<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
/X/ For quarterly period ended June 30, 1999
OR
/ / TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE
ACT
Commission file number 0-25377
NURESCELL INC.
A Nevada Corporation IRS Employer Identification No.:
33-0805583
Principal Executive Offices:
1400 Bristol Street North, Suite 240
Newport Beach, California 92660
(949) 752-0071
-------------------
Check whether Registrant (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for
such shorter period that the Registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days.
Yes /X/ No / /
Number of shares of Common Stock outstanding at August 10, 1999: 13,096,000
Transitional Small Business Disclosure Format (check one): Yes /X/ No / /
<PAGE>
PART I
FINANCIAL INFORMATION
NURESCELL INC.
(A Development Stage Company)
BALANCE SHEETS
ASSETS
<TABLE>
<CAPTION>
June 30, March 31,
1999 1999
--------- ---------
(Unaudited)
<S> <C> <C>
Current Assets:
Cash and cash equivalents $ 10,231 $ 125,421
Stock subscriptions receivable -0- 25,000
Advances to employees -0- 12,075
Note receivable officer 54,673 54,673
Other receivables 3,761 3,761
--------- ---------
Total Current Assets 68,665 220,930
Property, Plant and Equipment at cost, less
Accumulated depreciation and amortization of $7,483 45,126 43,100
Other Assets
Deposits 3,000 3,000
Intangibles 18,609 18,609
--------- ---------
Total Other Assets 21,609 21,609
TOTAL ASSETS $ 135,400 $ 285,639
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts Payable $ 37,811 $ 34,826
Accrued Salaries 3,000 3,000
Payroll Taxes Payable 13,357 6,839
--------- ---------
Total Current Liabilities 54,168 44,665
Stockholders' Equity
Capital Stock 1,308 1,308
Additional Paid in Capital 959,192 884,192
Deficit accumulated during the development stage (879,268) (644,526)
--------- ---------
Total Stockholders' Equity 81,232 240,974
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 135,400 $ 285,639
========= =========
</TABLE>
See accompanying notes to financial statements
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<PAGE>
NURESCELL INC.
(A Development Stage Company)
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
For the period May 12, For the period May 12,
Three months ended June 1998 (Date of Inception) 1998 (Date of Inception)
30, 1999 to June 30, 1998 to June 30, 1999
----------------------- ------------------------ ------------------------
(Unaudited) (Unaudited) (Unaudited)
<S> <C> <C> <C>
OPERATING EXPENSES:
Research and Development $ 99 $ 2,099
General and administration 236,450 $ 74,784 876,491
Depreciation 1,602 91 7,483
------------ ------------ ------------
Total Expenses 238,151 74,875 886,073
LOSS FROM OPERATIONS (238,151) (74,875) (886,073)
OTHER INCOME
Interest income 3,409 -0- 6,805
------------ ------------ ------------
NET LOSS $ (234,742) $ (74,875) $ (879,268)
============ ============ ============
NET LOSS PER SHARE
Basic and fully diluted $ (0.02) $ (0.01) $ (0.07)
============ ============ ============
Weighted average common
Shares outstanding 13,094,538 5,875,510 12,151,696
============ ============ ============
</TABLE>
See accompanying notes to financial statements
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<PAGE>
NURESCELL INC.
(A Development Stage Company)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
For the period May 12, 1998 (Date of Inception) to June 30, 1999
<TABLE>
<CAPTION>
RETAINED
EARNINGS
ADDITIONAL (DEFICIT) DURING COMMON
COMMON STOCK PAID-IN THE DEVELOPMENT STOCK
SHARES AMOUNT CAPITAL STAGE SUBSCRIBED TOTAL
----------- -------- --------- ---------------- ---------- ---------
<S> <C> <C> <C> <C> <C> <C>
Issuance of common stock:
Cash - Founding Stockholders 2,500,000 $ 250 $ 2,250 $ 2,500
Technology Agreement 10,000,000 1,000 9,000 10,000
Cash - $ 1 per share 498,000 50 497,950 498,000
Cash - $ 5 per share, net of cost 79,000 8 349,992 350,000
Common stock subscriptions $ 25,000 25,000
NET LOSS (644,526) (644,526)
----------- -------- ----------- ------------ --------- ---------
Balance March 31, 1999 13,077,000 1,308 859,192 (644,526) 25,000 240,974
Cash - $ 5 per share, net of cost 19,000 100,000 (25,000) 75,000
NET LOSS (234,742) (234,742)
----------- -------- ----------- ------------ --------- ---------
BALANCE JUNE 30, 1999 (unaudited) 13,096,000 $ 1,308 $ 959,192 $ (879,268) $ $ 81,232
=========== ======== =========== ============ ========= =========
</TABLE>
See accompanying notes to financial statements
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<PAGE>
NURESCELL INC.
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
For the period
May 12, 1998 For the period
Three months (date of May 12, 1998
ended inception) to (date of inception) to
June 30, 1999 June 30, 1998 June 30, 1999
------------- -------------- -----------------------
(Unaudited) (Unaudited) (Unaudited)
<S> <C> <C> <C>
INCREASE (DECREASE) IN CASH:
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Loss $ (234,742) $ (74,875) $ (879,268)
Adjustments:
Depreciation 1,602 91 7,483
(Increase) Decrease in:
Advances to employees 12,075
Notes Receivable - Officers (7,500) (54,673)
Other Receivables (3,761)
Subscription Receivable 25,000
Increase (Decrease) in:
Accounts Payable 2,985 37,811
Accrued Salaries 3,000
Payroll Taxes Payable 6,518 6,627 13,357
------------ ------------ ------------
Net Cash Flows Used by Operating Activities (186,562) (75,657) (876,051)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of Property, Plant & Equipment 3,628 12,103 52,609
Deposits 3,000 3,000
Intangibles -0- 18,609 18,609
------------ ------------ ------------
Net Cash Flows Used by Investing Activities 3,628 33,712 74,218
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from Sale of Common Stock 75,000 419,800 960,500
------------ ------------ ------------
Net Cash Flows Provided by Financing Activities 75,000 419,800 960,500
------------ ------------ ------------
Net increase (decrease) in cash (115,190) 310,431 10,231
Cash at beginning of period 125,421 -0- -0-
------------ ------------ ------------
Cash at end of period $ 10,231 $ 310,731 $ 10,231
============ ============ ============
Non cash transactions
Issuance of stock for purchased technology $ 10,000
</TABLE>
See accompanying notes to financial statements
-5-
<PAGE>
NURESCELL INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
1. GENERAL
BASIS OF PRESENTATION
The interim financial statements presented have been prepared by
Nurescell Inc. (the Company) without audit and, in the opinion of
the management, reflect all adjustments of a normal recurring
nature necessary for a fair statement of (a) the results of
operations for the three months ended June 30, 1999, (b) the
financial position at June 30, 1999 and (c) the cash flows for the
three months ended June 30, 1999. Interim results are not
necessarily indicative of results for a full year.
