SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the quarterly period ended March 31, 1995
Commission File Number 33-3385
ENVIRONMENTAL PLASMA ARC TECHNOLOGY, INC.
-----------------------------------------
(Exact name of small business issuer as specified in its charter)
Nevada 87-0430816
------ ----------
(State or other jurisdiction (I.R.S. Employer Identification Number)
of incorporation or organization)
870 East 9400 South, #203, Sandy, Utah 84094
--------------------------------------------
(Address of principal executive offices)
(Zip Code)
(801) 553-9393
--------------
(Issuer's telephone number including area code)
Indicate by check mark whether the issuer (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
Yes No [ XX ]
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.
As of March 31, 1995, the Issuer had issued and outstanding an aggregate
of 18,275,000 common voting shares, par value $0.001.
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
The unaudited financial statements of Environmental Plasma Arc
Technology, Inc. ("the Company") for the quarter ended March 31, 1995 are
attached hereto and incorporated by reference.
ITEM 2. PLAN OF OPERATION.
The Company had no revenues from operations for its quarter ended
March 31, 1995, nor for the corresponding quarter for the period of this
report, ended March 31, 1994, nor for the fiscal year ended December 31, 1994.
The Company owns an exclusive license in certain technology,
equipment and devices which employ the principles of Environmental Plasma Arc
Technology in emission, exhaust reduction, and purification systems
(hereinafter referred to as the "EPAT Technology").
Since 1992, it has been the intent of the Company to develop a
plan to exploit the EPAT Technology as an exclusive licensee. As of the date
hereof, the Company's inventory of systems utilizing the EPAT Technology
("EPAT Systems") is limited to two demonstration/test models, one production
model to be utilized for beta testing purposes and one commercially viable
model which the Company feels is ready for market with a commercial value of
approximately $250,000.
The Company is pursuing and will continue to pursue opportunities
to market the EPAT Technology to potential customers as well as to pursue
strategic combinations with potential business partners in an attempt to
maximize the value of the EPAT Technology and the EPAT Systems.
Although the Company has several potential sources of capital
resources, its liquidity position is not sufficient to allow for substantial
growth activity. The Company currently has no employees and is in need of
significant capital to enable it to pursue its objective of demonstrating the
EPAT Technology to potential customers and to obtain orders for the EPAT
Systems and to produce EPAT Systems that the Company will have the necessary
capital at the time to produce the same in a timely manner.
The Company does not intend or expect to purchase or sell any
significant equipment or assets, undertake any research and development, or to
hire any employees until such time as sufficient capital has been raised to
allow the Company to pursue operations.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
As of March 31, 1995, the Company is not a party to any
proceedings or threatened proceedings other than those discussed in its Report
on Form 10-KSB for its year ended December 31, 1994, which discussion,
pursuant to Rule 12b-23, is incorporated herein by this reference. There have
been no material developments in any legal proceedings reported on in the Form
10-KSB for the year ended December 31, 1994, nor are there any new proceedings
or threatened proceedings to which the Company is a party or threatened to be
made a party.
ITEM 2. CHANGES IN SECURITIES
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
ITEM 5. OTHER INFORMATION
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) The following exhibits are attached hereto and
incorporated herewith.
Exhibit # Description
- --------- ----------------
15 Incorporated as part of Letter on unaudited interim financial
information.
23 Consent of Shelley & Company
(b) No Reports on 8-K were filed during the quarter ended
March 31, 1995.
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf of the undersigned, thereunto
duly authorized.
DATED this 30th day of December, 1996.
ENVIRONMENTAL PLASMA ARC TECHNOLOGY, INC.
By: /s/ Mitchell T. Godfrey
_________________________
Mitchell T. Godfrey
President
ENVIRONMENTAL PLASMA ARC TECHNOLOGY, INC.
(Formerly known as Bio-Helix, Inc. and Concept Gold, Inc.)
(A Development Stage Company)
UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
March 31, 1995<PAGE>
SHELLEY & COMPANY
Certified Public Accountants
656 West 7250 South
Midvale, Utah 84047
Tel (801) 565-1547
Fax (801) 565-4709
To the Board of Directors
Environmental Plasma Arc Technology, Inc.
Salt Lake City, Utah
I have compiled the accompanying balance sheet of Environmental Plasma Arc
Technology, Inc. (a Nevada Corporation) as of March 31, 1995, and the related
statement of income, cash flows, and retained earnings, for the three month
period then ended, in accordance with standards established by the American
Institute of Certified Public Accountants.
