SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                           _____________________________
                                    FORM 10-K
[MARK ONE]
[X]  ANNUAL REPORT  PURSUANT TO SECTION 13 OR 15(D) OF THE  SECURITIES  EXCHANGE
     ACT OF 1934

                   For the fiscal year ended December 31, 2000

                                       OR

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

         For the transition period from _____________ to _____________.

                           Commission File No. 1-10489
                           _____________________________

                                  KIMMINS CORP.
             (Exact name of registrant as specified in its charter)

               FLORIDA                           59-3598343
       (State of Incorporation)      (I.R.S. Employer Identification No.)

                 1501 SECOND AVENUE, EAST, TAMPA, FLORIDA 33605
   (Address of registrant's principal executive offices, including zip code)
                         _____________________________
      (Registrant's telephone number, including area code): (813) 248-3878

           SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT:

                                                 Name of Exchange
            Title of Each Class                on Which Registered
       _____________________________       _____________________________
       Common Stock, $.001 par value                  None

           SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT:

                                      NONE

     Indicate by a 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 [X]         No [ ]

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

     As of March 15,  2001 there  were  outstanding  4,872,135  shares of Common
Stock and 1,666,569  shares of Class B common stock.  The aggregate market value
of the voting stock held by  non-affiliates  of the  registrant  as of March 19,
2001, was $2,436,068.

                          _____________________________
                      DOCUMENTS INCORPORATED BY REFERENCE:


                                    NONE


<PAGE>

                                  KIMMINS CORP.

                                    FORM 10-K

                                TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S>            <C>                                                                      <C>
                                                                                         Page
                                                                                           No.
                                                                                         -----
PART I
  Item 1       Business......................................................................3
  Item 2       Properties....................................................................8
  Item 3       Legal Proceedings.............................................................8
  Item 4       Submission of Matters to a Vote of Security Holders...........................8

PART II
  Item 5       Market for the Registrant's Common Equity and Related Stockholder Matters.....9
  Item 6       Selected Financial Data......................................................10
  Item 7       Management's Discussion and Analysis of Financial Condition and
                  Results of Operations.....................................................11
  Item 7A      Quantitative and Qualitative Disclosures about Market Risk...................17
  Item 8       Financial Statements and Supplementary Data..................................18
  Item 9       Changes in and Disagreements with Accountants on Accounting and
                     Financial Disclosures..................................................48

PART III
  Item 10      Directors and Executive Officers of the Registrant...........................49
  Item 11      Executive Compensation.......................................................50
  Item 12      Security Ownership of Certain Beneficial Owners and Management...............53
  Item 13      Certain Relationships and Related Transactions...............................54

PART IV
  Item 14      Exhibits, Financial Statement Schedules and Reports on Form 8-K..............56

</TABLE>
                                       2
<PAGE>

     Note: The discussions in this Form 10-K contain forward-looking  statements
that involve  risks and  uncertainties.  Statements  contained in this Form 10-K
that are not historical facts are forward looking statements that are subject to
the safe harbor created by the Private Securities Litigation Reform Act of 1995.
A number of important  factors could cause future  results of Kimmins Corp.  and
its subsidiaries to differ materially and significantly  from those expressed or
implied in past  results and in any forward  looking  statements  made by, or on
behalf  of,  the  Company.  Factors  that  could  cause  or  contribute  to such
differences  include,  but are not limited to, those discussed in "Business" and
"Management's  Discussion  and  Analysis of Financial  Condition  and Results of
Operations,"  as well as those  discussed  elsewhere  in this Form  10-K.  These
factors  include,  without  limitation,  those  listed in "Risk  Factors" in the
Company's Registration Statement on Form S-1 (File No. 33-12677).


                                     PART I

ITEM 1.  BUSINESS
                                   THE COMPANY

     Kimmins Corp. and its subsidiaries  (collectively,  the "Company")  provide
specialty-contracting  services  in the  south,  mainly  in  Florida,  including
earthwork; infrastructure development;  underground construction; roadwork; site
remediation  services;  facilities  demolition  and  dismantling;  and  asbestos
abatement.  The Company historically operated two business segments: solid waste
management services and specialty contracting  services.  The Company previously
provided solid waste  management  services  through its TransCor Waste Services,
Inc.,  ("TransCor")  subsidiary  to  commercial,  industrial,  residential,  and
municipal  customers in the state of Florida.  As a result of TransCor's sale of
its wholly owned subsidiary  Kimmins Recycling Corp. ("KRC") in August 1998, the
Company no longer provides solid waste management services.

     The Company's specialty contracting services are as follows:

                - Earthwork  and  utility  contracting  -  Earthwork  activities
                  including  commercial and residential  site work and earthwork
                  activities  for  the  phosphate   mining   industry.   Utility
                  contracting,  including  infrastructure services such as sewer
                  lines, water lines, and roads and site remediation services.

                - Industrial   demolition,    dismantling,   and   abatement   -
                  Dismantling  of facilities or  structures  including  draining
                  liquid wastes from pipes and tanks; asbestos removal, cleanup,
                  disposal, and reinsulation; removal of above- and below-ground
                  tanks;  removal and disposal or sale of other  equipment;  and
                  sale of scrap materials.

     The  Company's  services  may be used  individually  or in  combination  as
required  to meet  the  specific  needs of  customers.  The  Company's  business
strategy is to draw upon its contracting  experience to perform complex projects
requiring a broad range of services.  Although  each of the  Company's  business
lines can operate  independently  from the other related  services,  the Company
believes that integration of these services gives it a competitive  advantage by
relieving  the  customer of the burden of  coordinating  activities  of multiple
contractors.

     During its initial years of operation, the Company emphasized,  among other
services  offered,  a broad  range  of  contracting  services.  As the  need for
waste-related  and  specialty  contracting  services  has grown in  response  to
heightened  public concern and government  regulation,  the Company has used its
capabilities  in facilities  demolition and dismantling and in the management of
complex   construction    projects   to   become   increasingly    involved   in
project-oriented activities.

     The  Company's  strategy is to continue to focus on  specialty  contracting
projects for private and governmental  customers.  The Company does not consider
its business to be highly seasonal.

                                      3
<PAGE>

SERVICES
--------

SPECIALTY CONTRACTING:
---------------------

EARTHWORK AND UTILITY CONTRACTING SERVICES

     Since 1988,  the Company has directed its focus  toward  environmental  and
utility contracting,  including  infrastructure and reconstructive service work.
The Company,  through its subsidiary,  Kimmins  Contracting Corp.,  continues to
provide   comprehensive    non-hazardous    contracting   services,    including
infrastructure  services such as water and sewer line installation,  replacement
and repair,  to private and  governmental  customers  primarily  in the state of
Florida. Related infrastructure  development includes road installation,  repair
and  widening,  and  installation,   repair  and  enhancement  of  drainage  and
wastewater services.

     Kimmins  Contracting  Corp.  has  broadened its array of services by adding
earthwork  operations.  These  operations are mainly directed toward the private
sector in the state of Florida and include land  reclamation,  dam  construction
and  other  earthwork   operations  for  the  phosphate  mining  industry,   and
residential and commercial site work services.

     As part of its  earthwork  and utility  contracting  services,  the Company
offers a range of services for the removal and disposal of hazardous  materials.
The  services  offered  include  construction  of  containment  systems  and the
excavation and removal of contaminated  material.  The Company has de-emphasized
its hazardous waste services and will only perform these services in conjunction
with other environmental demolition activities.

INDUSTRIAL DEMOLITION, DISMANTLING, AND ABATEMENT SERVICES

     The Company offers  demolition and dismantling of facilities or structures;
asbestos removal;  cleanup,  disposal,  and  reinsulation;  removal of above and
below  ground  storage  tanks;  removal  and  disposal  or  sale  of  industrial
equipment; and the sale of equipment and scrap materials.

     Demolition and dismantling projects result from the closing or retooling of
facilities  due to such factors as  technological  obsolescence  of  facilities,
corporate  mergers and  consolidations  of  operations,  and the  relocation  of
manufacturing  operations  to  low-cost  labor  areas or areas  subject  to less
stringent  regulation,   primarily  in  foreign  countries.  In  addition,  site
remediation,  particularly in the case of environmental contamination of a site,
frequently requires the demolition or dismantling of a contaminated facility.

     Dismantling  is the precise  disassembly of a  manufacturing  or production
facility on a piece-by-piece  basis to recover  equipment as complete  operating
units that can be  reinstalled  at another  location.  Dismantling  enhances the
value of the facility above scrap market  values.  The Company is paid a fee for
dismantling  services and,  usually,  a commission on the sale of  non-relocated
equipment.

     Demolition usually requires wrecking services for which the Company is paid
a fee by the  customer.  In  certain  projects,  the  Company  may also  receive
additional  revenue from selling the scrap material.  The Company's  services in
these areas include  dismantling  large structures  (including  refineries,  and
utility plants); draining liquid wastes from pipes and tanks; removing above and
below-ground  tanks;  cleaning and  disposing  of  contaminated  equipment;  and
controlled demolition.

     Certain  demolition  projects also involve  asbestos  removal,  cleanup and
disposal.  The Company is  continuing  to  de-emphasize  its asbestos  abatement
services and generally  will only perform  these  services in  conjunction  with
other environmental demolition activities.

                                       4
<PAGE>

DISCONTINUED OPERATIONS
-----------------------

SOLID WASTE MANAGEMENT SERVICES:
-------------------------------

     On May 31, 1998, the Company sold its  Jacksonville  area waste  collection
and recycling  operating  assets and certain assets of the Miami  front-end load
and rear-load  commercial waste and recycling business to Eastern  Environmental
Services , Inc.  (EESI).  TransCor adopted a formal plan to dispose of its solid
waste  management  services  operations  on July 17,  1998 by selling its wholly
owned subsidiary KRC to EESI. On August 31, 1998, the Company completed the sale
of the solid  waste  management  services  (SWMS)  operations.  The assets  sold
consisted primarily of accounts receivables,  contracts,  property and equipment
and goodwill.  The selling price was  approximately  $69,400,000  in the form of
cash and EESI common  stock.  On December 31,  1998,  EESI was acquired by Waste
Management,  Inc. (WMI) and the Company received stock of Waste Management, Inc.
in exchange for its EESI stock.  On June 27, 2000,  the Company  received net of
related legal fees, $3,525,000 from WMI as final settlement. This settlement was
for  adjustments  required  under the purchase  agreement and for other disputes
related to the sale of the SWMS operations.

     The Company,  through its  majority-owned  subsidiary,  TransCor,  formerly
provided solid waste management services to commercial, industrial, residential,
and municipal customers. In connection with such services, the Company owned and
operated  fully  permitted  construction  and  demolition  ("C&D")  transfer and
recycling ("T&R") facilities in four of the largest  metropolitan regions in the
state of Florida; Jacksonville,  Clearwater, Tampa and Miami. In addition to its
T&R operations, the Company collected and disposed of all types of non-hazardous
solid waste for  industrial  and  commercial  customers in its T&R regions.  The
Company  also  provided  residential  garbage  collection  services  for several
municipalities  located in Lee  County and  Hillsborough  County,  Florida.  The
Company  also  engaged,   pursuant  to  several  municipal  contracts,   in  the
residential  curbside  collection of a variety of already segregated  recyclable
forms of  solid  waste,  including  such  materials  as  newspapers,  cardboard,
plastic, metals, and glass.


PERFORMANCE BONDS
-----------------

     The  Company is  required  to post  performance  bonds in  connection  with
certain asbestos  abatement,  waste  remediation,  demolition,  and construction
contracts. For the years ended December 31, 1999 and 2000, most of the Company's
revenue was derived from contracts or projects that required the Company to post
performance  bonds.  The Company's  current bonding  capacity for  qualification
purposes  is  $30,000,000  for  individual   projects  and  $60,000,000  in  the
aggregate.  This  capacity  is not  intended  to be  either  a  limitation  or a
commitment  as to  the  Company's  bond  capacity,  but  rather  guidelines  for
qualification  purposes. It is customary for surety bond companies to underwrite
each surety obligation  individually;  therefore, the potential for more or less
capacity exists based on the merits of the obligation. Historically, the Company
has obtained  surety bond  support for  individual  projects in the  $53,000,000
range while the aggregate approached $100 million.


MARKETING
---------

     The  Company's  specialty   contracting  business  results  primarily  from
customers  for  whom  the  Company  has  previously  provided  services,   prior
customer's  references,  and from direct marketing efforts.  In particular,  the
Company believes its national reputation as a leading demolition and dismantling
contractor has  contributed  significantly  to its ability to attract  specialty
service business.

     The Company's  specialty  contracting  subsidiaries  direct their marketing
activities through the home office in Tampa,  Florida. This office is located in
an area with a high concentration of industrial facilities. The Company believes
that  accurate  bidding is crucial in  securing  new  contracting  projects  and
completing them  profitably.  The Company uses  computerized  bidding systems in
conjunction with site visits to develop bids for contracting projects. While bid
price is an important  factor in  obtaining  contracts,  potential  clients also
consider the reputation, experience, safety record and financial strength of the
bidders in awarding contracts.

                                       5
<PAGE>

     The Company also obtains  contracts for its services through the process of
competitive bidding,  purchase orders, or negotiations.  The Company's marketing
efforts include door-to-door sales, monitoring trade journals and other industry
sources  for  bid  solicitations  by  various  entities,   including  government
authorities   and  related   instrumentalities,   and  responding  to  such  bid
solicitations,  which may include  requests for proposals  ("RFPs") and requests
for qualifications  ("RFQs").  The Company also attempts to be included on lists
of qualified  bidders  frequently  contained in RFPs and RFQs. In response to an
RFP or RFQ, the soliciting entity requires a written response within a specified
period.  Generally, in the case of an RFP, a bidder submits a proposal detailing
its qualifications, the services to be provided, and the cost of the services to
the  soliciting  entity;  then,  such  entity,  based on its  evaluation  of the
proposals  submitted,  awards the contract to the successful bidder. In the case
of  an  RFQ,  a  bidder  submits  a  response   describing  its  experience  and
qualifications, the soliciting entity then selects the bidder believed to be the
most qualified, and then negotiates all of the terms of the contract,  including
the cost of the services.


CUSTOMERS
---------

     The primary,  private  customers  for the  Company's  specialy  contracting
services are  corporations,  engaged in heavy  manufacturing,  such as phosphate
mining,  commercial and residential  real estate  developers,  as well as public
utilities and federal,  state and local government agencies. For the years ended
December 31, 1998,  1999 and 2000,  the following  table  summarizes the revenue
earned on contracts  with  significant  customers that  aggregated  more than 10
percent of the continuing operations revenues:


                                                (In thousands)
                                                --------------
                                      1998             1999            2000
                                      ----             ----            ----
Phosphate mining                       17,594           14,372           8,010
Utility municipal                         -0-              -0-           6,025
Real estate development                10,039              -0-          14,891
Governmental infrastructure             6,950              -0-             -0-
                                    ----------      -----------     -----------
Total from above customers       $     34,583    $      14,372   $      28,926
                                    ==========      ===========     ===========

Percentage of gross revenue             46.7%            22.7%           47.6%
                                    ==========      ===========     ===========

     For  the  year  ended  December  31,  2000,  69  percent  and  31  percent,
respectively,  of the  Company's  gross  revenue  were  derived from private and
governmental customers,  respectively.  Government contracts,  which represent a
significant  portion of the Company's gross revenue,  are subject to legislation
mandating a balanced  budget;  delays in funding;  lengthy review  processes for
awarding contracts;  delay or termination of contracts at the convenience of the
government; and termination, reduction or modification of contracts in the event
of changes in the  government's  policies or because of  budgetary  constraints.
Furthermore,  increased  or  unexpected  costs could result in losses or reduced
profits  under  fixed-price  government  as well as  commercial  contracts.  The
Company continues to focus efforts on securing more private customers.

BACKLOG
-------

     As of December 31, 2000, the Company had a backlog of uncompleted  projects
under contract aggregating  approximately $20,745,000 (compared to approximately
$20,250,000  as of December 31, 1999),  of which  approximately  $12,240,000  is
attributable  to  earthwork  and  utility  contracting  services,  approximately
$7,983,000  is  attributable  to  demolition  and  dismantling   services,   and
approximately $522,000 is attributable to asbestos abatement and other services.
The Company anticipates that it will recognize approximately 99% of the revenues
from these projects by the end of 2001.


                                       6
<PAGE>

COMPETITION
-----------

     The Company  believes  that its ability to offer a broad range of specialty
contracting  services  provides  it  with  significant   competitive  advantage.
Nevertheless,  the Company faces substantial competition from national, regional
and local competitors,  many of which are well established and have much greater
marketing, financial, technological and other resources than the Company.

     The Company  believes the  principal  competitive  factors in the specialty
contracting  services industry are safety,  reputation,  technical  proficiency,
surety bonding capability, managerial experience, price, and breadth of services
offered.

INSURANCE COVERAGE
------------------

     The Company currently maintains  comprehensive general liability insurance,
with total coverage of $11,000,000 for any single occurrence and $13,000,000 for
aggregate claims relating to damage to persons or property. These policies cover
all   activities   of  the   Company  and  its   subsidiaries   except  for  its
asbestos-related activities and certain non-asbestos related liabilities such as
pollution  liability  damage  (sudden or  gradual)  caused by the  discharge  or
release  of  any  irritant  or  contaminant.   In  addition,   the  Company  has
comprehensive  general  liability  coverage  that  covers,  among other  things,
specific asbestos-related risks up to $1,000,000.

GOVERNMENT REGULATION
---------------------

     The Company is subject to an extensive and  frequently  changing  statutory
and regulatory  framework of federal,  state, and local  environmental,  health,
safety, and transportation  authorities,  which imposes  significant  compliance
burdens and risks upon the Company.  The Company  believes it is in  substantial
compliance  with all  material  federal,  state,  and local laws  governing  its
material business operations. Nevertheless,  amendments to existing statutes and
regulations,  adoption  of  new  statutes  and  regulations  and  the  Company's
expansion into other jurisdictions and types of operations could result not only
in the additional risk of noncompliance,  but also in the increase in regulatory
burden that could cause related increases in costs and expenses.

     The federal  regulations of most  importance to the Company are governed by
the Occupational Safety and Health Administration  ("OSHA"), the Mine Safety and
Health Administration ("MSHA"), and the Department of Transportation ("DOT"). We
are  substantially  in compliance  with all  regulations.  The Company  conducts
regular training  programs and inspections on a regular basis. In addition,  our
brokers and insurance carriers also conduct inspections.

PERMITS AND LICENSES
--------------------

     Many states  license  such areas of the  Company's  operations  as asbestos
abatement  and  general   contracting.   Licensing  requires  that  workers  and
supervisors receive training from EPA approved and state certified organizations
and pass  required  tests.  The  Company is  currently  licensed  to perform its
services in  approximately a dozen states.  The Company also operates in certain
states  that do not have a special  asbestos  abatement  or general  contracting
license requirement,  however,  these states have adopted regulations  regarding
worker safety with which the Company must comply.

     The Company may need additional licenses to expand its operations. Although
there can be no assurance, based upon the level of training of its employees and
its  experience,  the  Company  currently  believes  that it can obtain all such
required licenses.



                                       7
<PAGE>

EMPLOYEES
---------

     The Company has  approximately  383  employees,  of which 4 are employed in
executive  capacities,  32 in  professional  capacities,  15  in  administrative
capacities,  45 as field  supervisors and 287 in field  operations.  None of the
Company's  employees  are union  members  or covered  by  collective  bargaining
agreements.  The Company has not  experienced  any strikes or work stoppages and
considers its relationship with its employees to be satisfactory.

     The Company,  through its  subsidiaries,  has  implemented  employee safety
programs  that require each  employee to complete a general  training and safety
program.  Training  topics include  approved work  procedures and instruction on
personal safety and the use of protective equipment.  In addition, all employees
engaged  in  asbestos  abatement  activities  are  required  to attend a minimum
three-day to four-day  course  approved by the EPA and  Occupational  Safety and
Health Administration, and all supervisors of abatement projects are required to
attend a 40-hour safety course annually. Moreover, employees are issued detailed
training materials and are required to attend ongoing safety seminars.