The balance sheet presented as of March 31, 1999 has been derived
from the financial statements that have been audited by the
Company's independent public accountants. The financial statements
and notes included herein should be read in conjunction with the
financial statements and notes included in the Company's Annual
Report on Form 10-KSB.
NATURE OF BUSINESS
The Company was incorporated on May 12, 1998, pursuant to the laws of
the State of Nevada under the name Nurescell Inc. The Company is
currently engaged in the research, development and testing of its
proprietary radiation shielding technology.
GOING CONCERN
The accompanying financial statements have been prepared on the
assumption that the Company will continue as a going-concern. This
assumption anticipates that the Company will be able to realize assets
and satisfy obligations in the normal course of business. The Company
has accumulated net losses of $879,268 and negative cash flows from
operating activities of $876,051 from inception to June 30, 1999. The
Company has not completed testing and development nor obtained patents
on its principal technology. The technology must undergo further
development and testing before the Company will be able to generate
any significant commercial revenues. The Company anticipates that
research, development and testing will require significant additional
financing. Management intends to seek the additional financing through
future private placement offerings, joint ventures, and research
grants. The Company's capacity to operate as a going-concern is
dependent on its ability to obtain adequate financing to fund its
operations until the Company is able to complete the necessary
research, development and testing necessary to generate commercial
revenues sufficient to fund ongoing operations. These factors, among
others, raise substantial doubt about the Company's ability to
continue as a going-concern. The financial statements do not include
any adjustments that might result from the outcome of this
uncertainty.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
FISCAL YEAR END
The Company's fiscal year end is March 31, 1999.
START-UP ACTIVITIES
In 1998, the American Institute of Certified Public Accountants
(AICPA) amended the AICPA SOP and Audit and Accounting Guides
addressing the reporting of costs of start-up activities. Effective
for fiscal years beginning after December 15, 1998, SOP No. 98 require
costs of start-up activities and organizational costs to be expenses
as incurred. Because early application is encouraged in prior periods,
the Company has restated the financial statements to conform. To date,
approximately $107,590 of startup costs and organizational expense
have been expensed.
USE OF ESTIMATES
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the
date of the financial statements and reported amounts of revenues and
expenses during the reporting period. Actual results could differ from
those estimates. The accompanying financial statements include all
adjustments which, in the opinion of management of the Company, are
necessary in order to make these financial statements not misleading.
-6-
<PAGE>
NURESCELL INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
RESEARCH AND DEVELOPMENT COSTS
Research and development costs are expensed as incurred. Such costs
were approximately $100 in the quarter ended June 30, 1999.
BASIS OF PRESENTATION
Since the Company has no revenues and has not yet commenced its
principal operations, it is considered a "development stage
enterprise," as defined by SFAS No. 7, Accounting and Reporting by
Development Stage Enterprises.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents for the statement of cash flows include cash
and cash on deposit. The Company maintains its cash balance in one
financial institution. During the fiscal year, the Company's cash
balance periodically exceeded the financial institution's insured
Federal Deposit Insurance Corporation limit of $100,000.
PROPERTY AND EQUIPMENT
Property and equipment is stated at cost. Expenditures for maintenance
and repairs are charged to operations as incurred while renewals and
improvements are capitalized. Depreciation of furniture, fixtures, and
equipment is computed using the straight-line method. Estimated
useful lives for reporting purposes are as follows:
<TABLE>
<S> <C>
Furniture, fixtures, and equipment 5 years
</TABLE>
OTHER ASSETS
Other assets consist of deposits and intangibles. Intangibles include
patent application (and associated legal costs) and certain technology
acquisition costs. Upon commencement of operations, all costs
associated with obtaining patents and technology acquisition costs
will be amortized on a straight-line basis over a 17-year period. The
Company will evaluate the recoverability of intangibles on an annual
basis by comparing the estimated net realizable value of the
intangibles to their carrying value. Organization costs and start-up
costs have been expensed in accordance with SOP-98.5.
LOSS PER SHARE
In 1997 the SFAS issued Statement No. 128, Earnings per Share. Unlike
primary loss per share, basic loss per share excludes any dilutive
effects of options, warrants and convertible securities. Diluted loss
per share is very similar to the previously reported fully diluted
loss per share. The basic and diluted loss per share is computed based
on the weighed average number of common shares outstanding. Common
equivalent shares are not included in the per share calculations where
the effect of their inclusion would be antidilutive. Options to
purchase shares of common stock are not included in the computations
of diluted loss per share since the effect would be antidilutive.
-7-
<PAGE>
NURESCELL INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
INCOME TAXES
The Company accounts for its income taxes in accordance with the
standards specified in SFAS No. 109, Accounting for Income Taxes.
3. INTANGIBLE ASSETS
On June 12, 1998 the Company entered into a Sales of Technology
Agreement ("Agreement") with Dr. Adrian Joseph (now an officer of the
Company) whereby the Company acquired all rights, title and interest
in a new generation of flexible containment material ("Nuresfoam") for
fissionable nuclear material ("Technology"). The Technology is based,
in part, on prior patented technology, however the Technology itself
has not yet been patented nor trademarked. An U.S. patent has been
applied for with the U.S. Patent Application 09/187,641.
As consideration for the sale of the Technology, Dr. Joseph received
10,000,000 shares or 80% of the Company's then outstanding common
stock. The transfer of the Technology was intended to be a tax-free
exchange in accordance with Internal Revenue Code Section 351. The
Agreement stated that the Company valued the Technology at $5,000,000;
however, an independent valuation of the Technology was not obtained.