A compilation is limited to presenting in the form of financial statements
information that is the representation of management. I have not audited or
reviewed the accompanying financial statements and, accordingly, do not
express an opinion or any other form of assurance on them.
I am not independent with respect to Environmental Arc Plasma Technology, Inc.
/s/ Shelley & Company
- ---------------------
Shelly & Company
December 5, 1996
ENVIRONMENTAL PLASMA ARC TECHNOLOGY, INC.
(Formerly know as Bio-Helix, Inc. and Concept Gold, Inc.)
(A Developmental Stage Company)
UNAUDITED CONSOLIDATED BALANCE SHEETS
ASSETS
------
March 31, December 31,
1995 1994
------------- -------------
CURRENT ASSETS
Cash in bank $ 8 $ 6,775
Work in process inventory (Note 1) 341,128 341,128
------------- -------------
Total Current Assets 341,136 347,903
------------- -------------
PROPERTY AND EQUIPMENT (Note 4) 28,190 28,491
------------- -------------
TOTAL ASSETS $ 369,326 $ 376,394
============= =============
LIABILITIES AND STOCKHOLDERS EQUITY
-------------------------------------
LIABILITIES
Accounts payable $ 300,176 $ 300,176
Accrued expenses 54,650 54,550
Taxes payable 30,084 33,031
Note payable -shareholder (Note 5) 231,613 226,573
------------- -------------
Total Liabilities 616,523 614,330
------------- -------------
STOCKHOLDERS EQUITY
Common stock, $.001 par value;
50,000,000 shares authorized,
18,275,000 issued and 18,275,000
Outstanding, respectively 18,275 18,275
Additional paid-in capital 1,679,814 1,679,814
Deficit accumulated during the
development stage (1,945,286) (1,936,025)
-------------- -------------
Total Stockholders Equity (Deficit) (247,197) (237,936)
------------- -------------
TOTAL LIABILITIES &
STOCKHOLDERS EQUITY $ 369,326 $ 376,394
============= =============
The accompanying notes are an integral part of these financial statements.
See accountants compilation report.
ENVIRONMENTAL PLASMA ARC TECHNOLOGY, INC.
(Formerly know as Bio-Helix, Inc. and Concept Gold, Inc.)
(A Developmental Stage Company)
UNAUDITED CONSOLIDATED STATEMENT OF OPERATIONS
From
For the Three Months Inception on
Ended March 31, February 10,
-------------------------- 1986 through
1995 1994 March 31, 1995
------------ ------------ --------------
REVENUE $ - $ - $ 50,000
------------ ------------ --------------
EXPENSES
Accounting 250 1,500 28,250
Advertising 14,489
Amortization expense 110
Automobile expense 289 13,495
Bad debt 9,176
Bank charges 30 (8) 11,861
Depreciation 301 2,012 11,167
Engineering 38,480
Filing fees 1,821
Insurance 1,300 91,582
Legal 7,500 30,500 327,328
Marketing 95,000
Miscellaneous 7,126
Moving expense 6,472
Office expense 672 1,507 73,811
Penalties 30,602
Professional services 3,570 219,463
Registration expense 1,093 3,335
Repairs & maintenance 740 11,463
Rent 1,739 87,920
Research and development 42,492
Salary expense 145,395
Seminars 2,413
Shipping 39,142
Taxes and licenses 208 40,476
Telephone 508 2,541 102,828
Transfer fees 700 6,327
Travel and promotion 3,596 222,100
Utilities 1,242 11,931
Inventory valuation 32,467
Losses from litigation 29,450
------------ ------------ --------------
Total Expenses 9,261 52,529 1,757,972
------------ ------------ --------------
OPERATING LOSS (9,261) (52,529) (1,707,972)
OTHER INCOME (EXPENSE)
Interest (4,183) (25,075)
Loss on disposal of assets (211,831)
Income taxes (408)
------------ ------------ --------------
NET LOSS $ (9,261) $ (56,712) $ (1,945,286)
============ ============ ==============
Weighted average loss
per share $ .000 $ (.003) $ (.005)
============ ============ ==============
The accompanying notes are an integral part of these financial statements.
See accountants compilation report.
ENVIRONMENTAL PLASMA ARC TECHNOLOGY, INC.
(Formerly know as Bio-Helix, Inc. and Concept Gold, Inc.)
