1998, respectively.

     At June 30, 2000 and 1999, the Company has invested $134,000 along with
certain key employees in real estate partnerships as special limited partners
for tax credit allocation purposes.

     In 1998, the Company entered into an operating lease with the principal
stockholder for an aircraft. The lease required $95,000 in annual payments for a
term of three years that began in January 1998. In April 2000, the lease
agreement was terminated. The lease agreement required the Company to maintain
the aircraft in its condition at lease inception with normal wear and tear
excepted. The Company incurred expenses of $225,000 at the termination of the
lease to comply with this requirement.

     In 2000 and 1999, the principal stockholder loaned the Company amounts
totaling $3.8 million and $3.4 million, respectively, bearing interest at a rate
of 12%, with terms ranging from seven days to six months. At June 30, 2000 and
1999, the balance of these obligations was $0 and $400,000, respectively.


NOTE 4: NOTE RECEIVABLE

     The note receivable is secured primarily by three deeds of trust on real
property located in the counties of Laclede, Camden and Crawford in the state of
Missouri. The note is due in monthly installments of $11,000, including interest
at 9.375%, until August 2012.

                                      -12-
<PAGE>

                            ALL STAR GAS CORPORATION

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                          JUNE 30, 2000, 1999 AND 1998

NOTE 5: LONG-TERM DEBT

     Long-term debt at June 30 consisted of (in thousands):
<TABLE>
<CAPTION>
                                                                                  1999
                                                                   2000        (Restated)
                                                                  -------      ----------
    <S>                                                           <C>          <C>
    Working capital facility (A)                                  $    --       $  4,756
    127/8% Senior Secured Notes, due 2004 (B)                      50,880        127,200
    9% Subordinated Debentures, due 2007 (C)                        9,729          9,729
    Purchase contract obligations and capital leases (D)            4,643         11,102
                                                                  -------       --------
                                                                   65,252        152,787
    Less unamortized discounts                                      4,178          5,077
                                                                  -------       --------
                                                                   61,074        147,710
    Less current maturities                                        57,897          2,252
                                                                  -------       --------

                                                                  $ 3,177       $145,458
                                                                  =======       ========
</TABLE>

(A)   The working capital facility was provided by a commercial financing entity
      in March 1999. All of the Company's receivables and inventories were
      pledged as collateral to the agreement which contained covenants
      concerning reporting, EBITDA, tangible net worth and fixed charge coverage
      ratio requirements, and debt and certain dividend restrictions. In
      February 2000, the working capital facility was paid in full.

      The facility provided for borrowing up to $15 million, subject to a
      sufficient borrowing base. The facility had borne interest at the greater
      of 7.75% or the reference rate (prime) plus 4%. The agreement provided for
      payment of a $150,000 funding fee on the anniversary date of the loan each
      year.

(B)   The notes were issued June 1994 at a discount and require interest
      payments at 7% through July 15, 1999, and at 127/8% thereafter. The notes
      are redeemable at the Company's option. The original principal issued may
      be redeemed, as a whole or in part, at 106.438% of the principal amount
      through July 15, 2000, and at declining percentages thereafter. The notes
      are guaranteed by the subsidiaries of the Company and secured by the
      common stock of the restricted subsidiaries of the Company.

                                      -13-
<PAGE>

                            ALL STAR GAS CORPORATION

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                          JUNE 30, 2000, 1999 AND 1998

NOTE 5: LONG-TERM DEBT (Continued)

      The original principal amount of the notes issued ($127,200,000) was
      adjusted ($27,980,000) to give effect for the original issue discount and
      the common stock purchase warrants (effective interest rate of 13.0%). The
      discount on these notes is being amortized over the remaining life of the
      notes using the effective interest, bonds outstanding method.

      Separate financial statements of the guarantor subsidiaries are not
      included because such subsidiaries have jointly and severally guaranteed
      the notes on a full and unconditional basis; the aggregate assets and
      liabilities of the guarantor subsidiaries are substantially equivalent to
      the assets and liabilities of the parent on a consolidated basis; and the
      separate financial statements and other disclosures concerning the
      subsidiary guarantors are not deemed to be material.