Consequently, the Technology has been recorded at a nominal value of
$10,000 based on the fair value ($.0001 per share) of the common stock
issued in exchange for the Technology on the date of transfer.
4. COMMITMENTS AND CONTINGENCIES
OPERATING LEASES
The Company leases office space under an operating sublease that
requires minimum monthly payments of $3,422. Rent expense for the
period ended June 30, 1999 was $10,860.
Effective June 1, 1999, the Company has moved to a new location and
has entered into a new three year lease that requires minimum monthly
payments of $3,422.
The estimated future minimum lease payments under all operating leases
for the periods ending June 30, are as follows:
<TABLE>
<CAPTION>
PERIOD ENDING
JUNE 30
-------------
<S> <C>
2000 $ 41,064
2001 41,064
2002 41,064
--------
Total $123,192
</TABLE>
5. INCOME TAXES
For federal income tax purposes, approximately $879,268 of net
operating loss carryforwards exists to offset future taxable income.
These carryforwards expire in 2014. No tax benefit has been reported
in the accompanying financial statements, however, because management
believes that there is at least a 50%
-8-
<PAGE>
NURESCELL INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
chance that the carryforwards will expire unused. Accordingly, at
March 31, 1999, the $279,080 tax benefit of the cumulative
carryforwards has been offset by a valuation allowance of the same
amount.
6. COMMON STOCK
The Company has 50,000,000 shares of $.0001 par value common stock
authorized, of which 13,096,000 shares were issued and outstanding at
June 30, 1999.
Common stock issued from issuance of $5.00 shares has been reflected
net of offering expenses of approximately of $45,000.
7. STOCK OPTIONS
Effective June 15, 1998, the stockholders approved an Incentive Stock
Option Plan granting to any director, employee or consultant of the
Company options to purchase Company Common stock over a ten-year
period, at the fair market value at time of grant. The aggregate
number of common shares of the Company which may be granted under the
plan is 360,000 shares. As of June 30, 1999, options for 300,000
shares have been granted under the Plan, none of which have been
exercised.
8. STOCK WARRANTS
Effective September 15, 1998 the stockholders approved a plan to issue
units consisting of one share of Common Stock (the "Common Stock") and
one Class "A" Common Stock Purchase Warrant (the "Class A Warrants")
of the Company.
The Class "A" Warrants are exercisable into one (1) share of Common
Stock and one (1) Class "B" Common Stock Purchase Warrant (the "Class
"B" Warrant") commencing the day immediately after the first
anniversary of the closing of the offering of the units (the "A"
Exercise Date") and have an exercise price of $4.00. The Class "A"
Warrants expire on the first anniversary of the "A" Exercise Date (the
"A" Expiration Date"). The Class "B" Warrants are exercisable into one
(1) share of Common Stock commencing immediately upon their issuance
(the "B" Exercise Date") and have an exercise price of $3.00 per share
of Company Common Stock. The Class "B" Warrants expire on the first
anniversary of the "B" Exercise Date.
Prior to permitting the exercise of either the Class "A" or Class "B"
Warrants, the Company will be required to either register the
underlying Common Stock or seek an exemption from registration under
both federal and state law. The Common Stock and the Class A Warrants
are immediately detachable.
9. RELATED PARTIES
The Company has made unsecured loans of $54,673, including interest,
to one of its officers. These 10% interest-bearing loans are
evidenced by notes and are all due within twelve months.
The Company has also entered into consulting contracts with certain
directors as a means of inducing the directors to devote additional
time and effort to the Company over and above the
-9-
<PAGE>
NURESCELL INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
time normally expected of a director. These contracts provide for
payments of $2,000 to $4,000 per month to each director under
contract, have no stated termination date but are cancelable by either
party on 30 days written notice. Amounts paid by the Company under
these contracts were $105,619, respectively at June 30, 1999.
The Company purchased various chemicals, lab equipment, research
material and start-up expenses from a related party. The purchase of
lab equipment, research materials and start-up expenses amounted to
$20,000 during the period ended March 31, 1999. The purchase of
chemicals for the period ended March 31, 1999 amounted to $14,000.
There were no purchases from related parties in the quarter ended June
30, 1999.
10. SUBSEQUENT EVENTS
SIGNIFICANT CONTRACTS AND AGREEMENTS
On June 25, 1999, the Company entered into a consulting agreement with
Dr. Chong Chiu. Under that agreement, Dr. Chiu will provide certain
marketing, product development, specification review and other
services to the Company related to nuclear power plants. Dr. Chiu is a
former Dean of Physics at the Massachusetts Institute of Technology
and the former General Manager of the San Onofre Nuclear Power
Station. The agreement provides for Dr. Chiu to receive a percentage
of all nuclear power plant revenues generated as a direct result of
his services.
The Company is currently in discussions with several parties to raise
approximately $5,000,000 on a "best efforts" basis through an offering
of equity securities. These discussions are preliminary in nature and
there is no guarantee that the Company will be able to consummate any
offering whereby the Company will receive all or any portion of the
$5,000,000 at any time during the near or distant future.
The Company is currently involved in negotiations with Battelle
Memorial Institute, Pacific Northwest Division (PNNL) in order to
establish a working relationship for the testing and qualification of
the technology. In this context, the Company is discussing the benefit
of forming a joint venture, known as "CRADA" versus a private venture
with PNNL.
In parallel with the work by PNNL, the Company has entered into an
agreement with the University of Missouri for product testing with
respect to high levels of alpha, beta and gamma radiation. This work
will be accomplished in a twelve month period at an approximate cost
of $151,064.
After the performance of the Technology has been satisfactorily
evaluated by PNNL, the Company will seek to incorporate Technology
based products into field studies of specialized applications and into
bench scale and field trials of specialized private enterprise
equipment. Simultaneous with that phase, the Company will use its best
efforts to seek out and form various strategic alliances for the use
of its products in nuclear material handling equipment and
applications.
The Company has agreed to repurchase 2,000 shares at the original cost
of $10,000 from an investor.
The Company, in return for introducing investors to the Company, has
offered to select individuals options to purchase one share of the
Company common stock at one dollar ($1.00) for every share of the
Company common stock sold to any investor introduced to the Company by
such individual. This option is to be exercised only twelve (12)
months after the completion of the transaction mentioned above, (i.e.
