China Education Technology (EVSF) 10-Q 2008 Q2 Quarterly report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES ACT OF 1934:

For the Quarterly Period ended June 30, 2008

[  ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE EXCHANGE ACT

For the transition period from __________________ to __________________

Commission File Number: 0-52407

ENVIROSAFE CORPORATION

(Exact name of registrant as specified in its charter)

Delaware	94-3251254
(State or other jurisdiction of	(IRS Employer Identification No.)
incorporation or organization)

8/F, Tower B, National Software Industry Zone,

Gao Tang Xin Jian Zone, Tian He District

Guangzhou, P.R.China  510663

(Address of principal executive offices)

(8620) 6108-8998 - Tel

(8620) 6108-8999 - Fax

(Issuer's telephone number)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act 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 [  ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.

Large accelerated filer [ ]                                                                           Accelerated filer   [ ]

Non-accelerated filer  [ ]                                                                           Smaller Reporting Company [X]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [  ] No [X]

As of the close of business on August 13, 2008, 22,141,375 shares of our common stock, par value $.0001 per share, were outstanding.

As of the close of business on August 13, 2008, 1,350,000 shares of our preferred stock, par value $.0001 per share, were outstanding.

Copies to:

Jared P. Febbroriello, Esq. LL.M. - Principal

JPF Securities Law, LLC

19720 Jetton Road, 3rd Floor

Cornelius, NC 28031

Phone: (704) 897-8334

Fax: (888) 608-5705

CAUTIONARY STATEMENT REGARDING FORWARD LOOKING INFORMATION

The discussion contained in this Form 10-Q under the Securities Exchange Act of 1934, as amended, contains forward-looking statements that involve risks and uncertainties. The issuer's actual results could differ significantly from those discussed herein. These include statements about our expectations, beliefs, intentions or strategies for the future, which we indicate by words or phrases such as "anticipate," "expect," "intend," "plan," "will," "we believe," "the Company believes," "management believes" and similar language, including those set forth in the discussions under "Notes to Financial Statements" and "Management's Discussion and Analysis or Plan of Operation" as well as those discussed elsewhere in this Form 10-Q. We base our forward-looking statements on information currently available to us, and we assume no obligation to update them. Statements contained in this Form 10-Q that are not historical facts are forward-looking statements that are subject to the "safe harbor" created by the Private Securities Litigation Reform Act of 1995.

1

TABLE OF CONTENTS

PART I  FINANCIAL INFORMATION
Item 1.  Financial Statements.	3
• Balance Sheet	3
• Statements of Operations	4
• Statements of Cash Flows	5
• Condensed Notes to Financial Statements	6
1. Organization and Basis for Presentation	6
2. Summary of Significant Accounting Policies	6
3. Earnings (Loss) Per Common Share	6
4. Income Taxes	6
Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations	19
• Overview	19
• Overall Operating Results	19
• Financial Position and Liquidity	19
• Going Concern	19
Item 3.  Controls and Procedures	19
Forward-Looking Statements	19
PART II  OTHER INFORMATION
Item 1. Legal Proceedings	20
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	20
Item 3. Defaults Upon Senior Securities	20
Item 4. Submission of Matters to a Vote of Security Holder	20
Item 5. Other Information	20
Item 6. Exhibits and Reports on Form 8-K	20
SIGNATURES	21

2

Item 1.  Financial Statements.

ENVIROSAFE CORPORATION
Unaudited Condensed Balance Sheets
As of June 30, 2008 and December 31, 2007
Assets				June 30, 2008	December 31, 2007
Current assets:
	Cash and cash equivalents		$	-	-
		Total current assets		-	-
		Total assets	$	-	-
Liabilities and Shareholders’ Deficit
Current liabilities:
	Accounts payable and accrued expenses		$	2,315	10,000
		Total current liabilities		2,315	10,000
Commitments and contingencies (note 8)
Shareholders’ deficit:
	Common stock, $0.0001 par, 500,000,000 shares authorized
	2,141,375 shares issued and outstanding			214	214
	Preferred stock, $0.0001 par, 10,000,000 shares authorized
	no shares issued and outstanding			-	-
	Additional paid in capital			2,322,230	2,312,230
	Retained deficit			(2,324,759)	(2,322,444)
		Total shareholders' deficit		(2,315)	(10,000)
		Total liabilities and shareholders’ deficit	$	0	0
See acompanying notes to financial statements.

3

ENVIROSAFE CORPORATION
Unaudited Condensed Statements of Operations
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2008 AND 2007
	For the Three Months						For the Six Months
	Ended June 30,						Ended June 30,
	2008			2007			2008			2007
REVENUES
Sales	$	-		$	-		$	-		$	-
Cost of sales		-			-			-			-
GROSS PROFIT		-			-			-			-
OPERATING EXPENSES
General and administrative expenses		2,100			-			2,100			62
Professional fees		215			153,000			215			303,544
TOTAL OPERATING EXPENSES		2,315			153,000			2,315			303,606
OPERATING (LOSS)		(2,315	)		(153,000	)		(2,315	)		(303,606	)
OTHER INCOME (EXPENSE)
Interest expense		-			-			-			-
NET (LOSS) BEFORE TAXES		(2,315	)		(153,000	)		(2,315	)		(303,606	)
NET (LOSS)		(2,315	)	$	(153,000	)		(2,315	)	$	(303,606	)
NET LOSS PER COMMON SHARE
Basic and fully diluted		**		$	(0.13	)		**		$	(0.27	)
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING		2,141,375			1,196,806			2,141,375			1,145,139
** Less than $.01
The accompanying notes are an integral part of these financial statements.

4

ENVIROSAFE CORPORATION
Unaudited Condensed Statements of Cash Flows
FOR THE SIX MONTHS ENDED JUNE 30, 2008 AND 2007
	For the Six Months
	Ended June 30,
	2008			2007
Cash flows from operating activities:
Net (loss)	$	(2,315	)	$	(303,606	)
Adjustments to reconcile net loss to net cash (used in)
operating activities:
Issuance of common stock for services rendered		-			300,544
Changes in operating assets and liabilities:
Accounts payable and accrued expenses		(7,685	)		(5,868	)
Net cash (used in) operating activities		(10,000	)		(8,930	)
Cash flows from financing activities:
Addition in paid-in capital	$	10,000		$	-
Net cash provided by financing activities		10,000			-
Net increase (decrease) in cash and cash equivalents		-			(8,930	)
Cash and cash equivalents at beginning of period		-			8,951
Cash and cash equivalents at end of period	$	-		$	21
Supplemental disclosure of non-cash information:
Common stock issued for services		-			300,544
See accompanying notes to financial statements.