     The  Company's  subsidiaries  also  conduct job safety  analysis in the job
bidding  stage.  Besides the  precautions  taken with respect to  projects,  the
Company takes  additional  measures to protect its asbestos and site remediation
workers,  including  providing  them with  additional  protective  equipment and
sponsoring periodic medical examinations.


ITEM 2.  PROPERTIES

     The  Company  owns its  principal  executive  offices  that are  located in
approximately 20,600 square feet of office space at 1501 and 1502 Second Avenue,
East,  Tampa,  Florida  33605.  The offices are subject to a mortgage,  securing
indebtedness evidenced by a promissory note with an outstanding principal amount
at December 31, 2000,  of  approximately  $1,472,000.  This  variable  rate note
matures on October 1, 2004 and  currently  bears  interest at the base rate plus
1/2%.

     The  Company  placed  its new shop in service  during the first  quarter of
2000. The shop is approximately  9,000 square feet and is located at 1617 Second
Avenue East, which is adjacent to the Company's principal executive offices.

     The  Company's  subsidiary,  TransCor,  owns  vacant  property  outside  of
Nashville, Tennessee. The land is undeveloped and listed for sale. This property
is included in property held for sale - non-current.

     In August  1998,  the Company sold its solid waste  management  subsidiary,
Kimmins  Recycling Corp. and as part of the sale, the following  properties were
transferred to EESI: land and buildings in Clearwater  (Pinellas  County),  Fort
Myers (Lee  County),  Fort Pierce (St.  Lucie  County),  Miami (Dade County) and
Tampa (Hillsborough County).


ITEM 3.  LEGAL PROCEEDINGS

     The Company is involved in various legal actions and claims  arising in the
ordinary  course of its  business,  none of which is expected to have a material
adverse effect on the Company's financial position or results of operations.


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

     None.

                                       8
<PAGE>


                                     PART II

ITEM 5.  MARKET  FOR THE  REGISTRANT'S  COMMON  EQUITY AND  RELATED  STOCKHOLDER
         MATTERS

     The Company's common stock is currently traded on the National  Association
of Securities Dealers,  Inc., (NASD)  Over-the-Counter (OTC) Bulletin Board. The
Company's  common stock was traded on the New York Stock  Exchange  (NYSE) under
the symbol "KVN" prior to March 1999.

     As a result of the Company no longer meeting the continued listing criteria
of the NYSE,  the Company was delisted from the NYSE after the close of business
on March 1, 1999. On March 10, 1999, the Company's  application for registration
on the NASD Over the Counter  Bulletin  Board (OTCBB) was cleared.  On March 11,
1999 the Company began trading on the OTCBB under the symbol  "KVNM".  The OTCBB
is a regulated  quotation  service that  displays  real-time  quotes,  last-sale
prices, and volume information in over-the-counter  (OTC) equity securities.  An
OTC equity  security  generally  is any  equity  that is not listed or traded on
Nasdaq or a national  securities  exchange.  OTCBB securities  include national,
regional,  and foreign  equity  issues,  warrants,  units,  American  Depository
Receipts  (ADRs)  and  Direct  Participation  Programs  (DPPs).  The  OTCBB is a
quotation medium for subscribing  members,  not an issuer listing  service,  and
should not be confused with the Nasdaq Stock Market. OTCBB securities are traded
by a community of Market  Makers that enter quotes and trade  reports  through a
highly sophisticated  closed computer network,  which is accessed through Nasdaq
Workstation II. The OTCBB is unlike the NYSE in that it:

        o does not  impose  listing  standards;
        o does not  provide  automated  trade executions;
        o does not maintain  relationships with quoted issuers;  and
        o does not have the same obligations for Market Makers.

     The following table sets forth for the periods indicated high and low sales
prices of the Company's common stock as reported by the NYSE or the NASD OTCBB:


           1999                  High           Low
           ----                  ----           ---
    First Quarter           $    2.5625    $   0.3750
    Second Quarter          $    1.5000    $   0.3750
    Third Quarter           $    1.2188    $   0.4375
    Fourth Quarter          $    0.7188    $   0.2800

           2000
    First Quarter           $    0.7500    $   0.3125
    Second Quarter          $    0.5312    $   0.1900
    Third Quarter           $    0.5000    $   0.2000
    Fourth Quarter          $    0.4375    $   0.2300

     The  closing  stock  price for the  Company's  stock on March 8, 2001,  was
$0.4375.  On March 1, 2001 there were approximately 704 holders of record of the
Company's   common  stock.   Certain   record  holders  are  brokers  and  other
institutions holding shares in "street name" for more than one beneficial owner.

Dividends
---------

     The  payment by the Company of  dividends,  if any, in the future is within
the  discretion  of its Board of  Directors  and will depend upon the  Company's
earnings,  capital requirements (including working capital needs), and financial
condition,  as well as other relevant factors.  Certain  agreements  between the
Company  and its lending  institutions  prohibit  the  Company  from paying cash
dividends  without the lenders'  consent.  Other than a three and one-third cent
per share of a common stock cash dividend paid in July 1989, the Company has not
paid any cash dividends since its inception, and the Board of Directors does not
plan to declare or pay any cash dividends in the future.

                                       9


<PAGE>

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

     The  following  information  relates to equity  securities  of the  Company
issued or sold during the year ended December 31, 2000, that were not registered
under the Securities Act in 1993, as amended (the "Securities Act").

     The  Company  issued  no  securities  during  2000 that  were  exempt  from
registration under the Securities Act by virtue of Section 4(2) as a transaction
not involving a public offering.

ITEM 6.  SELECTED FINANCIAL DATA
--------------------------------

     The following  selected  financial  data are derived from the  consolidated
financial  statements  of Kimmins Corp.  The data should be read in  conjunction
with the consolidated  financial statements,  related notes, and other financial
information included herein.

HISTORICAL OPERATING STATEMENT DATA:
<TABLE>
<CAPTION>
                                                                    Years ended December 31,
                                                              (In thousands, except per share data)
<S>                                         <C>           <C>         <C>           <C>         <C>
                                                1996         1997        1998          1999        2000
                                                ----         ----        ----          ----        ----
Gross revenue                               $   78,552    $ 102,717   $   74,051    $  63,450   $  60,756
Net revenue                                     63,288       80,932       59,302       56,241      52,249
Operating income (loss)                        (6,930)      (2,524)     (14,850)      (2,112)       4,232
Income (loss) from continuing operations       (7,231)      (5,611)     (15,088)      (3,340)         471
Income (loss) from discontinued operations     (1,452)      (2,907)       19,431          -0-       2,390
Net income (loss)                              (8,683)      (8,518)        4,343      (3,340)       2,861

PER SHARE DATA:

Income (loss) from continuing
  operations per share:
     Basic                                  $   (1.63)    $  (1.30)   $   (3.51)    $  (0.73)   $     .10
     Diluted                                $   (1.63)    $  (1.30)   $   (3.51)    $  (0.73)   $     .10
Income (loss) from discontinued
  operations per share:
     Basic                                  $    (.33)    $   (.67)   $     4.52    $     -0-   $     .49
     Diluted                                $    (.33)    $   (.67)   $     4.52    $     -0-   $     .49
Net income (loss) per share:
     Basic                                  $   (1.96)    $  (1.97)   $     1.01    $  (0.73)   $     .59
     Diluted                                $   (1.96)    $  (1.97)   $     1.01    $  (0.73)   $     .59
Weighted average number of shares of
  common stock used in the calculation:
     Basic                                       4,420        4,318        4,297        4,576       4,872
     Diluted                                     4,420        4,318        4,297        4,576       4,872
Dividends per share                               None         None         None         None        None
</TABLE>


HISTORICAL BALANCE SHEET DATA:
<TABLE>
<CAPTION>
<S>                                 <C>          <C>         <C>          <C>         <C>    <C>
                                                                 As of December 31,
                                                                   (In thousands)
                                       1996          1997          1998        1999        2000
                                       ----          ----          ----        ----        ----
Current assets                      $  41,381    $   38,322   $    47,205  $   27,655  $   34,778
Working capital (deficiency)           16,898         (633)         6,053     (5,574)       2,046
Net assets of discontinued
   operations                           6,073         7,091           -0-         -0-         -0-
Total assets                           66,493       110,330       114,300      88,614      77,328
Long term debt                         16,556        54,595        50,769      43,767      30,748
Stockholder's equity                   17,853         9,393        14,671       7,692      12,003
</TABLE>


                                       10
<PAGE>


ITEM 7. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS INTRODUCTION

     The Company  conducts its  business in one  segment:  specialty-contracting
services.  This segment provides  comprehensive services including earth moving;
land reclamation and site  preparation;  facilities  demolition and dismantling;
installation  of sewer  lines,  water lines and roads;  excavation,  removal and
disposal of contaminated soil; groundwater treatment; and asbestos abatement.

RESULTS OF OPERATIONS

     The following table sets forth for the periods indicated (i) the percentage
of net revenue  represented by certain items in the financial  statements of the
Company,  and (ii) the percentage change in the dollar amount of such items from
period to period.

<TABLE>
<CAPTION>
        <S>                             <C>              <C>            <C>               <C>             <C>
                                                    Percentage of Net Revenue             Percentage Increase (Decrease)
                                                     Year Ended December 31,                 Year ended December 31,
                                                     -----------------------                 -----------------------
                                            1998           1999            2000           1999 vs. 1998    2000 vs. 1999
                                            ----           ----            ----           -------------    -------------

        Gross revenues                       124.9%         112.8%            116.3%           (14.3%)           (4.2%)
        Outside services                     (24.9%)        (12.8%)           (16.3%)          (51.1%)            18.0%
                                          ----------     ----------     -------------    --------------   --------------
        Net revenue                          100.0%         100.0%              100%            (5.2%)           (7.1%)
        Cost of revenue earned               114.1%          91.1%             83.2%           (23.8%)          (15.1%)
                                          ----------     ----------     -------------    --------------   --------------
        Gross profit                        (14.1%)           8.9%             16.8%            165.7%            74.6%
        Selling, general and
           administrative expense             11.9%          12.8%              8.7%              2.1%          (37.2%)
                                          ----------     ----------     -------------    --------------   --------------
        Operating income (loss)             (26.0%)         (3.9%)              8.1%             85.8%           292.2%
        Income from marketable
           securities                           -0-           4.4%              1.9%              100%          (59.3%)
        Minority interest in net
           (income) loss of subsidiary         6.1%           0.2%              0.4%             96.4%            54.9%
        Gain (loss) on sale of fixed
           assets                              1.0%           0.2%              0.0%           (84.8%)         (117.3%)
        Interest expense, net                 10.9%           8.9%              8.2%           (22.9%)          (14.3%)
                                          ----------     ----------     -------------    --------------   --------------
        Income (loss) before
           provision for income taxes
           (benefit)                        (42.1%)         (8.4%)              1.4%             80.9%           115.6%
        Provision for income taxes
           (benefit)                        (16.6%)         (2.5%)              0.5%             85.7%         (119.4%)
                                          ----------     ----------     -------------    --------------   --------------
        Net income (loss) from
           continuing operations            (25.5%)         (5.9%)              0.9%             77.9%           114.1%
        Net income (loss) from
           discontinued operations            32.8%           0.0%              4.6%          (100.0%)           100.0%
                                          ----------     ----------     -------------    --------------   --------------

        Net income (loss)                      7.3%         (5.9%)              5.5%          (176.9%)           185.7%
                                          ==========     ==========     =============    ==============   ==============
</TABLE>

YEAR ENDED DECEMBER 31, 2000, COMPARED TO YEAR ENDED DECEMBER 31, 1999

CONTINUING OPERATIONS

     Net  revenue  for  the  year  ended   December  31,   2000,   decreased  by
approximately  $3,992,000 or 7.1 percent to $52,249,000 from $56,241,000 for the
same period in 1999. The decrease is due primarily to decreases in the Company's


                                       11
<PAGE>

utility  contracting  services  ($8,036,000  decrease in net revenue),  and mine
services ($6,409,000).  These decreases were somewhat offset by increases in the
Company's  demolition services  ($10,386,000  increase in net revenue) and other
services ($67,000  increase in net revenue).

     During the year ended December 31, 2000, the Company's  percentage of gross
revenues from private customers remained unchanged from 1999 at 69 percent.

     Outside services, which largely represent subcontractor costs, increased as
a  percentage  of net  revenue to  approximately  16 percent  for the year ended
December 31, 2000 from approximately 13 percent for the same period in 1999. The
Company will use the services of a  subcontractor  when it determines that it is
more  economical to do so than  internally  providing the services.  The Company
utilized the services of  subcontractors  to a greater  extent  during 2000 than
1999  due  to the  specific  contracts  in  progress  and  the  associated  work
requirements.

     Cost of revenue  earned as a  percentage  of net revenue for the year ended
December 31, 2000 decreased to 83 percent from 91 percent for the same period in
1999.  As a result,  the gross  profit for the year ended  December 31, 2000 was
approximately  $8,764,000 (17 percent of net revenue)  compared to $5,019,000 (9
percent of net revenue) for the same period in 1999.  The increase in the dollar
amount  $3,745,000  and  percentage  of gross  margin (8 percent)  is  primarily
associated with the Company's  demolition services ($2,285,000 increase in gross
profit),  utility contracting  services  ($1,017,000  increase in gross profit),
mining services  ($432,000 increase in gross profit) and other services ($11,000
increase in gross profit).

     Depreciation and amortization decreased to approximately $7,671,000 in 2000
from  approximately  $9,197,000 in 1999. The decrease  relates  primarily to the
sale of some underutilized  heavy construction  equipment which was sold in late
1999 and 2000.

     Included in the Company's  operating  results for the years ended  December
31, 1999 and 2000 is the activity related to the settlement and/or resolution of
contract claims and unapproved change orders. The "Excess of recovery over cost"
amounts  have been  reserved  for other  claims,  or reduced  by  current  costs
associated with claims. This activity can be summarized as follows:

                                               Years ended December 31,
                                               1999               2000
                                         -------------    --------------
Claim recoveries                          $ 1,400,000         $ 801,000

Cost of recoveries                          1,014,000            33,000
                                         -------------    --------------

Excess of recovery over cost          $       386,000  $        768,000
                                         =============    ==============

     The Company had the following balances recorded relating to contract claims
and unsigned change orders at December 31, 1999 and 2000.

                                                Years ended December 31,
                                                 1999              2000
                                             --------------     ------------
Claims                                    $     10,731,000   $    9,902,000
Unapproved change orders                               -0-              -0-
                                             --------------     ------------
                                          $     10,731,000   $    9,902,000
                                             ==============     ============
Cumulative external claim
   preparation costs included above       $            -0-   $          -0-
                                             ==============     ============

     During  the  year  ended   December   31,   2000,   selling,   general  and
administrative expenses decreased to approximately  $4,531,000 (9 percent of net
revenue)  from  $7,221,000  (13 percent of net  revenue)  for the same period in
1999.  The dollar and  percentage  decrease are  attributable  to  reductions in
administrative  costs including salaries and wages, ESOP compensation  expenses,
legal fees, bad debt expense, supplies and bank charges.



                                       12
<PAGE>

     Interest  expense,  net of interest  income for the year ended December 31,
2000 was  approximately  $4,285,000 as compared to approximately  $5,000,000 for
the year ended December 31, 1999.  The average amount of debt decreased  between
periods,   since  debt  payments   during  the  year   exceeded   borrowings  by
approximately $12,944,000.

     The Company's  income tax expense for continuing  operations was calculated
using a rate of  approximately  37 percent for the year ended December 31, 2000.
The Company's  income tax provision for  continuing  operations  was  calculated
using a rate of  approximately  30 percent for the year ended December 31, 1999.
As a result of the  foregoing,  the  Company  recorded  income  from  continuing
operations of  approximately  $471,000 for the year ended  December 31, 2000, as
compared to a loss from continuing  operations of  approximately  $3,340,000 for
the year ended December 31, 1999.

     On June  27,  2000,  the  Company  received,  net of  related  legal  fees,
$3,525,000  as final  settlement  from  WMI.  This  amount  was for  adjustments
required under the purchase agreement and for other disputes related to the sale
of the SWMS operations.

YEAR ENDED DECEMBER 31, 1999, COMPARED TO YEAR ENDED DECEMBER 31, 1998

CONTINUING OPERATIONS

     Net  revenue  for  the  year  ended   December  31,   1999,   decreased  by
approximately  $3,061,000 or 5 percent to $56,241,000  from  $59,302,000 for the
same period in 1998. The decrease is due primarily to decreases in the Company's
mining  services  ($3,697,000  decrease  in net  revenue),  demolition  services
($334,000  decrease in net revenue) and to decreases in other services ($185,000
decrease in net revenue).  These  decreases were somewhat offset by increases in
the Company's utility contracting services ($1,155,000 increase in net revenue).

     During the year ended December 31, 1999, the Company's  percentage of gross
revenues from private  customers  increased  from 68 percent to 69 percent.  The
increase in private work is mainly  attributable to earthwork projects including
land  reclamation  and site  preparation.  The  decrease  in the  percentage  of
government  work  from  32% to 31% for  the  year  ended  December  31,  1999 is
primarily  attributable  to fewer road  construction  projects  with the Florida
Department of Transportation and local municipalities.

     Outside services,  which largely represent  subcontractor costs, decreased,
as a percentage  of net revenue to  approximately  13 percent for the year ended
December 31, 1999 from approximately 25 percent for the same period in 1998. The
Company will use the services of a  subcontractor  when it determines that it is
more  economical to do so than  internally  providing the services.  The Company
utilized the services of subcontractors to a lesser extent during 1999 than 1998
due to the specific  contracts in progress and the associated work requirements,
especially  due to the  increase  in land  reclamation  work where  little or no
subcontracting  is utilized  and the  decrease in road  construction  work which
requires significant use of subcontractors.

     Cost of revenue  earned as a  percentage  of net revenue for the year ended
December  31, 1999  decreased to 91 percent from 114 percent for the same period
in 1998. As a result,  the gross profit for the year ended December 31, 1999 was
approximately  $5,110,000  (9 percent of net revenue)  compared to  ($7,777,000)
(negative 14 percent of net revenue) gross loss for the same period in 1998. The
increase in the dollar  amount  $12,887,000  and  percentage of gross margin (22
percent) is primarily associated with the Company's utility contracting services
($7,038,000  increase in gross profit), and mining services ($2,458,000 increase
in gross profit),  demolition services ($1,224,000 increase in gross profit) and
other services ($2,167,000 increase in gross profit).

     Depreciation and amortization decreased to approximately $9,197,000 in 1999
from  approximately  $9,871,000 in 1998. The decrease  relates  primarily to the
sale of some underutilized  heavy construction  equipment which was sold in late
1998 and 1999.

     Included in the Company's  operating  results for the years ended  December
31, 1998 and 1999 is the activity related to the settlement and/or resolution of
contract claims and unapproved change orders. This activity can be summarized as
follows:

                                       13
<PAGE>

                                            Years ended December 31,
                                             1998             1999
                                             ----             ----
Claim recoveries                      $     1,058,000    $    1,400,000
Cost of recoveries                          2,311,000         1,013,000
                                         -------------    --------------
Excess of recovery over cost          $   (1,253,000)    $      387,000
                                         =============    ==============

     In addition,  the Company incurred costs associated with unresolved  claims
of approximately  $500,000 and $763,000 during 1998 and 1999  respectively.  The
Company also recorded a reserve of approximately $387,000 during 1999.

     The Company had the following balances recorded relating to contract claims
and unsigned  change orders at December 31, 1998 and 1999.