      In May 2000, the Company received consent from the outstanding note
      holders to amend the indenture and the notes. Pursuant to the amendments,
      the Company redeemed 60% of the principal balance of the notes in the
      ratio of $786 per $1,000 principal. The aggregate amount paid was $60
      million and was generated through the proceeds from the sales of various
      retail service centers. The redemption resulted in the Company recording
      an extraordinary gain of approximately $12.6 million, less income taxes of
      $4.6 million.

      The remaining balance was to have been paid at the same discounted ratio
      at July 31, 2000, without any further accrual of interest since the last
      interest period that ended January 15, 2000. Proceeds from additional
      sales of service centers were to be used to generate the funds for the
      payment.

      On July 31, 2000, the Company defaulted with respect to the balance of the
      notes which, consequently, also caused the Company to be in default with
      respect to its 9% Subordinated Debentures, due 2007 (see item (C)). The
      Company was unable to enter into a definitive agreement for the sale of
      certain of its retail service centers to provide the funds necessary to
      redeem the remaining principal balance of the notes. The Company is
      negotiating with the holders seeking to restructure and extend the
      maturity of the notes.

      As a result of the default, the note holders have the right to accelerate
      the balance due and require immediate payment in full. Accordingly, the
      entire balance of the obligation is included in current liabilities at
      June 30, 2000. The note holders have not accelerated the balance due under
      the notes as of September 15, 2000.

                                      -14-
<PAGE>

                            ALL STAR GAS CORPORATION

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                          JUNE 30, 2000, 1999 AND 1998

NOTE 5: LONG-TERM DEBT (Continued)

(C)   The debentures, issued June 1983, are redeemable at the Company's option,
      as a whole or in part, at par value.

      The original principal amount of debentures issued was adjusted to market
      at issuance (effective interest rate of 16.5%). The remaining discount on
      these debentures is being amortized over the remaining life of the
      debentures using the effective interest, bonds outstanding method.

      On the June 30, 2000, interest due date, the Company notified note holders
      that it would use its 30 day grace period. At the same time, the Company
      offered to exchange the notes for a like principal amount on all of the
      outstanding notes and to amend the indenture governing the notes. The
      primary provisions of the offer include deferring all interest payments
      until maturity and eliminating the covenant in the indenture which
      requires it to maintain the registration of the notes under the Securities
      and Exchange Act of 1934. Consummation of the offer is subject to several
      conditions including the amendment of the indenture governing the notes
      and the acceptance of 662/3% in aggregate principal amount of the
      outstanding notes. The offer has an expiration date of October 31, 2000.

      The Company did not make the June 30, 2000, interest payment within the 30
      day grace period. As a result, the Company defaulted with respect to the
      notes. The Company is currently negotiating with the note holders to
      consummate an exchange offer as discussed above.

      As a result of the default, the note holders have the right to accelerate
      the balance due and require immediate payment in full. Accordingly, the
      entire balance of the obligation is included in current liabilities at
      June 30, 2000. The note holders have not accelerated the balance due under
      the notes as of September 15, 2000.

(D)   Purchase contract obligations arise from the purchase of operating
      businesses and are collateralized by the equipment and real estate
      acquired in the respective acquisitions. Capital leases include leases
      covering trucks and data processing equipment. At June 30, 2000 and 1999,
      these obligations carried interest rates from 7% to 11% and are due
      periodically through 2006.

                                      -15-
<PAGE>

                            ALL STAR GAS CORPORATION

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                          JUNE 30, 2000, 1999 AND 1998

NOTE 5: LONG-TERM DEBT (Continued)

     Aggregate annual debt service requirements (in thousands) of the long-term
debt outstanding at June 30, 2000, are:

                                                                  Total
                               Principal        Interest      Debt Service
                               ---------        --------      ------------
              2001              $57,897          $8,908          $66,805
              2002                  785             214              999
              2003                  670             164              834
              2004                  529             115              644
              2005                  446              77              523
           Thereafter               747              60              807
                                -------          ------          -------

                                $61,074          $9,538          $70,612
                                =======          ======          =======


NOTE 6: INCOME TAXES

     The provision (credit) for income taxes on income before extraordinary item
includes these components:
<TABLE>
<CAPTION>
                                                              1999           1998
                                               2000        (Restated)     (Restated)
                                               ----        ----------     ----------
                                                         (In Thousands)
   <S>                                       <C>            <C>             <C>
   Taxes currently payable (refundable)       $5,748        $(1,098)        $(1,533)
   Deferred income taxes                       2,144         (4,099)         (2,597)
                                              ------        -------         -------