5

ENVIROSAFE CORPORATION

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

For the Three and Six Months Ended June 30, 2008 and 2007

1.Basis of Presentation

The accompanying unaudited condensed financial statements have been prepared in accordance with both generally accepted accounting principles for interim financial information, and the instructions to Form 10-Q and Item 310(b) of Regulation S-B. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. The accompanying unaudited condensed financial statements reflect all adjustments (consisting of normal recurring accruals) that are, in the opinion of management, considered necessary for a fair presentation of the results for the interim periods presented. Interim results are not necessarily indicative of results for a full year.

The unaudited condensed financial statements and related disclosures have been prepared with the presumption that users of the interim financial information have read or have access to our annual audited financial statements for the preceding fiscal year. Accordingly, these unaudited condensed financial statements should be read in conjunction with the financial statements and the related notes thereto contained in the Annual Report on Form 10-KSB for the year ended December 31, 2007.

2.Organization and Business Background

We were incorporated in the state of Delaware in 1996. We were formed to produce a comprehensive suite of disinfecting, cleaning, and bioremediation products for the consumer, commercial, institutional and municipal markets. We were not successful in developing this business model and had very limited revenues.

In 2007, former management resigned and was replaced by a new board and new officers and directors. Recognizing the need to increase shareholder  value,  the  new  Board was determined that the only way to enhance shareholder  value  was  to  seek  potential  business opportunities and effect a business  combination  with  a target business with significant growth potential which,  in  the  opinion  of  our management, could provide a profit to both the Company and our shareholders.

As of March 4, 2008, we executed a Plan of Exchange (the "Agreement"), between and among us ("EVSF"), ADDE EDUCATION HLDS LTD., a corporation organized and existing under the laws ofHong Kong Special Administrative Region of People’s Republic of China("ADDE"), the shareholders of ADDE (the "ADDE Shareholders") and our majority shareholder (the "EVSF Shareholders").

Pursuant to the terms of the Agreement, the transaction will not immediately close but shall be conditioned upon: (1) EVSF shall eliminate all know or potential liabilities of EVSF as of the closing date. This shall include, but is not limited to, any accounts payable, accrued expenses, as well as any liabilities shown on its annual report for the fiscal year of 2007 in FORM 10-KSB filed with the Securities and Exchange Commission prior to the closing; (2) EVSF  and EVSF shareholders shall pledge that any expenses concerning any known or unknown lawsuits, legal disputes or any correlation expenses caused by original EVSF Corporation and their shareholders, EVSF shall undertake full responsibility and afford the correlation expenses after the closing. A comfort letter referencing  EVSF prepared by a third party law firm confirming that to the best of their knowledge after reasonable due diligence, EVSF has no pending or threatened litigation; (3) a deposit of 632,253 shares of common stock of EVSF into the escrow account of Greentree Financial Group, Inc. ("Escrow Agent") in exchange for the cash payment of $260,000 and $260,000 promissory note made by ADDE Shareholders to Guoqiang Zhan ("Mr. Zhan"), the new president of EVSF, which shall also be simultaneously deposited into the escrow account of escrow agent, (4) the issuance of 20,000,000 new shares of common stock and 1,350,000 new shares of preferred stock of EVSF to the ADDE shareholders, which should take no longer than 60 days, (5) the resignation of Mr. Zhan from the board of directors and as officer of EVSF and appointment of his successor(s) as designated by ADDE and/or the ADDE Shareholders, (6) a pledge of 10,000,000 shares of EVSF common stock to be used as collateral on the above mentioned promissory note, (7) a fully executed guarantee of the promissory note from EVSF in favor of Mr. Zhan. Upon completion of the exchange, ADDE will be our 100% owned subsidiary.

Upon the delivery of 20,632,253 shares of common stock (including 632,253 common shares from the EVSF Shareholders), and 1,350,000 new shares of our preferred stock, to ADDE Shareholders, ADDE Shareholders will hold a 'controlling interest' in us representing approximately 93.2% of the then issued and outstanding our common shares. Furthermore, the designees of ADDE will be appointed to the Board of Directors after the closing. Subsequent to the appointment of ADDE designees, our current management will resign from the Board of Directors.

We have agreed to use our best efforts to insure the escrow conditions under the escrow agreement will be satisfied as promptly as practicable so that the closing conditions under the agreement will occur. The closing did not occur until the third quarter of 2008, which was announced in an additional current report on Form 8-K, as amended, dated August 13, 2008. The detailed business description and audited financials of ADDE and its subsidiary were also included in the Form 8-K/A as required by the federal securities laws.

Accordingly, the unaudited condensed consolidated financial statements as of June 30, 2008 are disclosed in note 7 as pro forma financial information.

3.Summary of Significant Accounting Policies

Cash and Cash Equivalents

We consider all highly liquid debt instruments and other short-term investments with an initial maturity of three months or less to be cash or cash equivalents.

We may in the future maintain cash and cash equivalents with a financial institution that exceeds the limit of insurability under the Federal Deposit Insurance Corporation. Management’s evaluation of the financial strength of its financial institution, we believe the risk of maintaining deposits in excess of federal deposit limits at its financial institution is limited and does not pose a material risk.

Revenue Recognition

We record our transactions under the accrual method of accounting whereby income is recognized when the services are performed.

Income Taxes

We adopted the provisions of Statement of Financial Accounting Standards (“SFAS”) No. 109, Accounting for Income Taxes. The Statement requires an asset and liability approach for financial accounting and reporting of income taxes, and the recognition of deferred tax assets and liabilities for the temporary differences between the financial reporting bases and tax bases of our assets and liabilities at enacted tax rates expected to be in effect when such amounts are realized or settled.

6

ENVIROSAFE CORPORATION

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

For the Three and Six Months Ended June 30, 2008 and 2007

Use of Estimates

The preparation of financial statements in conformity with the accounting principles generally accepted in the Untied States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Fair Value of Financial Instruments

The carrying amounts reported in the balance sheets for cash and cash equivalents, and accounts payable approximate fair value because of the immediate or short-term maturity of these financial instruments. No other new accounting pronouncement issued or effective has had or is expected to have a material impact on the company’s financial statements.

Stock-Based Compensation

We measure compensation expense for our non-employee stock-based compensation under the Financial Accounting Standards Board (FASB) Emerging Issues Task Force (EITF) Issue No. 96-18, “Accounting for Equity Instruments that are Issued to Other Than Employees for Acquiring, or in Conjunction with Selling, Goods or Services ”. The fair value of the option issued is used to measure the transaction, as this is more reliable than the fair value of the services received. The fair value is measured at the value of our common stock on the date that the commitment for performance by the counterparty has been reached or the counterparty’s performance is complete. The fair value of the equity instrument is charged directly to compensation expense and additional paid-in capital.