                                               Years ended December 31,
                                                1998            1999
                                                ----            ----
        Claims                               $ 9,678,000   $ 9,337,000
        Unapproved change orders                     -0-           -0-
                                             ------------  ------------
                                             $ 9,678,000   $ 9,337,000
                                             ============  ============
        Cumulative external claim
          preparation costs included above   $       -0-   $        -0-
                                             ============ =============

     During  the  year  ended   December   31,   1999,   selling,   general  and
administrative expenses increased to approximately $7,221,000 (13 percent of net
revenue)  from  $7,072,000  (12 percent of net  revenue)  for the same period in
1998. The dollar  decrease and percentage  increase is  attributable  to reduced
revenues.

     Interest  expense,  net of interest  income for the year ended December 31,
1999 was  approximately  $5,000,000 as compared to approximately  $6,489,000 for
the year ended December 31, 1998.  The average amount of debt decreased  between
periods, since debt payments during the year exceeded borrowings by $8,679,000.

     The Company's  income tax benefit for continuing  operations was calculated
using a rate of  approximately  30 percent for the year ended December 31, 1999.
The Company's  income tax provision for  continuing  operations  was  calculated
using a rate of approximately 40 percent for the year ended December 31, 1998.

     As a result of the foregoing,  the Company  recorded a loss from continuing
operations  of  approximately  $3,340,000  and  $15,088,000  for the years ended
December 31, 1999 and 1998 respectively.

LIQUIDITY AND CAPITAL RESOURCES

     Cash  provided  by  (used  in)  operating   activities  was   approximately
($20,333,000),  $5,426,000 and $7,547,000 for the years ended December 31, 1998,
1999 and 2000.  Cash  provided by operations in 2000 was primarily the result of
the $3,525,000 final settlement received from WMI.

     During  2000,  the Company  generated  cash from  investing  activities  of
approximately $6,952,000.  This amount was primarily the result of cash proceeds
from the sale of property and equipment used by specialty contracting operations
of  approximately  $8,241,000  as well  as the net  proceeds  from  the  sale of
marketable  securities  of  $3,725,000.  The proceeds were  partially  offset by
capital expenditures of $4,031,000.

     The  Company  made  capital   expenditures  of  approximately   $6,459,000,
$5,029,000 and $4,031,000 in 1998, 1999 and 2000, respectively. The expenditures
in 2000 were primarily  related to the acquisition of equipment  associated with
the Company's utility contracting operations. Management believes future capital
expenditures  will be  financed  by  available  cash  resources,  cash flow from
operations and available credit resources, as needed.

     During 2000, the Company used cash in financing activities of approximately
$13,394,000.  The 2000  borrowings  and the related debt payments  resulted in a
decrease in the total  indebtedness of the Company to approximately  $48,623,000
at December 31, 2000 (approximately  $61,567,000 at December 31, 1999).  Current
maturities of total indebtedness amount to approximately $17,875,000 at December
31, 2000 (approximately $16,800,000 at December 31, 1999). Payments on long term
debt were  approximately  $14,647,000 during 2000. These payments were partially
offset by new borrowings of approximately $1,290,000 during 2000.

                                       14
<PAGE>

     During the years ended  December 31, 1999 and 2000,  the Company's  average
contract  and  trade   receivables   were   outstanding  for  73  and  65  days,
respectively. This improvement is primarily the result of the Company's 2000 mix
of business as well as the concentrated  effort by the senior management team to
accelerate cash collections. The Company anticipates sustaining the current rate
of collection for the year ended December 31, 2001. Management believes that the
number of days outstanding for its receivables approximates industry norms. Part
of the  Company's  contracting  operations  is  subcontracted,  and any delay in
collections of receivables  relating to primary  contracts will generally result
in a delay of payment to subcontractors.

     In addition to the sales  above,  the Company has  discontinued  the use of
certain assets with a net book value of approximately  $1,033,000 and has placed
them for sale. Of these assets,  approximately  $1,800,000  net of $1,177,500 of
deposits  received  relates  to  assets  from the  discontinuance  of a  certain
remediation business in the specialty-contracting segment. The remaining balance
of approximately $411,000 represents the net book value of land for sale located
in Nashville,  Tennessee.  Subsequent to December 31, 2000, the Company received
approximately $4,637,000 from the sale of its investment in the Apartments. This
amount represented the book value of the Apartments as of February 28, 2001, and
no gain or loss resulted from this transaction.

     As a result of the sale of the  investment in the Apartments in March 2001,
the investment account is classified as a current asset. The Company,  therefore
has  working  capital of  approximately  $2,046,000  as of  December  31,  2000.
Management of the Company  anticipates  that its projected  operations,  coupled
with the  marketable  securities,  will  provide  sufficient  levels  of cash to
fulfill its current and future obligations in the normal course of business.

     The Company's  current bonding coverage for  non-environmental  projects is
$30,000,000  for  an  individual  project  and  $60,000,000  in  the  aggregate.
Historically,  the  Company  has  obtained  bonding  coverage  in  amounts up to
$8,500,000 for  environmental  projects and  $53,000,000  for  non-environmental
projects.  However,  bonding  coverage is not  guaranteed  on projects up to the
above  limits  because  each  project has its own  distinct  and  separate  bond
requirements,  and it is customary  for surety  bonding  companies to underwrite
each surety obligation individually.  Management believes that bonding coverages
are adequate for the size and scope of projects being performed.


NEW ACCOUNTING PRONOUNCEMENTS

     In June 1998, the Financial Accounting Standards Board issued Statement No.
133, Accounting for Derivative Instruments and Hedging Activities. The Financial
Accounting   Standards  Board  has  issued  Statement  No.  137  Accounting  for
Derivative  Instruments and Hedging  Activities - Deferral of the effective date
of SFAS No. 133, which delays the implementation  date of SFAS 133 for one year,
to fiscal  years  beginning  after June 15,  2000.  The  Statement  requires the
companies  to  recognize  all  derivatives  on the balance  sheet at fair value.
Derivatives  that are not hedges must be adjusted to fair value through  income.
If the derivative is a hedge,  depending on the nature of the hedge,  changes in
the fair value of derivatives are either offset against the change in fair value
of assets,  liabilities or firm  commitments  through  earnings or recognized in
other comprehensive income until the hedged item is recognized in earnings.  The
ineffective  portion of a derivative's  change in fair value will be immediately
recognized  in earnings.  Because of the Company's  minimal use of  derivatives,
management  does  not  anticipate  the  adoption  of  the  statement  to  have a
significant effect on earnings or the financial position of the Company.

     Given the  complexity  of the new  Standard  and that the impact  hinges on
market values at the date of adoption, it is extremely difficult to estimate the
impact of adoption unless adoption is imminent.


                                       15
<PAGE>


FORWARD-LOOKING INFORMATION

     The  foregoing  discussion  in  "Management's  Discussion  and  Analysis of
Financial  Condition  and  Results  of  Operations"   contains   forward-looking
statements that reflect management's current views with respect to future events
and financial performance. Such statements involve risks and uncertainties,  and
there are certain  important  factors that could cause actual  results to differ
materially  from those  anticipated.  Some of the  important  factors that could
cause actual results to differ  materially from those anticipated  include,  but
are  not  limited  to,  economic  conditions,  weather  conditions,  competitive
factors,  changes  in  market  prices  of the  Company's  investments  and other
uncertainties,  all of which  are  difficult  to  predict  and many of which are
beyond the control of the Company.  Due to such  uncertainties and risk, readers
are cautioned not to place undue  reliance on such  forward-looking  statements,
which speak only as of the date hereof.

EFFECT OF INFLATION

     Inflation has not had, and is not expected to have, a material  impact upon
the Company's  operations.  If inflation increases,  the Company will attempt to
increase its prices to offset its increased expenses. No assurance can be given,
however,  that the Company  will be able to  adequately  increase  its prices in
response to inflation.



                                       16
<PAGE>


ITEM 7A.   QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     During  2000,  the  Company  did not  enter  into  any  transactions  using
derivative  financial  instruments or derivative  commodity  instruments.  As of
December 31, 2000,  the Company has debt of  approximately  $48,623,000 of which
$2,504,000 has a fixed  interest  rate.  The remaining  debt of $46,119,000  has
variable interest rates.  However,  an increase in the rates of 1% would have an
effect of only $15,000,  exclusive of the effect of income  taxes.  Accordingly,
the Company believes its exposure to market risk is not material. As of December
31, 2000, the Company held  available-for-sale  marketable  equity securities of
publicly  traded  companies   having  a  value  of   approximately   $12,361,000
($9,872,000 related to Waste Management,  Inc.). These securities are subject to
price risk.

     Beginning in January 1999,  the Company began  trading  covered  options on
Waste Management, Inc. common stock. Since December 31, 1999, the Company had no
funds invested in covered options. These securities are subject to price risk.

                                       17
<PAGE>

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA


                                  KIMMINS CORP.
                        INDEX TO FINANCIAL STATEMENTS AND
                          FINANCIAL STATEMENT SCHEDULE

                                                                          Page

Report of Independent Certified Public Accountants..........................19

Report of Independent Certified Public Accountants..........................20

Consolidated balance sheets at December 31, 1999 and 2000...................21

Consolidated statements of operations for each of the three years
   in the period ended December 31, 2000....................................23

Consolidated statements of comprehensive income for each
   of the years in the period ended December 31, 2000.......................25

Consolidated statements of stockholders' equity for each of the
   three years in the period ended December 31, 2000........................26

Consolidated statements of cash flows for each of the three years
   in the period ended December 31, 2000....................................27

Notes to consolidated financial statements..................................28


Financial statement schedule:

Schedule II - Valuation and qualifying accounts.............................56


     All other  schedules  are omitted  since the  required  information  is not
present in amounts  sufficient to require  submission of the schedule or because
the  information  required  is included in the  financial  statements  and notes
thereto.

                                       18
<PAGE>

               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS


The Board of Directors and Stockholders
Kimmins Corp.

     We have audited the  accompanying  consolidated  balance  sheets of Kimmins
Corp. as of December 31, 2000 and 1999, and the related consolidated  statements
of operations, comprehensive income, stockholders' equity and cash flows for the
years then ended.  Our audits also  included the  financial  statement  schedule
listed in the index at Item 14(a).  These financial  statements and schedule are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these financial statements and the schedule 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 consolidated financial position of
Kimmins Corp. at December 31, 2000 and 1999, and the consolidated results of its
operations  and its cash  flows for each of the two years in the  periods  ended
December 31, 2000, in conformity with generally accepted accounting  principles.
Also, in our opinion, the related financial statement schedule,  when considered
in relation to the basic financial statements taken as a whole,  presents fairly
in all material respects the information set forth therein.



                                     /s/ Giunta, Ferlita & Walsh, P.A.



Tampa, Florida
March 16, 2001

                                       19
<PAGE>

              REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS


The Board of Directors and Stockholders
Kimmins Corp.


     We have audited the  accompanying  consolidated  statements of  operations,
comprehensive  income,  stockholders' equity and cash flows of Kimmins Corp. for
the year  ended  December  31,  1998.  Our audit  also  included  the  financial
statement schedule listed in the index at Item 14(a). These financial statements
and  schedule  are  the   responsibility  of  the  Company's   management.   Our
responsibility  is to express an opinion on these  financial  statements and the
schedule based on our audit.

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

     In our opinion,  the consolidated  financial  statements  referred to above
present  fairly,  in all  material  respects,  the  consolidated  results of its
operations  and its  cash  flows  for the  year  ended  December  31,  1998,  in
conformity with accounting  principles  generally accepted in the United States.
Also, in our opinion, the related financial statement schedule,  when considered
in relation to the basic financial statements taken as a whole,  presents fairly
in all material respects the information set forth therein.



                                             /s/ Ernst & Young LLP


Tampa, Florida
April 7, 1999

                                       20
<PAGE>


                                  KIMMINS CORP.

                           CONSOLIDATED BALANCE SHEETS

                                     ASSETS
<TABLE>
<CAPTION>
<S>                                                         <C>              <C>
                                                                       December 31,
                                                                   1999              2000
                                                                   ----              ----
Current assets:
   Cash and cash equivalents including restricted cash
      of $1,154,399 and $1,080,350 in 1999 and 2000,
      respectively                                          $       194,202   $      1,299,769
   Marketable securities                                         11,520,739         12,361,268
   Accounts receivable, net
     Contract and trade                                          12,680,628         10,738,570
     Affiliates                                                      63,702            954,150
   Costs and estimated earnings in excess of billings on
     uncompleted contracts                                          148,782          2,657,353
   Deferred income tax, net                                       1,814,725          1,731,119
   Property and equipment held for sale                           1,083,182          4,464,867
   Other current assets                                             148,906            570,524
                                                              --------------    ---------------
     Total current assets                                        27,654,866         34,777,620
                                                              --------------    ---------------

Property and equipment, net                                      37,247,209         25,967,895
Non-current portion of costs and estimated earnings in
   excess of billings on uncompleted contracts                    8,088,928          7,582,860
Non-current portion of accounts receivable, net contract
   and trade                                                        794,495          1,878,445
Deferred income tax, non-current                                  2,624,170            632,927
Property held for sale                                                  -0-            410,681
Accounts receivable - affiliate                                     900,000                -0-
Note receivable - affiliate                                       1,110,764          1,000,000
Investment in the Apartments - affiliate                          4,440,840                -0-
Investment in Cumberland Technologies, Inc. - affiliate           4,881,069          5,077,751
                                                               --------------    ---------------
Total assets                                                $    87,742,341   $     77,328,179
                                                               ==============    ===============

</TABLE>


                                       21

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

<PAGE>

                                  KIMMINS CORP.

                           CONSOLIDATED BALANCE SHEETS

                      LIABILITIES AND STOCKHOLDERS' EQUITY

<TABLE>
<CAPTION>
<S>                                                                <C>               <C>
                                                                              December 31,
                                                                          1999               2000
                                                                          ----               ----
Current liabilities:
Accounts payable - trade                                            $     7,938,808   $      7,109,471
Accounts payable - affiliate                                                400,004            462,447
Income tax payable                                                          247,829            509,958
Accrued expenses                                                          5,496,312          5,857,807
Billings in excess of costs and estimated earnings on
   uncompleted contracts                                                  2,345,977            916,529
Current portion of long-term debt                                        16,799,575         17,875,227
                                                                      --------------    ---------------
      Total current liabilities                                          33,228,505         32,731,439
                                                                      --------------    ---------------

Long-term debt                                                           43,767,033         29,747,515
Capital lease obligations                                                   413,719                -0-
Minority interest in subsidiary                                           1,641,517          1,846,438
Related party debt                                                        1,000,000          1,000,000
Commitments and contingencies (Note 17)

Stockholders' equity:
   Common stock, $.001 par value; 32,500,000 shares
        authorized; 5,072,397 shares issued;
        4,872,135 shares outstanding
        as of December 31, 1999 and 2000, respectively                        5,072              5,072
   Class  B  common  stock,  $.001  par  value;
        10,000,000  shares  authorized,
        2,291,569 shares issued and 1,666,569
        outstanding as of December 31, 1999 and 2000, respectively            1,667              1,667
   Preferred  stock,  $.001 par value;
        1,000,000  shares  authorized;  0 shares
        issued; 0 shares outstanding as of
        December 31, 1999 and 2000, respectively                                -0-                -0-
   Capital in excess of par value                                        20,204,072         20,178,848
   Unrealized loss on securities (net of tax)                            (5,422,319)        (3,910,624)
   Retained earnings (deficit)                                           (6,287,140)        (3,426,284)
                                                                     ---------------   ---------------
                                                                          8,501,352         12,848,679
Less treasury stock (200,262 shares)                                       (809,785)          (845,892)
                                                                     ---------------   ----------------
Total stockholders' equity                                                7,691,567         12,002,787
                                                                     ---------------   ----------------
Total liabilities and stockholders' equity                          $    87,742,341   $     77,328,179
                                                                     ===============   ================
</TABLE>


                                       22

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

<PAGE>


                                  KIMMINS CORP.

                      CONSOLIDATED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
<S>                                                           <C>               <C>               <C>
                                                                            Years ended December 31,

                                                                     1998             1999               2000
                                                                     ----             ----               ----
Revenue:
   Gross revenue                                              $     74,051,465  $    63,450,166   $     60,756,258
   Outside services, at cost                                       (14,749,222)      (7,209,407)        (8,507,702)
                                                                ---------------   --------------    ---------------
   Net revenue                                                      59,302,243       56,240,759         52,248,556

Costs and expenses:
   Cost of revenue earned                                           67,675,942       51,221,637         43,484,729
                                                                ---------------   --------------    ---------------

Gross profit (loss)                                                (8,373,699)        5,019,122          8,763,827

   Selling, general and administrative expenses                      7,072,487        7,221,222          4,531,329
                                                                ---------------   --------------    ---------------

Operating income (loss)                                            (15,446,186)      (2,202,100)          4,232,498

Minority interest in net income of subsidiary                       (3,615,248)        (131,369)          (203,485)

Gain (loss) on disposal of property and equipment                       596,465           90,431           (15,627)

Income from marketable securities, including
   approximately $51,000 and $32,000 of dividends in 1999
   and 2000, respectively                                                  -0-        2,495,029          1,015,657

Interest expense (net of interest income of approximately
    $427,000, $182,000, and $184,000 for the years
    ended December 31, 1998, 1999, and 2000)                        (6,489,329)      (5,000,457)        (4,285,285)
                                                                ---------------   --------------    ---------------

Income (loss) before provision for income taxes (benefit)          (24,954,298)      (4,748,466)            743,758

Provision for income taxes (benefit)
   Current                                                         (11,232,732)              -0-            404,479
   Deferred                                                           1,366,733      (1,408,389)           (131,559)
                                                                ---------------   --------------    ---------------
                                                                    (9,865,999)      (1,408,389)            272,920
                                                                ---------------   --------------    ---------------

Income (loss) from continuing operations                           (15,088,299)      (3,340,077)            470,838

Discontinued operations:
   Loss from discontinued solid waste division
   operations- net of tax benefits of $81,593                         (180,043)              -0-                -0-
Gain on sale of discontinued solid waste division in 1998
   and 2000 respectively, net of tax of $11,860,848 and
   $1,134,982                                                       19,611,352              -0-          2,390,018
                                                                ---------------   --------------    ---------------

Income (loss) from discontinued operations                          19,431,309              -0-          2,390,018
                                                                ---------------   --------------    ---------------
Net income (loss)                                             $      4,343,010  $   (3,340,077)   $      2,860,856
                                                                ===============   ==============    ===============
</TABLE>




                                       23

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

<PAGE>

                                  KIMMINS CORP.

                CONSOLIDATED STATEMENTS OF OPERATIONS (Continued)
<TABLE>
<CAPTION>
<S>                                                                   <C>            <C>           <C>
                                                                                 Year Ended December 31,
                                                                                 -----------------------
                                                                             1998          1999         2000
                                                                             ----          ----         ----
Share data:
   Basic and diluted income (loss) per share from  continuing
     operations                                                        $    (3.51)    $   (0.73)    $       .10
                                                                        ===========    ===========   ===========
   Basic and diluted income (loss) per share from discontinued
     operations                                                        $      4.52    $    0.00     $       .49
                                                                        ===========    ===========   ===========
   Total basic and diluted income (loss) per share                     $      1.01    $    (0.73)   $       .59
                                                                        ===========    ===========   ===========
 Weighted average number of shares outstanding used in computations:
   Basic and diluted                                                     4,296,969      4,575,545     4,872,135
                                                                        ===========    ===========   ===========
</TABLE>

                                       24

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

<PAGE>

                                  KIMMINS CORP.

                 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
<TABLE>
<CAPTION>
<S>                                            <C>                <C>                  <C>
                                                               Year Ended December 31,
                                                               -----------------------
                                                      1998                1999                2000
                                                      ----                ----                ----

Net income (loss)                               $    4,343,010     $    (3,340,077)     $    2,860,856

Unrealized net gains (losses) on investments
   in marketable securities, net of tax
   (benefit)of $126,975 , ($3,479,430) and
   $599,519 for 1998, 1999, and 2000
   respectively                                        198,603          (5,997,654)          1,598,717

Less minority interest                                (28,639)              403,615          (127,443)

Allocable share of unrealized gain (loss) on
   investments in marketable securities
   held by Cumberland                                 (97,539)               70,656             40,421
                                                   ------------       --------------       ------------

Comprehensive income (loss)                     $    4,415,435     $    (8,863,460)     $    4,372,551
                                                   ============       ==============       ============
</TABLE>

                                       25

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

                                  KIMMINS CORP.