                                              $7,892        $(5,197)        $(4,130)
                                              ======        =======         ========
</TABLE>


                                      -16-
<PAGE>

                            ALL STAR GAS CORPORATION

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                          JUNE 30, 2000, 1999 AND 1998

NOTE 6: INCOME TAXES (Continued)

     The tax effects of temporary differences at June 30, 2000 and 1999
(restated), related to deferred taxes were:
<TABLE>
<CAPTION>

                                                                                        1999
                                                                      2000           (Restated)
                                                                     ----             ----------
                                                                          (In Thousands)
   <S>                                                              <C>              <C>
   Deferred Tax Assets

     Allowance for doubtful accounts                                 $   110           $    191
     Accounts receivable advance collections                              --                 36
     Self-insurance liabilities and contingencies                      1,472              1,247
     Original issue discount                                           4,041             10,046
     Net operating loss carryforwards                                     --              2,864
     Alternative minimum tax credit carryforwards                         --              2,200
                                                                     -------           --------
                                                                       5,623             16,584

   Deferred Tax Liability

     Accumulated depreciation and tax cost differences                (8,261)           (17,078)
                                                                     -------           --------

         Net deferred tax liability                                  $(2,638)          $   (494)
                                                                     =======           ========
</TABLE>

    The above net deferred tax liability is presented on the June 30 balance
sheets as follows:
<TABLE>
<CAPTION>

                                                                                         1999
                                                                       2000           (Restated)
                                                                     -------          ----------
                                                                           (In Thousands)
   <S>                                                              <C>                <C>
   Deferred Tax Assets (Liabilities)

     Deferred tax asset - current                                    $   150           $    300
     Deferred tax liability - long-term                               (2,788)              (794)
                                                                     -------           --------

         Net deferred tax liability                                  $(2,638)          $   (494)
                                                                     =======           ========
</TABLE>

                                      -17-

<PAGE>

                            ALL STAR GAS CORPORATION

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                          JUNE 30, 2000, 1999 AND 1998

NOTE 6: INCOME TAXES (Continued)

     A reconciliation of income tax expense (credit) at the statutory rate to
the Company's actual income tax expense (credit) is shown below:
<TABLE>
<CAPTION>
                                                                       1999            1998
                                                         2000        (Restated)      (Restated)
                                                        ------       ----------      ----------
                                                                   (In Thousands)
<S>                                                     <C>            <C>             <C>
Computed at the statutory rate (34%)                    $5,886         $(5,429)        $(5,175)
Increase (decrease) resulting from:
   Amortization of excess of cost over
     fair value of net assets acquired                     210             389             386
   State income taxes - net of federal tax benefit       1,323            (280)            (96)
   Nondeductible travel costs and other expenses            28              31              28
   Nondeductible goodwill amortization on sold
     retail service centers                                895              --              --
   Other                                                  (450)             92             727
                                                        ------         -------         -------

     Actual tax provision (credit)                      $7,892         $(5,197)        $(4,130)
                                                        ======         =======         =======
</TABLE>


NOTE 7: SELF-INSURANCE AND CONTINGENCIES

     Under the Company's current insurance program, the Company's comprehensive
general, auto and excess liability policy provides for losses of up to $101.0
million with a $250,000 self-insured retention for general and excess liability
losses with a $1 million aggregate cap. The Company's combined auto and workers'
compensation coverage is fully insured with no self-insured retention. The
Company obtains excess coverage on occurrence basis policies. Provisions for
self-insured losses are recorded based upon the Company's estimates of the
aggregate self-insured liability for claims incurred, resulting in a retention
for a portion of these expected losses.

     The ending accrued liability includes $150,000 for incurred but not
reported claims at June 30, 2000 and 1999. The current portion of the ending
liability of $400,000 at June 30, 2000 and 1999, is included in accrued expenses
in the consolidated balance sheets. The noncurrent portion at the end of each
period is included in accrued self-insurance liability.

                                      -18-
<PAGE>

                            ALL STAR GAS CORPORATION

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                          JUNE 30, 2000, 1999 AND 1998

NOTE 7: SELF-INSURANCE AND CONTINGENCIES (Continued)

     The Company and its subsidiaries are also defendants in various lawsuits
related to the self-insurance program and other business related lawsuits which
are not expected to have a material adverse effect on the Company's financial
position or results of operations.