Common Stock Issued For Other Than Cash

Services purchased and other transactions settled in our stock are recorded at the estimated fair value of the stock issued if that value is more readily determinable than the fair value of the consideration received.

Recent Accounting Pronouncements

In March 2008, the FASB issued SFAS No. 161, “Disclosures about Derivative Instruments and Hedging Activities, an amendment of FASB Statement No. 133” (“SFAS 161”). This new standard requires enhanced disclosures for derivative instruments, including those used in hedging activities. It is effective for fiscal years and interim periods beginning after November 15, 2008, and will be applicable to us in the first quarter of fiscal 2009. We are currently evaluating the impact this statement and we do not anticipate that it will have an impact on our financial position and results of operations.

4.     Income Taxes

Effective July 14, 2000, we adopted the provisions of Statement of Financial Accounting Standards (SFAS) No. 109, “Accounting for Income Taxes”. The statement requires an asset and liability approach for financial accounting and reporting for income taxes, and the recognition of deferred tax assets and liabilities for the temporary differences between the financial reporting basis and tax basis of the Company’s assets and liabilities at enacted tax rates expected to be in effect when such amounts are realized or settled. Because of its history of losses, we have not had any material federal or state income tax obligations. Due to the anticipated use of net operating loss carryforwards to offset future year income, no provision for income taxes was recorded for the six-month period ended June 30, 2008. The Company’s net operating loss carryforwards totaled ($2,324,759) at June 30, 2008, expiring through June 30, 2028. When there has been a change in an entity’s ownership, utilization of net operating loss carryforwards may be limited. Because of the changes in the ownership of our prior acquisitions, the use of these acquired net operating losses will be limited and may not be available to offset future taxable income.

There were no provisions for income taxes for the six-month period ended June 30, 2008.

At June 30, 2008, deferred tax assets approximated the following:

Deferred tax assets	$	970,000
Valuation for deferred asset		(970,000	)
Net deferred tax assets	$	—

At June 30, 2008, we had accumulated deficits approximating $2,324,000, available to offset future taxable income through 2028. We established valuation allowances equal to the full amount of the deferred tax assets due to the uncertainty of the utilization of the operating losses in the future period.

7

ENVIROSAFE CORPORATION

NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS

For the Three and Six Months Ended June 30, 2008 and 2007

5.     Capital Transactions

On April 23, 2007, we performed a one-for-three-hundred (1:300) reverse stock split of our outstanding shares of common stock. The number of our outstanding shares of common stock at that date was reduced from 342,375,000 to 1,141,375 shares and the par value of our common stock was unchanged at $0.0001. The financial statements amounts and shares herein have been retroactively adjusted thereto for the reverse split.

6.     Going Concern

Our financial statements have been prepared on the basis that we will continue as a going concern, which contemplates the realization of asset values and the satisfaction of liabilities in the normal course of business. Certain conditions indicate that we may be unable to continue as a going concern:

· We reported net losses of $2,315 and $303,606, respectively for the six months ended June 30, 2008 and 2007.  

· At June 30, 2008, stockholder's deficit was ($2,315) and included an accumulated deficit of ($2,324,759).

· At June 30, 2008 there was a working capital deficit of $2,315.  

· We have limited revenue prospects and have had no revenue in the past two years.

· Our ability to continue as a going concern is dependent upon our generating revenues and profit margins to cover cost of revenues and other operating expenses, generating positive cash flows from operations, obtaining debt or equity capital to fund expected negative operating cash flows and returning to profitable operations.  

· We may be forced to liquidate our assets and cease operations if we are unable to raise sufficient capital to support operations and to satisfy its obligations.

In connection with these issues, we are implementing the following operating and management plans to in order to provide positive cash flow from operations during the subsequent periods:

· Develop our primary business products and develop a customer base and production facilities and capacity to manufacture products.  

· Develop strategic partnerships with major companies to support our sales and marketing strategy, and production and manufacturing capacity.

· Negotiate with capital and debt funding sources to provide working capital to fund the growth and operations.

8

7.     Unaudited Pro Forma Condensed Consolidated Financial Statements

ENVIROSAFE CORP.

Unaudited Pro Forma Condensed Consolidated Financial Statements

For the six months ended June 30, 2008 and 2007

Index to Unaudited Pro Forma Condensed Consolidated Financial Statements

	Pages
Introduction to Unaudited Pro Forma Condensed Consolidated Financial Statements	10
Unaudited Pro Forma Condensed Consolidated Balance Sheet	11
Unaudited Pro Forma Condensed Consolidated Statement of Operations	12
Unaudited Pro Forma Condensed Consolidated Statements of Cash Flows	13
Notes to Unaudited Pro Forma Condensed Consolidated Financial Statements	14

9

ENVIROSAFE CORP.

Introduction to Unaudited Pro Forma Condensed Consolidated Financial Statements

The following unaudited pro forma condensed consolidated financial statements are presented to illustrate the estimated effects of the acquisition of ADDE Education Hldgs Limited (“ADDE”) and Guangzhou Hao Yu Educational Technology Company Limited (“Hao Yu”) by Envirosafe Corp. (“EVSF”) (the “Transaction”) on the historical financial position and results of operations of EVSF.

The unaudited pro forma balance sheet as of June 30, 2008 is based on the unaudited balance sheets of EVSF, ADDE and Haoyu as of June 30, 2008.

The unaudited pro forma statement of operations for the six months ended June 30, 2008 is based on the unaudited statements of operations of EVSF for the six months ended June 30, 2008, of ADDE for the period from February 12, 2008 (date of inception) to June 30, 2008 and of Haoyu for the six months ended June 30, 2008.  The unaudited pro forma statement of operations for the six months ended June 30, 2007 is based on the unaudited statements of operations of EVSF for the six months ended June 30, 2007, and of Haoyu for the six months ended June 30, 2007. As ADDE was incorporated on February 12, 2008, the financial data of the statement of operations of ADDE for the six months ended June 30, 2007 were reported nil.

The unaudited pro forma statement of cash flow for the six months ended June 30, 2008 is based on the unaudited statements of cash flow of EVSF for the six months ended June 30, 2008, of ADDE for the period from February 12, 2008 (date of inception) to June 30, 2008 and of Haoyu for the six months ended June 30, 2008.  The unaudited pro forma statement of cash flow for the six months ended June 30, 2007 is based on the unaudited statements of cash flow of EVSF for the six months ended June 30, 2007, and of Haoyu for the six months ended June 30, 2007. As ADDE was incorporated on February 12, 2008, the financial data of the statement of cash flow of ADDE for the six months ended June 30, 2007 were reported nil.