"exercising day") and the option will be good for twenty-four (24)
months after the exercising day.
-10-
<PAGE>
NURESCELL INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
SECURITIES OFFERINGS
The Company has filed a Form 10-SB registration statement with the
Securities and Exchange Commission, which filing has now become
effective.
The Company's Common Stock is quoted on the OTC Bulletin Board under
the symbol "NUSL", and has been so quoted since June 10, 1999. Prior
to that date, there was no public trading market for the Company's
equity securities. In addition, the Company's Class "A" Common Stock
Purchase Warrants are quoted on the OTC Bulletin Board under the
symbol "NUSLW".
-11-
<PAGE>
PLAN OF OPERATION. Nurescell Inc. (the "Company" or "Registrant") is in
the very early stages of its development. Consequently, its operations
consist principally of research, development and testing of its proprietary
radiation shielding technology (the "Nurescell Technology"). Although the
Company intends to actively pursue research grants to fund either all or a
portion of this research, development and testing, any such revenues are not
anticipated prior to the fiscal quarter ending December 31, 1999.
Additionally, there are no assurances that the Company will obtain any grants
or that any grant funding received will be sufficient to meet all the
Company's funding requirements, either within this estimated time frame or in
the future. Revenues associated with actual commercial applications of the
Nurescell Technology are not anticipated for two years. From inception to
June 30, 1999, the Company has obtained approximately $995,000 in financing
through the sale of equity securities through two private offerings (the
"Offerings"), each of which has been completed. Through June 30, 1999, the
Company utilized approximately $930,000 of the proceeds of the Offerings to
(i) commence patent applications for the Nurescell Technology, (ii) identify,
negotiate and finalize suitable research, development and testing contracts,
(iii) identify, negotiate and finalize preliminary marketing consulting
contracts and (iv) provide working capital for the ongoing administrative and
financing acquisition costs of the Company. All of the remaining proceeds
from the Offerings is being used to begin initial formal testing of the
Nurescell Technology, continue the pursuit of patents and provide
administrative working capital. The Company anticipates that its remaining
capital will enable it to operate until September 1999.
The Company's financial statements for the quarter ended June 30, 1999
have been prepared assuming the Company will continue as a going-concern. As
noted in the Company's financial statements for the year ended March 31,
1999, as filed with the Company's report on Form 10-KSB for that period, the
presence of significant losses, negative cash flows and limited working
capital, together with the uncertainties associated with the ability of the
Company to obtain additional capital, raise substantial doubts as to the
Company's ability to continue as a going-concern. The Company's ability to
continue as a going-concern will be questionable until such time as it is
able to generate sufficient revenues (from research grants and/or commercial
operations) in excess of expenses to sustain its normal business activities.
Until that time, the Company will depend on its ability to raise additional
capital through either commercial loans or equity or debt offerings. At this
time, the Company expects that it will need approximately $3 million in
additional funding over the next two years in order to complete the necessary
research, development and testing of its Nurescell Technology. The Company
currently anticipates financing of approximately $5 million to be derived
from a "best efforts" offering of equity securities which is currently being
discussed with various parties. There can, however, be no guarantee that
such offering will be successfully completed or that any additional funding
will be available on terms favorable to the Company or its shareholders, if
at all. If sufficient funds are not available when needed, the Company may
be required to curtail its operations, which could
-12-
<PAGE>
have a material adverse effect on the Company's business, operating results
and financial condition.
PART II
OTHER INFORMATION
ITEM 5. OTHER INFORMATION
On August 1, 1999, Harold L. Rapp became the President of the Company,
replacing Adrian A. Joseph, Ph.D., who has become the Company's Chief
Executive Officer. Prior to being named President of the Company, Mr. Rapp
was Chief Operating/Financial Officer for American Technologies Group, Inc.
since March 1997. He also previously served on the Advisory Board to that
firm for five years as a Technical Consultant to their research scientists.
Mr. Rapp is a former principal and Executive Vice President of
Baltes/Valentino Associates, an Arizona-based consulting engineering firm,
and he is a successful inventor with patents in desalination, fluid
purification and vacuum technologies. He has a degree in Electronics
Technology supplemented by studies in finance and management through the
American Management Association. In his capacity as the Company's President,
Mr. Rapp will effectively bridge the gap between highly technical projects
and traditional operational business management.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) The following Exhibits are attached hereto:
6.1 Consulting Agreement between the Company and Dr. Chong
Chiu dated June 25, 1999
6.2 Investment Banking Services Agreement between the
Company and National Capital Merchant Group, Ltd. dated
June 30, 1999
27 Financial Data Schedule
(b) No reports on Form 8-K were filed during the Company's fiscal
quarter ended June 30, 1999.
-13-
<PAGE>
SIGNATURES
In accordance with the requirements of the Exchange Act, the Registrant
has caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
Dated: August 12, 1999 NURESCELL, INC.
By: /s/ ADRIAN A. JOSEPH
----------------------------
Adrian A. Joseph, President
By: /s/ SHARON NITKA
----------------------------
Sharon Nitka,
Chief Financial Officer
-14-
<PAGE>
EXHIBIT INDEX
EXHIBIT NUMBER DESCRIPTION
6.1 Consulting Agreement between the Company and Dr.
Chong Chiu dated June 25, 1999
6.2 Investment Banking Services Agreement between the
Company and National Capital Merchant Group, Ltd.
dated June 30, 1999
27 Financial Data Schedule
-15-
<PAGE>
EXHIBIT 6.1
CONSULTING AGREEMENT
This Agreement is made on June 25, 1999, between NURESCELL a Nevada
Corporation ("CLIENT"), with a principal place of business at 1400 Bristol
Street, North, Suite 240, Newport Beach, CA 92660 and DR. CHONG CHIU
("Consultant"), an independent contractor, with a principal place of business
at 112 West Canada, San Clemente, California 92675
1. TERM OF CONTRACT.
1.1 This Agreement will become effective upon execution and will
continue in affect for five (5) years with one five year
renewal Option unless otherwise terminated in accordance with
this Agreement. The Performance of Services shall be reviewed
annually.
