SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) of the
SECURITIES ACT OF 1934
For the Quarterly period ended September 30, 2000
Commission File Number 0-31169
EAGLE ENVIRONMENTAL TECHNOLOGIES, LTD.
----------------------------------------
(Exact Name of Registrant as Specified in Its Charter)
Nevada 88-0284209
------------------------------------------- -----------------
(State or Other Jurisdiction of (IRS Employer
Incorporation or Organization) Identification No.)
1380 Greg Street, Suite 220, Sparks, NV 89431
-------------------------------------------------
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code (775) 331-6555
Common Stock, Par Value $0.001 Per Share
----------------------------------------
(Title of Class)
Check whether the issuer: (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.
[X] Yes [ ] No
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date.
Common Stock, Par
Value $0.001 Per Share 14,526,147
---------------------- -----------------------
(Title of Class) (Number of Shares
Outstanding on
September 30, 2000
Traditional Small Business Disclosure Format (Check One):
[X] Yes [ ] No
<PAGE>
ITEM 1. Financial Statements
<TABLE>
<CAPTION>
Eagle Consolidated Report
Balance Sheet UNAUDITED
Sep/00 Sep/99 Inc/(Dec) %
----------- ----------- ----------- -----------
ASSETS
<S> <C> <C> <C> <C>
Current Assets:
Cash $ 5,283 ($ 425) $ 5,709 1342.2%
Account Receivables 12,070 2,093 9,977 476.7%
Notes receivable Lone Eagle 0 377,355 (377,355) -100.0%
Note Receivable, Related Parties 8,738 0 8,738
Inventory 564 0 564
----------- ----------- ----------- -----------
TOTAL Current Assets 26,656 379,023 (352,368) -93.0%
----------- ----------- ----------- -----------
Fixed Assets:
Property & Equipment 62,840 29,758 33,082 111.2%
Vehicle Accum Deprn (4,792) 0 (4,792)
----------- ----------- ----------- -----------
TOTAL Fixed Assets 58,048 29,758 28,290 95.1%
----------- ----------- ----------- -----------
Other Assets:
Other Assets 651,552 1,426,484 (774,933) -54.3%
----------- ----------- ----------- -----------
TOTAL Other Assets 651,552 1,426,484 (774,933) -54.3%
----------- ----------- ----------- -----------
TOTAL ASSETS $ 736,256 $ 1,835,266 ($1,099,010) -59.9%
=========== =========== =======
LIABILITIES
Current Liabilities:
Accounts Payable $ 504,706 $ 320,258 $ 184,448 57.6%
Sales Tax Payable 2,353 0 2,353
Salaries and Wages Payable 45,254 25,438 19,816 77.9%
JAB Enterprises Inc. (4,710) (14,830) 10,120 68.2%
Lease payable IKON 17,416 26,218 (8,802) -33.6%
Lease Payable Auto/Ford 10,729 (2,282) 13,012 570.1%
----------- ----------- ----------- -----------
TOTAL Current Liabilities 575,748 354,802 220,946 62.3%
----------- ----------- ----------- -----------
Long-Term Liabilities:
Notes Payable, Papas 23,678 11,656 12,022 103.1%
Notes Payable, JAB ENT 56,496 (2,000) 58,496 2924.8%
Notes Payable, Conv. Debenture
9,000 0 9,000
----------- ----------- ----------- -----------
TOTAL Long-Term Liabilities 89,175 9,656 79,518 823.5%
----------- ----------- ----------- -----------
TOTAL LIABILITIES 664,923 364,458 300,464 82.4%
----------- ----------- ----------- -----------
CAPITAL
Common Stock 132,955 78,812 54,143 68.7%
Additional paid in Capital 1,783,176 2,218,751 (435,575) -19.6%
Retained Earnings (774,560) (1,109,643) 335,083 30.2%
Year-to-Date Earnings (1,070,239) 282,887 (1,353,126) -478.3%
----------- ----------- ----------- -----------
TOTAL CAPITAL 71,333 1,470,807 (1,399,475) -95.2%
----------- ----------- ----------- -----------
TOTAL LIABILITIES & CAPITAL $736,256 $1,835,266 $(1,099,010) -59.9%
=========== ========== =========== ===========
</TABLE>
F-1
The accompanying notes are an integral part of these financial statements.