(A Developmental Stage Company)
UNAUDITED CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY
<TABLE>
<CAPTION>
Deficit
Accumulated Total
Common Stock Additional During the Stock-
------------------------ Paid-in Development Treasury holders
Shares Amount Capital Stage Stock Equity
----------- ------------ ----------- ------------ ---------- -----------
<S> <C> <C> <C> <C> <C> <C>
Balance, Feb. 10, 1986 - $ - $ - $ - $ - $ -
Shares issued to
officers & directors
at $.25 per share 200,000 200 4,800 - - 5,000
Net loss for the period
ended December 31, 1986 - - - (160) - (160)
----------- ------------ ----------- ------------ ---------- -----------
Balance, Dec. 31, 1986 200,000 200 4,800 (160) - 4,480
Shares issued through
public offering at $.25
per share 400,000 400 99,600 - - 100,000
Pubic offering costs - - (20,315) - - (20,315)
Share issued in
acquisition of wholly-
owned subsidiary 720,000 720 29,280 - - 30,000
Shares issued through
private placement 10,000 10 24,990 - - 25,000
Net loss for the year
ended Dec. 31, 1987 - - - (36,112) - (36,112)
---------- ----------- ----------- ------------ ---------- -----------
Balance, Dec. 31, 1987 1,330,000 1,330 138,355 (36,272) - 103,413
Shares issued through
private placement 30,000 30 74,970 - - 75,000
Net loss for the year
ended Dec. 31, 1988 - - - (48,075) - (48,075)
---------- ----------- ----------- ------------ ---------- -----------
Balance, Dec. 31, 1988 1,360,000 1,360 213,325 (84,347) - 130,338
Net loss for the year
ended Dec. 31, 1989 - - - (175,094) - (175,094)
---------- ----------- ----------- ------------ ---------- -----------
Balance, Dec. 31, 1989 1,360,000 1,360 213,325 (259,441) - (44,756)
---------- ----------- ----------- ------------ ---------- -----------
Balance Feb. 10, 1989 1,360,000 1,360 213,325 (259,441) - (47,756)
Expenses paid on behalf
of the Company by
stockholders - - 53,481 - - 53,481
Shares issued for
services rendered by
stockholders 170,000 170 (170) - - -
Net loss for the year
ended Dec. 31, 1990 $ - $ - $ - $ (8,685) $ - $ (8,685)
----------- ----------- ----------- ----------- ----------- -----------
The accompanying notes are an integral part or these financial statements.
See accountants compilation report.
</TABLE>
ENVIRONMENTAL PLASMA ARC TECHNOLOGY, INC.
(Formerly know as Bio-Helix, Inc. and Concept Gold, Inc.)
(A Developmental Stage Company)
UNAUDITED CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY(Continued)
<TABLE>
<CAPTION>
Deficit
Accumulated Total
Common Stock Additional During the Stock-
------------------------ Paid-in Development Treasury holders
Shares Amount Capital Stage Stock Equity
----------- ------------ ----------- ------------ ---------- -----------
<S> <C> <C> <C> <C> <C> <C>
Balance, Dec.31, 1990 1,530,000 1,530 266,636 (268,126) - 40
Net Loss for the year
ended Dec. 31, 1991 - - - (41,701) - (41,701)
----------- ------------ ----------- ------------ ---------- -----------
Balance, Dec. 31, 1991 1,530,000 1,530 226,636 (309,827) - (41,661)
Shares issued for cash
and relief of debt 470,000 470 80,370 - - 80,840
Shares issued for
marketing rights 14,000,000 14,000 (14,000) - - -
Shares issued for
services performed 2,000,000 2,000 (2,000) - - -
Shares issued through
private placement 2,000,000 2,000 453,692 - (192) 455,500
Net loss for the year
ended Dec. 31, 1992 - - - (387,200) - (387,200)
---------- ------------ ----------- ------------ --------- ------------
Balance, Dec. 31, 1992 20,000,000 20,000 784,698 (697,027) (192) 107,479
Cancellation of shares
issued for private
placement (2,000,000) (2,000) 2,000 - - -
Shares issued through
private placement 332,000 332 213,668 - 192 214,192
Capital contribution
from shareholder - - 80,826 - - 80,826
Net loss for the year
ended Dec. 31, 1993 - - - (855,206) - (855,206)
----------- ------------- ---------- ------------ ---------- -----------
Balance, Dec. 31, 1993 18,332,000 18,332 1,081,192 (1,552,233) - (452,709)
Capital contributed by
Shareholders - - 598,565 - - 598,565
Cancellation of shares (57,000) (57) 57 - - -
Net loss for the year
ended Dec. 31, 1994 - - - (383,792) - (383,792)
----------- ------------ ----------- ------------ ---------- -----------
Balance, Dec. 31, 1994 18,275,000 18,275 1,679,814 (1,936,025) - (237,936)
Net Loss for the three
month period ended
March 31, 1995 - - - (9,261) - (9,261)
----------- ------------ ----------- ------------ ---------- -----------
Balance, March 31, 1995 18,275,000 $ 18,275 $1,679,814 $(1,945,286) $ - $ (247,197)
=========== ============ =========== =========== =========== ===========
The accompanying notes are an integral part of these financial statements.