2. SERVICES TO BE PERFORMED BY CONSULTANT.
2.2 SPECIFIC SERVICES. Consultant agrees to perform certain
services as hereinafter set forth, but including the following:
2.1.1 Marketing analysis and salability analysis of high
demand segments in the nuclear industry (commercial
power, uranium production and DOE nuclear facilities).
2.1.2 Development of product and material specifications
that can meet the demand of radiation shielding and
safety applications in nuclear power stations.
2.1.3 Formation of high-level industry committees to help
review the specifications.
2.1.4 Facilitation of DOE Grants and other funding
mechanisms to enable in-plant field trials and
NRC/LARA Approvals and Licenses.
2.1.5 Facilitation of endorsement of the products and
materials to the nuclear power industry.
2.1.6 Completion of sales of NURESCELL materials to the
power plant industry.
<PAGE>
2.2 PURPOSE OF THE SERVICE. The service provided by Consultant and
his team will help NURESCELL to finalize the products and to
obtain quick access to key design and marketing information,
responsible management personnel and NRC officials that are
needed to develop and capture the application identified by
NURESCELL and Consultant in a cost-effective and timely
manner, the estimated $2 to $3 Billion Dollars per year
radiation shielding market in the nuclear industry.
2.3 METHOD OF PERFORMING SERVICES. Consultant will determine the
method, details, and means of performing the above-described
services; provided however, that Consultant shall, on at least
a monetary basis, prepare a detailed written report on the
Consultant's activities in connection with this Agreement.
Said report shall include all contacts made and a summary of
progress against committed performance of services.
2.4 STATUS OF CONSULTANT. Consultant enters into this Agreement,
and will remain throughout the term of this Agreement, as an
Independent Contractor. Consultant agrees that he is not and
will not become an employee, partner, agent or principal of
Client while this Agreement is in effect. Consultant agrees he
is not entitled to the rights or benefits afforded to Client's
employee, including disability or unemployment insurance,
worker's compensation, medical insurance, sick leave, or any
other employment benefit. Consultant is responsible for
providing, at his own expense, disability, unemployment, and
other insurance, worker's compensation, training, permits, and
licenses for himself and for his employees and subcontractors.
2.5 PAYMENT OF INCOME TAXES. Consultant is responsible for paying
when due all income taxes, including estimated taxes, incurred
as a result of the compensation paid by Client to Consultant
for services under this Agreement. On request, Consultant will
provide Client with proof of timely payment. Consultant agrees
to indemnify Client for any claims, costs, losses, fees,
penalties, interest, or damages suffered by Client resulting
from Consultant's failure to comply with this provision.
2.6 USE OF EMPLOYEES OR SUBCONTRACTORS. Consultant may, at
Consultant's own expense, use any employees or subcontractors
as Consultant deems necessary to perform
2
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the services required of Consultant by this Agreement. Client
may not control, direct, or supervise Consultant's employees
or subcontractors in the performance of those services.
3. COMPENSATION
3.1 COMPENSATION. Client agrees to pay Consultant for the services
set forth in Section 2 in the following manner:
3.1.1 NURESCELL Materials Sales -- 15% of the Net Sales
Revenue. Net is defined as Gross Sales minus cost of
NURESCELL Materials, Production & Transportation/
Delivery to Purchaser.
3.1.2 Demonstration Grants -- 10% of Gross Grant Value.
3.1.3 ALL Sales and/or Grant Agreements shall be
presented to NURESCELL for written pre-approval before
finalization of the Contract.
3.2 The COMPENSATION discussed above will be payable to Consultant
within 30 days from the receipt of payment to NURESCELL from
the contracts derived from Consultant's effort.
3.3 PAYMENT OUT OF POCKET EXPENSES. Consultant will be reimbursed
for actual expenses incurred (not to exceed $126,000.00 per
year) based upon a five year Agreement. NURESCELL must
pre-approve ALL expenses. Consultant will provide Client with
receipts for all expenses over $25.00
3.4 As additional compensation, Consultant shall be entitled to a
STOCK OPTION of 200,000 NURSCELL shares at $3.0 per share.
This Option may be exercised by Consultant upon consultant
forming a nuclear power committee with qualified power Plan
Managers etc. Said Option shall be approved by the Board of
Directors and NURESCELL.
3.3 LIMITATION OR COMPENSATION. Notwithstanding anything to the
contrary contained herein, should Consultant be terminated for
cause, all right to compensation shall forthwith cease. Should
the Agreement be terminated for any other reason, including
the agreed upon expiration date of the Agreement, then the
right to receive compensation shall be limited to Gross Sales
and or Grants (See Section 3.1) derived from
3
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existing contracts between NURESCELL and the Nuclear industry
which were derived directly from Consultant's efforts, but
shall not include renewals or extensions of any such
Agreements and shall not include any Agreements executed after
this consulting Agreement has been terminated.
4. OBLIGATIONS OF CONSULTANT
4.1 MINIMUM AMOUNT OF SERVICE. Consultant agrees to devote
substantial time to performing the above-described services.
4.2 NON-EXCLUSIVE RELATIONSHIP. Consultant may represent, perform
services for, and contract with as many additional clients,
persons, or companies as Consultant, in his sole discretion;
provided, however, during the term of this Agreement
Consultant shall not, directly or indirectly, either as an
employee, employer, consultant, agent, principal, partner,
stockholder, corporate officer, director, or in any other
individual or representative capacity, engage or participate
in any business that is in competition in any manner
whatsoever with the business of NURESCELL.
4.3 MATERIALS AND EQUIPMENT. Subject to information, samples and
technical assistance as needed to be obtained from Client,
Consultant will supply all materials, and equipment required
to perform the services under this Agreement.
4.4 WORKER'S COMPENSATION. Consultant agrees to provide worker's
compensation insurance for Consultant's employees and agents,
if any, and agrees to hold harmless and indemnify Client for
any and all claims arising out of any injury, disability or
death of any of Consultant's employees or agents.
4.5 GENERAL LIABILITY INSURANCE. Consultant agrees to hold
NURESCELL harmless for any negligent acts or omissions
committed by Consultant or Consultant's employees or agents
during the performance of any duties under this Agreement.
Consultant further agrees to indemnify and hold Client free
and harmless from any and all claims arising from any such
negligent act or omission.