     The Company currently self-insures health benefits provided to the
employees of the Company and its subsidiaries subject to a $75,000 cap per
claim. Provisions for losses expected under this program are recorded based upon
the Company's estimate of the aggregate liability for claims incurred. The
aggregate cost of providing the health benefits was $1,079,000, $816,000 and
$700,000 for the years ended June 30, 2000, 1999 (restated) and 1998 (restated),
respectively.

     In conjunction with a restructuring transaction involving the Company and
Empire Energy Corporation, the parties agreed to share on a percentage basis the
self-insured liabilities and other business related lawsuits incurred prior to
June 30, 1994, including both reported and unreported claims. The self-insured
liabilities included under this agreement include general, vehicle, workers'
compensation and health insurance liabilities. Under the agreement, the Company
assumed 52.3% of the liability with Empire Energy Corporation assuming the
remaining 47.7%.

     The Company and its subsidiaries are presently involved in other various
federal and state tax audits which are not expected to have a material adverse
effect on the Company's financial position or results of operations.

NOTE 8:  STOCK OPTIONS AND WARRANTS

Stock Options

     The Company has established a Stock Option Plan for the benefit of its
employees, consultants and directors. Stock options may be either incentive
stock options or nonqualified stock options, with an option price no less than
the fair value of the Company's common stock on the date of the grant. Options
are granted for no more than a 10-year term and are exercisable based on a
written agreement between the administrator and optionee.

                                      -19-
<PAGE>

                            ALL STAR GAS CORPORATION

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                          JUNE 30, 2000, 1999 AND 1998

NOTE 8: STOCK OPTIONS AND WARRANTS (Continued)

Stock Options (Continued)

     The table below summarizes transactions under the Company's stock option
plan:

                                              Number of Shares
                                              ----------------

   Balance, June 30, 1997                         672,126
     Granted ($1.00 per share)                    104,000
     Forfeited                                   (192,100)
                                                 --------
   Balance, June 30, 1998                         584,026
     Granted ($1.00 per share)                    154,404
     Forfeited                                   (237,730)
                                                 --------
   Balance, June 30, 1999                         500,700
     Granted ($1.00 per share)                     10,000
     Forfeited                                    (75,000)
                                                  -------

   Balance, June 30, 2000                         435,700
                                                  =======

     Options outstanding at June 30, 2000, have a weighted-average remaining
contractual life of approximately seven years with 313,680 options currently
exercisable. The exercise price was $7.00 per share until May 2000 when it was
reduced to $1.00 per share.

     The Company applies Accounting Principles Board Opinion 25 and related
Interpretations in accounting for the plan, and no compensation cost has been
recognized. No fair value disclosures with respect to stock options are
presented because, in the opinion of management, such values do not have a
material effect.

Common Stock Purchase Warrants

     The Company issued detachable warrants to purchase common stock in
connection with the issuance of 127/8% Senior Secured Notes in 1994. Each
warrant represents the right to purchase one share of the Company's common stock
for $.01 per warrant. The warrants are exercisable currently and will expire on
July 15, 2004. No warrants were issued or exercised in 2000, 1999 and 1998.
Warrants to purchase 175,536 shares were outstanding at June 30, 2000 and 1999.

                                      -20-
<PAGE>

                            ALL STAR GAS CORPORATION

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                          JUNE 30, 2000, 1999 AND 1998

NOTE 9: ADDITIONAL CASH FLOW INFORMATION
<TABLE>
<CAPTION>
                                                                              1999                1998
                                                             2000          (Restated)           (Restated)
                                                            -------         ----------          ----------
                                                                           (In Thousands)
<S>                                                        <C>              <C>                 <C>
Noncash Investing and Financing Activities
------------------------------------------
   Notes receivable from sale of retail service
     centers and Tres Hombres, Inc.                         $ 1,350            $   207                  --
   Purchase contract obligations incurred for
     business acquisitions                                     $389                $75             $ 7,115
   Capital lease obligations incurred for property
     and equipment                                             $332               $232                $328

Additional Cash Payment Information
-----------------------------------
   Interest paid                                            $14,199            $11,762             $11,406
   Income taxes paid                                           $552                 --                  --
   Income taxes refunded                                       $869             $1,486                $842
</TABLE>

NOTE 10:  EMPLOYEE BENEFIT PLAN

     The Company has a defined contribution retirement plan covering
substantially all employees. Employees who elect to participate may contribute a
percentage of their salaries to the plan. The Company may make contributions to
the plan at the discretion of its Board of Directors. No contributions to the
plan were made by the Company during the years ended June 30, 2000, 1999 or
1998.