<PAGE>
<TABLE>
<CAPTION>
Eagle Consolidated Report
Income Statement UNAUDITED
3 Months 3 Months Variance
Ended Sep/00 Ended Sep/99 Fav/(Unf) % Var
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Income
Sales $30,360 $1,500 $28,860 1924.0%
------------ ------------ ------------ ------------
TOTAL Income 30,360 1,500 28,860 1924.0%
------------ ------------ ------------ ------------
NET REVENUE 30,360 1,500 28,860 1924.0%
------------ ------------ ------------ ------------
GROSS PROFIT 30,360 1,500 28,860 1924.0%
------------ ------------ ------------ ------------
Expenses
Payroll Costs
Officers Salaries 0 9,700 9,700 100.0%
Employee Benefits 551 561 10 1.8%
------------ ------------ ------------ ------------
TOTAL Payroll Costs 551 10,261 9,710 94.6%
------------ ------------ ------------ ------------
Utilities 402 25 (377) -1499%
General Expenses 20,789 84,342 63,553 75.4%
------------ ------------ ------------ ------------
TOTAL Expenses 21,743 94,628 72,885 77.0%
------------ ------------ ------------ ------------
OPERATING PROFIT 8,617 (93,128) 101,745 109.3%
------------ ------------ ------------ ------------
Other Income & Expenses
Other Income & Expenses 3,500 55,365 (51,865) -93.7%
------------ ------------ ------------ ------------
TOTAL Other Income & Expenses 3,500 55,365 (51,865) -93.7%
------------ ------------ ------------ ------------
PROFIT BEFORE TAXES 12,117 (37,763) 49,880 132.1%
------------ ------------ ------------ ------------
NET PROFIT $12,117 ($37,763) $49,880 132.1%
============ ============ ============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-2
<PAGE>
<TABLE>
<CAPTION>
Eagle Consolidated Report
Income Statement UNAUDITED
9 Months 9 Months Variance
Ended Sep/00 Ended Sep/99 Fav/(Unf) % Var
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Income
Sales $35,360 $4,000 $31,360 784.0%
------------ ------------ ------------ ------------
TOTAL Income 35,360 4,000 31,360 784.0%
------------ ------------ ------------ ------------
NET REVENUE 35,360 4,000 31,360 784.0%
------------ ------------ ------------ ------------
Cost of Goods Sold
Cost of Goods Sold 3,021 0 (3,021)
------------ ------------ ------------ ------------
TOTAL Cost of Goods Sold 3,021 0 (3,021)
------------ ------------ ------------ ------------
GROSS PROFIT 32,339 4,000 28,339 708.5%
------------ ------------ ------------ ------------
Expenses
Payroll Costs
Officers Salaries 18,200 20,700 2,500 12.1%
Employee Benefits 5,059 1,345 (3,715) -276.2%
------------ ------------ ------------ ------------
TOTAL Payroll Costs 23,259 22,045 (1,215) -5.5%
------------ ------------ ------------ ------------
Advertising 798 0 (798)
Utilities 2,306 590 (1,716) -290.8%
General Expenses 692,208 202,243 (489,964) -242.3%
------------ ------------ ------------ ------------
TOTAL Expenses 718,571 224,878 (493,693) -219.5%
------------ ------------ ------------ ------------
OPERATING PROFIT (686,233) (220,878) (465,354) -210.7%
------------ ------------ ------------ ------------
Other Income & Expenses
Other Income & Expenses (384,006) 503,765 (887,771) -176.2%
------------ ------------ ------------ ------------
TOTAL Other Income & Expenses (384,006) 503,765 (887,771) -176.2%
------------ ------------ ------------ ------------
PROFIT BEFORE TAXES (1,070,239) 282,887 (1,353,126) -478.3%
------------ ------------ ------------ ------------
NET PROFIT ($1,070,239) $282,887 ($1,353,126) -478.3%
============ ============ ============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-3
<PAGE>
<TABLE>
<CAPTION>
Eagle Consolidated Report
Statement of Cash Flows UNAUDITED
Sep/00 Sep/99 Inc/(Dec)
--------- --------- --------
CASH FLOWS, OPERATIONS:
<S> <C> <C> <C>
Period Earnings: (1,018,043)
Adjustments to Year-to-Date Earnings:
US BANK, Reno (4,853) 2,075 (6,928)
Checking, Sparks (320) (500) 180
Interest Receivable 529 0 529
Trade Receivables (12,600) 0 (12,600)
Travel Advances 0 (900) 900
Employee Advances 0 (1,193) 1,193
Notes receivable Lone Eagle 0 (377,355) 377,355
Note Receivable, JAB (8,738) 0 (8,738)
Inventory Account #1 (564) 0 (564)
Accounts Pay. Related Parties 4,209 450 3,759
Loans, short term, other 400 0 400
Contract payables 231,520 33,477 198,043
Trade Payables 189,064 205,866 (16,802)
Deposits on Equipment 69,045 70,000 (955)
Sales Tax Payable 2,353 0 2,353
Salaries and Wages Payable 45,254 25,438 19,816
JAB Enterprises Inc. (4,710) (14,830) 10,120
Lease payable IKON 17,416 26,218 (8,802)
Lease Payable Auto/Ford 10,729 (2,282) 13,011
--------- --------- --------
NET CASH FLOWS, OPERATIONS (445,773)
--------
CASH FLOWS, FINANCING and INVESTING:
Rights To Technology (256,655) (237,155) (19,500)
Licenses for Zawcad (391,417) 0 (391,417)
Deposits (3,380) (1,189,229) 1,185,849
Furniture & Fixtures (214) 0 (214)
Equipment (61,130) (55,386) (5,745)
Equipment Accum. Deprn. 36,874 26,689 10,185
Vehicles (38,369) (1,062) (37,307)
Vehicle Accum Deprn 4,792 0 4,792
Notes Payable, Papas 23,678 11,656 12,022
Notes Payable, JAB ENT 56,496 (2,000) 58,496
Notes Payable, Conv. Debenture 9,000 0 9,000
Common Stock 132,955 78,812 54,143
Additional paid in Capital 1,783,176 2,218,751 (435,575)
--------- --------- --------
NET CASH FLOWS, FINANCING and INVESTING 444,729
Net Increase (Decrease) in CASH (1,044)
CASH and CASH EQUIVALENTS
Beginning of the Period 1,150
--------
CASH and CASH EQUIVALENTS
Current 106
--------
CASH and CASH EQUIVALENTS:
Checking, Other AW 106
------------
TOTAL CASH and CASH EQUIVALENTS 106
============
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-4
<PAGE>
EAGLE ENVIRONMENTAL TECHNOLOGIES, LTD.
(A DEVELOPMENT STAGE CORPORATION)
NOTES TO THE CONSOLIDATED UNAUDITED FINANCIAL STATEMENTS
SEPTEMBER 30, 2000
NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION:
Eagle Environmental Technologies, Ltd. (the "Company") was incorporated in the
State of Nevada on June 15, 1990 for the purpose of acquiring, developing,
testing, and marketing high technological developments for the protection of the
environment. In June of 1990, the Company issued 3,000,000 shares of its common
stock for $8,400 cash. On July 12, 1991 the Company merged with Cholla Precious
Metals, Inc., for 876,667 shares of the Company's common stock. (Post
consolidation number)
On March 12, 1992, the Company issued 100,000 shares of common stock to an
individual for his current and future rights in the development of tire
recycling, Biomass technology and improvements to the Chemstasis technology. The
Company is involved with other technologies through the execution of joint
venture or value-added resale agreements. See note 3.
On December 31, 1997 the Board voted to issue 165,500 shares as collateral for
purchase of another company, American Water Technologies (AWT). The purchase was
never consummated and AWT had refused to return the stock. Eagle put a block on
this stock and started legal proceedings to collect the stock which was
completed on September 1, 2000 with the stock being returned to Eagle. On
September 30, 1999 Eagle issued 1,779,167 shares as collateral for the purchase
of a company. This purchase was never consummated and the stockholders have
refused to return stock. Eagle has placed a block on this stock and started
proceedings to collect this stock. This has been reconciled by the changes
listed in the ZawCad technology license agreement between Eagle and JAB
Enterprises.