4
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4.6 CONSULTANT'S QUALIFICATIONS. Consultant represents that he has
the qualifications and skills necessary to perform the
services under this Agreement in a competent, professional
manner, without the advice or direction of Client. This means
Consultant is able to fulfill the requirements of this
Agreement. Failure to perform all the services required under
this Agreement constitutes a material breach of the Agreement.
Consultant has complete and sole discretion for the manner
in which the work under this Agreement will be performed.
4.7 INDEMNITY. Consultant agrees to indemnify, defend, and hold
Client free and harmless from all claims, demands, losses,
costs, expenses, obligations, liabilities, damages,
recoveries, and deficiencies, including interest, penalties,
attorney's fees, and costs, that Client may incur as a result
of a breach by Consultant of any representation or Agreement
contained in this Agreement.
4.8 ASSIGNMENT. Neither this Agreement nor any duties or
obligations under this Agreement may be assigned by Consultant
without the prior written consent of Client.
5. OBLIGATIONS OF CLIENT.
5.1 COOPERATION OF CLIENT. Client agrees to comply with all
reasonable requests of Consultant necessary to the performance
of Consultant's duties under this Agreement.
5.2 ASSIGNMENT. Neither this Agreement nor any duties or
obligations under this Agreement may be assigned by Client
without the prior written consent of the Consultant.
6. TERMINATION OF AGREEMENT.
6.1 TERMINATION ON NOTICE. Notwithstanding any other provision of
this Agreement, either party may terminate this Agreement at
any time by giving sixty (60) days written notice to the other
party. Unless otherwise terminated as provided in this
agreement, this agreement will continue in force for 5 years
with an additional five year option and annual performance
reviews.
5
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6.2 TERMINATION ON OCCURRENCE OF STATED EVENTS. This Agreement
will terminate automatically on the occurrence of any of the
following events:
(a) Bankruptcy or insolvency of either party.
(b) Death of Consultant.
6.3 TERMINATION FOR DEFAULT. If either party defaults in the
performance of this Agreement or materially breaches any of
its provisions, the non-breaching party may terminate this
agreement by giving written notification to the breaching
party. Termination will take effect immediately on receipt of
notice by the breaching party or five days after mailing of
notice, whichever occurs first. For the purposes of this
paragraph, material breach of this Agreement includes, but is
not limited to, the following:
(a) Client's failure to pay Consultant any compensation due
within 30 days after written demand for payment.
(b) Consultant's failure to complete the services specified
in 2.1 of this Agreement.
(c) Consultant's material breach this Agreement or any
representation contained herein.
(d) Client's material breach of any representation or
agreement contained in this Agreement.
6.4 Either party may terminate this Agreement for the reasons
stated in 6.3 by giving forty-five (45) days written notice of
termination to the other, but without prejudice to any other
remedy to which either party may be entitled either at law, in
equity, or under this Agreement.
6.5 NURESCELL reserves the right to terminate this Agreement not
less than six (6) months after Consultant suffers any physical
or mental disability that would prevent the performance of his
duties under this Agreement. Such a termination shall be
effected by giving forty-five (45) days written notice of
termination to Consultant.
7. UNIQUE INJUNCTIVE RELIEF.
7.1 Consultant hereby represents and agrees that the services to
be performed under the terms of this Contract/Agreement are of
a special, unique, unusual, extraordinary, and intellectual
character that gives them a peculiar value, the
6
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loss of which cannot be reasonably or adequately compensated
in damages in an action at law. Consultant therefore expressly
agrees that NURESCELL, in addition to any other rights or
remedies that NURESCELL may possess, shall be entitled to
injunctive and other equitable relief to prevent or remedy a
breach of this Agreement by Consultant.
8. PROPRIETARY RIGHTS.
6.1 NEW DEVELOPMENTS. Consultant agrees that all designs, plans,
reports, specifications, drawings, inventions, processes, and
other information or items produced by Consultant while
performing services under this Agreement will be assigned to
Client as the sole and exclusive property of Client and
Client's assigns, nominees, and successors, as well any
copyrights, patents, or trademarks obtained by Consultant
while performing services under this Agreement. On request and
at Client's expense, Consultant agrees to help Client obtain
patents and copyrights for any new developments. This includes
providing data, plans specifications, descriptions,
documentation, and other information, as well as assisting
Client in completing any required application or registration.
6.2 CONFIDENTIAL INFORMATION. Any written, printed, graphic, or
electronically or magnetically recorded information furnished
by Client for Consultant's use are the sole property of
Client. This proprietary information includes, but is not
limited to, customer requirements, customer lists, marketing
information, and information concerning Client's employees,
products, services, prices, operations, and subsidiaries.
Consultant will keep this confidential information in the
strictest confidence, and will not disclose it by any means to
any person except with Client's approval, and only to the
extent necessary to perform the services under this agreement.
This prohibition also applies to Consultant's employees,
agents, and subcontractors. On termination of this agreement,
Consultant will return any confidential information in his
possession to Client.
(a) The parties acknowledge and agree that during the terms
of this agreement and in the course of the discharge of
his duties hereunder, Consultant shall have access to
and become acquainted with
7
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information concerning the operation and process of
NURESCELL, including without limitation, financial,
personnel, sales, scientific, and other information that
is owned by NURESCELL and regularly used in the
operation of NURESCELL's business, and that such
information constitutes NURESCELL's trade secrets.
(b) Consultant specifically agrees that he shall not misuse,
misappropriate, or disclose any such trade secrets,
directly or indirectly, to any other person or use them
in any way, either during the term of this agreement or
at any other time thereafter, except as is required in
the course of his Agreement hereunder.
(c) Consultant acknowledges and agrees that the sale or
unauthorized use or disclosure of any of NURESCELL's
trade secrets obtained by Consultant during the course
of this Agreement, including information concerning
NURESCELL's current or any future and proposed work,
services or products, the facts that any such work,
services, or products are planned, under consideration,
or in production, as well as any descriptions thereof,
constitute unfair competition. Consultant promises and
agrees not to engage in any unfair competition with
NURESCELL, either during the term of this Agreement.
(d) Consultant further agrees that all files, records,
documents, drawings, specifications, equipment, and
similar items relating to NURESCELL's business, whether
prepared by NURESCELL or others, are and shall remain
exclusively the property of NURESCELL and that they
shall be removed from the premises of NURESCELL only
with the express prior written consent of NURESCELL's
Board of Directors.