The unaudited pro forma condensed consolidated statements of operations for the six months ended June 30, 2008 and 2007, and the unaudited pro forma condensed consolidated statements of cash flow for the six months ended June 30, 2008 and 2007 assume that the Transaction was consummated on January 1, 2007. The unaudited pro forma condensed consolidated balance sheet as of June 30, 2008 assumes the Transaction was consummated on that date. The Transaction was actually consummated on July 31, 2008.

The information presented in the unaudited pro forma condensed consolidated financial statements are presented for informational purposes only and does not purport to represent what the financial position or results of operations of EVSF would have been had the Transaction occurred as of the dates indicated, nor is it indicative of the future financial position or results of operations for any period of EVSF.

The pro forma adjustments are based upon available information and certain assumptions that the management of EVSF believes are reasonable under the circumstances.

These unaudited pro forma condensed consolidated financial statements should be read in conjunction with the accompanying notes and assumptions and the historical financial statements and related notes of EVSF, ADDE and Haoyu.

10

ENVIROSAFE CORP.

Unaudited Pro Forma Condensed Consolidated Balance Sheet

As of June 30, 2008

(Stated in US Dollars)

	EVSF			ADDE
	As of			As of						Pro forma
	June 30,			June 30,		Pro forma				consolidated
	2008			2008		adjustment				total
ASSETS
Current assets:
Cash and cash equivalents	$	-		$	150,624					$	150,624
Trade receivables (net of allowance for doubtful accounts of $31,142)		-			1,011,102						1,011,102
Other receivables and prepayments		-			302,376						302,376
Inventories		-			386,315						386,315
Total current assets		-			1,850,417						1,850,417
Property, plant and equipment, net		-			72,795						72,795
Total assets	$	-		$	1,923,212					$	1,923,212
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Trade payables	$	-		$	22,661					$	22,661
Other payables and accrued expenses		2,315			148,653						150,968
Amount due to a director		-			72,411						72,411
Secured bank loan					436,567						436,567
Income tax payable		-			228,474						228,474
Total current liabilities		2,315			908,766						911,081
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS’ (DEFICIT) EQUITY
Preferred stock, $.0001 par, 10,000,000 shares authorized, no shares issued and outstanding at June 30, 2008 and 1,350,000 subsequent to		-			-		135		Note 3(b)		135
Common stock, $.0001 par, 500,000,000 shares authorized, 2,141,375 shares issued and outstanding at June 30, 2008 and 22,141,375 subsequent to		214			1,351		649		Note 3(b)		2,214
Additional paid-in capital		2,322,230			117,702		(2,325,543	)	Note 3(a), 3(b)		114,389
Statutory and other reserves		-			50,803						50,803
Accumulated other comprehensive income		-			84,201						84,201
(Accumulated deficit) retained earnings		(2,324,759	)		760,389		2,324,759		Note 3(a)		760,389
Total stockholders’ (deficit) equity		(2,315	)		1,014,446						1,012,131
Total liabilities and stockholders’ (deficit) equity	$	-		$	1,923,212					$	1,923,212

11

ENVIROSAFE CORP.
Unaudited Pro Forma Condensed Consolidated Statements of Operations
For the six months ended June 30, 2008 and 2007
(Stated in US Dollars)
	EVSF			ADDE			Pro forma			EVSF			ADDE			Pro forma
	Six months ended			Six months ended			consolidated			Six months ended			Six months ended			consolidated
	June 30, 2008			June 30, 2008			total			June 30, 2007			June 30, 2007			total
Sales	$	-		$	1,881,201		$	1,881,201		$	-		$	314,573		$	314,573
Cost of sales		-			938,715			938,715			-			222,615			222,615
Gross profit		-			942,486			942,486			-			91,958			91,958
Operating expenses
General and administrative expenses		2,100			110,062			112,162			62			56,946			57,008
Research and development expenses		215			62,431			62,646			303,544			67,179			370,723
Selling expenses		-			35,462			35,462			-			76,868			76,868
Total operating expenses		2,315			207,955			210,270			303,606			200,993			504,599
Net operating income (loss)		(2,315	)		734,531			732,216			(303,606	)		(109,035	)		(412,641	)
Other income (expenses)
Subsidy income from the PRC authorities
for general operations		-			164,789			164,789			-			27,841			27,841
Interest income		-			209			209			-			109			109
Other income		-			18,438			18,438			-			-			-
Financial cost		-			(14,177	)		(14,177	)		-			-			-
Total other income		-			169,259			169,259			-			27,950			27,950
Income (loss) before income taxes		(2,315	)		903,790			901,475			(303,606	)		(81,085	)		(384,691	)
Income taxes		-			221,079			221,079			-			9,111			9,111
Net income (loss)	$	(2,315	)	$	682,711		$	680,396		$	(303,606	)	$	(90,196	)	$	(393,802	)
Other comprehensive income
Foreign currency translation adjustments		-			38,909			38,909			-			8,517			8,517
Total comprehensive income (loss)	$	(2,315	)	$	721,620		$	719,305		$	(303,606	)	$	(81,679	)	$	(385,285	)
Pro forma income (loss) per share		**		$	68.27		$	0.34		$	(0.27	)	$	(9.02	)	$	(0.34	)
Weighted average common shares outstanding		2,141,375						2,141,375			1,145,139						1,145,139
** Less than $.01