On August 8, 1994 the Company completed all Securities and Exchange Commission
requirements to publicly trade its stock. The Company currently trades on the
Electronic "Over the Counter" (OTC) Exchange (Symbol EGVR).
On July 26, 2000, the Company completed its filing of the 10SB12G, Registration
Statement, to become a fully reporting company with the SEC. The statute time of
60 days ended on September 23, 2000, which completes the standard process. There
is a comment period during and often after the 60 days, which will be completed
by the Company as needed. This change in stature of the company will enhance its
visibility to the public and the stockbrokers that trade in the company's
shares.
PRINCIPLES OF CONSOLIDATION
The accompanying consolidated financial statements include the accounts of Eagle
Environmental Technologies Ltd., and its wholly owned subsidiary, Lone Eagle
Technology Site, Inc. All significant intercompany balances and transactions
have been eliminated from the balance sheets and carried as "off balance sheet"
amounts.
USE OF ESTIMATES:
The preparation of financial statements in conformity with generally accepted
accounting principals requires management to make estimates and assumptions that
affect certain reported accounts and disclosures. Accordingly, actual results
could differ from these estimates.
F-5
<PAGE>
EAGLE ENVIRONMENTAL TECHNOLOGIES, LTD.
(A DEVELOPMENT STAGE CORPORATION)
NOTES TO THE CONSOLIDATED UNAUDITED FINANCIAL STATEMENTS
SEPTEMBER 30, 2000
EARNINGS PER SHARE:
The earnings per share calculation is based on the weighted average number of
shares outstanding during the period, 8,566,859 in 1999, 5,139,125 in '98,
2,919,585 in '97 and 1,755,962 in 1996. Stock options or convertible debentures
or warrants are not included in the calculation since they are anti-dilutive.
DIVIDEND POLICY:
The Company has not paid dividends and any dividends that may be paid in the
future will depend upon the financial requirements of the Company and other
relevant factors.
EQUIPMENT:
Equipment is recorded at cost and depreciation is computed using a 5-year life
on a straight-line basis.
INCOME TAX:
Because of losses sustained since inception, no provision for Federal income tax
was made.
NATURE OF BUSINESS:
The Company is a "Technology Systems Integrator". The company gains ownership,
licenses or rights to market various technologies independently. The company
uses the various rights to the technologies to form a new "solution based
system" for a customer to solve a particular environmental problem. By
investigating existing waste handling, disposal equipment and water purification
systems, the company develops more sophisticated types of systems for waste
handling and disposal procedures and products. By operating as a "Systems
Integrator", several types of technology may be combined with the company's to
perfect a complete solution for a customer.
NOTE 2 - RIGHTS TO TECHNOLOGY:
The merger with Cholla Precious Metals, Inc., included total rights to
Chemstasis Technology. The technology is to enable the Company to economically
and easily destroy undesirable toxic and hazardous waste materials, and is still
under early development.
With the purchase of the sub license from Zawtech International/JAB Enterprises
Inc., the company is able to use the ZawCAD technology in coating removal,
cutting or drilling processes, worldwide. The process works similar to a
water-jet process but without developing the waste stream. See Note 9, below
NOTE 3 - JOINT VENTURES AND AGREEMENTS:
In 1994, the Company entered into a joint venture with Research Institute of the
Electrical Industry, the largest research institute in Hungary, to form a U.S.
Corporation, Plasma Environmental Technologies, Inc., (formally Eagle AM Master
Inc, Reno, NV) to sell waste elimination systems throughout the Americas. The
systems use Plasma Technology to destroy highly toxic wastes by the application
of high temperature. The units using the Plasma Technology systems are
manufactured by EPOS, (now Hungaroplasma) one of the largest specialty
manufacturers in Hungary
The Company entered into an additional agreement with Plasma Environmental
Technologies, Inc., to market the Plasma Technology. Pursuant to the agreement,
the Company implemented a regional licensing program whereby Canada and the
United States were divided into 10 regions for marketing purposes. The Company
intends to license specific companies to service each region in return for a fee
and minority interest.
