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 June 30, 2000
Commission File Number 33-3385
EARTH PRODUCTS AND TECHNOLOGIES, INC.
(Exact name of registrant as specified in its charter)
Nevada 87-0430816
(State of incorporation) (I.R.S. Employer
Identification Number)
525 South 300 East
Salt Lake City, Utah 84111
(801) 323-2395
(Address and telephone number of principal executive
officer and principal place of business)
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 [ X ] No [ ]
As of August 1, 2000, Earth Products and Technologies, Inc. had a total
of 26,281,004 shares of common voting stock issued and outstanding.
<PAGE>
TABLE OF CONTENTS
PART I: FINANCIAL INFORMATION
Item 1. Financial Statements..............................................3
Item 2. Management's Discussion and Analysis or Plan of Operations........9
PART II: OTHER INFORMATION
Item 6. Exhibits and Reports Filed on Form 8-K............................10
Signatures.................................................................11
<PAGE>
PART I: FINANCIAL INFORMATION
ITEM 1: FINANCIAL STATEMENTS
Earth Products and Technologies, Inc.
(A Development Stage Company)
Financial Statements
June 30, 2000
<PAGE> 3
Earth Products and Technologies, Inc.
(A Development Stage Company)
Balance Sheets
ASSETS
------
June 30, December 31,
2000 1999
------------- -------------
(Unaudited)
CURRENT ASSETS
Cash $ 549,972 $ 13,168
------------- -------------
TOTAL ASSETS $ 549,972 $ 13,168
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
CURRENT LIABILITIES
Accounts Payable $ - $ 250
------------- -------------
Total Liabilities - 250
------------- -------------
STOCKHOLDERS' EQUITY
Common Stock, $.001 par value; 50,000,000 shares
authorized; 26,281,004 and 26,281,004 shares
issued and outstanding, respectively 26,281 26,281
Additional Paid-In Capital 3,866,126 3,866,126
Retained Earnings (3,342,435) (3,879,489)
------------- -------------
Total Stockholders' Equity 549,972 12,918
------------- -------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 549,972 $ 13,168
============= =============
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Earth Products and Technologies, Inc.
(A Development Stage Company)
Statement of Operations
(Unaudited)
<TABLE>
<CAPTION>
From
Inception on
For the three For the three For the six For the six February 10, 1986
months ended months ended months ended months ended Through
June 30, 2000 June 30, 1999 June 30, 2000 June 30, 1999 June 30, 2000
-------------- -------------- ------------- ------------- --------------
<S> <C> <C> <C> <C> <C>
REVENUES $ - $ - $ - $ - $ 50,000
-------------- -------------- ------------- ------------- --------------
EXPENSES
Selling Expenses - - - - 109,489
Depreciation &
Amortization - - - - 67,187
Research &
Development - - - - 153,773
General &
Administrative 62,760 4,662 62,946 5,299 2,076,847
-------------- -------------- ------------- ------------- --------------
TOTAL EXPENSES 62,760 4,662 62,946 5,299 2,407,296
-------------- -------------- ------------- ------------- --------------
OTHER INCOME(EXPENSE)
Bad Debt - - - - (894,326)
Collection of Bad
Debt Previously
Written Off 600,000 - 600,000 - 600,000
Gain on Disposition
of Debt - - - - 103,284
Interest Expense - - - - (94,008)
Loss on Disposal of
Assets - - - - (525,281)
Discontinued
Operations - - - - (689,191)
Income Taxes - - - - (1,241)
Minority Interest - - - - 89,595
-------------- -------------- ------------- ------------- --------------
Total Other Income
(Expense) 600,000 - 600,000 - (1,411,168)
-------------- -------------- ------------- ------------- --------------
NET INCOME(LOSS) $ 537,240 $ (4,662) $ 537,054 $ (5,299) $ (3,768,464)
============== ============== ============= ============= ==============
WEIGHTED AVERAGE INCOME
(LOSS) PER SHARE $ 0.020 $ (0.000) $ 0.020 $ (0.000)
============== ============== ============= =============
WEIGHTED AVERAGE SHARES
OUTSTANDING 26,281,004 26,281,004 26,281,004 26,281,004
============== ============== ============= =============
</TABLE>
<PAGE> 5
<TABLE>
<CAPTION>
Earth Products and Technologies, Inc.