                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
<S>                    <C>         <C>    <C>        <C>    <C>          <C>           <C>          <C>         <C>        <C>
                                                                                       Unearned
                                                                                       Employee
                                                                                       Compensation
                                                                                       from         Unrealized
                                                                                       Employee     Gain/                  Total
                                                Class B       Capital in  Retained     Stock        (Loss) on              Stock-
                           Common Stock       Common Stock    Excess of   (Deficit)    Ownership    Marketable   Treasury  Holders
                        Shares      Amount  Shares    Amount  Par  Value  Earnings     Plan Trust   Securities   Stock     Equity
                        ------      ------  ------    ------  ---  -----  --------     ----------   ----------   -----     ------
Balance at
   January 1, 1998       4,447,397   $4,447  2,291,569 $2,292  $18,730,173 $(7,290,073) $(1,320,000) $      -0- $(733,463)$9,393,376

Net income                                                                   4,343,010                                     4,343,010
Employee compensation
  from Employee Stock
  Ownership Trust                                                                           480,000                          480,000
Unrealized gain on
  marketable
  securities, net
  of tax                                                                                               101,064               101,064
Changes in ownership
  percentage of
  subsidiary due
  to treasury stock
  purchased by
  subsidiary                                                      384,430                                                    384,430
Purchase of Treasury
  Stock, at cost                                                                                                 (30,800)   (30,800)
                        --------- --------  ---------  -----  -----------  ----------- ------------  ---------   --------  ---------
Balance at
  December 31, 1998     4,447,397   $4,447  2,291,569  2,292  $19,114,603 $(2,947,063) $  (840,000)  $ 101,064 $(764,263)$14,671,080
Net loss                                                                   (3,340,077)                                   (3,340,077)
Conversion of
  Class B common
  stock to
  common stock            625,000      625  (625,000)  (625)                                                                     -0-
Employee compensation
  from Employee Stock
  Ownership Trust                                                                           840,000                          840,000
Unrealized loss on
  marketable
  securities, net
  of tax                                                                                           (5,523,383)           (5,523,383)
Change in ownership
  percentage of
  subsidiary due
  to treasury
  stock purchased
  by subsidiary                                                 1,089,469                                                  1,089,469
Purchase of Treasury
  Stock, at cost                                                                                                 (45,522)   (45,522)
                       ---------- --------  ---------  -----  -----------  -----------  ----------- ----------  --------- ----------
Balance at
  December 31, 1999     5,072,397   $5,072  1,666,569  1,667  $20,204,072 $(6,287,140) $     -0-  $(5,422,319) $(809,785) $7,691,567

Net income                                                                   2,860,856                                     2,860,856
Unrealized gain on
  marketable
  securities, net
  of tax                                                                                             1,511,695             1,511,695
Change in ownership
  percentage of
  subsidiary due
  to treasury
  stock purchased
  by subsidiary                                                  (25,224)                                                   (25,224)
Purchase of Treasury
  Stock, at cost                                                                                                 (36,107)   (36,107)
                        --------- -------   ---------  -----  -----------  -----------  ----------  ----------  --------- ----------
Balance at
  December 31, 2000     5,072,397  $5,072   1,666,569  1,667  $20,178,848 $(3,426,284) $      -0- $(3,910,624)  (845,892)$12,002,787
                        ========= =======   =========  =====  ===========  ===========   ======== ===========  ========= ===========
</TABLE>

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


                                       26
<PAGE>



                                  KIMMINS CORP.

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
<S>                                                                 <C>                 <C>               <C>
                                                                               Twelve months ended December 31,
                                                                               --------------------------------
                                                                            1998               1999               2000
                                                                            ----               ----               ----
Cash flows from operating activities:
   Net income (loss) from continuing operations                     $    (15,088,299)   $    (3,340,077)  $         470,838
   Adjustments  to  reconcile  net income  (loss) from  continuing
     operations to net cash provided (used) by operating activities:
        Depreciation and amortization                                       9,871,206          9,197,195          7,671,016
        Provision for uncollectible accounts receivable                        87,275             40,000                -0-
        Deferred income taxes                                               1,366,733        (1,408,389)          (131,559)
        Minority interest in income of subsidiary                           1,306,161            131,369            203,485
        Gain on sale of investments                                               -0-          (513,404)        (1,025,307)
        Gain on sale of options                                                   -0-        (1,996,445)                -0-
        (Gain)/loss on disposal of property and equipment                   (596,465)           (90,431)             15,627
        Equity in losses (earnings) of equity investees                       330,361             24,693          (100,558)
        Unearned employee compensation from
            Employee Stock Ownership Plan Trust                               480,000            840,000                -0-
Changes in operating assets and liabilities:
        Accounts receivable                                                 1,264,554          5,028,654            867,660
        Costs and estimated earnings in excess of
            billings on uncompleted contracts                               4,015,841          2,310,662        (2,002,503)
        Income tax refund receivable and payable                              736,914           (23,973)            262,130
        Other                                                               (438,065)             76,771          (484,903)
        Accounts payable                                                  (3,784,313)        (3,460,481)          (656,130)
        Accrued expenses                                                      496,179            415,924            361,495
        Billings in excess of costs and estimated earnings on
             uncompleted contracts                                          (431,011)        (1,806,545)        (1,429,448)
                                                                       ---------------     --------------    ---------------
Total adjustments                                                          14,705,370          8,765,599          3,551,005
                                                                       ---------------     --------------    ---------------
Net cash provided by (used in) continuing operations                        (382,929)          5,425,523          4,021,843

Net income (loss) from discontinued operations                              (180,043)                -0-          2,390,018
Net book value of assets of discontinued operations                       (7,909,434)                -0-                -0-
Taxes on gain of sale of assets of discontinued operations               (11,860,848)                -0-          1,134,982
                                                                       ---------------     --------------    ---------------
Net cash provided by (used in) operating activities                      (20,333,254)          5,425,523          7,546,843
                                                                       ---------------     --------------    ---------------

Cash flows from investing activities:
   Purchase of TransCor stock                                                     -0-        (1,201,706)            (2,550)
   Purchase of options                                                            -0-        (7,609,897)                -0-
   Sale of options                                                                -0-          9,606,343                -0-
   Purchase of marketable securities                                      (4,696,719)        (1,641,289)          (980,047)
   Proceeds from the sale of marketable securities                                -0-          3,052,191          3,725,322
   Capital expenditures                                                   (6,459,245)        (5,028,601)        (4,030,843)
   Proceeds from sale of property and equipment                             3,224,897          5,888,273          8,240,534
   Cash proceeds on sale of assets of discontinued operations              26,868,891                -0-                -0-
                                                                       ---------------     --------------    ---------------
Net cash provided by investing activities                                  18,937,824          3,065,314          6,952,416
                                                                       ---------------     --------------    ---------------

Cash flows from financing activities:
     Proceeds from long-term debt                                          12,573,508          8,223,772          1,289,858
     Repayments of long-term debt and capital leases                     (11,331,528)       (17,524,662)       (14,647,443)
     Repayments of Employee Stock Ownership Plan                            (630,502)          (809,498)                -0-
     Cash loan to Cumberland Technologies, Inc.                           (1,000,000)                -0-                -0-
     Purchase of treasury stock                                              (30,800)           (45,522)           (36,107)
                                                                       ---------------     --------------    ---------------
Net cash used in financing activities                                       (419,322)       (10,155,910)       (13,393,692)
                                                                       ---------------     --------------    ---------------

Net increase (decrease) in cash                                           (1,814,752)        (1,665,073)          1,105,567
Cash, beginning of period                                                   3,674,027          1,859,275            194,202
                                                                       ---------------     --------------    ---------------
Cash, end of period                                                 $       1,859,275   $        194,202  $       1,299,769
                                                                       ===============     ==============    ===============
</TABLE>



                                      27

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

<PAGE>


                                  KIMMINS CORP.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


1.   ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     ORGANIZATION  -  Kimmins  Corp.  and its  subsidiaries  (collectively,  the
"Company")  operate one business segment:  specialty-contracting  services.  The
Company  provides  specialty-contracting  services  in the  southeastern  United
States,  primarily Florida,  including  earthwork;  infrastructure  development;
underground   construction;   roadwork;   site  remediation   services  such  as
excavation, removal and disposal of contaminated soil; facilities demolition and
dismantling;  and asbestos abatement.  The Company formerly provided solid waste
management  services  through its  subsidiary,  TransCor  Waste  Services,  Inc.
("TransCor"), (See Note 21).

     PRINCIPLES OF CONSOLIDATION - The consolidated financial statements include
the accounts of Kimmins and its subsidiaries,  including TransCor,  a 93 percent
owned subsidiary. All material intercompany transactions have been eliminated.

     USE OF ESTIMATES - The  preparation  of financial  statements in conformity
with  generally  accepted  accounting  principles  requires  management  to make
estimates  and  assumptions  that affect the amounts  reported in the  financial
statements  and  accompanying  notes.  Actual  results  could  differ from those
estimates.

     CONCENTRATIONS  OF CREDIT RISK - Financial  instruments  which  subject the
Company to  concentrations of credit risk consist primarily of trade receivables
in the state of Florida.  Trade  receivables are comprised  primarily of amounts
due  from  specialty  contracting  contracts.  Credit  is  extended  based on an
evaluation of the customer's  financial  condition.  Collateral is generally not
required;  however, the Company has the ability to file for a mechanic's lien to
protect its interest in contract accounts receivable. Credit losses are provided
for in the financial statements and have been within management's expectations.

     CASH AND CASH EQUIVALENTS - Cash and cash equivalents include cash on hand,
on deposit with financial  institutions,  cash in interest  bearing accounts and
certificates of deposit with maturities of 90 days or less.

     ACCOUNTS  RECEIVABLE  -  CONTRACT  AND  TRADE,   includes  $13,475,000  and
$12,617,000 net of allowance for doubtful accounts of approximately $551,000 and
$488,000,  respectively at December 31, 1999 and 2000. The Company's  policy for
allowance for doubtful accounts is to provide for specific  accounts  considered
to be uncollectible.

     MARKETABLE  SECURITIES - As a result of the sale of Kimmins Recycling corp.
(KRC) to Eastern  Environmental  Services,  Inc.  (EESI),  the Company  received
555,329  shares  of  common  stock of EESI.  Subsequent  to the sale of  Kimmins
Recycling Corp. to EESI, Waste Management, Inc. acquired EESI. Accordingly,  the
Company  now  holds  355,742  shares of Waste  Management,  Inc.  common  stock.
Additionally,  commencing in September 1998, the Company began purchasing common
stocks  and other  marketable  securities  with a portion  of the cash  proceeds
received  from the sale of KRC. In  accordance  with the  Statement of Financial
Accounting  Standards No. 115.  "Accounting for Certain  Investments in Debt and
Equity  Securities,"  the  investments  are  classified  as   available-for-sale
securities  and the  cost of  investments  sold is  determined  on the  specific
identification  method. Such securities are carried at an aggregate market value
of  approximately  $12,361,000 as of December 31, 2000. The Company's cost basis
in these  investments is  approximately  $19,082,000  and the unrealized loss of
approximately  $6,721,000,   net  of  deferred  income  taxes  of  approximately
$2,520,000  and the  minority  interest's  share of  approximately  $276,000  is
reported as a separate  component of  shareholders'  equity.  Additionally,  the
Company's  allocable  share of the  unrealized  gains and (losses) on marketable
securities held by Cumberland Technologies, Inc. ("Cumberland") is approximately
($43,000)  and  $22,000  net of  deferred  income tax  (benefit)  and expense of
approximately ($16,000) and $8,000 at December 31, 1999 and 2000,  respectively.
The balance of the net unrealized  gains and (losses)  account is  approximately
($5,422,000) and ($3,910,000) at December 31, 1999 and 2000, respectively.


                                       28
<PAGE>


                                  KIMMINS CORP.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     INVESTMENTS   -  The   Company's  31  percent   investment   in  Cumberland
Technologies,  Inc.  (Cumberland)  is accounted  for using the equity  method of
accounting.  The Company's 49 percent  investments in  Summerbreeze  Apartments,
Ltd., and Sunshadow Apartments, Ltd. (the "Apartments"),  are also accounted for
using the equity method of accounting.  The original  carrying amounts in excess
of the  underlying  equity in these  companies is amortized  over the  estimated
useful life of the investment.  The estimated useful lives of these  intangibles
are twenty years for Cumberland and thirty years for the Apartments.

     INCOME  TAXES - The Company  accounts  for income taxes using the asset and
liability  method pursuant to Statement of Financial  Accounting  Standards 109,
"Accounting for Income Taxes"  (Statement No. 109). Under this method,  deferred
tax assets  and  liabilities  are  recognized  for the  future tax  consequences
attributable to differences  between the financial statement carrying amounts of
existing  assets and liabilities  and their  respective tax bases.  Deferred tax
assets and liabilities are measured using enacted tax rates expected to apply to
taxable income in the years in which those temporary differences are expected to
be recovered  or settled.  Under  Statement  No. 109, the effect on deferred tax
assets and  liabilities  of a change in tax rates is recognized in income in the
period that includes the enactment date.

     CONTRACTS AND REVENUE  RECOGNITION - Contracts generally range from 6 to 12
months in duration,  and earnings from contracting operations are reported under
the  percentage-of-completion  method  for  financial  statement  purposes.  The
estimated  earnings for each contract  reflected in the  accompanying  financial
statements  represent  the  percentage  of estimated  total  earnings that costs
incurred to date bear to estimated total costs,  based on the Company's  current
estimates.  With  respect to contracts  that extend over one or more  accounting
periods,  revisions in costs and earnings  estimates are reflected in the period
the  revisions  become known.  When current  estimates of total  contract  costs
indicate a loss,  provision is made for the entire  estimated loss in the period
indications  of  a  loss  become  known.   The  estimates  can  be  affected  by
uncertainties,  such as weather  related delays,  and it is reasonably  possible
that a change in estimate could occur in the near term.

     Change orders are  modifications  to an original  contract that effectively
change the scope  and/or  price of the  contract.  They may  include  changes in
specifications  or  design,   method  or  manner  of  performance,   facilities,
equipment, materials, site, or period for completion of the work. Certain change
orders may be priced under the terms of the  contract.  Other change  orders are
unpriced; that is, the work to be performed is defined;  however, the adjustment
to the contract price is negotiated subsequent to performance.  Finally, in some
cases,  both scope and price of a change order may be  unapproved or in dispute.
Accounting for change orders depends on the underlying circumstances,  which may
differ for each change order  depending on the customer,  the contract,  and the
nature of the change.  The Company  evaluates each change order according to its
characteristics and the circumstances in which they occur.

     Contract  revenue and  associated  profit are  recognized for change orders
that have been approved by the customer and the contractor  regarding both scope
and price to the extent performance related to the change order has occurred.

     Accounting  for change  orders,  where  either scope or price have not been
determined,  depends on careful consideration of the underlying  characteristics
and the  circumstances  in which they occur.  For all  unpriced  change  orders,
recovery is deemed  probable if the terms of the  contracts or other  applicable
legal principles  provide a legal basis for  recoverability,  the costs incurred
are objective and  verifiable,  and,  finally,  all future events  necessary for
recovery are more likely than not to occur. The Company  considers the following
factors in  evaluating  whether  recovery is probable:  the  customer's  written
approval  of the  scope  and/or  price of the  change  order,  the  objectivity,
verifiability,  and  reasonableness of underlying  accounting  documentation for
change order costs, and the Company's experience in negotiating change orders in
similar instances.

     The  following  guidelines  are utilized by the Company in  accounting  for
change  orders under which  either the scope or price have not been  approved by
the customer.


                                       29
<PAGE>

                                  KIMMINS CORP.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     A.   Costs directly  attributable to change orders whose scope and/or price
          is not  determinable  are charged directly to operations in the period
          in which the costs are incurred if it is not  probable  that the costs
          will be recovered through a change in the contract price.

     B.   If it is probable that the costs will be recovered through a change in
          the  contract  price,  the  costs  are  treated  as costs of  contract
          performance  in the period in which  they are  incurred  and  contract
          revenue  is  recognized  to the  extent of the costs  incurred.  Costs
          incurred  in excess of  amounts  that are  probable  of  recovery  are
          charged directly to operations when incurred.

     C.   In the case of change  orders  that are  approved  as to scope but not
          price,  profit  recognition  is deferred  until  receipt of the priced
          change order.

     Contract  claims are amounts  incurred  by the Company  related to contract
changes that are unapproved as to both scope and price, or are directly disputed
or contested as to either, by the customer.  Claims are amounts in excess of the
agreed upon  contract  price (or amounts not included in the  original  contract
price)  that are due to  customer-caused  delays,  errors in  specification  and
designs,  contract  terminations,  or other causes of  unanticipated  additional
costs. The Company recognizes  contract revenue relating to claims to the extent
of its costs  incurred  only if it is  probable  that the claim  will  result in
additional  contract  revenue and if the amount of contract  revenue and related
costs can be reliably  estimated.  Those two  requirements  are satisfied by the
existence of all of the following conditions:

     A.   The contract  or other applicable  legal  principles  provides a legal
          basis for the claim;  or a legal  opinion has been  obtained,  stating
          that the Company is entitled to recover  amounts under the contract or
          other applicable legal principles.

     B.   Additional costs are caused by  circumstances  that were unforeseen at
          the  contract  date  and are not the  result  of  deficiencies  in the
          contractor's performance.

     C.   Costs incurred by the Company that are  associated  with the claim are
          identifiable and reasonable in view of the work performed.

     D.   The evidence supporting the claim is objective and verifiable.

     In evaluating the probability of recovery and the estimation of the amounts
that will be recovered,  the Company consults with outside consultants and legal
counsel as the claims progress through the stages of negotiations, actual filing
of formal  claims,  and/or  litigation.  Legal  counsel has been engaged for the
majority of the claims, both in number and recorded amounts.

     For those  claims (see Note 6) where  outside  counsel has been  engaged to
review the claim, the recorded amount is not in excess of the amounts  estimated
by outside counsel to be recoverable.

     Except  in rare  circumstances,  claim  preparation  and  legal  costs  are
expensed  as  incurred.  Exceptions  include  instances  in which  the  contract
document  provides  for their  recovery  or legal  costs are  incurred to pursue
approved settlements by court ruling, binding arbitration, and otherwise. In all
instances  where such  amounts are  recorded,  it is  probable  that the amounts
associated  with claim  preparation  and legal  costs will be  recovered.  As of
December 31, 1999 and 2000, no claim preparation and legal costs were deferred.

     Fees arising from services other than contracting activities are recognized
when the negotiated services are provided.


                                       30
<PAGE>


                                  KIMMINS CORP.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


     BACKLOG - As of December 31, 2000, the Company had a backlog of uncompleted
projects  under  contract  aggregating  approximately  $20,745,000  (compared to
approximately  $20,250,000  as of December  31,  1999),  of which  approximately
$12,240,000  is  attributable  to earthwork  and utility  contracting  services,
approximately $7,983,000 is attributable to demolition and dismantling services,
and  approximately  $522,000 is  attributable  to asbestos  abatement  and other
services.  The Company  anticipates that it will recognize  approximately 99% of
the revenues from these projects by the end of 2001.

     STOCK BASED  COMPENSATION  - The Company  grants stock  options for a fixed
number of shares to employees  with an exercise price equal to the fair value of
the shares at the date of grant. The Company accounts for stock option grants in
accordance  with  Accounting  Principles  Board Opinion No. 25,  "Accounting for
Stock Issued to  Employees"  ("APB No. 25"),  and,  accordingly,  recognizes  no
compensation expense for the stock option grants.