8.3 NON-SOLICITATION. For a period of two (2) years following the
termination of this Agreement, Consultant will not do either
of the following: (1) call on, solicit, or take away any of
Client's customers or potential customers Consultant became
aware of as a result of performing services under this
agreement; or (2) solicit or hire away any of Client's
employees or contractors Consultant became aware of as a
result of performing services under this Agreement.
8
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8.4 EFFECT OF MERGER, TRANSFER OF ASSETS, OR DISSOLUTION. This
Agreement shall be terminated by any voluntary or involuntary
dissolution of NURESCELL; provided, however, that if said
dissolution is the result of either a merger or consolidation
in which NURESCELL is not the consolidated or surviving
corporation, or a transfer of all or substantially all of the
assets of NURESCELL, then at the option of Consultant, he
shall be entitled to be paid the balance remaining under this
Agreement. In the event of a Merger or transfer of Assets
NURESCELL will retain the right to terminate this Agreement.
9. GENERAL PROVISIONS
9.1 TIME OF THE ESSENCE. Time is of the essence with respect to
this Agreement.
9.2 ENTIRE AGREEMENT. This Agreement contains the entire agreement
between the parties with respect to the subject matter hereof,
and there are no agreements, understandings, representations
or warranties among the parties other than those set forth or
referred to herein.
9.3 EXPENSES. Except as set forth in this Agreement, whether the
transactions contemplated hereby are consummated or not, all
legal and other costs and expenses incurred in connection with
this Agreement and the transactions contemplated hereby shall
be paid by the party incurring such costs and expenses.
9.4 NOTICES. All notices ("Notice") hereunder shall be
sufficiently given for all purposes hereunder if in writing
and delivered personally, sent by documented overnight
delivery service or to the extent receipt is confirmed,
telecopy, telefax, or other electronic transmission service to
the appropriate address or number as set forth below.
9
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Notices to NURESCELL, Inc. shall be addressed to:
1400 Bristol Street, North
Suite 240
Newport Beach, California 92660
Telephone Number: (949) 752-0071
Facsimile Number: (949) 752-0091
Notices to Dr. Chong Chiu shall be addressed to:
112 West Canada
San Clemente, California 92675
Telephone Number: ________________________________
Facsimile Number: ________________________________
Any party may change the Notice designation by complying with the notice
provision hereof.
9.5 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon
and inure to the benefit of the parties hereto and their
respective successors and assigns.
9.6 HEADINGS; DEFINITIONS. The Section and article headings
contained in this Agreement are inserted for convenience of
reference only and will not affect the meaning or
interpretation of this Agreement. All references to Sections or
Articles contained herein mean Sections or Articles of this
Agreement unless otherwise stated. All capitalized terms
defined herein are equally applicable to both the singular and
plural forms of such farms.
9.7 ASSIGNMENT. This Agreement and all of the provisions hereof
shall be binding upon and insure to the benefit of the parties
hereto and their respective successors and permitted assigns,
but neither this Agreement nor any of the rights, interests or
obligations hereunder shall be assigned by any of the parties
hereto without the prior written consent of the other parties.
9.8 GOVERNING LAW. This Agreement and the legal relations among
the parties hereto shall be governed by and constructed in
accordance with the laws of the State of California.
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9.9 AMENDMENTS AND WAIVERS. This Agreement may not be modified or
amended except by an instrument or instruments in writing
signed by the party against whom enforcement of any such
modification or amendment is sought. Either party hereto may,
only by an instrument in writing, waive compliance by the other
party hereto with any term or provision of this Agreement. The
waiver by any party hereto of a breach of any term or
provision of this Agreement shall not be construed as a waiver
of any subsequent breach.
9.10 ATTORNEYS FEES AND COSTS. In the event of any breach of this
Agreement including any representation or warranty contained
in this Agreement which results in a claim being made against
the breaching party, the prevailing party shall be entitled to
recover reasonable attorney's fees and costs arising
therefrom, including but not limited to, travel and lodging
expenses, expert witness fees, depositions and related costs.
9.11 ARBITRATION. Any dispute or claim arising under or with
respect to this Agreement will be resolved by arbitration in
Los Angeles, CA in accordance with the Commercial Arbitration
Rules of the American Arbitration Association before a panel
of three (3) arbitrators, in accordance with the Commercial
Arbitration Rules of the American Arbitration Association. The
decision or ward of a majority of the arbitrators shall be
final and binding upon the parties. Any arbitrated award may
be entered as a judgment or order in any court of competent
jurisdiction.
9.12 SEVERABILITY. If any provision of this Agreement shall be
declared void or unenforceable by a court of competent
jurisdiction, the remaining provisions of this Agreement shall
nevertheless continue in effect.
9.13 FULL AUTHORITY. Each party hereto has taken all necessary
action to authorize such party to enter into and perform under
this Agreement. Each party hereto represents and warrants that
nothing contained in this Agreement violates or conflicts with
any agreement, contract or understanding to which such party
or its properties is subject, or any law rule regulation or
order or to any of the charter 5 documents or internal
policies or procedures of such party. Each person whose
signature is affixed hereto in a representative capacity
represents and warrants that he or she is
11
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authorized to execute this Agreement on behalf of and to bind
the entity on whose behalf his or her signature is affixed.
9.14 COUNTERPARTS: EXECUTION BY FACSIMILE. This Agreement and/or
any amendments to this Agreement may be executed in one or
more counterparts, each of which shall be deemed an original,
but all of which together shall constitute one and the same
instrument. This Agreement is effective when each party has
received an executed version transmitted to such party via
facsimile by the other party.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and their respective corporate seals to be affixed hereto, all as of
the day and year first above written.
NURESCELL, INC.
"CLIENT"
By: /s/ ADRIAN A. JOSEPH Date: 6/29/99
---------------------------- -------------------------
President
By: Date:
---------------------------- -------------------------
Secretary
"CONTRACTOR"
By: /s/ CHONG CHIU Date: 6/29/1996
---------------------------- -------------------------
DR. CHONG CHIU
* * *
12
<PAGE>
EXHIBIT 6.2
NATIONAL CAPITAL MERCHANT GROUP, LTD.