12

ENVIROSAFE CORP.
Unaudited Pro Forma Condensed Consolidated Statements of Cash Flows
For the six months ended June 30, 2008 and 2007
(Stated in US Dollars)
	EVSF			ADDE			Pro forma			EVSF			ADDE			Pro forma
	Six months ended			Six months ended			consolidated			Six months ended			Six months ended			consolidated
	June 30, 2008			June 30, 2008			total			June 30, 2007			June 30, 2007			total
Cash flows from operating activities
Net income (loss)	$	(2,315	)	$	682,711		$	680,396		$	(303,606	)	$	(90,196	)	$	(393,802	)
Adjustments to reconcile net income to net cash
used in operating activities:
Depreciation		-			16,511			16,511			-			14,102			14,102
Issuance of common stock for services rendered		-			-			-			300,544			-			300,544
Provision for doubtful debts		-			-			-			-			9,825			9,825
Provision for obsolete inventories		-			2,398			2,398			-			12,076			12,076
Changes in operating assets and liabilities:																	-
Trade receivables		-			(413,567	)		(413,567	)		-			(81,315	)		(81,315	)
Other receivables and prepayments		-			(190,690	)		(190,690	)		-			(244,679	)		(244,679	)
Inventories		-			51,965			51,965			-			54,668			54,668
Trade payables		-			(641,583	)		(641,583	)		-			229,233			229,233
Other payables and accrued expenses		(7,685	)		7,109			(576	)		(5,868	)		(44,433	)		(50,301	)
Income tax payable		-			216,793			216,793			-			9,111			9,111
Net cash flows used in operating activities		(10,000	)		(268,353	)		(278,353	)		(8,930	)		(131,608	)		(140,538	)
Cash flows from investing activities
Payments to acquire property, plant and equipment		-			(8,010	)		(8,010	)		-			(3,953	)		(3,953	)
Net cash flows used in investing activities		-			(8,010	)		(8,010	)		-			(3,953	)		(3,953	)
Cash flows from financing activities
Cash acquired from RTO		-			13,532			13,532			-			-			-
New bank loan		-			424,172			424,172			-			-			-
(Repayment to) advances from a director		-			(155,709	)		(155,709	)		-			109,314
Addition in paid-in capital		10,000			-			10,000			-			-			-
Net cash flows provided by financing activities		10,000			281,995			291,995			-			109,314			109,314
Effect of foreign currency translation on   cash and cash equivalents		-			8,551			8,551			-			1,232			1,232
Net increase (decrease) in cash and cash equivalents		-			14,183			14,183			(8,930	)		(25,015	)		(33,945	)
Cash and cash equivalents - beginning of period		-			136,441			136,441			8,951			63,065			72,016
Cash and cash equivalents - end of period	$	-		$	150,624		$	150,624		$	21		$	38,050		$	38,071
Supplemental disclosures for cash flow information:
Cash paid for:
Interest	$	-		$	1,452		$	1,452		$	-		$	-		$	-
Income taxes	$	-		$	5,195		$	5,195		$	-		$	-		$	-
Common stock issued for services	$	-		$	-		$	-		$	300,544		$	-		$	300,544

13

ENVIROSAFE CORP.

Notes to Unaudited Pro Forma Condensed Consolidated Financial Statements

1.   Basis of Presentation

The accompanying unaudited pro forma condensed consolidated financial statements have been prepared in accordance with both generally accepted accounting principles for interim financial information, and the instructions to Form 10-Q and Item 310(b) of Regulation S-B. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. The accompanying unaudited pro forma condensed consolidated financial statements reflect all adjustments (consisting of normal recurring accruals) that are, in the opinion of management, considered necessary for a fair presentation of the results for the interim periods presented. Interim results are not necessarily indicative of results for a full year.

The unaudited pro forma condensed consolidated financial statements and related disclosures have been prepared with the presumption that users of the interim financial information have read or have access to our annual audited financial statements for the preceding fiscal year. Accordingly, these unaudited pro forma condensed consolidated financial statements should be read in conjunction with the financial statements and the related notes thereto contained in the Annual Report on Form 10-KSB for the year ended December 31, 2007.

2.   Organization and Business Background

We were incorporated in the state of Delaware in 1996. On July 31, 2008, we completed a stock exchange transaction with ADDE Education Hldgs Limited (“ADDE”). ADDE was incorporated on February 12, 2008 under the laws of Hong Kong Special Administrative Region of the People’s Republic of China, which is an investment holding company whose only asset is 100% equity interest in Guangzhou Haoyu Educational Technology Company Limited (“Haoyu”), pursuant to an agreement, dated March 1, 2008, with the then sole stockholder of Haoyu, the spouse of ADDE’s sole stockholder.

Upon completion of the exchange, ADDE and Haoyu became our wholly-owned subsidiaries and the former owners of ADDE then owned 93.2% of our issued and outstanding shares.

The stock exchange transaction has been accounted for as a reverse acquisition and recapitalization of the EVSF whereby ADDE is deemed to be the accounting acquirer (legal acquiree) and EVSF to be the accounting acquiree (legal acquirer). The accompanying unaudited pro forma condensed consolidated financial statements are in substance those of ADDE, with the assets and liabilities, and revenues and expenses, of EVSF being included effective from the date of stock exchange transaction.

In addition, as ADDE and Haoyu were under the control of same controlling stockholders and management, and the transaction between ADDE and Haoyu was deemed to be a recapitalization of ADDE, the historical financial statements and operations of Haoyu become the historical financial statements of ADDE, which is deemed to be a continuation of the business of Haoyu.

EVSF and ADDE and Haoyu are hereinafter referred to as (the “Company”).

ENVIROSAFE CORP.

Notes to Unaudited Pro Forma Condensed Consolidated Financial Statements

3.   Pro Forma Adjustments

(a)  Pursuant to the stock exchange transaction disclosed in Note 2, the ADDE stockholders acquired the majority of the outstanding common stock of EVSF. The transaction is accounted for as a reverse purchase acquisition / merger wherein ADDE is the accounting acquirer and EVSF is the legal acquirer. Accordingly, the accounting acquirer records the assets purchased and liabilities assumed as part of the merger and the entire stockholders equity section of the legal acquirer is eliminated with negative book value acquired offset against the paid in capital of the accounting acquirer.

(b) To subsequently record 1,350,000 new preferred shares and 20,000,000 new common shares issued to ADDE shareholders per the stock exchange transaction disclosed in Note 2.

4.   Description of Business

The Company, through Haoyu, is specialized in the research and development of educational products and technology applications.

Haoyu was established in the PRC on March 27, 2001 and is a high-tech company specialized in the research and development of educational products and technology application.  It is located in the Guangzhou Province of the PRC with three manufacture bases for research and development purpose.

The educational software developed by the Company is in conformity to the new educational purpose.  The software uses the advanced technology of data collection, sensor and wireless control and video image with handy appearance, which can virtually upload the live experiment and analyze the information collected.  Teachers and students can have the experiments done automatically instead of the traditional method by hand.

The Company also engages in the trading of hardware and computer products such as monitors and computer notebooks.

5.   Summary of significant accounting policies

Principles of consolidation

The consolidated financial statements include the accounts of the Company and its subsidiaries.  All significant inter-company accounts and transactions have been eliminated in consolidation.

Use of estimates

In preparing financial statements in conformity with accounting principles generally accepted in the United States of America, management makes estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the dates of the financial statements, as well as the reported amounts of revenues and expenses during the reporting periods.  These accounts and estimates include, but are not limited to, the valuation of trade receivables, other receivables, inventories, warranty reserve, deferred income taxes and the estimation on useful lives of property, plant and equipment.  Actual results could differ from these estimates.

Revenue recognition

Revenue from sales of the Company’s products is recognized when the significant risks and rewards of ownership have been transferred to the customers at the time when the products are delivered to and accepted by them, the sales price is fixed or determinable and collection is reasonably assured.