See accountants compilation report.
</TABLE>
ENVIRONMENTAL PLASMA ARC TECHNOLOGY, INC.
(Formerly know as Bio-Helix, Inc. and Concept Gold, Inc.)
(A Developmental Stage Company)
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
From
For the Three Months Inception on
Ended March 31, February 10,
-------------------------- 1986 through
1995 1994 March 31, 1995
------------ ------------ --------------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (Net loss) from operations $ (9,261) $ (56,712) $ (1,945,286)
Adjustments to reconcile net cash
provided by operating activities
Depreciation 301 2,012 11,167
Amortization 110
Loss on disposal of assets 36,831
(Increase) in advances 9,176
(Increase) decrease in inventory (341,128)
Increase (decrease) in accrued expenses (2,847) 378,379
------------ ------------ --------------
Net cash used by operating activities (11,807) (54,700) (1,850,751)
------------ ------------ --------------
CASH FLOW FROM INVESTING ACTIVITIES
Purchase of fixed assets (85,818)
Investments & organizational costs (110)
Cash from sale of assets 1,970
Cash applied from trust 20,000
------------ ------------ --------------
Net cash provided from investing
Activities 20,000 (83,958)
------------ ------------ --------------
CASH FLOWS FROM FINANCING ACTIVITIES
Bank overdraft 112
Payment to stockholder (13,202)
Sale of common stock - net 35,250 876,185
Contribution by stockholders 955,710
Cash received from debt financing 5,040 25,155 355,384
Cash paid on debt financing (25,817) (239,360)
------------ ------------ --------------
Net cash provided from financing
Activities 5,040 34,700 1,934,717
------------ ------------ --------------
Net increase (decrease) in cash (6,767)
Cash at beginning of period $ 6,775
------------ ------------ --------------
Cash at ending of period $ 8 $ $ 8
============ ============= ==============
Supplemental cash flows:
Cash paid for:
Interest $ $ 4,183 $
Income taxes $ $ $
Noncash financing activities:
Issuance of stock for relief of debt $ $ $ 40,840
Capital contributions by shareholders $ $ $ 598,565
The accompanying notes are an integral part of these financial statements.
See accountants s compilation report.
</TABLE>
ENVIRONMENTAL PLASMA ARC TECHNOLOGY, INC.
(Formerly known as Bio-Helix, Inc. and Concept Gold, Inc.)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
March 31, 1995
NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization
- ------------
The Company was incorporated as Bio-Helix, Inc. under the laws of the State of
Nevada on February 10, 1986 for the purpose of searching out and acquiring or
participating in a business or business opportunity. On July 13, 1990, the
name was changed to Concept Gold Inc., and on September 30, 1992, the
shareholders voted to change the name to Environmental Plasma Arc Technology,
Inc. At such time the Company resolved to issue stock for an agreement between
Nu Arc Scientific, Inc., Edward Taylor and Carole Taylor, which would give the
Company exclusive marketing rights of patented air purification systems for
internal combustion systems. The Company is currently in the beginning stages
of marketing these purification systems, and no significant revenues have been
realized from the sale of the units.
Consolidation
- -------------
The consolidated financial statements are those of Environmental Plasma Arc
Technologies, Inc. and its wholly owned subsidiary EPAT Marketing Corporation.
All Intercompany accounts have been eliminated in the consolidation.
Work in Process Inventory
- -------------------------
Work in process inventories are stated at the lower of cost or market and
consist of the following:
March 31, 1995
--------------
Materials $ 277,915
Labor 63,213
--------------
$ 341,128
==============
These costs have been incurred in the manufacturing process of an air
purification system. At December 31, 1993, the estimated market value was
assessed and inventory was decreased through a valuation expense account in
the amount of $32,467.