SUITE 61, GROSVENOR CLOSE
SHIRLEY STREET - P.O. BOX N-7521
NASSAN, BAHAMAS
INVESTMENT BANKING SERVICES AGREEMENT
This Financial Consultant Services Agreement (the "Agreement") is
entered this 30th day of June, 1999 by and between NATIONAL CAPITAL MERCHANT
GROUP, LTD. ("Consultant"), a Bahamian Corporation, and Nurescell, Inc.
(NUSL) OTC:BB ("Client"), a Nevada corporation, with reference to the
following:
RECITALS
A. The Client desires to be assured of the association and services of
the Consultant in order to avail itself of the Consultant's experience,
skills, abilities, knowledge, and background to facilitate long range
strategic planning, and to advise the Client in business and/or financial
matters and is therefore willing to engage the Consultant upon the terms and
conditions set forth herein.
B. The Consultant agrees to be engaged and retained by the Client and
upon the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing, of the mutual
promises hereinafter set forth and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties
hereto agree as follows:
1. ENGAGEMENT. Client hereby engages Consultant on a non-exclusive
basis, and Consultant hereby accepts the engagement to become a
financial consultant to the Client and to render such advice,
consultation, information, and services to the Directors and/or
Officers of the Client regarding general financial and business
matters including, but not limited to:
A. Mergers and acquisitions advisory, reorganizations, reverse mergers,
divestitures, due diligence studies, and capital sources
B. Capital structures, banking methods and systems, financial
transactions
C. Providing guidance and assistance in maximizing shareholder value
D. Periodic reporting as to developments concerning the general
financial markets and public securities markets and industry which
may be of interest or concern to the Client or the Client's business
E. Broker/dealer and investment banking relations for Client
1
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It shall be expressly understood that Consultant shall have no power to
bind Client to any contract or obligation or to transact any business in
Client's name or on behalf of Client in any manner.
2. TERM. The term ("Term") of this Agreement shall commence on the date
hereof and continue for twelve (12) months. However, either party may
terminate this Agreement earlier upon fifteen (15) days written notice of
termination. The Agreement may be extended upon agreement by both parties,
unless or until the Agreement is terminated.
3. COMPENSATION AND FEES. As consideration for Consultant entering into
this Agreement, Client and Consultant shall agree to the following:
A. An Engagement Fee ("Engagement Fee") of one hundred thousand dollars
($100,000), payable to the Consultant by issuing certificates representing an
aggregate of twenty thousand (20,000) shares of common stock (the "Shares")
at a price of $2.50 per share upon execution of this Agreement and an
additional twenty thousand (20,000) shares due sixty (60) days after the
execution of this Agreement if said Agreement is still in effect and has not
been canceled. If Client determines that Consultant is not entitled to the
second installment of twenty thousand (20,000) shares, Client shall be
entitled to terminate this Agreement upon fifteen (15) days written notice
with no further obligation to Consultant. The Shares, when issued to
Consultant, will be duly authorized, validly issued and outstanding, fully
paid and nonassessable and will not be subject to any liens or encumbrances.
Securities shall be issued to Consultant in accordance with a mutually
acceptable plan of issuance as to relieve securities or Consultant from
restrictions upon transferability of shares in compliance with applicable
registration provisions or exemptions.
4. EXCLUSIVITY; PERFORMANCE; CONFIDENTIALITY. The services of
Consultant hereunder shall not be exclusive, and Consultant and its agents
may perform similar or different services for other persons or entities
whether or not they are competitors of Client. Consultant shall be required
to expend only such time as is necessary to service Client in a commercially
reasonable manner. Consultant acknowledges and agrees that confidential and
valuable information proprietary to Client and obtained during its engagement
by the Client, shall not be, directly or indirectly, disclosed without the
prior express written consent of the Client, unless and until such
information is otherwise known to the public generally or is not otherwise
secret and confidential.
5. INDEPENDENT CONTRACTOR. In its performance hereunder, Consultant and
its agents shall be an independent contractor. Consultant shall complete the
services required hereunder according to his own means and methods of work,
shall be in the exclusive charge and control of Consultant and which shall
not be subject to the control or supervision of Client, except as to the
results of the work. Client acknowledges that
2
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nothing in this Agreement shall be construed to require Consultant to provide
services to Client at any specific time, or in any specific place or manner.
Payments to consultant hereunder shall not be subject to withholding taxes or
other employment taxes as required with respect to compensation paid to an
employee.
6. MISCELLANEOUS. No waiver of any of the provisions of this Agreement
shall be deemed or shall constitute a waiver of any other provision and no
waiver shall constitute a continuing waiver. No waiver shall be binding
unless executed in writing by the party making the waiver. No supplement,
modification, or amendment of this Agreement shall be binding unless
executed in writing by all parties. This Agreement constitutes the entire
agreement between the parties and supersedes any prior agreements or
negotiations. There are no third party beneficiaries of this Agreement.
IN WITNESS WHEREOF, the parties hereto have entered into this Agreement
on the date first written above.
"Client"
Signature: /s/ ADRIAN JOSEPH
------------------------------------
Print with Title: ADRIAN JOSEPH
----------------------------
PRESIDENT
Company: Nurescell, Inc.
"Consultant"
Signature: M. B. RILEY
------------------------------------
Print with Title: M. Blaine Riley - director
----------------------------
Company: National Capital Merchant Group, Ltd.
[Delivery Instructions on following page]
3
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS OF NURESCELL INC. (A DEVELOPMENT STAGE COMPANY) FOR THE
PERIOD FROM APRIL 1, 1999 TO JUNE 30, 1999 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAR-31-2000
<PERIOD-START> APR-01-1999
<PERIOD-END> JUN-30-1999
<CASH> 10,231
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 68,665
<PP&E> 52,609
<DEPRECIATION> 7,483
<TOTAL-ASSETS> 135,400
<CURRENT-LIABILITIES> 54,168
<BONDS> 0
0
0
<COMMON> 1,308
<OTHER-SE> 959,192
<TOTAL-LIABILITY-AND-EQUITY> 135,400
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 238,151
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (238,151)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (238,151)
<EPS-BASIC> (0.02)
<EPS-DILUTED> (0.02)
</TABLE>