     In October 1995, the Financial  Accounting  Standards Board ("FASB") issued
Statement No. 123 ("SFAS No. 123"),  "Accounting  and  Disclosure of Stock-Based
Compensation,"  which encourages,  but does not require,  companies to recognize
stock  awards  based  on  their  fair  value at the  date of  grant.  Pro  forma
information regarding net income and earnings per share, as calculated under the
provisions of SFAS No. 123, are disclosed in Note No. 13.

     EARNINGS (LOSS) PER SHARE - In February 1997, the FASB issued  Statement of
Financial  Accounting  Standards  No. 128 "Earnings per Share" ("SFAS No. 128"),
which establishes standards for computing and presenting earnings per share. The
Company  adopted the provisions of SFAS No. 128 effective  December 31, 1997 and
all earnings per share amounts for all periods presented, and where appropriate,
have been restated to conform to SFAS No. 128 requirements.

     COMPREHENSIVE INCOME - In June 1997, the FASB issued Statement of Financial
Accounting  Standards No. 130, Reporting  Comprehensive Income ("SFAS No. 130").
SFAS No.  130  requires  that  total  comprehensive  income  be  displayed  in a
financial  statement  with  equal  prominence  as  other  financial  statements.
Comprehensive  income is defined as changes in stockholders' equity exclusive of
transactions  with  owners  such as capital  contributions  and  dividends.  The
Company adopted the provisions of SFAS effective  January 1, 1998. For the years
ended  December 31, 2000 and 1999,  the change in unrealized  loss on marketable
securities includes  reclassification  adjustments for approximately  $1,025,000
and  $513,000,  respectively,  of gains  realized in income from the sale of the
securities.

     SEGMENTS - In June 1997, the FASB issued Statement of Financial  Accounting
Standards No. 131,  "Disclosures  about  Segments of an  Enterprise  and Related
Information" ("SFAS No. 131"), which supersedes  Financial  Accounting Standards
No.  14.  SFAS No.  131 uses a  management  approach  to  report  financial  and
descriptive information about a Company's operating segments. Operating segments
are revenue-producing  components of the enterprise for which separate financial
information  is produced  internally  for the Company's  management.  During the
fourth quarter of 1998, the Company  adopted the provisions of SFAS No. 131. The
adoption of SFAS No. 131 did not affect the results of  operations  or financial
position of the Company.

     The Company's continuing operations are specialty contracting.  See Note 21
for a discussion of discontinued operations. The Company's specialty contracting
is performed for third parties  located  primarily in the state of Florida.  The
Company  evaluates the  performance of each of its contracts.  However,  because
each of the contracts have similar economic characteristics,  the contracts have
been aggregated into a single dominant  segment.  All segment  measurements  are
disclosed in the Company's consolidated financial statements.


                                       31
<PAGE>


                                  KIMMINS CORP.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


     PROPOSED  ACCOUNTING  STANDARDS - In June 1998,  the  Financial  Accounting
Standards Board issued Statement No. 133, "Accounting for Derivative Instruments
and Hedging  Activities."  The Financial  Accounting  Standards Board has issued
Statement No. 137, Accounting for Derivative  Instruments and Hedging Activities
-  deferral  of  the  effective   date  of  SFAS  No.  133,   which  delays  the
implementation  date of SFAS 133 for one year, to fiscal years  beginning  after
June 15, 2000. The Statement  requires companies to recognize all derivatives on
the  balance  sheet  at fair  value.  Derivatives  that are not  hedges  must be
adjusted to fair value through income.  If the derivative is a hedge,  depending
on the nature of the hedge,  changes in the fair value of derivatives are either
offset  against  the  change  in fair  value  of  assets,  liabilities,  or firm
commitments through earnings,  or recognized in other comprehensive income until
the  hedged  item is  recognized  in  earnings.  The  ineffective  portion  of a
derivative's  change in fair value will be  immediately  recognized in earnings.
Because  of the  Company's  minimal  use of  derivatives,  management  does  not
anticipate  that the adoption of the Statement to have a  significant  affect on
earnings or the financial position of the Company.

     RECLASSIFICATION  -  Certain  amounts  in the 1998  and  1999  consolidated
financial statements have been reclassified to conform to the 2000 presentation.

2.   SUPPLEMENTAL STATEMENTS OF CASH FLOWS INFORMATION

<TABLE>
<CAPTION>
<S>                                                  <C>              <C>                <C>
                                                                 Years ended December 31,
                                                                 ------------------------
                                                           1998              1999              2000
                                                           ----              ----              ----
 Cash paid:
    Interest                                         $     7,013,000  $      4,982,000   $     4,469,000
    Income taxes                                     $        54,815  $         24,869   $       139,000
 Non-cash investing and financing activity:
 Capitalized leases                                  $     2,020,000  $            -0-   $           -0-
Receipt of EESI stock                                $    17,000,000  $            -0-   $           -0-
Unrealized gain/(loss) on marketable securities      $       325,578  $    (9,278,000)   $     2,198,000
Transfer to property held for sale
   from discontinued operations                      $       397,195  $            -0-   $           -0-
Transfer to discontinued operations
   from property and equipment                       $       267,696  $            -0-   $           -0-
Transfer between A/P - affiliate and note
   receivable - affiliate                            $           -0-  $            -0-   $       207,083
</TABLE>


3.   RELATED PARTY TRANSACTIONS

     Mr. Francis M. Williams,  the Company's President and majority stockholder,
also controls Cumberland Technologies, Inc. (Cumberland) (see Footnote 9 for the
Company's  investment in  Cumberland),  a publicly  traded property and casualty
insurance company that provides insurance for specialty sureties and performance
and payment bonds for contractors.  Through Cumberland, the Company has obtained
performance  and payment bonds in  connection  with certain of its contracts and
projects.  The fees that the Company paid for these  services for the year ended
December  31, 1998 was  approximately  $29,000.  There were no such fees paid to
Cumberland for the years ended December 31, 1999 and 2000. At December 31, 2000,
the amount due Cumberland for services rendered was approximately $24,300.

     On November 10, 1998, the Company loaned $1,000,000 to Cumberland, which is
evidenced by a convertible term note, which is due November 10, 2001.  Quarterly
interest payments are due beginning January 1, 1999 at a rate of one half of one
percent  over the prime rate  established  by  NationsBank.  The Company has the
right to convert the principal amount of the note into shares of common stock of
Cumberland  at $3.00 per  share.  The  balance of the  convertible  term note at
December 31, 1999 and 2000 is $1,110,764 and  $1,000,000,  respectively.  During
1999  and  2000,  the  Company  recorded  approximately  $111,000  and  $96,000,
respectively, of interest income on its note from Cumberland.


                                       32
<PAGE>

                                 KIMMINS CORP.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     Qualex, Inc., a subsidiary of Cumberland,  provided professional counsel to
the Company,  during 1999 and 2000. The Company recorded  approximately  $97,000
and $220,000,  respectively  for these services.  At December 31, 1999 and 2000,
the amount due Qualex for  services  rendered  was  approximately  $275,000  and
$215,000.  During 1999 and 2000, the Company offset  interest  receivable on the
$1,000,000 note  receivable due from  Cumberland  against the payable to Qualex,
Inc.

     The  Company  recorded  bond  fees  payable  to  officers,   who  are  also
shareholders of the Company,  of  approximately  $82,000 and $50,000 during 1999
and 2000, respectively, although only $10,000 were paid in 2000. At December 31,
1999 and 2000, the amount due Francis M. Williams, the Company's President,  for
bond fees payable was approximately $109,000 and $149,000, respectively.

     Mr. Francis M. Williams,  the Company's President and majority stockholder,
Mr. John V. Simon, Jr.,  President of Kimmins  Contracting Corp., and Mr. Joseph
M.  Williams,  the  Company's  Secretary and Treasurer are partners in an entity
called JFJ Investments (JFJ). During 2000, JFJ loaned $90,000 to the Company, of
which  $65,000 was owed as of December  31,  2000.  In  addition,  JFJ  provided
$38,000 of disposal services to the Company during 2000, which were unpaid as of
December 31, 2000.

     Effective  with the sale of Kimmins  Recycling  during  1998,  the  Company
accrued $1,000,000 payable to Mr. Francis M. Williams for a 10-year  non-compete
agreement.  During 1999 and 2000, the accrual  remained  unchanged.  There was a
proposed  agreement  to convert the  $1,000,000  payable to common  stock during
2000. As part of the agreement,  the Class B common stock owned by Mr.  Williams
was to be retired. The proposed agreement was never consummated. On December 31,
2000, Mr. Williams agreed to accept a 6% interest  bearing  promissory note that
matures on December  31, 2005.  The Company did not record any interest  expense
during 2000, in addition,  the Company will continue to reflect this  obligation
as a long-term liability to a related party.

     On August 14, 1998,  the Company  acquired an additional  297,200 shares of
common stock in TransCor for $3,031,000 from Mr. Francis M. Williams,  President
and Chief  Executive  Officer of the  Company.  The  acquisition  increased  the
Company's  ownership  percentage  to 81  percent  in 1988  from 74  percent  and
resulted in the ability to  consolidate  the  Company and  TransCor  for federal
income tax purposes on a prospective basis.

     During the year ended December 31, 1998, TransCor contributed $1,000,000 to
the Kimmins Terrier Foundation,  a private foundation  controlled by Mr. Francis
M. Williams.

4.   ACCOUNTS RECEIVABLE

<TABLE>
<CAPTION>
           <S>                                           <C>                 <C>
                                                                    December 31,
                                                                1999                2000
                                                                ----                ----
           Contract and trade:
              Billed contract receivables
                Completed and uncompleted contracts       $     8,984,641     $    8,491,514
                Retainage                                       3,673,932          1,888,701
              Unbilled contract receivables                       886,550          2,306,800
              Trade receivables                                   481,355            417,941
                                                            --------------      -------------
                                                               14,026,478         13,104,956
           Less allowance for doubtful accounts                 (551,355)          (487,941)
                                                            --------------      -------------
                                                               13,475,123         12,617,015
           Less noncurrent portion                                794,495          1,878,445
                                                            --------------      -------------
           Net accounts receivable -
              contract and trade                          $    12,680,628     $   10,738,570
                                                            ==============      =============
</TABLE>


                                       33
<PAGE>


                                 KIMMINS CORP.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


     All unbilled  receivables  relate to work performed or material  shipped by
the  balance  sheet  date and are billed as soon as  administratively  feasible.
Accounts  receivable not expected to be collected within one year of the balance
sheet date are  classified as  non-current.  At December 31, 1999 and 2000,  the
non-current portion of accounts receivable were all claim related.

     During 2000, the Company reclassified from long-term to current, a $900,000
accounts  receivable-affiliate  due to the sale and closing of the Apartments in
March 2001.  (See  Subsequent  Events).  This  account  receivable-affiliate  is
guaranteed by Mr. Francis M. Williams.

5.   OTHER CURRENT ASSETS

     During 2000, the Company made cash collateral  deposit payments of $383,000
in connection with the Company's workers' compensation insurance. The balance of
the  other  current   assets   account  at  December  31,  1999  and  2000,  was
approximately $149,000 and $571,000, respectively.


6.   COSTS AND ESTIMATED EARNINGS IN EXCESS OF BILLINGS ON UNCOMPLETED CONTRACTS

<TABLE>
<CAPTION>
     <S>                                                            <C>                 <C>
                                                                              December 31,
                                                                           1999               2000
                                                                           ----               ----

      Expenditures on uncompleted contracts                         $     41,790,548    $    27,051,091
      Estimated earnings on uncompleted contracts                          2,895,678          4,297,052
                                                                      ---------------     --------------
                                                                          44,686,226         31,348,143
      Less actual and allowable billings on uncompleted
         contracts                                                        46,290,267         29,607,319
                                                                      ---------------     --------------
                                                                         (1,604,041)          1,740,824
      Recorded claims on completed contracts                               7,495,774          7,582,860
                                                                      ---------------     --------------
                                                                    $      5,891,733    $     9,323,684
                                                                      ===============     ==============
      Costs and estimated earnings in excess of billings on
         uncompleted contracts                                      $        741,936    $     2,657,353
      Billings in excess of costs and estimated earnings on
         uncompleted contracts                                           (2,345,977)           (916,529)
                                                                      ---------------     ---------------
                                                                         (1,604,041)          1,740,824
      Recorded claims on completed contracts                               7,495,774          7,582,860
                                                                      ---------------     --------------
                                                                    $      5,891,733    $     9,323,684
                                                                      ===============     ==============

</TABLE>

     During 1998,  the Company  settled  contract  claims that resulted in a net
loss of  approximately  ($1,253,000).  During 1999 and 2000, the Company settled
claims that resulted in approximately  $386,000 and $768,000,  respectively,  in
excess of the recorded  amount.  The excess  recoveries  have been  reserved for
other claims, or reduced by current costs associated with claims.

     As of  December  31,  1999 and 2000,  the costs and  estimated  earnings in
excess  of  billings  on  uncompleted  contracts  includes  the  Company's  cost
associated with unapproved or disputed  contract change orders and costs claimed
from  customers  on  completed   contracts  of   approximately   $7,496,000  and
$7,583,000, respectively. During the performance of these contracts, the Company
encountered site conditions that differed from bid specifications.  As a result,
the Company  incurred  additional  labor and equipment  costs in performing  the
contract.  By their  nature,  recovery  of these  amounts  is often  subject  to
negotiation  with  the  customer  and,  in  certain  cases,  resolution  through
litigation.  As a result,  the recovery of these  amounts may extend  beyond one
year.  The portions at December 31, 1999 and 2000,  that were not expected to be
collected within twelve months are classified as a non-current asset.


                                       34
<PAGE>



                                  KIMMINS CORP.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


7.   PROPERTY AND EQUIPMENT HELD FOR SALE

     As a result of management's  decision to cease  operations in the northeast
and to de-emphasize the performance of certain environmental services within the
specialty-contracting  segment,  the Company  decided to sell its  transportable
incineration  system.  A purchase  agreement for the sale of the incinerator for
$1,800,000  was  executed  in  February  1998.  The  sale  of the  transportable
incineration system will be completed upon full receipt of the purchase price by
the Company.  As of December 31, 2000, the Company had received $1,177,500 which
has been netted  against the carrying  value of the asset  resulting in $622,500
being included in "property held for sale" at December 31, 2000.

     Due to the March 2001 sale of the  Apartments,  $3,842,367,  the  Company's
investment in Apartments  balance at December 31, 2000 has been  reclassified as
"property held for sale." See Subsequent events (Footnote 22).

     The Company also has real estate for sale in  Nashville,  Tennessee,  which
has a net book value of approximately  $411,000. This amount is included in long
term "property  held for sale" as management  does not expect the property to be
disposed of within the next twelve months.

8.   PROPERTY AND EQUIPMENT

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

      Land                                   $     1,058,234   $     1,058,234
      Buildings and improvements                   2,166,984         2,891,804
      Construction equipment                      58,455,431        50,457,355
      Furniture and fixtures                         680,485           523,367
      Construction in progress - building            616,742               -0-
                                               --------------    --------------
                                                  62,977,876        54,930,760
      Less accumulated depreciation             (25,730,667)      (28,962,865)
                                               --------------    --------------

      Net property and equipment             $    37,247,209   $    25,967,895
                                               ==============    ==============

     Property and equipment is recorded at cost.  Depreciation is provided using
the straight-line method over estimated useful lives ranging from 3 to 30 years.
Depreciation  expense was approximately  $11,202,000,  $8,630,000 and $7,104,000
for the years ended December 31, 1998, 1999 and 2000, respectively.


9.   INVESTMENTS  IN CUMBERLAND  TECHNOLOGIES,  INC.,  SUMMERBREEZE  APARTMENTS,
     LTD., AND SUNSHADOW APARTMENTS, LTD.

     CUMBERLAND - In 1988, Cumberland Casualty & Surety Company ("CCS") issued a
surplus  debenture to the Company that bears interest at 10 percent per annum in
exchange for  $3,000,000.  In 1992,  such  debenture  was assigned to Cumberland
Technologies, Inc. ("Cumberland"),  a holding company that provides, among other
services,  reinsurance for specialty  sureties and performance and payment bonds
for contractors.  Cumberland entered into a term note agreement with the Company
for  the  outstanding  amount  of the  debenture,  including  accrued  interest.
Interest accrued on the term note was $506,755 at December 31, 1995 ($372,066 in
1996 prior to the conversion discussed below).


                                       35
<PAGE>


                                  KIMMINS CORP.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     On November 5, 1996, the Company received  1,723,290  shares, or 30 percent
of the outstanding  common stock, of Cumberland common stock in exchange for the
term note from affiliate. The Cumberland common stock had a fair market value of
$3.00 per share on the date of the exchange, based upon the quoted market price.
This  investment  is  accounted  for  under the  equity  method.  The  amount of
$3,300,000 in excess of the underlying  equity was attributed to goodwill and is
being amortized over twenty years.  Cumberland is a publicly traded  corporation
and at December 31, 2000, the market value of the  Cumberland  common stock held
by the Company was approximately  $4,308,000 based on a stock price of $2.50. As
of  December  31,  1999 and 2000,  the  Company's  balance in its equity  method
investment  in  Cumberland  was   approximately   $4,881,000   and   $5,078,000,
respectively.

     The  following  is a summary of the  financial  position of  Cumberland  at
December 31, 1999 and 2000:

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

Cash and cash equivalents                        $  2,000,000   $     694,000
Investments in various marketable securities        8,394,000       9,955,000
Accounts receivable - trade, net                    2,896,000       3,821,000
Reinsurance recoverable                             2,899,000       4,334,000
Intangibles                                         1,267,000       1,115,000
Other                                               3,251,000       3,785,000
                                                  ------------    ------------

   Total assets                                  $ 20,707,000   $  23,704,000
                                                  ============    ============

Policy liabilities and accruals                  $  9,788,000   $  11,106,000
Long-term debt                                      2,282,000       2,103,000
Other                                               1,945,000       2,637,000
                                                  ------------    ------------
   Total liabilities                               14,015,000      15,846,000

Stockholders' equity                                6,692,000       7,858,000
                                                  ------------    ------------

   Total liabilities and stockholders' equity    $ 20,707,000   $  23,704,000
                                                  ============    ============

     During  the  years  ended   December   31,  1999  and  December  31,  2000,
Cumberland's operating results included revenue of approximately $11,455,000 and
$14,425,000.  During  the same  periods,  Cumberland  recognized  net  income of
approximately  $1,148,000 and $950,000,  respectively.  The Company's  equity in
this net income  amounted to  approximately  $360,000 and $297,000 for the years
ended  December  31, 1999 and 2000,  respectively.  In  addition,  approximately
$165,000  of  amortization  expense was  recorded by the Company  related to the
investment in both 1999 and 2000.

     APARTMENTS  - On  October  22,  1997,  the  Company  contributed  its  note
receivable in an amount of  approximately  $3,851,000  from the  Apartments  and
other  receivables  of $3,059,000  for a  non-controlling  49 percent  preferred
limited partnership interest in the Apartments and a receivable of $900,000 from
the  Apartments.  The  amount  of  approximately  $12,066,000  in  excess of the
underlying  equity was attributed to goodwill and is being amortized over thirty
years. The Company will be allocated 49 percent of operating income,  losses and
cash flow.  The  preference in the Company's  equity  interest in the Apartments
occurs  upon  the  sale  of the  underlying  partnership  properties.  Upon  the
occurrence of a capital  transaction,  the Company would receive cash flows from
the sale or refinancing of the Apartments' assets equal to its net book value of
its investment  balance prior to any other partner  receiving any proceeds.  The
Company accounts for its investment in the Apartments using the equity method.


