UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1998
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ________________ to _______________
Commission File No. 33-55254-35
ENVIRONMENTAL DEVELOPMENT CORPORATION
(Exact name of Small Business Issuer as specified in its charter)
NEVADA 87-0500742
(State or other jurisdiction of (I.R.S. Employer Identification Number)
incorporation or organization)
R.R. #2, Site 25, Comp. 6
Nelson, B. C., Canada V1L5P5
(Address of principal executive offices) (Zip Code)
Issuer's telephone number, including area code (250) 352-6880
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 Issuer
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. [X] Yes [ ] No
Indicate the number of shares outstanding of each of the Issuer's
classes of common stock, as of the latest practicable date.
Class Outstanding as of March 31, 1998
- ------------------------------------ ---------------------------------
$.001 PAR VALUE CLASS A COMMON STOCK 4,000,000 SHARES
<PAGE>
PART 1 - FINANCIAL INFORMATION
Item 1. Financial Statements.
BASIS OF REPRESENTATION
General
The accompanying unaudited financial statements have been prepared in
accordance with the instructions to Form 10-QSB and, therefore, do not include
all information and footnotes necessary for a complete presentation of financial
position, results of operations, cash flows and stockholders' equity in
conformity with generally accepted accounting principles. In the opinion of
management, all adjustments considered necessary for a fair presentation of the
results of operations and financial position have been included and all such
adjustments are of a normal recurring nature. Operating results for the quarter
ended March 31, 1998, are not necessarily indicative of the results that can be
expected for the year ending December 31, 1998.
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
The Company has had no operational history and has yet to engage in
business of any kind. All risks inherent in new and inexperienced enterprises
are inherent in the Company's business.
The Company was incorporated under the laws of the State of Nevada on
March 14, 1990. The Company's operations up until February of 1998 consisted of
the investigation of potential business ventures which, in the opinion of
management, would provide a source of eventual profit to the Company.
In February of 1998, the Company acquired the following four companies:
(1) Specialty Coatings Ltd., an Alberta, Canada corporation; (2) Mike McCarthy
Construction Ltd., a British Columbia, Canada corporation; (3) B.C. Thermal
Dynamic Coatings, Inc., a British Columbia, Canada corporation; and (4) West
Kootnay Lite-Form Ltd., a British Columbia, Canada corporation. The four
companies were acquired in a stock-for-stock exchange pursuant to Section
368(a)(1)(B) of the Internal Revenue Code.
The Company is still in the organizational stage of development, though
the replacement of existing management has been completed, and, therefore, not
much additional information is presently available. Once the organizational
process has been completed, the Company intends to manufacture roofing products,
oil field tank wraps and supplies, and market a lite-form building process.
Initially, the market for the Company's products will be limited to North
America.
The Company had no financial activity for the quarter ended March 31,
1998.
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
99.1 Financial Statements as of March 31, 1998
27 Financial Data Schedule
(b) Reports on Form 8-K
A Form 8-K was filed on February 20, 1998 announcing a change
in control of the Registrant and the acquisition of the
entities discussed in Item 2.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of
1934, the Issuer has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
ENVIRONMENTAL DEVELOPMENT CORPORATION
Dated: May 22, 1998 /s/ Arnie Gustafson
Arnie Gustafson, President and Director
<PAGE>
SMITH & COMPANY
A PROFESSIONAL CORPORATION OF
CERTIFIED PUBLIC ACCOUNTANTS
MEMBERS OF: 10 WEST 100 SOUTH, SUITE 700
AMERICAN INSTITUTE OF SALT LAKE CITY, UTAH 84101
CERTIFIED PUBLIC ACCOUNTANTS TELEPHONE: (801) 575-8297
UTAH ASSOCIATION OF FACSIMILE: (801) 575-8306
CERTIFIED PUBLIC ACCOUNTANTS E-MAIL: [email protected]
- --------------------------------------------------------------------------------
INDEPENDENT AUDITOR'S REPORT
The Board of Directors and Shareholders
Environmental Development Corporation
The accompanying consolidated balance sheet of Environmental Development
Corporation and subsidiaries as of March 31, 1998, and the related consolidated
statements of operations, and cash flows for the three months ended March 31,
1998 and 1997, and the period from inception to March 31, 1998 were not audited
by us and, accordingly, we do not express an opinion on them.