Concentrations of credit risk

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of cash and cash equivalents, and trade and other receivables.  As of June 30, 2008 and December 31, 2007, substantially all of the Company’s cash and cash equivalents were held by major financial institutions located in the PRC, which management believes are of high credit quality.  With respect to trade receivables, the Company extends credit based on an evaluation of the customer’s financial condition.  The Company generally does not require collateral for trade and other receivables and maintains an allowance for doubtful accounts of trade and other receivables.  The Company had three customers that individually comprised 10% or more of net revenue for the six months ended June 30, 2008: Shen Zhen Jiao Yi Equipment Ltd. (深圳教仪设备有限公司) $490,979 (26%), Shen Zhen Wei Er De Technological Equipment Ltd. (深圳市唯尔德科技设备有限公司) $215,019 (11%) and Shen Zhen Xun Da Tong Technology Ltd. (深圳市迅达通科技有限公司) $191,191 (10%).

14

ENVIROSAFE CORP.

Notes to Unaudited Pro Forma Condensed Consolidated Financial Statements

5.         Summary of significant accounting policies (Cont’d)

Allowance for doubtful accounts

The Company establishes an allowance for doubtful accounts based on management’s assessment of the collectibility of trade receivables.  A considerable amount of judgment is required in assessing the amount of the allowance.  The Company considers the historical level of credit losses and applies percentages to aged receivables categories.  The Company makes judgments about the creditworthiness of each customer based on ongoing credit evaluations, and monitors current economic trends that might impact the level of credit losses in the future.  If the financial condition of the customers were to deteriorate, resulting in their inability to make payments, a larger allowance may be required.

Based on the above assessment, during the reporting periods, the management establishes the general provisioning policy to make allowance equivalent to 5% of gross amount of trade receivables due from 1 to 2 years, 10% of gross amount of trade receivables due from 2 to 3 years and 15% of gross amount of trade receivables due over 3 years.  Additional specific provision is made against trade receivables to the extent which they are considered to be doubtful.

Bad debts are written off when identified.  The Company does not accrue interest on trade receivables.

Historically, losses from uncollectible accounts have not significantly deviated from the general allowance estimated by the management and no significant additional bad debts have been written off directly to the profit and loss.  This general provisioning policy has not changed in the past since establishment and the management considers that the aforementioned general provisioning policy is adequate and not too excessive and does not expect to change this established policy in the near future.

Inventories

Inventories are stated at the lower of cost or market.  Cost is determined on a first in first out basis and includes all expenditures incurred in bringing the goods to the point of sale and putting them in a saleable condition.  In case of manufacturing inventories, cost includes an appropriate share of production overheads based on normal operating capacity.  In assessing the ultimate realization of inventories, the management makes judgments as to future demand requirements compared to current or committed inventory levels.  The Company estimates the demand requirements based on market conditions, forecasts prepared by its customers, sales contracts and orders in hand.

In addition, the Company estimates net realizable value based on intended use, current market value and inventory ageing analyses.  The Company writes down the inventories for estimated obsolescence or unmarketable inventories equal to the difference between the cost of inventories and the estimated market value based upon assumptions about future demand and market conditions.

Based on the above assessment, the Company establishes a general policy to make a 10% provision for inventories aged over 1 to 2 years, a 25% provision for inventories aged over 2 to 3 years and a 35% provision for inventories aged over 3 years.

15

ENVIROSAFE CORP.

Notes to Unaudited Pro Forma Condensed Consolidated Financial Statements

5.         Summary of significant accounting policies (Cont’d)

Government grant

Subsidy income for both reporting periods represents refund of value-added tax from State Administration of Taxation of the PRC for the sales of software products and is recognized in the statements of operations and comprehensive income (loss) when the income is received.

Warranty

The Company maintains a policy of providing after sales support for certain products by way of a warranty program. The Company provided 3 years warranties for the software products to certain customers.  Further, the relevant customers are allowed to defer the settlement of certain percentage (normally 5%) of the billed amount for certain period of time (normally three year) after acceptance of the Company’s products under the warranty program.  As of June 30, 2008 and December 31, 2007, such receivables amounted to $14,938 and $14,035 respectively and are included in trade receivables.

Since the aforementioned products were well developed, the Company did not encounter any claims from such customers.  Accordingly, the Company did not maintain a warranty reserve during the reporting periods.  However, the Company will periodically assess the estimation of its warranty liability and recognize the reserve when necessary based on the actual experience.

Recently issued accounting pronouncements

In May 2008, the FASB issued SFAS No. 162, “The Hierarchy of Generally Accepted Accounting Principles”.  SFAS 162 identifies the sources of accounting principles and the framework for selecting the principles used in the preparation of financial statements of nongovernmental entities that are presented in conformity with generally accepting accounting principles in the United States.  This statement will be become effective 60 days following the SEC’s approval of the Public Company Accounting Oversight Board amendments to AU Section 411 “The Meaning of Present Fairly in Conformity With Generally Accepted Accounting Principles”.  The management does not expect the adoption of this statement will have any material effect on the Company’s financial statements.

6.	Inventories	June 30,			December 31,
		2008			2007
		(Unaudited)			(Audited)
	Raw materials	$	16,447		$	20,041
	Finished goods		416,436			436,914
			432,883			456,955
	Provision for obsolete inventories		(46,568	)		(41,433	)
		$	386,315		$	415,522

7.          Amount due to a director

The amount is interest-free, unsecured and repayable when the Company is in a position to do so.

16

ENVIROSAFE CORP.

Notes to Unaudited Pro Forma Condensed Consolidated Financial Statements

8.          Secured bank loan

The bank loan is denominated in RMB and repayable within one year.  It carries interest at 110% of the benchmark rate of the People’s Bank of China (the “PBOC”) for six-month to one-year short-term loans per annum.

The bank loan is secured by a guarantee put up by an independent party and a deposit of $21,828 (RMB150,000) placed with the bank in the name of the guarantor, with no other covenants.  The guarantor received $12,913 from the Company for issuing the guarantee.  The Company had also paid the required deposit to the bank on behalf of the guarantor.  The receivable due from the guarantor was included in other receivables and prepayments under current assets as of June 30, 2008.

9.         Commitments and contingencies

The Company had no commitments or contingencies as of June 30, 2008 and December 31, 2007.

10.       Income taxes

The Company is subject to Hong Kong profits tax.  No provision for Hong Kong profits tax has been made as the Company had no taxable income for the reporting periods.

Commencing from the fiscal year 2008, Haoyu is subject to the PRC Enterprise Income Tax (“EIT”) at the statutory rate of 25% (under the new law as detailed below) on the profits as reported in its PRC statutory financial statements adjusted by profit and loss items that are not taxable or deductible.