F-6
<PAGE>
EAGLE ENVIRONMENTAL TECHNOLOGIES, LTD.
(A DEVELOPMENT STAGE CORPORATION)
NOTES TO THE CONSOLIDATED UNAUDITED FINANCIAL STATEMENTS
SEPTEMBER 30, 2000
In November 1996, the company formed a joint venture company, Plasma Energy
Processing Inc, with Palota Kornyezelvedelmi KFT of Hungary, to produce a larger
version of the Plasma system than available from the Canadian firm PETI. The
company owns 50% of the stock at this time. The equipment has not been built or
tested under the USA EPA standards, so no sales have been made.
Under the licensing agreement, Intercommerce Inc. has agreed to purchase the
rights to market Plasma Technology. Intercommerce Inc. and will pay the Company
$2,000,000, by a promissory note to be paid over 10 years (with interest at
12%). The agreements are contingent and will be finalized in the future upon
delivery of the equipment that is not yet scheduled.
NOTE 4 - NOTES RECEIVABLE
The Company had the following notes receivable 1999:
Notes receivable from Plasma Environmental Technologies, Inc for $17,683 with
interest at 10% per annum. Management believes the note to be collectable.
NOTE 5 - ACCRUED EXPENSES:
The Company has accrued unpaid wages to Jerry Wilmot in the amount of $27,000,
and accrued rent due to JAB in the amount $1,920.
NOTE 6 - NOTES PAYABLE, RELATED PARTIES
1999 1998
A non interest bearing note payable to related parties, 56,408 105,000
A non-interest bearing Note Payable to BBTC for services: -0- 20,000
NOTE 7 - CAPITAL LEASE
Future minimum payments for a copier under a non-cancelable lease exist at
December 31. 1999
2000 8,687
2001 8,687
2002 8,687
2003 1,327
Total minimum lease payments: 27,388
Amount representing interest 3,938
-------
Present value of net, current portion: 23,450
Current portion 8,687
-------
14,763
Future minimum payments for a Ford Explorer under a non-cancelable lease exist
at December 31. 1999
2000 6,230
2001 6,230
2002 3,116
Total minimum lease payments: 15,576
Amount representing interest 551
--------
Present value of net, current portion: 15,025
Current portion 6,230
-------
8,795
F-7
<PAGE>
EAGLE ENVIRONMENTAL TECHNOLOGIES, LTD.
(A DEVELOPMENT STAGE CORPORATION)
NOTES TO THE CONSOLIDATED UNAUDITED FINANCIAL STATEMENTS
SEPTEMBER 30, 2000
NOTE 8 - NOTE PAYABLE: EMPLOYMENT CONTRACTS, STOCK OPTIONS:
The Company signed modified employment agreements with individuals and corporate
entities to act as chairman, president chief executive, corporate treasurer
(CFO), corporate secretary and marketing officer, for compensation totaling
$590,000 per year. A pool of compensation is to be set aside equal to 25% of net
cash flow or net pre-tax profits, whichever is lesser, as incentive bonuses to
be paid to the above entities. The entities have elected not to be compensated
on these contracts until the Company has a positive cash flow from operations,
therefore, the Company did not accrue a liability on these contracts during the
years previously. The employment agreements also contain stock options in lieu
of part of their salaries at a purchase price equal to 70% of the then current
market value.
NOTE 9 - RELATED PARTY TRANSACTIONS:
The Company rents office space from JAB Enterprises, Inc., a related
corporation, for $960 per month. The company has entered into an agreement to
receive worldwide license rights for the ZawCAD technology from Zawtech
International Inc. The company paid in stock for the rights at a value of
$391,417. The agreement was entered into in 1999 and finalized in 2000 and is
currently reflected in the balance sheets.