                                       36
<PAGE>

                                  KIMMINS CORP.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     During the years  ended  December  31,  1999 and  December  31,  2000,  the
Apartments recognized revenue of approximately $4,402,000 and $4,394,000. During
the same periods, the Apartments recognized net losses of approximately $388,000
and $397,000, respectively. The Company has recorded its 49 percent share of the
net results of operations.  In addition,  approximately $402,000 of amortization
expense was recorded by the Company related to the investments in the Apartments
in both 1999 and 2000. At December 31, 1999 and 2000,  the Company's  balance in
its  total  investment  in  the  Apartments  was  approximately  $5,340,000  and
$4,742,000,  respectively,  which includes a receivable of $900,000. See Note 22
for subsequent disposition of the Apartments.

     The following is a summary of the  financial  position  (unaudited)  of the
Apartments at December 31, 1999 and 2000:

<TABLE>
<CAPTION>
          <S>                                              <C>              <C>
                                                                1999             2000
                                                                ----             ----
                                                            (unaudited)      (unaudited)

           Cash and cash equivalents                       $       30,000   $        (40,000)
           Accounts receivable - affiliate                        946,000            946,000
           Land                                                 3,800,000          3,800,000
           Buildings, capitalized construction interest,
           furniture and equipment, net                        15,555,000         14,649,000
           Other                                                  602,000            712,000
                                                             -------------    ---------------

           Total assets                                    $   20,933,000   $     20,067,000
                                                             =============    ===============

           Accounts payable and accrued expenses           $      743,000   $        711,000
           Accounts payable to affiliates                       1,702,000          1,548,000
           Mortgage loan payable                               20,833,000         20,665,000
           Note payable to partner - Francis M. Williams        2,860,000          2,860,000
                                                             -------------    ---------------
           Total liabilities                                   26,138,000         25,784,000
           Partners' deficit                                   (5,205,000)        (5,717,000)
                                                             -------------    ---------------

           Total liabilities and partners' deficit         $   20,933,000   $     20,067,000
                                                             =============    ===============
</TABLE>

10.  ACCRUED EXPENSES
<TABLE>
<CAPTION>
          <S>                                              <C>              <C>


                                                                     December 31,
                                                                1999             2000
                                                                ----             ----
           Accrued insurance                               $    3,137,675   $      2,868,175
           Accrued interest                                       417,067            113,049
           Accrued property taxes                               1,222,215          2,054,726
           Accrued salaries, wages and payroll taxes              660,163            725,736
           Other                                                   59,192             96,121
                                                             -------------    ---------------

           Total accrued expenses                         $     5,496,312   $    5,857,807
                                                             =============    ===============
</TABLE>


                                       37
<PAGE>

                                  KIMMINS CORP.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

11.      LONG-TERM DEBT
<TABLE>
<CAPTION>
<S>                                                                             <C>            <C>

                                                                                   December 31,
                                                                                1999              2000
                                                                                ----              ----
Notes payable,  principal and interest  payable in monthly
   installments  plus a balloon payment of $28,124,867
   due upon maturity of July 2002, interest at 8.25%,
   collateralized by equipment.                                                 $ 46,621,417    $ 37,653,614

Term bank line of  credit,  due March 31,  2000,  interest
   payable  monthly  at lender's base rate plus .5%.
   At December 31, 1999, the rate is 8.25%.                                        2,451,885             -0-

Notes payable,  principal and interest payable in monthly
   installments  through October 2003, interest at varying
   rates up to 9.3%, collateralized by equipment.                                  6,237,606       4,150,181

Line of credit secured by Waste  Management  shares due and
   payable upon demand, interest payable at lender's base rate of
   LIBOR plus 0.75%.                                                               3,491,153        4,314,566

Mortgage notes,  principal and interest payable in monthly
  installments through December  1,  2004,  interest  at
  varying  rates  up to  prime  plus  1.25%, collateralized by land and
   buildings.  At December 31, 2000 the average rate is 9.75%.                     1,764,547         1,504,381
                                                                                --------------   ---------------

Total debt                                                                        60,566,608        47,622,742
Less current portion                                                            (16,799,575)      (17,875,227)
                                                                                --------------   ---------------

Net long-term debt                                                              $ 43,767,033     $ 29,747,515
                                                                                ==============   ===============
</TABLE>

     Annual  principal  maturities  subsequent  to  December  31,  2000,  are as
follows:

                         2001                 $      17,875,227
                         2002                        28,636,693
                         2003                           553,183
                         2004                           557,639
                                                 ---------------
                                              $      47,622,742
                                                 ===============


     At  December  31,  1999,  there  were no  borrowings  available  under  the
revolving term bank line of credit.  During the year,  the Company  restructured
its loan arrangements with one of its financial institutions,  which was secured
by a pledge of all of the stock of the Company's  subsidiaries and substantially
all of the unsecured  assets of the Company.  The use of funds under these lines
is  limited  among  certain   subsidiaries,   and  repayment  is  guaranteed  by
Cumberland. The Company's outstanding letter of credit facility of approximately
$1,080,000  is  secured  by a  restricted  cash  account  at a  local  financial
institution. At December 31, 1999 and 2000, there were no borrowings outstanding
against the letter of credit facility.

         There was an  outstanding  balance of  approximately  $2,452,000 on the
Company's  bank line of credit as of December 31, 1999 which was scheduled to be
paid off during the first  quarter of 2000.  The  Company  paid the  outstanding
balance on the line of credit during the second quarter of 2000.


                                       38
<PAGE>

                                  KIMMINS CORP.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     The  Company's  revolving  term  line of  credit  with a  vendor  supplying
financing for heavy  construction  equipment  purchases was discontinued  during
1999.  The  outstanding  balance  on the  revolving  term  line of credit is now
classified as notes payable.

     The Company  established loan and collateral  account agreements with firms
holding the Company's  marketable  securities  during 1999 and 2000.  The margin
lines of  credit  provide  cash  advances  to the  Company  and are based on the
current value of the Waste  Management  shares and other  marketable  securities
held by the Company.

12.  EMPLOYEE STOCK OWNERSHIP PLAN TRUST DEBT

     In March 1990, the Company's  Employee Stock  Ownership Plan Trust ("ESOP")
(Note 14) originally was funded from a $5,100,000 loan. This loan was refinanced
during December 1995 and bears interest at prime plus .5 percent, with quarterly
principal and monthly interest  payments  originally  scheduled  through October
2000.  The loan was  guaranteed  by the Company as to payment of  principal  and
interest and,  therefore,  the unpaid  balance of the borrowing was reflected as
debt of the Company at December  31,  1998.  This loan was repaid in full during
the fourth quarter of 1999. The ESOP plan was terminated December 31, 1999.

13.  LEASING ARRANGEMENTS

     The Company  rents  equipment  and  machinery as needed,  as well as office
space, under operating leases for varying periods not to exceed one year. Rental
expense for the years ended December 31, 1998, 1999, and 2000, was approximately
$11,858,000,  $7,741,000 and $5,466,000,  respectively.  Since 1998, some of the
heavy  construction  equipment  previously  leased was  purchased by the Company
which is the primary reason for the significant and continued  decreases in 1999
and 2000 rental expense.

     The Company formerly leased some of its heavy construction  equipment under
capital  leases.  The  economic  substance  of each lease is that the Company is
financing the acquisition of the assets through the lease, and  accordingly,  it
was recorded in the Company's assets and liabilities.

     The following is an analysis of the leased assets  included in property and
equipment:

                                                12/31/99           12/31/00
                                                --------           --------
      Machinery and equipment              $   1,234,500                -0-
      Less:  accumulated depreciation          (411,501)                -0-
                                            ------------      -------------
      Net book value of leased equipment   $     822,999                -0-
                                            ============      =============


14.  PENSION AND OTHER BENEFIT PLANS

     Employee Stock  Ownership  Plan. On January 1, 1989,  the Company,  for the
benefit of its  employees,  formed the ESOP to purchase  shares of the Company's
common stock from time to time in the open market or in negotiated  transactions
at prices  deemed to be  attractive.  Contributions  to the ESOP are made at the
discretion  of the Board of Directors.  During 1989,  the ESOP acquired from the
Company's President 257,371 shares of common stock at a cost of $5,100,000.  The
shares were acquired in exchange for a note payable to the Company's  President.
Simultaneous  with this  purchase,  the Company's  President  purchased  certain
receivables and interests in certain investments from the Company for a purchase
price of  approximately  $5,100,000,  which  was paid by the  assignment  to the
Company  of the note  received  from the ESOP.  The note  originally  was funded
during March 1990,  through a long-term bank financing  agreement  guaranteed by


                                       39
<PAGE>




                                  KIMMINS CORP.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

the  Company  (Note  11).  As the  debt is  repaid,  shares  are  released  from
collateral  and allocated to active  employees,  based on the proportion of debt
service paid in the current year.  Debt of the ESOP is recorded as debt, and the
shares pledged as collateral are reported as unearned  employee  compensation in
the balance sheet. For financial  statement  purposes,  as of December 31, 1999,
the unearned employee  compensation is reflected as a reduction in stockholders'
equity. The Company's accounting treatment for the ESOP as described above is in
accordance with SOP 76-3 for grandfathered  plans established prior to 1993. The
ESOP Plan was terminated effective December 31, 1999.

     Interest and compensation expenses relating to the ESOP are as follows:

                                  Years ended December 31,
                                     1998          1999
                                     ----          ----

        Interest               $    102,852     $     59,335
        Compensation           $    480,000     $    840,000

     The ESOP shares were as follows:

                                         December 31,
                                     1998          1999
                                     ----          ----

        Allocated shares            214,525          255,000
        Shares released for
          allocation                 -0-                 -0-
        Unreleased shares            40,475              -0-
                                 ----------      -----------
        Total ESOP shares           255,000          255,000
                                 ==========      ===========

        Market value of
          unreleased shares      $   83,000      $      -0-
                                 ==========      ===========

     Stock Option Plan. The Company  originally  reserved  975,000 shares of its
common stock for issuance  upon the exercise of options to be granted  under the
Company's  1987 Stock Option Plan (the Company  Plan).  The exercise price of an
incentive  stock option  granted under the Company Plan may not be less than the
fair market  value of the common  stock at the time the option is  granted.  The
exercise  price of a  non-qualified  stock option granted under the Company Plan
may be any amount  determined  by the Board of  Directors  but not less than the
fair market value of the common stock on the date of the grant.  Options granted
under the Company Plan must, in general, expire no later than ten years from the
date of the grant.

     The Company's Plan has the option to acquire an aggregate of 975,000 shares
of common  stock that may be  granted  to  employees,  officers,  directors  and
consultants  of the Company.  The Plan  authorizes  the Board of Directors  (the
"Board")  to issue  incentive  stock  options  ("ISOs"),  as  defined in Section
422A(b) of the Internal  Revenue Code,  and stock options that do not conform to
the requirements of that Code section ("Non-ISOs").  The Board has discretionary
authority to  determine  the types of stock  options to be granted,  the persons
among those eligible to whom options will be granted, the number of shares to be
subject to such options,  and the terms of the stock option agreements.  Options
may be exercised in the manner and at such times as fixed by the Board,  but may
not be exercised after the tenth anniversary of the grant of such options.



                                       40
<PAGE>

                                  KIMMINS CORP.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

         The following  table  summarizes the  transactions  for the three years
ended December 31, 2000, relating to the Plan:


                                              Number of            Exercise
                                               Shares                Price
                                               ------                -----
    Outstanding January 1, 1998                  274,075         $2.62 - $4.50
       Granted                                       -0-                  $-0-
       Exercised                                     -0-                  $-0-
       Canceled                                 (16,476)         $2.62 - $4.50
                                            -------------      ----------------
    Outstanding December 31, 1998                257,599         $2.62 - $4.50
       Granted                                   699,099         $0.25 - $0.275
       Exercised                                     -0-                  $-0-
       Canceled                                (236,266)         $2.62 - $4.50
                                            -------------      ----------------
    Outstanding December 31, 1999                720,432         $0.25 - $4.50
       Granted                                   321,976                  $.25
       Exercised                                     -0-                  $-0-
       Canceled                                  (3,000)                  $-0-
                                            -------------      ----------------
    Outstanding December 31, 2000              1,039,408         $0.25 - $4.50
                                            -------------      ----------------
    Exercisable December 31, 2000                360,572         $0.25 - $4.50
                                            =============      ================

     Pro forma information regarding net income (loss) and earnings per share is
required by SFAS No. 123, which also requires that the information be determined
as if  the  Company  had  accounted  for  its  employee  stock  options  granted
subsequent to December 31, 1993,  under the fair value method of that Statement.
The fair value for these  options  was  estimated  at the date of grant  using a
Black-Scholes   option   pricing  model  with  the  following   weighted-average
assumptions for 1998, 1999 and 2000;  risk-free interest rates of 5.5 percent; a
dividend yield of zero;  volatility  factors of the expected market price of the
Company's  common  stock  based on  historical  trends;  and a  weighted-average
expected life of the options of seven years.

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


                                       41
<PAGE>


                                  KIMMINS CORP.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


         For purposes of pro forma disclosures,  the estimated fair value of the
options is amortized to expense over the options' vesting period.  The Company's
pro forma information is as follows:
<TABLE>
<CAPTION>
<S>                                                        <C>             <C>               <C>
                                                                 1998             1999              2000
                                                                 ----             ----              ----
Proforma net income (loss) attributable to stockholders    $    4,271,103  $    (3,371,264)   $     2,833,431
Proforma income (loss) per common share:
      Basic and diluted                                    $          .99  $         (0.74)   $           .58
</TABLE>


     Multi-Employer  Defined  Contribution  Plan.  The Company made  payments to
collectively  bargained,  multi-employer  defined  contribution  plans  covering
Company union employees.  Under the Multi-Employer Pension Plan Amendment Act, a
withdrawing  employer is  required  to continue  funding its share of the plan's
unfunded vested benefits. The Company does not possess sufficient information to
determine its portion of the unfunded vested benefits, if any.  Contributions to
such plans for the year ended  December 31,  1998,  was not  significant.  As of
August 31, 1998, there were no longer any union employees.

     Savings and  Profit-Sharing  Plan.  The Company offers a savings and profit
sharing plan (the "401(k) Plan"),  which qualifies under Sections 401(a) and (k)
of the Code.  Employees  of the  Company and  certain  affiliates  who have been
employed  for a  specified  period of time are  eligible to  participate  in the
401(k) Plan. All contributions  made by the employees vest immediately.  Amounts
contributed  by the Company vest 20 percent  after three years of service and 20
percent each year thereafter.


15.  INCOME TAXES

     As of December 31, 1999 and 2000, the Company had  consolidated  income tax
net  operating   loss  ("NOL")   carryforwards   for  federal  tax  purposes  of
approximately   $11,600,000   and   $4,200,000   respectively.   The   remaining
consolidated  federal tax NOL carryforward of $4,200,000 will expire through the
year 2020 if not used. For  alternative  minimum tax ("AMT")  purposes,  the NOL
carryforward is  approximately  $3,332,000 and $0 at December 31, 1999 and 2000,
respectively.  The Company also has alternative minimum tax credit carryforwards
of  approximately  $1,000,000  available at December  31, 2000 to reduce  future
federal regular income taxes. The AMT credit carryforwards do not expire.

     Prior to August 15, 1998,  TransCor  and the Company were not  permitted to
file consolidated  income tax returns because the Company owned less than 80% of
TransCor. On August 15, 1998, the Company acquired an additional 6% of the stock
of TransCor,  raising its ownership  above 80% thereby  permitting the filing of
consolidated tax returns prospectively.

     The   components  of  the  provision  for  income  taxes   (benefits)   are
attributable to continuing operations as follows:

                         1998              1999               2000
                         ----              ----               ----
Current          $    (11,232,732)  $            -0-   $        404,479
Deferred                 1,366,733       (1,408,389)          (131,559)
                    ---------------    --------------     --------------
                 $     (9,865,999)  $    (1,408,389)   $        272,920
                    ===============    ==============     ==============





                                       42
<PAGE>


                                  KIMMINS CORP.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     Deferred income taxes reflect the net tax effects of temporary  differences
between the carrying  amounts of assets and liabilities for financial  reporting
purposes and the amounts used for income tax purposes. Significant components of
the Company's deferred tax assets and liabilities are as follows:

<TABLE>
<CAPTION>
<S>                                                <C>                  <C>
                                                                 December 31,
                                                           1999                2000
                                                           ----                ----
Deferred tax assets:
   Net operating loss carryforward                  $      4,449,317    $     1,576,574
   Unrealized losses on marketable securities              3,479,430          2,520,200
   Share of Cumberland's unrealized loss                      16,130                -0-
   Allowance for doubtful accounts                            26,250             26,250
   Costs deferred for tax expensed for books                 611,847            633,794
   Alternate minimum tax credit carryforwards                376,442          1,062,917
   Accrued worker's compensation                           1,176,628          1,008,158
   Uncompleted long-term contracts                           502,234            341,062
   Tax revenue deferred for books                            747,436            258,390
                                                       --------------      -------------
                                                          11,385,714          7,427,345
                                                       --------------      -------------
Deferred tax liabilities:
   Excess of tax over book depreciation                  (6,843,230)        (4,826,625)
   Undistributed earnings in Cumberland                    (103,589)          (228,552)
   Share of Cumberland's unrealized gain                         -0-            (8,122)
                                                         (6,946,819)        (5,063,299)
Net deferred tax asset (liability)                         4,438,895          2,364,046
Less current net deferred asset                            1,814,725          1,731,119
   Net non-current deferred asset (liability)       $      2,624,170    $       632,927
                                                       ==============      =============
</TABLE>

     As  reflected  above,  the Company has recorded a net deferred tax asset of
$4,438,895  and  $2,364,046  at  December  31,  1999  and  2000,   respectively.
Management  has  determined  that a  valuation  allowance  is not  necessary  at
December  31, 1999 and 2000,  because it is expected  that the net  deferred tax
assets will be realized  through  future profits in operations and settlement of
pending claims. The amount of the net deferred tax assets considered realizable,
however,  could change in the near future if estimates of future  taxable income
during the carryforward period are changed.

     Factors  causing the effective  tax rate to differ from the statutory  rate
are as follows:

                                             Years ended December 31,
                                             ------------------------
                                          1998        1999        2000
                                          ----        ----        ----

Federal statutory rate                    (34.0%)     (34.0%)     (34.0%)
Valuation allowance                       (10.0%)         -0-         -0-
State income taxes, net of
   Federal benefit                         (2.7%)      (3.5%)      (3.5%)
Additional tax (benefit) on the
   Company's shares of
   TransCor's earnings                       5.4%         -0-         -0-
Other                                        1.8%        7.8%        4.6%
                                        ----------  ----------  ----------
Effective tax rate                        (39.5%)     (29.7%)     (32.9%)
                                        ==========  ==========  ==========


                                       43
<PAGE>


                                  KIMMINS CORP.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


16.  STOCKHOLDERS' EQUITY

     The  Company's  Class B common  stock has the same voting  rights as common
stock and is not entitled to participate in cash dividends.  Upon liquidation or
dissolution of the Company,  the holders of common stock are entitled to receive
up to $9.00 per  share,  after  which the  holders  of Class B common  stock are
entitled to receive up to $9.00 per share. Thereafter,  all assets remaining for
distribution  will be  distributed  pro rata to the holders of common  stock and
Class B common stock.  The right to convert Class B common stock to common stock
occurs in any fiscal year in which the Company  achieves net earnings equal to a
specified  amount per the Class B common stock conversion  agreement  (currently
$.84 per share),  which is calculated by adding the total shares  outstanding at
fiscal  year end to the  number of shares  that  could be  converted  during the
fiscal year.