(A Development Stage Company)
Statement of Cash Flows
(Unaudited)
From
For the six months ended Inception on
June 30 February 10, 1986
--------------------------- Through
2000 1999 June 30, 2000
------------- ------------- --------------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income(Loss) $ 537,054 $ (5,299) $ (3,768,464)
Adjustments to Reconcile Net Income(Loss) to
Net Cash Provided(Used)in Operating Activities:
Bad Debt - - 894,326
Depreciation & Amortization - - 93,309
Loss on Disposal of Assets - - 246,997
Stock Issued for Services - - 256,945
Minority Interest - - (89,595)
Change in Assets and Liabilities(Net of Effects
of Purchase/Spin-Off of EWSI)
(Increase) Decrease in:
Accounts Receivable - - (98,803)
Inventory - - 22,842
Shareholder Advances - - 9,176
Increase (Decrease) in:
Accounts Payable and Accrued Expenses (250) (1,622) 583,580
------------- ------------- --------------
Net Cash Provided(Used) by Operating Activities 536,804 (6,921) (1,849,687)
------------- ------------- --------------
CASH FLOWS FROM INVESTING ACTIVITIES
Cash Acquired(Spin-Off) in Acquisition of EWSI - - 6,241
Payment for Notes Receivable - (4,399) (6,049)
Investment in Inventory - - (381,143)
Payment of Organization Costs - - (110)
Purchase of Fixed Assets - - (121,743)
Cash Advanced to Subsidiary Prior to Acquisition - - (200,000)
Proceeds from Sale of Assets - - 1,970
------------- ------------- --------------
Net Cash Provided(Used) by Investing Activities - (4,399) (700,834)
------------- ------------- --------------
CASH FLOWS FROM FINANCING ACTIVITIES
Contribution by Stockholders - - 996,375
Payment to Stockholders - - (13,202)
Proceeds from Issuance of Stock - 30,000 1,295,685
Proceeds from Debt Financing - - 1,581,384
Principal Payments of Debt Financing - (18,000) (759,749)
------------- ------------- --------------
Net Cash Provided(Used) by Financing Activities - 12,000 3,100,493
------------- ------------- --------------
Increase in Cash 536,804 680 549,972
Cash and Cash Equivalents at Beginning of Period 13,168 2,483 -
------------- ------------- --------------
Cash and Cash Equivalents at End of Period $ 549,972 $ 3,163 $ 549,972
============= ============= ==============
</TABLE>
<PAGE> 6
<TABLE>
<CAPTION>
Earth Products and Technologies, Inc.
(A Development Stage Company)
Statement of Cash Flows
(Unaudited)
<S> <C> <C> <C>
SUPPLEMENTAL CASH FLOW INFORMATION
Cash Paid for:
Interest $ - $ - $ 19,972
============= ============= ==============
Income Taxes $ - $ - $ 502
============= ============= ==============
Non Cash Financing Activities:
Issuance of Stock in Settlement of Debt $ - $ - $ 1,446,858
============= ============= ==============
Capital Contributed by Shareholders $ - $ - $ 639,230
============= ============= ==============
</TABLE>
<PAGE> 7
Earth Products and Technologies, Inc.
Notes to the Financial Statements
June 30, 2000
GENERAL
-------
Earth Products and Technologies, Inc. (the Company) has elected to omit
substantially all footnotes to the financial statements for the six months
ended June 30, 2000 since there have been no material changes (other than
indicated in other footnotes) to the information previously reported by the
Company in their Annual Report filed on the Form 10-KSB for the fiscal year
ended December 31, 1999.
Collection of Bad Debt
----------------------
During the three months ended June 30, 2000, $600,000 was received in a
settlement with EWS Services, Inc. This settlement was for a note which was
written off in a prior year.