NOTE 10 GOING CONCERN
The interim 2000 financial statements of the Company have been prepared assuming
that the Company will continue as going concern as of September 2000. The
Company is currently generating limited revenue and substantial capital is
necessary to market the Chemstasis Technology, Plasma technology, WaterClear
Technology and the Zawcad Technology. If additional capital is not secured from
the public offering of the stock, from its current shareholders, or from the
marketing agreements discussed in Note 3, then there is substantial doubt about
the company's ability to continue as a going concern.
The company currently has orders for the ZawCAD equipment from Lockheed Martin
Corporation for delivery in fourth quarter 2000. The company has contracted with
EDC Engineering in Santa Fe, NM to construct the equipment. All re-designs have
been completed and the manufacturing has begun.
The company has a pending agreement with Osmonics Inc, the manufacturer of the
WaterClear for the company to continue the manufacturing of the equipment to the
Eagle specifics. The final agreement is expected in the fourth quarter of 2000.
F-8
<PAGE>
EAGLE ENVIRONMENTAL TECHNOLOGIES, LTD.
(A DEVELOPMENT STAGE CORPORATION)
NOTES TO THE CONSOLIDATED UNAUDITED FINANCIAL STATEMENTS
SEPTEMBER 30, 2000
MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS
FINANCIAL
The following discussion should be read in conjunction with Company's
Consolidated Financial Statements and Notes included in this report.
RESULTS OF OPERATIONS, comparison of periods, September 2000 and September 1999
Gross sales increased $28,860 during the current period due to the recent
approval and sale of the Company's WaterClear(TM) equipment line to the
California school. Further orders for similar equipment are pending at another
school and the California Fish and Game Department.
Sales of the ZawCAD equipment have not yet been finalized, as deliveries on
previous orders, (those placed prior to the Company obtaining the license) are
not scheduled to be completed until the first quarter of next year. Certain
engineering, marketing and design costs have been included in the reflected
expenses for this period and the previous quarters of 2000.
General expenses show a decline of 75.4% for the current period due to deposits
and purchases made in 1999 to open the new Sparks office/warehouse facility.
Year to date expenses show an increase of 242.3% in this area. Most of the
changes and office equipment purchases are complete at this time and it is
expected that overall, non-operating, expenses will not increase for the
remainder of 2000.
Major adjustments on the balance sheet were due to changes in the method of
accounting of the funds advanced to the subsidiary, Lone Eagle Technology Site,
Inc., (Texas), for the processing facility in Texas City, Texas, being taken off
of the balance sheet and carried as an "off balance sheet" asset. The final
determination of the status of the processing facility has not yet been made by
the Texas Bankruptcy Court. Until that is completed, the Company will not be
able to move on the acquisition.
In 2000, the added license acquisition of the ZawCAD technology rights was the
largest asset change to the balance sheet. The purchase was based on a stock
issuance at .22 cents per share, which increased the common stock calculation
and diluted the existing amount of shares by 1,779,167.
Liquidity: The company's liquidity increase during the current period was due to
the recent equipment sales. The company is negotiating a lease/credit line for
equipment purchase - resale use during the fourth quarter. This is for the cyclo
mill equipment that the company feels it can get operational within the fourth
quarter to improve its year-end cash flow captions.
F-9
<PAGE>
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
Plan of Operation
Statements contained herein that are not historical facts are
forward-looking statements as that term is defined by the Private Securities
Litigation Reform Act of 1995. Although the Company believes that the
expectations reflected in such forward-looking statements are reasonable, the
forward-looking statements are subject to risks and uncertainties that could
cause actual results to differ from those projected. The Company cautions
investors that any forward-looking statements made by the Company are not
guarantees of future performance and that actual results may differ materially
from those in the forward-looking statements. Such risks and uncertainties
include, without limitation: well established competitors who have substantially
greater financial resources and longer operating histories, regulatory delays or
denials, the Company's ability to compete as a start-up company in a highly
competitive market, and access to sources of capital.
During the last quarter of 2000 and the first half of 2001, the Company
plans to focus on continuing its efforts to secure the newest technologies
available, to secure the best expertise and team available, to develop the most
cost effective technologies for the treatment of toxins and wastes in the
environment, and to complete the development of its intellectual properties.