Deferred Offering Costs
- -----------------------
Deferred offering costs were deducted from additional paid- capital when the
offering was completed.
ENVIRONMENTAL PLASMA ARC TECHNOLOGY, INC.
(Formerly known as Bio-Helix, Inc. and Concept Gold, Inc.)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
March 31, 1995
NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Organization Costs
- ------------------
The Company will amortize its organization costs, which reflect amounts
expended to organize the Company, over sixty months on the straight-line
method.
Cash
- -----
The Company considers all highly liquid debt instruments purchased with a
maturity of three months or less to be cash equivalents for purposes of the
statement of cash flows.
Earnings Per Share
- ------------------
The computation of earnings per share of common stock is based on the weighted
average number of shares outstanding during the period.
Income Taxes
- ------------
No federal income taxes have been accrued due to net operating loses in each
year presented. The Company has net operating loss carryovers of approximately
$1,936,000 which begins to expire in 2007.
Effective January 1, 1993, the Company adopted "Statement of Financial
Accounting Standard No. 109" accounting for income taxes. No cumulative effect
of the change in accounting for income taxes for prior years was necessary and
no tax benefit has been reported in the 1993 financial statements for the net
operating loss carryforward because of the uncertainty that future income will
be generated to offset the losses. The valuation allowance of the loss
carryforwards offset any potential tax benefit.
NOTE 2 COMMITMENTS AND CONTINGENCIES
The Company is included in a lawsuit as a co-defendant with, Nu Arc
Scientific, Inc. Edward Taylor and Carole Taylor are involved in litigation
concerning the marketing and manufacturing rights of the Plasma Arc
Technology, which rights were purchased by the Company. An out of court
settlement of cash and stock totaling $23,750 was negotiated on this case. An
order dismissing the action was subsequently signed on June 29, 1994.
ENVIRONMENTAL PLASMA ARC TECHNOLOGY, INC.
(Formerly known as Bio-Helix, Inc. and Concept Gold, Inc.)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
March 31, 1995
NOTE 2 COMMITMENTS AND CONTINGENCIES (Continued)
The Company is involved as a co-defendant in a law suit with Bank One. Bank
One instituted a suit against the Company and certain affiliates of the
Company seeking to recover certain sums relating to overdrafts in the
Company's bank account. On March 18, 1994, the Company and its affiliates
entered into a settlement agreement with Bank One. The Company was unable to
meet the terms of the settlement agreement, and on September 19, 1994 the
co-defendants took assignments of the bank's claim against the Company and
made full settlement in relationship to Bank One's claims.
NOTE 3 TRANSACTIONS WITH RELATED PARTIES
On February 10, 1986, the Company accepted common stock subscriptions from its
initial three members of the board of directors for an aggregate purchase
price of $5,000 or an average of $0.025 per share.
All of the original shares issued are "restricted" shares and may not be
resold except in compliance with the provisions of Rule 144 promulgated by the
Securities and Exchange Commission.
Except as disclosed above, no officer, director, organizer or affiliate of the
Company presently has any direct or indirect material interest by security
holdings, contracts, options or otherwise in the Company, or any asset
proposed to be acquired by the Company, or in any purchase, the value of which
will be affected by the operations of the Company.
An officer and shareholder of the Company has advanced or paid personally
obligations of the Company in the amount of $44,811. These amounts were
contributed to the Company during 1990 and will not be repaid.
During 1992 the Company paid various expenses of Nu Arc Scientific, Inc. a
related party through common ownership, and a shareholder of the Company. Nu
Arc Scientific, Inc. has agreed to set 5% of their stock aside for the purpose
of selling and using the proceeds to repay the Company. The balance at March
31, 1995 was $ -0-.
ENVIRONMENTAL PLASMA ARC TECHNOLOGY, INC.
(Formerly known as Bio-Helix, Inc. and Concept Gold, Inc.)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
March 31, 1995
NOTE 4 PROPERTY AND EQUIPMENT
Property and equipment consists of the following at March 30:
Automobile $ 2,500
Equipment 1,920
Furniture and fixtures 497
Promotional video 25,597
------
Total 30,514
Less accumulated depreciation 2,324
------
$ 28,190
========
Property and equipment are recorded at cost. Depreciation is provided using
the straight-line method over the estimated useful lives of the related
assets.