UNAUDITED INFORMATION
----------------------
The information furnished herein was taken from the books and records of the
Company without audit. However, such information reflects all adjustments
which are, in the opinion of management, necessary to properly reflect the
results of the interim period presented. The information presented is not
necessarily indicative of the results from operations expected for the full
fiscal year.
<PAGE> 8
In this quarterly report references to "Earth Products," "we," "us," and
"our" refer to Earth Products and Technologies, Inc.
FORWARD LOOKING STATEMENTS
This Form 10-QSB contains certain forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. For this
purpose any statements contained in this Form 10-QSB that are not statements
of historical fact may be deemed to be forward-looking statements. Without
limiting the foregoing, words such as "may," "will," "expect," "believe,"
"anticipate," "estimate" or "continue" or comparable terminology are intended
to identify forward-looking statements. These statements by their nature
involve substantial risks and uncertainties, and actual results may differ
materially depending on a variety of factors, many of which are not within
Earth Products's control. These factors include but are not limited to
economic conditions generally and in the industries in which Earth Products
may participate; competition within Earth Product's chosen industry,
including competition from much larger competitors; technological advances and
failure by Earth Products to successfully develop business relationships.
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS
For the six months ended June 30, 2000, we have had no business
operations and had no full time employees. Since our inception, we have funded
our cash requirements through debt and equity transactions. For the next
twelve months we plan to seek, investigate and, if warranted, acquire one or
more properties or businesses.
As of June 30, 2000, we had $549,972 cash on hand with no liabilities.
The cash on hand is primarily the result of our negotiation and settlement of
the $840,000 debt owed to us by EWS Services, Inc. related to the sale of our
former subsidiary Environmental Water Systems, Inc. EWS Services agreed to
pay $600,000 in settlement of the debt. We had written the note off in prior
years as a bad debt.
We have no material commitments for the next twelve months and
management believes that our current cash needs can be met with the cash on
hand and loans from management or shareholders for at least twelve months.
However, should we obtain a business opportunity, it may be necessary to raise
additional capital. This may be accomplished by selling our common stock or
debt financing. If common stock is issued it will be issued pursuant to
available exemptions provided by federal and state securities laws.
At the present time we have not identified any business opportunity that
we plan to pursue, nor have we reached any agreement or definitive
understanding with any person concerning an acquisition. In addition, there
can be no assurance that we will be successful in finding a desirable business
opportunity. We expect to encounter substantial competition in our efforts to
locate attractive opportunities, primarily from business development
companies, venture capital partnerships and corporations, venture capital
affiliates of large industrial and financial companies, small investments
companies, and wealthy individuals.
Potential investors must recognize that because of our limited capital
available for investigation and management's limited experience in business
analysis, we may not discover or adequately evaluate adverse facts about the
business opportunity to be acquired. Also, we intend to concentrate our
acquisition efforts on properties or businesses that we believe to be
undervalued or that we believe may realize a substantial benefit from being
publicly owned. Investors should expect that any acquisition candidate may
have little or no operating history, or a history of losses or low
profitability.
It is emphasized that our management may effect transactions having a
potentially adverse impact upon our shareholders pursuant to the authority and
discretion of our management to complete acquisitions without submitting any
proposal to the stockholders for their consideration.
<PAGE> 9
PART II. OTHER INFORMATION
ITEM 6: EXHIBITS AND REPORTS ON FORM 8-K
(a) Part I Exhibits.
Exhibit Description
------- -----------
27 Financial Data Schedule
(b) Reports on Form 8-K.
None
<PAGE> 10
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report be signed on its behalf by the undersigned, who are duly
authorized.
8/1/00
DATE ______________
EARTH PRODUCTS AND TECHNOLOGIES, INC.
/s/ John W. Peters
By:_______________________________________________
John W. Peters, President and Director
/s/ Anita Patterson
By ________________________________________________
Anita Patterson, Secretary/Treasurer, Director