NOTE 11: OPERATING LEASES

     Noncancelable operating leases, which cover office space and various
equipment, expire in various years through 2012. These leases generally contain
renewal options for periods ranging from one to five years and require the
Company to pay all executory costs (property taxes, maintenance and insurance).

                                      -21-
<PAGE>

                            ALL STAR GAS CORPORATION

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                          JUNE 30, 2000, 1999 AND 1998

NOTE 11: OPERATING LEASES (Continued)

     Future minimum lease payments (in thousands) at June 30, 2000, were:

            2001                                         $  586
            2002                                            451
            2003                                            417
            2004                                            410
            2005                                            407
            Thereafter                                    2,686
                                                         ------

            Future minimum lease payments                $4,957
                                                         ======


NOTE 12: RESTRUCTURING PROPOSAL COSTS

     During the year ended June 30, 1998, the Company was considering a proposal
to restructure its debt and equity. The Company abandoned the proposal and has
expensed the related costs of $910,000 during the year ended June 30, 1998.

NOTE 13: SIGNIFICANT ESTIMATES AND CONCENTRATIONS

     Generally accepted accounting principles require disclosure of certain
significant estimates and current vulnerabilities due to certain concentrations.
Those matters include the following:

Estimates

     Significant estimates related to self-insurance, goodwill amortization,
litigation, collectibility of receivables and income tax assessments are
discussed in Notes 1 and 6. Actual losses related to these items could vary
materially in the near term from amounts reflected in the financial statements.


NOTE 14: DISCLOSURES ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS

     At June 30, 2000 and 1999, the Company's financial instruments consist of
cash, trade receivables and payables, receivables from related parties and
long-term debt. The following methods were used to estimate the fair value of
financial instruments:

                                      -22-
<PAGE>

                            ALL STAR GAS CORPORATION

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                          JUNE 30, 2000, 1999 AND 1998

NOTE 14: DISCLOSURES ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS
         (Continued)

Note Receivable

     Fair value is estimated by discounting the future cash flows using the
rates at which similar notes would be written for the same remaining maturities.

Long-Term Debt

     Fair value of the Senior Secured Notes is estimated based on the trading
prices of this debt issuance. The fair value of the Subordinated Debentures is
estimated by discounting the future cash flows using the rates at which similar
notes would be written for the same remaining maturities. The fair value of the
other debt approximates carrying value as other debt consists of multiple
mortgage obligations and the working capital facility with interest rates
approximating rates currently available to the Company.

     The following table presents estimated fair values of the Company's
financial instruments. The fair values of certain of these instruments were
calculated by discounting expected cash flows, which method involves significant
judgments by management and uncertainties. Fair value is the estimated amount at
which financial assets or liabilities could be exchanged in a current
transaction between willing parties, other than in a forced or liquidation sale.
Because no market exists for certain of these financial instruments and because
management does not intend to sell these financial instruments, the Company does
not know whether the fair values shown below represent values at which the
respective financial instruments could be acquired or sold individually or in
the aggregate.
<TABLE>
<CAPTION>

                                                                       June 30
                                             ------------------------------------------------------------
                                                                                          1999
                                                       2000                            (Restated)
                                             ------------------------          --------------------------
                                            Carrying            Fair           Carrying            Fair
                                             Amount            Value            Amount             Value
                                             -------          -------          --------           -------
<S>                                          <C>              <C>              <C>               <C>
Financial Assets:
   Cash                                         $432             $432            $1,323            $1,323
   Note receivable                              $972             $972                --                --
Financial Liabilities:
   Senior Secured Notes, due 2004            $50,535          $40,000          $126,183           $94,764
   Subordinated Debentures, due 2007          $5,896           $5,843            $5,669            $5,669
   Other long-term debt                       $4,643           $4,643           $15,858           $15,858
</TABLE>

                                      -23-
<PAGE>

                            ALL STAR GAS CORPORATION

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                          JUNE 30, 2000, 1999 AND 1998