Unless a client base is established, the Company will be forced to rely on
investment financing to meet its short and long term cash requirements.
Management believes that demand for its services will be high in the
disposal of toxic wastes. The USA leads the world in production of consumable
goods and the utilization and disposal of their remains. The ever growing
stringency of anti- pollution regulations and their enforcement by the
regulators has put the manufacturing industry in a very precarious position.
Manufacturing plants are avoiding discharge of their wastes by transporting them
to centralized treatment facilities. There is increased awareness of the hazards
from polluted water, both on wildlife and humans, and greater emphasis is being
placed on finding cost effective methods to clean up our water systems. The
Company offers manufacturing plants and others an on-site process for disposal
of toxic wastes at a lower cost.
2
<PAGE>
Unless revenues increase, the Company will not be able to meet its
short-term or long-term cash requirements. Current revenues and financing likely
will be adequate through December 31, 2000. The Company will have to raise
additional funds after that point. Though management has successfully obtained
such financing in the past, there is no assurance that investment financing will
be available in the future. And if it is, additional investment financing will
result in a dilution of current shareholder equity.
The Company will continue to improve its intellectual properties
through its research and development efforts. The Company plans to protect its
developments through appropriate patent applications. If the Company receives
the appropriate patent and copyright approvals, which is not certain, the
Company expects to be able to capitalize on the anticipated trend in the
industry for technologies the Company employs. Additional development efforts
and expansion into new markets depend on the Company's ability to develop
revenue streams.
PART II
OTHER INFORMATION
ITEM 1: Legal Proceedings
The Company is not party to, and none of the Company's property is
subject to, any pending or threatened legal, governmental, administrative or
judicial proceedings that will have a materially adverse effect upon the
Company's financial condition or operation, except as disclosed below:
The Company is bringing suit against Dakota Partners, Bismarck, North
Dakota. The case has not yet been filed. The Company is seeking the return of
funds resulting from a liquidation of assets by a lienholder for a loan made to
the Company's subsidiary, Lone Eagle Technology Site, Inc. The partners were
overpaid by the liquidation and have not returned the overpaid sum of $25,000,
plus over-charges of $50,000.
The Company is investigating facts on a suit against Plasma
Environmental Technologies Inc. Canada. PETI has granted the Company the
exclusive marketing rights to its Plasma equipment by contract and its offering
circulars, and then tried to disclaim the commitment. The Company would
seek-reaffirmation of the agreements and cash to pay legal expenses of
approximately $10,000.
The Company has filed a suit against American Water Technologies Inc.,
Stockton, California and its president Paul Chapman for damages and the return
of issued purchase money stock of 165,500 shares. AWT was a corporation which
the Company planned to acquire. Purchase contracts were signed and the Company
3
<PAGE>
paid a cash deposit of $10,000, plus the stock, to purchase 100% of the
outstanding shares of AWT. AWT failed to produce audited financial statements,
failed to disclose numerous tax authority debts and misrepresented its business
condition. AWT failed to deliver its shares to the Company. The Company
terminated the agreement and made demand that its shares be returned.
ITEM 2: Changes in Securities and Use of Proceeds
None.
ITEM 3: Defaults Upon Senior Securities
None.
ITEM 4: Submission of Matters to a Vote of Security Holders
No matters have been submitted to a vote of the security holders during
the period covered by this report through the solicitation of proxies or
otherwise.
ITEM 5: Other Information
None.
ITEM 6: Exhibits and Reports on Form 8-K
A. Exhibits
(2) Plan of acquisition, reorganization, liquidation or
succession:
NONE.
(3) (i) Articles of Incorporation *
(ii) By-laws *
* Incorporated by reference from the Registrant's Form 10-SB.
B. Reports on Form 8-K.
The Registrant did not file reports on Form 8-K during the quarter
covered by this report.
4
<PAGE>
Signatures
----------
In accordance with Section 13 or 15(d) of the Exchange Act, the
Registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
Dated: November 20, 2000.
EAGLE ENVIRONMENTAL
TECHNOLOGIES, LTD.
By: /s/ Brian D. Wilmot
-----------------------
Brian D. Wilmot
President