     The holders of the Class B common stock will  thereafter  have the right to
convert up to 625,000  shares of Class B common  stock  into  common  stock on a
share for share basis as follows.  Each cumulative  incremental  increase in net
earnings in any subsequent  year of $.21 per share above the specified  level of
earnings  previously  obtained will afford holders the right to convert up to an
additional  625,000  shares of Class B common stock into common stock on a share
for share basis. Holders of Class B common stock will not be entitled to convert
more than 625,000 of such shares in any fiscal year unless the Company  achieves
earnings  of $1.44 per share of common  stock in any  fiscal  year,  which  will
entitle holders to convert all shares of Class B common stock into common stock.
In addition, conversion occurs if a sale of part of the Company's business as to
which  there  is  a  bona  fide  offer  to  purchase   would  have  resulted  in
convertibility  of  any  of the  outstanding  Class  B  common  stock  and it is
determined  by the Board of  Directors  of the  Company  not to  approve  such a
transaction,  then,  upon  request of the holder or holders of a majority of the
outstanding  Class B common stock, the number of shares thereof which would have
become convertible had the transaction  occurred,  would become  convertible.  A
similar provision  provides that if there is an independent  valuation of a part
of the business of the Company such that if such part of the business were sold,
the result would allow conversion of all outstanding Class B common stock and if
the Board of Directors of the Company does not authorize such sale,  then,  upon
request of the holder or holders of a majority of the outstanding Class B common
stock, the outstanding Class B common stock would become convertible.  No shares
of Class B common stock became  eligible for conversion into common stock during
the years ended December 31, 1999 or 2000.

     Based on 1998  earnings,  625,000  shares  of Class B common  stock  became
eligible  for  conversion  into common  stock.  The 625,000  Class B shares were
converted to common stock in 1999.

     As a result of TransCor's sale of KRC to EESI in August 1998, the Company's
net income for the year ended December 31, 1998 exceeded the threshold amount of
$.84 per share.  Thus,  during 1999, the holder of the Class B common stock, Mr.
Francis M. Williams converted 625,000 Class B shares into common stock.

     The Company has authorized  1,000,000  shares of preferred stock with a par
value of $.001, none of which is presently outstanding. Such preferred stock may
be issued in series and will have such designations,  rights,  preferences,  and
limitations as may be fixed by the Board of Directors.

     Net unrealized losses on marketable securities of approximately  $5,826,000
net of  taxes  of  approximately  $3,496,000  are  recorded  as a  reduction  to
stockholders equity as of December 31, 1999. Net unrealized losses on marketable
securities of approximately  $3,911,000 net of taxes of approximately $2,512,000
are recorded as a reduction to stockholders' equity as of December 31, 2000.

     During the year ended December 31, 1999, the Company acquired 41,821 shares
of treasury stock at a cost of $45,522. At December 31, 2000, the balance of the
Company's treasury stock was $845,892.

                                       44
<PAGE>

                                  KIMMINS CORP.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


17.  COMMITMENTS AND CONTINGENCIES

     The Company is involved in various legal actions and claims  arising in the
ordinary course of its business. After taking into consideration legal counsel's
evaluation  of such actions and claims,  management is of the opinion that their
outcome will not have a material  adverse effect on the  consolidated  financial
position of the Company.

     During 2000, the Company entered into a three-year  "Club Seat"  membership
agreement with a local sports venue,  for a total of  approximately  $40,000 per
year. Part of the cost of the agreement is shared with the Company's  affiliate,
Cumberland Technologies, Inc.


18.  FOURTH QUARTER ADJUSTMENTS

     During the fourth  quarter of 1998,  the Company  revised its  estimates of
costs to complete  certain  contracts  primarily  as a result of work  slowdowns
caused by excessive  rainfall and recorded  certain  charges related to contract
claim and  change  order  settlements.  The  aggregate  effect of these  revised
estimates  on  the  Company's   pretax  income  for  1998  was  a  reduction  of
approximately $5,000,000.

     During the fourth quarters of 1999 and 2000, the Company evaluated its self
insurance  accounts and determined that they were over reserved by approximately
$867,000  and  $125,000,  respectively.  The  reserve for  insurance  claims was
accordingly  reduced by $867,000  and $125,000 as of December 31, 1999 and 2000,
respectively.

     The Company had a balance  sheet amount at  September  30, 1999 of $536,000
for equipment  burden.  This equipment burden amount  represented the difference
between the actual equipment  expense and amounts charged to specific job costs,
based on actual usage as of September  30,  1999.  During the fourth  quarter of
1999, this amount was expensed.


19.  FAIR VALUE OF FINANCIAL INSTRUMENTS

     The  following  estimated  fair value  amounts have been  determined  using
available market information and appropriate valuation  methodologies.  However,
considerable  judgment is necessarily  required in  interpreting  market data to
develop the estimates of fair value. Accordingly, the estimates presented herein
are not necessarily  indicative of the amounts that the Company could realize in
a current  market  exchange.  The use of  different  market  assumptions  and/or
estimation  methodologies may have a material effect on the estimated fair value
amounts.

     CASH,  ACCOUNTS  RECEIVABLE,  NOTE  RECEIVABLE  -  AFFILIATE,  AND ACCOUNTS
PAYABLE.  The carrying amount  reported in the balance sheet for cash,  accounts
receivable, and accounts payable approximates their fair value.

     MARKETABLE  SECURITIES - The carrying  amount reported in the balance sheet
for  marketable  securities   approximates  their  fair  value  based  on  price
quotations listed on national markets.

     LONG-TERM  DEBT.  The  fair  values  of the  Company's  long-term  debt are
estimated using  discounted cash flow analyses,  based on the Company's  current
incremental  borrowing  rates for similar types of borrowing  arrangements.  The
carrying value of the Company's long-term debt approximates the fair value.

                                       45
<PAGE>

                                  KIMMINS CORP.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


20.  EARNINGS (LOSS) PER SHARE

     As required by FASB  Statement No. 128, the following  table sets forth the
computation  of basic and diluted  earnings per share:
<TABLE>
<CAPTION>
<S>                                                           <C>                <C>              <C>
                                                                          Years ended December 31,
                                                                     1998              1999                2000
                                                                     ----              ----                ----
Numerator:
---------
Income (loss) from continuing operations                      $  (15,088,299)    $   (3,340,077)   $        470,838
Adjustment for basic earnings per share                                   -0-                -0-                -0-
                                                                --------------     --------------    ---------------
Numerator for basic earnings per share -
   Income (loss) available to common stockholders
   from continuing operations                                 $  (15,088,299)    $   (3,340,077)   $        470,838

Effect of dilutive securities
Numerator for diluted earnings per share-
Income (loss) from continuing operations                      $  (15,088,299)    $   (3,340,077)   $        470,838
Income (loss) from discontinued operations                         19,431,309                -0-          2,390,018
                                                                --------------     --------------    ---------------
Income (loss) applicable to common stockholders
   after assumed conversions                                  $     4,343,010    $   (3,340,077)   $      2,860,856
                                                                ==============     ==============    ===============

Denominator:
-----------
Denominator for basic earnings per share -
   weighted-average shares                                          4,296,969          4,575,545          4,872,135
Effect of dilutive securities:
Stock options                                                             -0-                -0-                -0-
Dilutive potential common shares                                          -0-                -0-                -0-
                                                                --------------     --------------    ---------------
Denominator for diluted earnings per share - adjusted
   weighted-average shares and assumed conversions                  4,296,969          4,575,545          4,872,135
                                                               ==============     ==============    ===============
Basic and diluted earnings per share from
   continuing operations                                      $        (3.51)    $         (.73)   $            .10
                                                                ==============     ==============    ===============
Basic and diluted earnings per share from
   discontinued operations                                    $          4.52    $           -0-   $            .49
                                                                ==============     ==============    ===============
Basic and diluted earnings per share                          $          1.01    $         (.73)   $            .59
                                                                ==============     ==============    ===============
</TABLE>


     Unexercised options to purchase approximately 104,000,  154,000 and 361,000
shares of common stock for 1998, 1999 and 2000, respectively,  were not included
in the  computations  of diluted loss per share  because the assumed  conversion
would be antidilutive.

21.  DISCONTINUED OPERATIONS

     On May 31, 1998, the Company sold its  Jacksonville  area waste  collection
and recycling  operating  assets and certain assets of the Miami  front-end load
and rear-load  commercial waste and recycling business to Eastern  Environmental
Services of Florida,  Inc., for approximately  $11,600,000 in cash. The proceeds
exceeded  the net book  value of the  underlying  assets  sold by  approximately
$5,200,000.  This gain is shown in the Consolidated  Statements of Operations as
part of "gain on sale of discontinued operations."

                                       46
<PAGE>

                                  KIMMINS CORP.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     On July 17, 1998, the Company adopted a formal plan to sell its solid waste
management services operations to EESI. On August 31, 1998 the Company completed
the sale of the solid waste management  services (SWMS)  operations.  The assets
sold  consisted  primarily of accounts  receivables,  contracts and property and
equipment.  The selling price was approximately  $57,800,000 in the form of cash
and EESI common stock.

     Revenues and expenses of the SWMS  operations for the year ending  December
31, 1998 is shown separately in the schedule below.  The consolidated  statement
of  operations  for the year ended  December 31, 1998 has been  restated to show
separately  the  operating  results of the SWMS  operations.  These  amounts are
included  in the  income or loss from  discontinued  operations  portion  of the
accompanying consolidated statements of operations.  Approximately $7,610,000 of
these net revenues was received after the Company's adoption of the plan to sell
the SWMS operations.  Information related to the discontinued SWMS operations of
KRC for the year ended December 31, 1998 is as follows:

                                                            Year Ended
                                                        December 31, 1998
                                                        -----------------

    Net revenue                                      $         21,526,000
    Operating expenses, including depreciation                 18,176,000
    Selling, general and administrative expenses                4,002,000
                                                         -----------------
    Operating loss                                                652,000
    Interest expense, net                                         913,000
                                                         -----------------
    Loss before provision for income tax benefit                1,565,000
    Provision for income tax benefit                              618,000
                                                         -----------------
    Loss from discontinued operations                $            947,000
                                                         =================

     For the year ended December 1998, approximately $180,000 is shown as a loss
from  discontinued  operations and the remainder of approximately  $767,000,  in
accordance with APB No. 30, income or loss incurred after the  measurement  date
is included in the gain on the sale of discontinued operations.  Included in the
gain is a $1,000,000 charitable  contribution to a private foundation controlled
by Mr.  Francis M.  Williams.  The loss from  discontinued  operations  included
write-offs of intangible and other assets.

     The  sale  of  the  Company's  SWMS  operations   resulted  in  a  gain  of
approximately $19,611,000 net of taxes approximately $11,861,000.  Approximately
$15.1 million of the cash proceeds were used to pay off debt on the property and
equipment of the SWMS  operations.  An additional  $6.6 million was used to fund
the working capital deficit of the SWMS operations at August 31, 1998.

     On  June  27,  2000,  the  Company  received  net of  related  legal  fees,
$3,525,000  from WMI as final  settlement.  This  settlement was for adjustments
required under the purchase agreement and for other disputes related to the sale
of the SWMS operations.  This amount net of tax of $1,135,000 has been reflected
on the Statement of Operations as Income from Discontinued Operations.

22.  SUBSEQUENT EVENTS

     In March 2001,  the  Company  sold its  investment  in the  Apartments  for
approximately $4,637,000.  This amount represents the adjusted book value of the
Apartments as of December 31, 2000.

                                       47
<PAGE>


                 SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS

                         ALLOWANCE FOR DOUBTFUL ACCOUNTS

<TABLE>
<CAPTION>
<S>                                 <C>             <C>             <C>                <C>
                                                        Additions
                                       Balance at       Charged to      Deductions
                                        Beginning        Costs and        from             Balance at
            Description                 of Period        Expenses       Allowances (a)   End of Period
            -----------                 ---------        --------      ---------------   -------------

Year ended December 31, 2000         $    551,355    $      -0-     $   (63,414)        $    487,941
Year ended December 31, 1999         $    739,223    $   40,000     $  (227,868)        $    551,355
Year ended December 31, 1998         $    921,301    $   87,275     $  (269,353)        $    739,223
</TABLE>

(a)  This amount represents additional  collections of the St. Lucie receivables
     which  were  fully  reserved  as well  as the  write-off  of  uncollectible
     accounts in 1998 and 1999.


ITEM 9.  CHANGES  IN  AND  DISAGREEMENTS  WITH  ACCOUNTANTS  ON  ACCOUNTING  AND
         FINANCIAL DISCLOSURE

     As reported in Kimmins Corp. Current Report on Form 8-K, filed November 18,
1999,  Kimmins has changed its  accountants.  On November 11, 1999, the Board of
Directors of the Company  approved the  engagement  of Giunta,  Ferlita & Walsh,
P.A. as its independent auditors for the fiscal year ending December 31, 1999 to
replace  the firm of Ernst & Young LLP,  who were  dismissed  as auditors of the
Company  effective  November 11,  1999.  The reports of Ernst & Young LLP on the
Company's financial statements for the past two years did not contain an adverse
opinion or a  disclaimer  of opinion  and were not  qualified  or modified as to
uncertainty,  audit scope, or accounting principles.  The Company had authorized
Ernst & Young LLP to  discuss  the  results  of the past two years  audits  with
Giunta, Ferlita & Walsh.

     In  connection  with the  audits of the  Company's  consolidated  financial
statements  for  each  of the two  years  ended  December  31,  1998  and in the
subsequent interim periods,  there we no disagreements with Ernst & Young LLP on
any  matters  of  accounting   principles  or  practices,   financial  statement
disclosure  or  auditing  scope and  procedures  which,  if not  resolved to the
satisfaction  of Ernst & Young LLP,  would have caused Ernst & Young LLP to make
reference to the matter in their report.

                                       48
<PAGE>


                                    PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

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

            Name        Age            Position
            ----        ---            --------
Francis M. Williams     59    President, Chief Executive Officer and Director
Norman S. Dominiak      56    Vice President
Joseph M. Williams      44    Secretary and Treasurer
Michael Gold            52    Director
R. Donald Finn          57    Director

     All  directors of the Company hold office until the next annual  meeting of
stockholders and the election and qualification of their successors. Officers of
the Company are elected  annually by the Board of  Directors  and hold office at
the discretion of the Board of Directors.

     Francis M.  Williams  has been  President  and Chairman of the Board of the
Company  since its  inception and Chairman of the Board of Directors of TransCor
since  November  1992.  For more than five years  prior to  November  1988,  Mr.
Williams  was the Chairman of the Board and Chief  Executive  Officer of Kimmins
Corp. and its  predecessors  and sole owner of K Management Corp. From June 1981
until  January  1988,  Mr.  Williams  was also the  President  and a Director of
College Venture Equity Corp., a small business investment company.  Mr. Williams
has also been a Director of the National  Association of Demolition  Contractors
and a member of the  Executive  Committee of the Tampa Bay  International  Trade
Council.

     Norman S. Dominiak has been Vice  President of the Company since March 1995
and has been  employed  by the  Company  as its Chief  Financial  Officer  since
January 1994.  Mr.  Dominiak has also been Chief  Financial  Officer of TransCor
since  January 1994.  Mr.  Dominiak  served as Controller of ThermoCor  Kimmins,
Inc., a subsidiary of the Company,  from October 1991 until  January 1994.  From
May 1988 until  September  1991, Mr. Dominiak served as Senior Vice President of
Creative  Edge,  a company  engaged in the  manufacturing  and  distribution  of
educational products. From October 1982 until April 1988, Mr. Dominiak served as
Senior Vice President of Cecos Environmental  Services,  Inc., a company engaged
in treatment,  transportation,  and disposal of hazardous waste. From 1965 until
1982,  Mr.  Dominiak  was  employed  in  various  financial  capacities  for the
Carborundum Company.

     Joseph M.  Williams  has been the  Secretary  and  Treasurer of the Company
since October 1988.  Since  September  1997, Mr. Williams has been President and
Chief  Executive  Officer of TransCor.  Since November  1991,  Mr.  Williams has
served as President and has been a Director of Cumberland Technologies,  Inc., a
holding  company  whose  wholly  owned  subsidiaries   provide  reinsurance  and
specialty  sureties and  performance  and payment  bonds.  Since June 1986,  Mr.
Williams has served as President  and Vice  President and has been a Director of
Cumberland  Real  Estate  Holdings,  Inc.,  the  corporate  general  partner  of
Sunshadow  Apartments,  Ltd.  ("Sunshadow")  and Summerbreeze  Apartments,  Ltd.
("Summerbreeze"),  both of which are limited partnerships. Mr. Williams has been
employed by the Company and its subsidiaries in various capacities since January
1984.  From  January  1982 to  December  1983,  he was the  managing  partner of
Williams and Grana,  a firm engaged in public  accounting.  From January 1978 to
December 1981, Mr.  Williams was employed as a senior tax accountant  with Price
Waterhouse & Co. Joseph M. Williams is the nephew of Francis M. Williams.

     Michael Gold has been a Director of the Company since  November  1987.  For
more than the last five years, Mr. Gold has been a partner in the Niagara Falls,
New York law firm of Gold and Gold.

     R. Donald Finn has been a Director of the Company since  November 1992. For
more than the last five  years,  Mr.  Finn has been a partner in the Law Firm of
Gibson,  McAskill & Crosby  located in  Buffalo,  New York,  where Mr.  Finn has
practiced law for more than the last 25 years.

                                       49
<PAGE>

     Set forth  below is  information  regarding  certain key  employees  of the
Company:

     John V.  Simon  Jr.,  has been  President  and  General  Manager of Kimmins
Contracting Corp.,  responsible for supervising utility construction,  since May
1981,  and served as a Vice  President  of the Company  from 1981 until  October
1988. From January 1978 to May 1981, Mr. Simon owned Simon Construction Company,
a company that performed site work and utilities and demolition projects.

     Section  16(a)  Beneficial  Ownership  Reporting  Compliance.  Pursuant  to
Section  16(a)  of the  Securities  Exchange  Act of 1934 and the  rules  issued
thereunder,  the  Company's  executive  officers and  directors  and any persons
holding more than 10 percent of the Company's  common stock are required to file
with the  Securities  and Exchange  Commission  and the New York Stock  Exchange
reports of their initial ownership of the Company's common stock and any changes
in ownership of such common stock. Specific due dates have been established, and
the Company is required to disclose in its Annual  Report on Form 10-K and Proxy
Statement  any  failure  to file such  reports  by these  dates.  Copies of such
reports are required to be furnished to the Company.  Based solely on its review
of  the  copies  of  such  reports   furnished   to  the  Company,   or  written
representations that no reports were required, the Company believes that, during
2000, all of its executive  officers  (including the Named Executive  Officers),
directors and persons  owning more than 10 percent of its common stock  complied
with the Section 16(a) requirements, except that Mr. Simon failed to file a Form
4 to report one option grant.


ITEM 11. EXECUTIVE COMPENSATION

     Summary  Compensation  Table.  The following table provides certain summary
information  concerning  compensation  paid or  accrued by the  Company  and its
subsidiaries  to the Chief Executive  Officer and all other  executive  officers
whose salary and bonus  exceeded  $100,000 for the year ended  December 31, 2000
(the "Named Executives"):

                                             SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
<S>                            <C>       <C>         <C>                <C>              <C>                    <C>
                                                                                         Long Term Compensation
                                                       Annual Compensation                       Awards
                                                       -------------------                       ------
                                                                                               Securities
          Name and                                                      Other Annual           Underlying            All Other
     Principal Position         Year         Salary          Bonus      Compensation        Options/SAR's (#)     Compensation(1)
     ------------------         ----         ------          -----      ------------        -----------------     ---------------
Francis M. Williams             2000     $    125,000  $       50,000       $-0-                    -0-          $     1,250
   Chairman of the Board        1999          126,345  $       50,000       $-0-                420,000          $     1,775
   President and                1998          119,991  $      193,217       $-0-                    -0-          $       996
   Chief Executive Officer


John V. Simon, Jr.              2000     $    125,008  $          -0-       $-0-                100,000          $     1,262
   President of Kimmins         1999     $    126,353  $          -0-       $-0-                 21,333     (2)  $     1,612
   Contracting Corp.            1998     $    126,069  $       30,000       $-0-                    -0-          $     1,698

</TABLE>


(1)  Represents  the Company's  contribution  to the  employee's  account of the
Company's  401(k) Plan and premiums paid by the Company for term life  insurance
and long-term  disability.  These plans,  subject to the terms and conditions of
each plan, are available to all employees.