NOTE 5 NOTE PAYABLE - SHAREHOLDER
Various shareholders advance funds to the Company on a short term basis as
needed. The balance at March 31, 1995 is a short term notes with a
stockholders for $ 231,613, with interest at 10% annual.
NOTE 6 STOCKHOLDER TRANSACTIONS
On September 25, 1992, stockholders ratified an agreement dated August 10,
1992, to purchase the manufacturing and marketing rights of air purification
systems held by Nu Arc Scientific, Inc., Edward Taylor and Carole Taylor. The
agreement provided that 70% of the total issued and outstanding stock would be
owned by Nu Arc Scientific, Inc. and the Taylors, 10% would go to an investor
group for services, 10% would be issued for a private placement, and 10% would
be held by the shareholders of Concept Gold, Inc.
In November 1992, the Company issued 14,000,000 shares for the marketing
rights to the "Plasma Arc Technology.. The value of the right was recorded at
predecessor cost which was $-0-.
ENVIRONMENTAL PLASMA ARC TECHNOLOGY, INC.
(Formerly known as Bio-Helix, Inc. and Concept Gold, Inc.)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
March 31, 1995
NOTE 6 STOCKHOLDER TRANSACTIONS (Continued)
Also in November of 1992, the Company issued 2,000,000 shares to an investor
group for services performed, and 2,000,000 shares were issued and kept in
treasury for the private placement. 1,806,000 shares were sold for cash of
$455,500 with the remaining 192,000 shares remaining in treasury at December
31, 1992. During 1993 the remaining 192,000 shares in treasury were sold for
cash at $.25 per share.
In June of 1993, the board of directors approved the cancellation of 2,000,000
shares issued to Nu-Arc Scientific, Inc.
In July of 1993, the Company issued 332,000 shares of common stock for cash at
$.50 per share.
As mentioned in Note 3, Nu-Arc Scientific, Inc. sold some of its stock in the
Company to pay liabilities incurred by the Company, with the remainder being
contributed to capital.
During 1993, Edward Taylor and Carole Taylor, major shareholders of the
Company, filed for bankruptcy. Their stock was sold at a sheriff's sale to a
group of investors and certain shareholder of the Company, thus changing the
majority control of the Company. In 1994, some of these shares were used to
settle debts of the Company.
During 1994, the board of directors approved the cancellation of 57,000 shares
issued to Nu-Arc Scientific, Inc.
NOTE 7 GOING CONCERN
The Company's financial statements are prepared using generally accepted
accounting principles applicable to a going concern which contemplates the
realization of assets and liquidation of liabilities in the normal course of
business. However, the company has not yet realized significant revenue from
the sale of the purification systems, and must rely on proceeds from stock
sales to continue operations. The Company plans to continue to market the
systems in order to increase revenues to a level sufficient to support
operations. Without realization of additional adequate financing it would be
unlikely for the Company to pursue and realize its objectives.
ENVIRONMENTAL PLASMA ARC TECHNOLOGY, INC.
(Formerly known as Bio-Helix, Inc. and Concept Gold, Inc.)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
March 31, 1995
NOTE 8 STOCK SETTLEMENTS
During 1994, the Company negotiated stock settlement agreements with several
vendors and creditors of the Company. The board of directors also approved the
settlement of several obligations of Nu-Arc Scientific, Inc. and Edward and
Carole Taylor, with stock of the Company owned by shareholders of the Company.
This was done to alleviate the risk of any future claims being brought against
the Company's right to market the technology purchased from Nu-Arc Scientific,
Inc. and Edward and Carole Taylor.
Approximately $271,553 of accounts payable and accrued expenses recorded on
the books of the Company at December 31, 1993 were satisfied through these
settlement agreements.
NOTE 9 INTANGIBLE ASSETS
In November of 1993, a group of investors and certain shareholders of the
Company acquired the patent rights of the Plasma Arc Technology" (See Note 6).
The group of investors and certain shareholders of the Company contributed the
patent to the Company. The value of the patent was recorded at predecessor
cost, which was $ -0-
EXHIBIT 23
CONSENT OF INDEPENDENT AUDITOR
We consent to the incorporation by reference in Form 10-QSB of
Environmental Plasma Arc Technologies, Inc. of our report for the period ended
March 31, 1995.
SHELLEY & COMPANY, CPA
/s/ Shelley & Company
----------------------
Salt Lake City, Utah
December 21, 1996
