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, 1998
Commission File Number 33-3385
EARTH PRODUCTS AND TECHNOLOGIES, INC.
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(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)
215 South State Street, Suite 1100, Salt Lake City, Utah 84111
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(Address of principal executive offices)
(Zip Code)
(801) 323-2394
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(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 [ XX ] No [ ]
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, 1998, the Issuer had issued and outstanding an aggregate
of 7,287,004 common voting shares, par value $0.001.
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1 FINANCIAL STATEMENTS
The unaudited financial statements of Earth Products and
Technologies, Inc. ("the Company") for the quarter ended March 31, 1998 are
attached hereto and incorporated by reference.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
During the first quarter of 1998, the Company has continued to
explore options for future capitalization of the Company's growth, including
investment banking relationships, additional offerings or private placements
and loans. The subsidiaries of the Company, Environmental Water Systems, Inc.
("EWS") and EPAT, Inc. ("EPAT") have continued their marketing strategies.
Specifically, EWS continues to research, develop and market its patented and
proprietary industrial waste water treatment system, and EPAT continues to
research and develop the EPAT Technology, an electro-mechanical system
designed to reduce air pollutants. However, both EWS and EPAT did not realize
any revenues during the first quarter of 1998.
The Company posted $83,473 in revenues for the year ending December
31, 1997 primarily as a result of the operations of EWS, but the Company
experienced a net operating loss of $513,883 for that year. During the first
quarter of 1998, the Company posted no revenues, but showed a $2,552 net
income due to a gain realized by disposition of debt. In comparison to the
same quarter in 1997, the Company had no revenues from operations and showed a
net operating loss of $12,965.
The United States government and other governments throughout the
world continue to enact environmental laws with stricter emissions standards.
There are many different systems being developed to satisfy the needs of
industry. The technologies owned by the Company's subsidiaries may provide a
means for industry to meet the tougher air and water emissions standards.
However, the subsidiaries of the Company face substantial competition from
conventional environmental control methods and must compete with other
companies with greater research and manufacturing resources.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
As of March 31, 1998, 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 ending December 31, 1997, which discussion, pursuant to Rule
12b-23, is incorporated herein by this reference. There have been no material
developments in any legal proceedings reported in the Form 10-KSB for the year
ended December 31, 1997, 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
The Company has not issued or sold any unregistered securities
during the quarter ending March 31, 1998.
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) Pursuant to Rule 12b-23, the following exhibits are herewith
incorporated by reference.
Exhibit # Description
- --------- -------------
27 Financial Data Schedule
(b) No Reports on 8-K were filed during the quarter ended March
31, 1998.
SIGNATURES
In accordance with Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
Dated this 1st day of May, 1998
EARTH PRODUCTS AND TECHNOLOGIES, INC.
By: /s/ John W. Peters
-----------------------------
John W. Peters, President
<PAGE>
Earth Products and Technologies, Inc.
(A Development Stage Company)
Consolidated Financial Statements
March 31, 1998
(Unaudited)
<PAGE>
Earth Products and Technologies, Inc.
(A Development Stage Company)
Unaudited Consolidated Balance Sheets
March 31, 1998
ASSETS
------
CURRENT ASSETS:
Cash $ 2,031
Accounts receivable 23,861
Loans receivable 195,000
Inventory 49,755
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Total Current Assets 270,647
-------------
PROPERTY AND EQUIPMENT 186,621
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OTHER ASSETS:
Work in process inventory 381,143
Goodwill 106,686
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Total Other Assets 487,829
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TOTAL ASSETS $ 945,097
=============
LIABILITIES AND STOCKHOLDERS (DEFICIT)
--------------------------------------
CURRENT LIABILITIES:
Accounts payable $ 163,348
Accrued expenses 15,717
Payroll taxes payable 121,229
Note payable - current portion 7,684
Notes payable shareholders 473,500
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Total Current Liabilities 781,478
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LONG-TERM DEBT
Notes payable 30,359
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STOCKHOLDERS' EQUITY:
Common stock, $0.001 par value;
50,000,000 shares authorized, 7,287,004
shares issued and outstanding 7,287
Additional paid-in capital 2,824,319
Deficit accumulated during the
development stage (2,698,347)
-------------
Total Stockholder's Equity 133,259
-------------
TOTAL LIABILITIES AND
STOCKHOLDERS EQUITY $ 945,097
=============
The accompanying notes are an integral part of these consolidated
financial statements.
<PAGE>
Earth Products and Technologies, Inc.
(A Development Stage Company)
Unaudited Consolidated Statements of Operations
For the Three Months Ended March 31, 1998
REVENUE $ -0-
COST OF GOOD SOLD 1,898
-------------
Gross Profit (1,898)
EXPENSES
General and administrative 8,797
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Total Expenses 8,797
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OPERATING LOSS (10,695)
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OTHER INCOME (EXPENSE)
Gain on disposition of debt 13,543
Interest (296)
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Total Other Income (Expense) 13,247
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NET INCOME $ 2,552
=============
WEIGHTED AVERAGE INCOME
PER SHARE ( 0.00)
=============
The accompanying notes are an integral part of these consolidated
financial statements.
<PAGE>
Earth Products and Technologies, Inc.
(A Developmental Stage Company)
Notes to the Consolidated Financial Statements
Unaudited
March 31, 1998
NOTE 1 - Basis of Financial Statements
The financial statements at march 31, 1998 are prepared from the records
of the companies without audit or other review by and independent accountant.
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<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> MAR-31-1998
<CASH> 2,031
<SECURITIES> 0
<RECEIVABLES> 23,861
<ALLOWANCES> 0
<INVENTORY> 49,755
<CURRENT-ASSETS> 270,647
<PP&E> 256,443
<DEPRECIATION> 69,822
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<CURRENT-LIABILITIES> 781,478
<BONDS> 0
0
0
<COMMON> 7,287
<OTHER-SE> 125,972
<TOTAL-LIABILITY-AND-EQUITY> 945,097
<SALES> 0
<TOTAL-REVENUES> 13,543
<CGS> 1,898
<TOTAL-COSTS> 8,797
<OTHER-EXPENSES> 0
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<INTEREST-EXPENSE> 296
<INCOME-PRETAX> 2,552
<INCOME-TAX> 0
<INCOME-CONTINUING> 2,552
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,552
<EPS-PRIMARY> 0.00
<EPS-DILUTED> 0.00
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