(2) Reflects  21,333  options  granted during 1999 upon  cancellation  of 21,333
options originally granted in 1997.

     Grant of Options.  During 1999,  420,000 options were granted to Francis M.
Williams in recognition of his performance. During 2000, options were granted to
Mr. Simon and other management personnel in recognition of their performance. No
stock appreciation rights (SARs) have been granted by the Company. The following
table  sets forth  information  regarding  the grant of options to an  executive
officer in 2000:

                                       50
<PAGE>

<TABLE>
<CAPTION>
<S>                       <C>               <C>              <C>               <C>         <C>
                           Number of          % of Total                                       Potential Redeemable
                           Securities        Options/SARs                                    Value at Assumed Annual
                           Underlying         Granted to                                      Rates of Appreciation
                          Options/SARs       Employees in     Exercise Price    Expiration       for Option Terms
          Name             Granted            Fiscal Year      ($/Share)(2)      Date(3)        5%($)       10%($)
          ----             -----------        -----------      ------------      -------        -----       ------

Joseph M. Williams         100,000(1)          31.06%               .25         08/13/10       26,000       56,000
John V. Simon, Jr.         100,000(1)          31.06%               .25         08/13/10       26,000       56,000
</TABLE>

(1)  The  options  vest and become  exercisable  on a  cumulative  basis on each
     anniversary  following  the  grant  date at the rate of 20% per year on the
     first through fifth anniversaries.

(2)  The exercise  price was based upon the closing  market price on the date of
     grant.

(3)  Options  are  subject  to  earlier  termination  in  the  event  of  death,
     disability, retirement or termination of employment.

     Aggregated  Option/SAR  Exercises  in Last Fiscal Year and Fiscal Year- End
Option/SAR  Values. The following table summarizes the net value realized on the
exercise of options in 2000 and the value of outstanding  options as of December
31, 2000, for the Named Executives.


               AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
                      AND FISCAL YEAR-END OPTION/SAR VALUES
<TABLE>
<CAPTION>
<S>                      <C>                 <C>               <C>                             <C>
                                                                                                 Unexercised
                                                                  Number of Securities            In-the-Money
                                                                 Underlying Unexercised         Options/SARs at
                               Shares                                Options/SARs at            Year-End ($) (1)
                              Acquired           Value                Year-End (#)                Exercisable/
          Name             on Exercise (#)    Realized ($)      Exercisable/Unexercisable        Unexercisable
          ----             ---------------    ------------      -------------------------        -------------
Francis M. Williams              -0-              $-0-               168,000/252,000                 $0/$0
Joseph M. Williams               -0-              $-0-               65,333/148,000                  $0/$0
John V. Simon, Jr.               -0-              $-0-               48,666/123,000                  $0/$0
Norman Dominiak                  -0-              $-0-                 3,000/4,500                   $0/$0
</TABLE>

(1)  Value is calculated using the Company's closing stock price on December 31,
     2000, per share, less the exercise price for such shares.

     Compensation  Committee  Interlocks and Insider  Participation.  During the
year ended December 31, 2000, Mr. Francis M. Williams,  the Company's  President
and Chairman of the Board of Directors,  served as President and Chairman of the
Board of Directors  of  TransCor,  and Mr.  Norman S.  Dominiak  served as Chief
Financial Officer of the Company and TransCor.

     Compensation  of Directors.  During the year ended  December 31, 2000,  the
Company paid non-officer  Directors an annual fee of $5,000 and $1,000 per board
meeting  attended.  Directors  are  reimbursed  for all  out-of-pocket  expenses
incurred in attending  Board of Directors and committee  meetings.  In addition,
Mr. Gold received $20,000 as compensation for option buyouts.


                                       51
<PAGE>

Stock Option and Other Plans

1987 STOCK OPTION PLAN

     The  Company  adopted a stock  option plan (the  "Plan")  pursuant to which
975,000 shares of common stock were originally  reserved for issuance to persons
upon exercise of options  designated as "incentive  stock  options,"  within the
meaning of Section 422A of the Internal  Revenue code of 1986 (the "Code"),  and
non-qualified stock options. The purpose of the Plan is to attract,  retain, and
motivate  officers and other  full-time  employees  of the Company,  and certain
other persons  instrumental  to the success of the Company,  and to provide them
with a means to acquire a proprietary interest in the Company.

     The Plan is administered by a committee  consisting of three members of the
Board of  Directors.  The exercise  price of an incentive  stock option  granted
under the Plan may not be less than the fair market value of the common stock at
the time the option is granted  (110 percent of fair market value in the case of
an incentive  stock option granted to an employee owning more than 10 percent of
the voting stock of the Company).  The exercise price of a  non-qualified  stock
option  granted  under  the Plan may be any  amount  determined  by the Board of
Directors  but not less than the fair  market  value of the common  stock on the
date of the grant.  Options  granted under the Plan must, in general,  expire no
later  than ten years  from the date of the grant  (five  years from the date of
grant in the case of an  incentive  stock option  granted to an employee  owning
more than 10 percent of the voting stock of the Company). All options granted to
date  provide  that the  grantees'  rights vest over five years from the date of
grant. See Item 12 for Named Executives holding options at December 31, 2000.

SAVINGS AND PROFIT-SHARING PLAN

     The Company offers a savings and profit  sharing plan (the "401(k)  Plan"),
which  qualifies  under  Sections  401(a) and (k) of the Code.  Employees of the
Company and certain  affiliates who have been employed for a specified period of
time are eligible to participate in the 401(k) Plan. All  contributions  made by
the  employees  vest  immediately.  Amounts  contributed  by the Company vest 20
percent after three years of service and 20 percent each year thereafter.


                                       52
<PAGE>

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The following table sets forth the number of shares of the Company's common
stock  beneficially  owned as of March 15,  2001,  by (i)  persons  known by the
Company to own more than 5 percent of the  Company's  outstanding  common stock,
(ii) by each  Named  Executive  and  director  of the  Company,  and  (iii)  all
executive officers and directors of the Company as a group:

<TABLE>
<CAPTION>
<S>                           <C>                      <C>                  <C>   <C>         <C>
                                                                                              Percent of
                                                                                  Percent       Total
Name and Address of                                                                  of         Voting
Beneficial Owner(1)            Title of Class           Number of Shares            Class        Power
-------------------            --------------           ----------------            -----        -----
Francis M. Williams            Common Stock                   2,693,238              55.3%
                               Class B Common Stock           1,666,569      (2)    100.0%       66.7%

Joseph M. Williams             Common Stock                     253,553      (3)      5.2%        3.9%

John V. Simon, Jr.             Common Stock                     108,220      (4)      2.2%        1.7%

Michael Gold                   Common Stock                      21,223      (5)         *           *

Donald Finn                    Common Stock                      12,554      (6)         *           *

Norman S. Dominiak             Common Stock                       3,000      (8)         *           *

All executive officers and     Common Stock                   3,091,788   (2)(3)     63.5%
directors as a group                                                      (5)(7)
(five persons)                 Class B Common Stock           1,666,569      (8)    100.0%       72.8%

</TABLE>
(1)  The  addresses of all officers  and  directors of the Company  above are in
     care of the Company at 1501 Second Avenue, East, Tampa, Florida 33605.

(2)  Includes  2,385,319  shares  owned  directly  by Mr.  Francis M.  Williams;
     includes  168,000  shares  issuable upon exercise of currently  exercisable
     stock options;  48,908 shares owned by Mr.  Williams'  wife;  30,493 shares
     held by Mr.  Williams as Trustee for his wife and  children;  24,626 shares
     held by Mr. Williams as Custodian under the Florida Uniform Gifts to Minors
     Act for his children; 1,066 shares held by Kimmins Realty Investment, Inc.,
     which is owned 100 percent by Mr.  Williams;  and 34,826 shares held by the
     Company's 401(k) Plan of which Mr. Williams is fully vested.

(3)  Includes  51,500  shares owned by Mr.  Joseph M.  Williams;  65,333  shares
     issuable upon exercise of currently exercisable stock options; 5,500 shares
     held by Mr.  Williams as trustee for his children;  131,220  shares held by
     the  Company's  401K plan of which Mr.  Williams is a trustee of the 401(k)
     Plan with shared voting and investment power.

(4)  Includes  1,500 shares owned by Mr.  Simon;  48,666  shares  issuable  upon
     exercise of currently  exercisable stock options; and 58,054 shares held by
     the Company's 401(k) plan of which Mr. Simon is fully vested.

(5)  Includes 1,150 shares owned by Mr. Gold;  5,775 shares  currently  owned by
     Mr.  Gold's  wife;  2,898 held by Mr. Gold as trustee for Mr.  Gold's minor
     children; and 11,400 shares issuable upon exercise of currently exercisable
     stock options.

(6)  Includes  5,154 shares owned by Mr. Finn;  and 7,400 shares  issuable  upon
     exercise of currently exercisable stock options.

                                       53
<PAGE>

(7)  Includes  303,799  shares  issuable upon exercise of currently  exercisable
     stock  options;  92,880 shares held by the  Company's  401(k) Plan of which
     certain  officers of the Company are fully vested;  and 131,220 shares held
     by the  Company's  401(k) Plan of which the  Secretary  of the Company is a
     trustee.

(8)  Includes  3,000 shares that may be purchased  by Mr.  Dominiak  pursuant to
     immediately exercisable options.

     *Less than one percent.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     The Company had a note  receivable in an original amount of $3,638,696 from
Sunshadow Apartments,  Ltd., and Summerbreeze Apartments, Ltd., two Florida real
estate  limited  partnerships  (collectively,  the  "Apartments"),  of which Mr.
Francis M. Williams is the sole shareholder of the corporate general partner and
was the sole limited partner. The note receivable originally accrued interest at
prime plus 1.375  percent,  increasing  to prime plus 2 percent on July 1, 1995,
with principal and interest payable in monthly installments through December 31,
1999,  and was  guaranteed  by Mr.  Williams.  The  Company  did not receive any
interest or principal payments during 1997 relating to this note receivable, and
management  of the  Company  discontinued  recognition  of  interest  income  of
approximately $551,000 for the year. Amounts due from the Apartments at December
31, 1996, were approximately $3,851,000.

     On October 22, 1997,  the Company  contributed  its note  receivable  in an
original amount of approximately $3,851,000 from Sunshadow Apartments, Ltd., and
Summerbreeze Apartments, Ltd., and other receivables of approximately $3,059,000
for a non-controlling 49 percent preferred limited  partnership  interest in the
Apartments. The Company will be allocated 49 percent of operating income, losses
and cash flow. The preference in the Company's equity interest in the Apartments
occurs  upon  the  sale  of the  underlying  partnership  properties.  Upon  the
occurrence of a capital  transaction,  the Company would receive cash flows from
the sale or refinancing of the Apartments' assets equal to its net book value of
its investment balance,  prior to any other partner receiving any proceeds.  See
Note 8 of Notes to Consolidated Financial Statements for additional information.

     Mr. Francis M. Williams,  the Company's President and majority stockholder,
also  controls  Cumberland,  a property  and  casualty  insurance  company  that
provides  insurance for specialty sureties and performance and payment bonds for
contractors.  Through  Cumberland,  the Company  has  obtained  performance  and
payment bonds in connection with certain of its contracts and projects. The fees
that the Company paid for these  services for the years ended  December 31, 1997
and 1998, were approximately  $43,000 and $29,000,  respectively.  There were no
related fees paid to Cumberland for the years ended December 31, 1999 and 2000.

     The  Company  recorded  bond fees  payable to  officers  of the  Company of
approximately $82,000 and $50,000 during 1999 and 2000 although none were paid.

     On November 5, 1996, the Company  received  1,723,290  shares of Cumberland
common stock in exchange for the term note of  $5,169,870  due from  Cumberland.
The  Cumberland  common  stock had a fair market value of $3.00 per share on the
date of the exchange,  based upon the quoted market  price.  This  investment is
accounted for under the equity method,  and the Company's interest in Cumberland
represents an ownership share of approximately 31 percent.  At December 31, 1999
and 2000,  the market value of the  Cumberland  common stock held by the Company
was approximately $3,447,000 and $2,585,000, respectively.

     On November  10,  1998,  TransCor  loaned  $1,000,000  to  Cumberland.  The
TransCor loan to Cumberland is evidenced by a convertible term note which is due
November 10, 2001. Quarterly interest payments are due beginning January 1, 1999
at a rate of one half of one percent over the rate  established by  NationsBank.
TransCor  has the right to convert the  principal  amount of note into shares of
common stock of Cumberland at $3.00 per share.

                                       54
<PAGE>

     Effective July 1, 1997,  employees  associated with  TransCor's  demolition
contracting  services unit was transferred to Kimmins Contracting Corp. ("KCC"),
a wholly owned  subsidiary of the Company,  for  administrative  and  accounting
purposes. As a result, contracting services previously performed by employees of
TransCor  were  subcontracted  to KCC.  For the year ended  December  31,  1998,
TransCor  paid  $2,716,000  to  KCC  for  services  rendered  by  Kimmins  as  a
subcontractor.  In  addition,  TransCor  rented  equipment  from  KCC for use in
performing demolition contracts. TransCor incurred approximately $ $1,822,000 in
equipment rental charges with KCC for the year-ended  December 31, 1998. All new
demolition projects were handled directly by KCC in 1999.

     On August 14, 1998,  the Company  acquired an additional  297,200 shares of
common stock in TransCor from Francis M. Williams, President and Chief Executive
Officer.  The  acquisition  increased the Company's  ownership  percentage to 81
percent  from 74 percent and results in the ability to  consolidate  the Company
and TransCor for federal income tax purposes on a prospective basis.

     During the year ended December 31, 1998, TransCor contributed $1,000,000 to
the Kimmins Terrier  Foundation,  a private foundation  controlled by Francis M.
Williams.

     Qualex,  which is  controlled  by Mr.  Francis M.  Williams,  provides some
services,  including  legal  counsel to the Company.  During 1999 and 2000,  the
Company recorded  approximately  $97,000 and $220,000,  respectively,  for these
services.

     Effective  with the sale of Kimmins  Recycling  during  1998,  the  Company
accrued $1,000,000 payable to Mr. Francis M. Williams for a 10-year  non-compete
agreement. In 1999 and 2000, the accrual amount remained unchanged.

     Mr. Francis M. Williams,  the Company's President and majority stockholder,
Mr. John V. Simon, Jr.,  President of Kimmins  Contracting Corp., and Mr. Joseph
M.  Williams,  the  Company's  Secretary and Treasurer are partners in an entity
named JFJ Investments  (JFJ).  During 2000, JFJ loaned $90,000 to the Company of
which  $65,000 was owed as of December  31,  2000.  In  addition,  JFJ  provided
$38,000 of services to the Company  during 2000 which were unpaid as of December
31, 2000.


                                       55
<PAGE>

                                     PART IV

ITEM 14.  EXHIBITS,  FINANCIAL  STATEMENT,  SCHEDULES,  AND  REPORTS ON FORM 8-K
-------   ----------------------------------------------------------------------

(a)  List of documents filed as part of this Report

     1.   Financial Statements

          -    Report of Independent Certified Public Accountants

          -    Report of Independent Certified Public Accountants

          -    Consolidated balance sheets at December 31, 1999 and 2000

          -    Consolidated statements of operations for each of the three years
               in the period ended December 31, 2000

          -    Consolidated  statements of comprehensive  income for each of the
               three years in the period ended December 31, 2000

          -    Consolidated  statements of stockholders'  equity for each of the
               three years in the period ended December 31, 2000

          -    Consolidated statements of cash flows for each of the three years
               in the period ended December 31, 2000

          -    Notes to consolidated financial statements

     2.   Financial Statement Schedule

          II -  Valuation and Qualifying Accounts

          All other Schedules are omitted since the required  information is not
present or is not present in amounts  sufficient  to require  submission  of the
Schedules,  or because the  information  required  is included in the  financial
statements and notes thereto.

     3.   The following documents are filed as exhibits to this Annual Report on
          Form 10-K:

          2.1       -Plan and Agreement of Merger  (incorporated by reference to
                    Appendix A to the Company's  definitive  Proxy Statement for
                    its 1999 Annual  Meeting of  Stockholders,  dated August 16,
                    1999,  filed with the  Commission  on August  16,  1999 (the
                    "Proxy Statement").

          3.1       -Articles of Incorporation  of the Registrant  (incorporated
                    by reference to Appendix B to the Proxy Statement).

          3.2       -Bylaws of the Registrant  (incorporated by reference to the
                    Registrant's  Current  Report on Form 8-K dated  October 19,
                    1999 as filed with the Securities and Exchange Commission).

          10.1(1)   -Stock Option Plan

          10.2(1)   -Form of Stock Option Agreement for Executives

          10.3(2)   -The Apartments Partnership Agreements

          10.4(2)   -Term  Notes  for  equipment   financed  with  Caterpillar
                    Financial Services

                                       56

<PAGE>

          10.5(3)   -Stock Purchase  Agreement dated August 14, 1998 between the
                    Company and Francis M. Williams

          10.6(4)   -Stock  Purchase  Agreement  between  TransCor  and  Eastern
                    Environmental Services dated July 17, 1998

          10.7(5)   -Second   Amended  and  Restated  Loan   Agreement   between
                    Registrant and SouthTrust Bank, NA

          10.8(5)   -Amendment to Second Amended and Restated Loan Agreement

          16.1      -Letter re change in Certifying Accountant  (incorporated by
                    reference to Exhibit 99.1 of the Registrant's Current Report
                    on Form  8-K  dated  November  18,  1999 as  filed  with the
                    Securities and Exchange Commission).

          21        -Subsidiaries of the Registrant

          23.1      -Consent of Ernst & Young LLP

          23.2      -Consent of Giunta, Ferlita & Walsh, PA

     1    Previously  filed on June 29, 1989, as part of Registrant's  Form S-8,
          File No. 33-29612, and incorporated herein by reference thereto.

     2    Previously  filed on July 2, 1998 as part of the  Registrant's  Annual
          Report on Form 10-K for the year ended  December  31,  1997,  File No.
          001-10489 and incorporated herein by reference thereto.

     3    Previously filed on April 15, 1999 as part of the Registrant's  Annual
          Report on Form 10-K for the year ended  December  31,  1998,  File No.
          001-10489 and incorporated herein by reference thereto.

     4    Previously  filed as part of  TransCor's  amended  Form 8-K,  File No.
          001-11822, filed on August 4, 1998.

     5    Previously filed on April 14, 2000 as part of the Registrant's  Annual
          Report on Form 10-K for the year ended  December  31,  2000,  File No.
          001-10489, and incorporated herein by reference thereto.

(b)  Reports on Form 8-K.

     The Registrant  filed a Report on Form 8-K dated October 19, 1999 reporting
the completion of the Registrant's reincorporation merger.

     The Registrant filed a Report on Form 8-K dated November 18, 1999 reporting
that the Registrant changed its accountants.

                                       57
<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, thereunder duly authorized.


                                             KIMMINS CORP.


Date: March 28, 2001                    By:  /s/ Francis M. Williams
                                             -----------------------------------
                                             Francis M. Williams
                                             President


         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.


Date: March 28, 2001                    By:  /s/ Francis M. Williams
                                             -----------------------------------
                                             Francis M. Williams
                                             President and Director
                                             (Chief Executive Officer)


Date: March 28, 2001                    By:  /s/ Joseph M. Williams
                                             -----------------------------------
                                             Joseph M. Williams
                                             Secretary/Treasurer


Date: March 28, 2001                    By:  /s/ Norman S. Dominiak
                                             -----------------------------------
                                             Norman S. Dominiak
                                             Vice President and
                                             Chief Financial Officer
                                             (Principal Accounting and
                                             Financial Officer)


Date: March 28, 2001                    By:  /s/ Michael A. Gold
                                             -----------------------------------
                                             Michael A. Gold, Director


Date: March 28, 2001                    By:  /s/ R. Donald Finn
                                             -----------------------------------
                                             R. Donald Finn, Director

                                       58

1340937