NOTE 15: ACQUISITIONS AND DISPOSITIONS OF RETAIL SERVICE CENTERS

     During the year ended June 30, 2000, the Company acquired one LP gas
operation through an asset purchase transaction for a total of $545,000, of
which $5,500 was paid in cash with the remainder in mortgage obligations and the
assumption of certain liabilities. During the year ended June 30, 1999, the
Company acquired one LP gas operation through an asset purchase transaction for
a total of $675,000, of which $590,000 was paid in cash with the remainder in
mortgage obligations and the assumption of certain liabilities. Each of these
acquisitions has been accounted for as a purchase by recording the assets
acquired and the liabilities assumed at their estimated fair values at the
acquisition date. Amounts paid above these fair values are recorded as excess of
cost over fair value of net assets acquired. The consolidated operations of the
Company include the operations of the acquirees from the acquisition dates. The
pro forma effects of the acquisitions as if they had been completed at the
beginning of the year would not be materially different from actual results.

     During the year ended June 30, 2000, the Company sold 66 retail service
centers. The Company received $91.1 million in cash from these sales. Unaudited
pro forma consolidated operations, assuming the dispositions were made at the
beginning of the current and previous years, are shown below:

                                    2000               1999
                                    ----               ----
                                         (In Millions)
   Operating revenue               $55.7               $46.1

   Net income (loss)               $14.9              $(14.9)

     The pro forma results are not necessarily indicative of what would have
occurred had the retail service center dispositions been on those dates, nor are
they necessarily indicative of future operations.


NOTE 16: BUSINESS ACQUISITION AND DISPOSITION

     On July 2, 1999, the Company acquired Tres Hombres, Inc., a restaurant
chain controlled by the Company's principal stockholder, in a transaction that
was accounted for in a manner similar to a pooling of interests. The Company
issued 22,865 shares of stock previously held in treasury in exchange for all of
the outstanding common stock of Tres Hombres, Inc. The consolidated

                                      -24-
<PAGE>

                            ALL STAR GAS CORPORATION

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                          JUNE 30, 2000, 1999 AND 1998

NOTE 16: BUSINESS ACQUISITION AND DISPOSITION (Continued)

balance sheets as of June 30, 1999, and the consolidated statements of
operations, stockholders' equity (deficit) and cash flows for the years ended
June 30, 1999 and 1998, have been retroactively restated to include Tres
Hombres, Inc. This resulted in an increase in net loss for fiscal 1999 and 1998
of $1,144,000 and $1,138,000, respectively, and an increase in basic and diluted
loss per common share for both fiscal 1999 and 1998 of $0.63.

     Due to covenant requirements established by its working capital lender, the
Company sold Tres Hombres, Inc. in December 1999, recognizing a loss of
approximately $363,000. The sale was consummated through receipt of a promissory
note and assumption of certain liabilities by the buyer. Unaudited pro forma
consolidated operations, assuming the disposition was made at the beginning of
the current and previous years, are shown below:

                                  2000               1999
                                  ----               ----
                                       (In Millions)

   Operating revenue             $78.7               $79.5

   Net income (loss)             $18.3               $(9.6)




                                      -25-
<PAGE>

                       Independent Accountants' Report on
                            Supplementary Information


Board of Directors and Stockholders
All Star Gas Corporation
Lebanon, Missouri


     Our audits were made for the purpose of forming an opinion on the basic
consolidated financial statements taken as a whole. The nature of our audit
procedures is more fully described in our report on the basic consolidated
financial statements. Our report on the basic consolidated financial statements
includes an emphasis paragraph discussing substantial doubt about the Company's
ability to continue as a going concern. The accompanying supplementary
information is presented for purposes of additional analysis and is not a
required part of the basic consolidated financial statements. Such information
has been subjected to the procedures applied in the audits of the basic
consolidated financial statements and, in our opinion, is fairly stated, in all
material respects, in relation to the basic consolidated financial statements
taken as a whole.