PRC’s legislative body, the National People’s Congress, adopted the unified EIT Law on March 16, 2007. This new tax law replaces the existing separate income tax laws for domestic enterprises and foreign-invested enterprises and became effective on January 1, 2008. Under the new tax law, a unified income tax rate is set at 25% for both domestic enterprises and foreign-invested enterprises. However, there will be a transition period for enterprises, whether foreign-invested or domestic, that are currently receiving preferential tax treatments granted by relevant tax authorities. Enterprises that are subject to an enterprise income tax rate lower than 25% may continue to enjoy the lower rate and will transit into the new tax rate over a five year period beginning on the effective date of the EIT Law. Enterprises that are currently entitled to exemptions for a fixed term may continue to enjoy such treatment until the exemption term expires. Preferential tax treatments may continue to be granted to industries and projects that qualify for such preferential treatments under the new law.

Income taxes in the statements of operations and comprehensive income (loss) for the reporting periods represent provision for EIT for the Company’s continuing operations in the PRC.

In July 2006, the FASB issued Interpretation No. 48, “Accounting for Uncertainty in Income Taxes” (“FIN 48”).  This interpretation requires recognition and measurement of uncertain income tax positions using a “more-likely-than-not” approach.  The Company adopted FIN 48 on January 1, 2007.  The management evaluated the Company’s tax positions and considered that no additional provision for uncertainty in income taxes is necessary as of June 30, 2008.

17

ENVIROSAFE CORP.

Notes to Unaudited Pro Forma Condensed Consolidated Financial Statements

11.       Earnings (loss) per share

The basic and diluted earnings (loss) per share is calculated using the net income (loss) and the weighted average number of shares outstanding during the reporting periods.  All share and per share data have been adjusted to reflect the recapitalization of the Company in the RTO.

The Company had no dilutive instruments during the reporting periods.

12.       Defined contribution plan

The Company has a defined contribution plan for all qualified employees in the PRC.  The employer and its employees are each required to make contributions to the plan at the rates specified in the plan.  The only obligation of the Company with respect to retirement scheme is to make the required contributions under the plan.  No forfeited contribution is available to reduce the contribution payable in the future years.  The defined contribution plan contributions were charged to the condensed consolidated statements of income.  The Company contributed $8,059 and $6,038 for the six months ended June 30, 2008 and 2007 respectively.

13.       Related party transactions

Apart from the transaction as disclosed in note 5 to the condensed consolidated financial statements, the Company had no other material transactions carried out with its related parties during the reporting periods.

14.        Segment information

The Company uses the “management approach” in determining reportable operating segments.  The management approach considers the internal organization and reporting used by the Company’s chief operating decision maker for making operating decisions and assessing performance as the source for determining the Company’s reportable segments.  Management, including the chief operating decision maker, reviews operating results solely by monthly revenue of hardware and software and the overall operating results of the Company.  The revenue of hardware and software for the reporting periods is as follows:

	Hardware				Software				Total
	Six months ended June 30, (Unaudited)				Six months ended June 30, (Unaudited)				Six months ended June 30, (Unaudited)
	2008		2007		2008		2007		2008		2007
Revenue from external customers	$	786,867	$	212,409	$	1,094,334	$	102,164	$	1,881,201	$	314,573

	Hardware				Software				Total
	Three months ended June 30, (Unaudited)				Three months ended June 30, (Unaudited)				Three months ended June 30, (Unaudited)
	2008		2007		2008		2007		2008		2007
Revenue from external customers	$	368,032	$	135,559	$	510,515	$	50,078	$	878,547	$	185,637

All of the Company’s long-lived assets and customers are located in the PRC.

18

Item 2.    Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis provides information that management believes may be useful in understanding our operating results, cash flows and financial condition. This discussion should be read in conjunction with the unaudited financial information and related notes included in this Form 10-Q.

The following discussion contains various “Forward-Looking Statements” within the meaning of the Private Securities Litigation Reform Act of 1995. The readers are referred to the statement entitled “Forward-Looking Statements” located at the end of Part I of this report.

We have adopted the provisions of Statement of Financial Accounting Standard No. 123 (Revised 2004), Share-Based Payment (SFAS No. 123R), and the new accounting standard for expensing stock options, in the three and six months ended June 30, 2008. All financial results presented in this Form 10-Q include the impact of expensing stock options.

Overview

Our financial statements have been prepared on the basis that we will continue as a going concern, which contemplates the realization of asset values and the satisfaction of liabilities in the normal course of business. Certain conditions indicate that we may be unable to continue as a going concern:

- We reported net losses of $2,315 and $303,606 for the six months ended June 30, 2008 and 2007, respectively.

- Net cash used in our operating activities was $10,000 and $8,930 the six month periods ended June 30, 2008 and 2007, respectively.

- We are unable to generate business opportunities.

- At June 30, 2008, stockholder's deficit was $(2,315) and included an accumulated deficit of $(2,324,759).

- At June 30, 2008, there was a working capital deficit of $2,315.

- We had no revenues for the three and six months ended June 30, 2008 and 2007.

We do not expect positive cash flow from operations for the 2008 fiscal year and we may require additional funding to cover expected negative cash flows until the end of fiscal year 2008.

Our ability to continue as a going concern is dependent upon generating revenues and gross profit margins to cover cost of services and other operating expenses, generating positive cash flows from operations, obtaining debt or equity capital to fund expected negative operating cash flows and returning us to profitable operations.

Operating results:

We have not generated any revenues during the three and six months ended June 30, 2008 and 2007.

We generated net losses of $2,315 and $2,315 for the three and six months ended June 30, 2008, respectively, compared to net losses of $153,000 and $303,606 for the three and six months ended June 30, 2007, respectively. The losses for the periods were due to general and administrative expenses and the non-cash professional fees resulting from the issuance of shares of common stock for services rendered in 2007. .

In 2007, the Company issued 1,143,458 shares of common stock as follows:

            133,000      —shares issued for consulting and executive services performed by the Company’s CEO in 2006; valued at $120,000.

              10,000      —shares issued for professional services; valued at $7,000.

            500,000      —shares issued for consulting and executive services performed by the Company’s CEO in 2007; valued at $150,000

            500,000      - ---shares issued for consulting services; valued at $50,000.

The expenses were booked pro rata due to the service periods.

As of June 30, 2008 we had accumulated $2,324,759 in operating losses that may, on a limited basis, be offset against future taxable income. There are limitations on the amount of net operating loss carryforwards that can be used. No tax benefit has been reported in the financial statements.

Financial Position and Liquidity

Total assets were $-0- at June 30, 2008, no decrease from total assets at year-end 2007.

Total liabilities were $2,315 at June 30, 2008, compared to total liabilities of $10,000 at year-end 2007. The liability was due to the monthly fees to the transfer agent and the miscellaneous expenses..