/s/ Smith & Company
CERTIFIED PUBLIC ACCOUNTANTS
Salt Lake City, Utah
May 21, 1998
F-1
<PAGE>
ENVIRONMENTAL DEVELOPMENT CORPORATION
AND SUBSIDIARIES
(A Development Stage Company)
CONSOLIDATED BALANCE SHEET
(Unaudited)
<TABLE>
<CAPTION>
March 31,
1998
----------------------
ASSETS
CURRENT ASSETS
<S> <C>
Cash in bank $ 0
----------------------
TOTAL CURRENT ASSETS 0
OTHER ASSETS
Organization costs 0
0
----------------------
$ 0
======================
LIABILITIES & EQUITY
CURRENT LIABILITIES
Accounts payable $ 0
----------------------
TOTAL CURRENT LIABILITIES 0
STOCKHOLDERS' EQUITY
Common Stock $.001 par value:
Authorized - 25,000,000 shares
Issued and outstanding
4,000,000 shares 4,000
Additional paid-in capital (3,000)
Deficit accumulated during the
development stage (1,000)
----------------------
TOTAL STOCKHOLDERS' EQUITY 0
----------------------
$ 0
======================
</TABLE>
F-2
<PAGE>
ENVIRONMENTAL DEVELOPMENT CORPORATION
AND SUBSIDIARIES
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
3/14/90
Three Months Ended (Date of
March 31, inception) to
1998 1997 3/31/98
----------------- ----------------- -----------------------
<S> <C> <C> <C>
Net sales $ 0 $ 0 $ 0
Cost of sales 0 0 0
----------------- ----------------- -----------------------
GROSS PROFIT 0 0 0
General and administrative expenses 0 0 1,000
----------------- ----------------- -----------------------
NET LOSS $ 0 $ 0 $ (1,000)
================= ================= =======================
Net income (loss) per weighted
average share $ .00 $ .00
================= =================
Weighted average number of common
shares used to compute net income
(loss) per weighted average share 4,000,000 1,000,000
================= =================
</TABLE>
F-3
<PAGE>
ENVIRONMENTAL DEVELOPMENT CORPORATION
AND SUBSIDIARIES
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
3/14/90
(Date of
Three Months Ended March 31, Inception) to
1998 1997 3/31/98
--------------- --------------- ----------------
OPERATING ACTIVITIES
<S> <C> <C> <C>
Net (loss) $ 0 $ 0 $ (1,000)
Adjustments to reconcile net (loss) to cash used
by operating activities:
Amortization 0 0 50
--------------- --------------- ----------------
NET CASH USED
BY OPERATING ACTIVITIES 0 0 (950)
INVESTING ACTIVITIES
Organization costs 0 0 (50)
--------------- --------------- ----------------
NET CASH PROVIDED (USED)
BY INVESTING ACTIVITIES 0 0 (50)
FINANCING ACTIVITIES
Proceeds from sale of common stock 0 0 1,000
--------------- --------------- ----------------
NET CASH PROVIDED BY
FINANCING ACTIVITIES 0 0 1,000
--------------- --------------- ----------------
INCREASE IN CASH
AND CASH EQUIVALENTS 0 0 0
Cash and cash equivalents at beginning of year 0 0 0
--------------- --------------- ----------------
CASH AND CASH EQUIVALENTS
AT END OF PERIOD $ 0 $ 0 $ 0
=============== =============== ================
</TABLE>
During the quarter ended March 31, 1998, the Company issued 3,000,000 shares of
its common stock to acquire four subsidiaries.
F-4
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted
from Environmental Development Corporation March 31, 1998
financial statements and is qualified in its entirety by
reference to such financial statements.
</LEGEND>
<CIK> 0000894551
<NAME> Environmental Development Corporation
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> MAR-31-1998
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 0
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 4,000
<OTHER-SE> (4,000)
<TOTAL-LIABILITY-AND-EQUITY> 0
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 0
<EPS-PRIMARY> .00
<EPS-DILUTED> .00
</TABLE>