                                                        BAIRD, KURTZ & DOBSON





Springfield, Missouri
August 25, 2000


                                      -26-
<PAGE>

                            ALL STAR GAS CORPORATION

                CONSOLIDATED SCHEDULES OF SALES AND GROSS PROFIT

                       YEARS ENDED JUNE 30, 2000 AND 1999
                                 (In Thousands)

<TABLE>
<CAPTION>

                                                                                            1999
                                                  2000                                   (Restated)
                                   -------------------------------------     -------------------------------------
                                                       Gross Profit                             Gross Profit
                                                 -----------------------                   -----------------------
                                                              Percentage                                Percentage
                                    Sales         Amount      of Revenue      Sales         Amount      of Revenue
                                   -------       -------      ----------     -------       -------      ----------
<S>                                <C>           <C>          <C>            <C>           <C>          <C>
Gas Sales
   Bulk - retail                   $64,529       $26,696         41.4%       $67,626       $37,076         54.8%
   Bulk - industrial
     accounts                        5,529           910         16.5          2,366          (526)       (22.2)
   Bottle - retail and
     wholesale                       1,593           975         61.2          2,000         1,375         68.8
                                   -------       -------                     -------       -------
                                    71,651        28,581         39.9         71,992        37,925         52.7

Gas Systems
   and Appliances                    3,424           677         19.8          3,741         1,225         32.7
                                   -------       -------                     -------       -------
                                    75,075        29,258                      75,733        39,150


Other Revenue
   Food, liquor and other            1,860         1,252                       4,026         2,638
   Rental, storage
     and leases                      1,607         1,607                       1,706         1,706
   Service labor                     1,453         1,453                       1,494         1,494
   Service charges                     280           280                         341           341
   Miscellaneous                       342           342                         263           263
                                   -------       -------                     -------       -------
Total Operating
   Revenues                        $80,617       $34,192         42.4        $83,563       $45,592         54.6
                                   =======       =======                     =======       =======
</TABLE>

                                      -27-

<PAGE>

                            ALL STAR GAS CORPORATION

          CONSOLIDATED SCHEDULES OF GENERAL AND ADMINISTRATIVE EXPENSES

                       YEARS ENDED JUNE 30, 2000 AND 1999
                                 (In Thousands)

                                                                        1999
                                                         2000        (Restated)
                                                        -------      ----------

Salaries and commissions                                $14,692       $17,625
Transportation                                            2,593         2,032

Office, telephone and utilities                           1,930         2,008
Taxes and licenses other than payroll and income          1,010         1,118

Rent and maintenance of building and equipment            2,657         2,515
Payroll taxes and employee benefits                       2,604         2,630

Insurance and liability claims                            3,773         1,687
Travel and entertainment                                    525           553

Professional fees                                         1,600           866
Advertising                                                 369           412
Miscellaneous                                             1,329           931
                                                        -------       -------

                                                        $33,082       $32,377
                                                        =======       =======

                                      -28-
<PAGE>


        Independent Accountants' Report on Financial Statement Schedules

Board of Directors and Stockholders
All Star Gas Corporation
Lebanon, Missouri

     In connection with our audit of the consolidated financial statements of
ALL STAR GAS CORPORATION for each of the three years in the period ended June
30, 2000, we have also audited the following financial statement schedules.
These financial statement schedules are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statement schedules based on our audits of the basic financial statements. The
schedules are presented for purposes of complying with the Securities and
Exchange Commission's rules and regulations and are not a required part of the
consolidated financial statements.

     In our opinion, the financial statement schedules referred to above, when
considered in relation to the basic consolidated financial statements taken as a
whole, present fairly, in all material respects, the information required to be
included therein.

                                        BAIRD, KURTZ & DOBSON



Springfield, Missouri
August 25, 2000


<PAGE>
                 SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS

                    YEARS ENDED JUNE 30, 2000, 1999 AND 1998
                                 (In Thousands)

<TABLE>
<CAPTION>
                                      Balance at        Charges to         Amount                      Balance at
                                      Beginning         Costs and         Written                        End of
         Description                   of Year           Expenses           Off            Other          Year
         -----------                  -----------       ----------        ---------        -----        --------
<S>                                   <C>                <C>              <C>              <C>          <C>
Valuation accounts deducted
   from assets to which they
   apply - for doubtful
   accounts receivable:
     June 30, 2000                        $526             $464             $369            $1(A)          $300
                                                                                         $(322)(B)
     June 30, 1999                        $844             $227             $545            $3 (A)         $526
                                                                                           $(3)(B)
     June 30, 1998                        $899             $342             $475           $96 (A)         $844
                                                                                          $(18)(B)
</TABLE>

(A) Allowance for doubtful accounts receivable established with respect to the
    acquisition of retail service centers.

(B) Related to accounts receivable which were sold in conjunction with the
    disposition of retail service centers.