As of June 30, 2008 and at December 31, 2007, we had $-0- in cash and cash equivalents.

Going Concern

Our financial statements have been prepared on the basis that we will continue as a going concern, which contemplates the realization of asset values and the satisfaction of liabilities in the normal course of business. Certain conditions indicate that we may be unable to continue as a going concern:

· We reported net losses of $2,315 and $303,606, respectively, for the six months ended June 30, 2008 and 2007.  

· At June 30, 2008, stockholder's deficit was ($2,315) and included an accumulated deficit of ($2,324,759).

· At June 30, 2008 there was a working capital deficit of $2,315.  

· We have limited revenue prospects and have had no revenue in the past two years.

· Our ability to continue as a going concern is dependent upon our generating revenues and profit margins to cover cost of revenues and other operating expenses, generating positive cash flows from operations, obtaining debt or equity capital to fund expected negative operating cash flows and returning to profitable operations.  

· We may be forced to liquidate our assets and cease operations if we are unable to raise sufficient capital to support operations and to satisfy its obligations.

In connection with these issues, we are implementing the following operating and management plans to in order to provide positive cash flow from operations during the subsequent periods:

· Develop our primary business products and develop a customer base and production facilities and capacity to manufacture products.  

· Develop strategic partnerships with major companies to support our sales and marketing strategy, and production and manufacturing capacity.

· Negotiate with capital and debt funding sources to provide working capital to fund the growth and operations.

Item 3.    Controls and Procedures.

We maintain disclosure controls and procedures designed to ensure that information required to be disclosed in reports filed under the Securities Exchange Act of 1934 (“Exchange Act”) is recorded, processed, summarized and reported within the specified time periods. Our Chief Executive Officer and our Chief Financial Officer (collectively, the “Certifying Officers”) are responsible for maintaining our disclosure controls and procedures. The controls and procedures established by us are designed to provide reasonable assurance that information required to be disclosed by the issuer in the reports that it files or submits under the Exchange Act are recorded, processed, summarized and reported within the time periods specified in the Commission’s rules and forms.

During the six months ended June 30, 2008, our Certifying Officers evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based on the evaluation, the Certifying Officers concluded that our disclosure controls and procedures were effective to provide reasonable assurance that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the applicable rules and forms, and that it is accumulated and communicated to our management, including the Certifying Officers, as appropriate to allow timely decisions regarding required disclosure. These conclusions notwithstanding you are advised that no system is 100% foolproof.

Changes in Internal Control over Financial Reporting

There were no changes in the our internal control over financial reporting that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Forward-Looking Statements

This Quarterly Report on Form 10-Q, including “Management’s Discussion and Analysis of Financial Condition and Results of Operation” in Item 2, contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include expectations concerning gross margin improvements, increasing raw material costs, contributions to our U.S. and international pension and benefit plans, borrowing capacity, plans to re-finance existing debt and favorable short-term liquidity requirements. Without limiting the foregoing, words or phrases such as “will likely result,” “are expected to,” “will continue,” “is anticipated,” “we believe,” “estimate,” “project” (including the negative or variations thereof) or similar terminology, generally identify forward-looking statements. Forward-looking statements may also represent challenging goals for us. Management cautions that undue reliance should not be placed on such forward-looking statements, which speak only as of the date made.

19

PART II. OTHER INFORMATION

Item 1.        Legal Proceedings.

None.

Item 2.        Unregistered Sales of Equity Securities and Use of Proceeds.

None.

Item 3.        Defaults Upon Senior Securities.

None.

Item 4.        Submission of Matters to a Vote of Security Holders.

None.

Item 5.        Other Information

As of March 4, 2008, we executed a Plan of Exchange (the “Agreement”) between and among us, ADDE EDUCATION HLDS LTD., a corporation organized and existing under the laws of Hong Kong Special Administrative Region of People’s Republic of China (“ADDE”), the shareholders of ADDE (the “ADDE Shareholders”) and our Majority Shareholders (the “EVSF Shareholders”). ADDE is the holding company of Hao Yu Education Technology Co. Ltd., a corporation organized and existing under the laws of the Peoples’ Republic of China ("Hao Yu"), pursuant to a Share Exchange Agreement, dated March 1, 2008.

The share exchange transaction was consummated on July 31, 2008. As a result of the above exchange, ADDE has a total of 20,632,253 shares of the Common Stock and 1,350,000 shares of the Preferred Stock (1:50) of EVSF, or a ‘controlling interest’ in EVSF representing approximately 93.2% of the issued and outstanding shares of Common Stock and has appointed their candidate(s) to the board of directors at Closing. 

Accordingly, Mr. Guo, Yan Bin (Mr. Guo) and Ms. Yan, Chang Ping (Ms. Yan) were appointed as Directors, and Mr. Guo was also appointed as President at Closing.

At Closing, Mr. Zhan, Guoqiang resigned his office as President and resigned his position as a director effective upon the expiration of the ten day period after a Schedule 14F-1 has been mailed to the shareholders of record.  The new board of directors consists of Mr. Guo and Ms. Yan.

On August 7, 2008, the board of directors of the Company approved the appointment of Mr. Liu, Bao Long to the position of Chief Financial Officer of the Company, effective immediately.  

The detailed business description and audited financials of ADDE and its subsidiary were announced in a current report on Form 8-K, as amended, filed with the Commission on August 13, 2008 as required by the federal securities laws.

Item 6. Exhibits and Reports on Form 8-K

(a)      Exhibits

(1)   Exhibits: Exhibits required to be attached by Item 601 of Regulation S-B are listed in the Index to Exhibits Beginning on page 22 of this Form 10-Q, which is incorporated herein by reference.

(b)    Reports on Form 8-K filed subsequent to the second quarter of 2008

(1) On August 1, 2008, we filed a current report on Form 8-K to announce the completion of the transaction with ADDE EDUCATION HLDS LTD., a corporation organized and existing under the laws of Hong Kong Special Administrative Region of People’s Republic of China.

(2) On August 8, 2008, we filed a current report on Form 8-K to announce the appointment of our Chief Financial Officer.

(3) On August 13, 2008, we filed an amendment to the current report, which was initially filed on August 1, 2008, on Form 8-K/A to correct the information regarding the appointment of our Chief Financial Officer.

20

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, there unto duly authorized.

	ENVIROSAFE CORPORATION
Date: August 15, 2008	By:	/s/ Guo, Yan Bin
		Guo, Yan Bin President

21

INDEX TO EXHIBITS

Exhibit No.	Description
31.1	Certification of Chief Executive Officer
31.2	Certification of Chief Financial Officer
32.1	Statement required by 18 U.S.C. Section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Statement required by 18 U.S.C. Section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002