1
Commission File No. 000-27421
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
FORM 10-KSB
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Fiscal Year Ended: December 31, 2000
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Transition Period Form ________ to_________
EMERGENCY FILTRATION PRODUCTS, INC.
- -------------------------------------------------------------------------------
(Exact Name of Small Business Issuer as Specified in its Charter)
NEVADA 87-0561647
- ------------------------------- ----------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
4335 South Industrial Road, Suite 440
Las Vegas, Nevada 89103
- -------------------------------------------------------------------------
(Address of principal executive offices) (Zip code)
Issuer's telephone number: (702) 798-4541
Securities to be registered pursuant to Section 12(b) of the Act:
none
Securities to be registered pursuant to Section 12(g) of the Act:
$.001 Common Stock
------------------
(Title of Class)
Check whether the registrant (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 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 [ ]
Check if disclosure of delinquent filers pursuant to Item 405 of Regulation
S-K is not contained herein, and will not be contained, to the best of
registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part II of this From 10-K or any amendments to this
Form 10-K [ ]
As of December 31, 2000, there were 9,567,758 shares of the Registrant's
Common Stock, $.001 par value, outstanding.
The aggregate market value of shares of Common Stock held by
non-affiliates of the Registrant is $3,062,702.50
State the Registrant's revenues for the December 31, 2000 fiscal year:
$163,497.
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TABLE OF CONTENTS
Page
----
Item 1. Description of Business............................ 3
Item 2. Description of Property............................ 3
Item 3. Legal Proceedings.................................. 3
Item 4. Submission of Matter to Vote of
Security Holders................................... 4
Item 5. Market for Common Registrant Equity
and Related Stockholder Matter...................... 4
Item 6. Management's Discussion and Analysis
or Plan of Operation................................ 6
Item 7. Financial Statements................................ 9
Item 8. Changes in and Disagreements with
Accountants on Accounting and Financial
Disclosure.......................................... 26
Item 9. Directors, Executive Officers, Promoters
and Control Persons; Compliance with
Section 16(a) of the Exchange Act................... 26
Item 10. Executive Compensation.............................. 28
Item 11. Security Ownership of Certain
Beneficial Owners and Management.................... 28
Item 12. Certain Relationships and
Related Transactions................................ 30
Item 13. Exhibits and Reports on Form 8-K.................... 31
Signature........................................... 31
3
Item 1. Description of Business.
Emergency Filtration Products, Inc. (the "Company") was organized
under the laws of the State of Nevada on November 1, 1991, under the name "Lead
Creek Unlimited". Until February 9, 1996, the Company conducted no business. The
Company filed with the Secretary of State of the State of Nevada a Certificate
of Amendment changing its name to "Emergency Filtration Products, Inc." on March
8, 1996. The Company is in the business of developing a state-of-the-art
cardio-pulmonary resuscitation ("CPR") isolation mask that is designed to reduce
the possibility of transmission of contagious diseases during the administration
of CPR (the "RespAide(TM)").
On February 9, 1996, the Company entered into an Agreement with
Douglas K. Beplate whereby Mr. Beplate granted to the Company all rights,
including patent rights, to the commercial exploitation of RespAide(TM) . In
consideration of the assignment of these rights, the Company agreed (I) to pay
Mr. Beplate a royalty of 5% of the Company and any licensee on sales of the
RespAide(TM) and any components thereof, payable quarterly; (ii) to compensate
Douglas K. Beplate for consulting services at market value, for which Douglas K.
Beplate was to invoice the company monthly; and (iii) to deliver to Douglas K.
Beplate 19% of the issued and outstanding common stock of the Company as of the
date of the Agreement. On June 18, 1996, Douglas K. Beplate also executed an
Assignment of Invention assigning to the Company all rights to exploit the
RespAide(TM) technology.
The Company is a specialty filter products company that has
developed the state-of-the-art air filtration technology for removing infectious
bacteria and viruses in air flow systems. The Company's internationally patented
dual-filtered (2H) technology can be used in a wide range of medical and
commercial applications, including: (1) CPR isolation masks to protect emergency
response personnel against infectious diseases during mouth-to-mouth
resuscitation; (2) disposable filters to avoid contamination of critical
components in ventilators and other medical devices; (3) air filtration systems
for semiconductor manufacturing and laboratory "clean rooms"; and (4) heating,
ventilating, and air conditioning (HVAC) filters for use in commercial and
residential buildings, airplanes, and motor vehicles.
Item 2. Description of Property.
The Company presently occupies office and warehouse space located
at 4335 South Industrial Road, Suite 440, Las Vegas, Nevada 89103. The property
consists of approximately 1,800 square feet of offices and 1,512 square feet of
warehouse space. The property is leased from an unaffiliated party for 3 years,
commencing October 15, 1998, at $3,809.95 per month.
Item 3. Legal Proceedings.
4
(a) Bruce E. Batchelor, a shareholder and former officer of the
Company has made certain claims for alleged breaches of agreements as they
relate to unpaid wages, reimbursement for expenses, and claims certain rights in
the trademark of the Company as security for the alleged obligations. The
Company has recorded the sum of $135,000 as of December 31, 1998 and December
31, 1999 which represents the amount claimed to be owed to Bruce E. Batchelor.
The Company and patent counsel, Thomas Fehr, #703 Aerospace Center, 1104 Country
Hills Drive, Ogden, Utah 84403, believe that any claims other than for alleged
money damages is without merit. The Company has entered into a payment plan
resolving all differences and has agreed to pay the principal sum of $146,500 in
monthly installments of $1,800 or more, commencing on or about July 1, 2000.
Other than described above, there are no legal proceedings
threatened or pending, except such ordinary routine matters which may be
incidental to the business currently being conducted by the Company.
Item 4. Submission of Matter to Vote of Security Holders.
There have been no matters submitted to the Company's security
holders.
Item 5. Market for Common Company Equity and Related Stockholder Matter.
(a) Market Price.
The Company's Common Stock is quoted on the Over-The-Counter
Bulletin Board System. During the first quarter of 2000, the Company's Common
Stock was quoted on the National Quotation Bureau.
As of December 31, 2000, the Company had 154 shareholders of
record of its common stock. The Company has not paid cash dividends on its
common stock. The Company anticipates that for the foreseeable future any
earnings will be retained for use in its business, and no cash dividends will be
paid on the common stock. Declaration of common stock dividends will remain
within the discretion of the Company's Board of Directors and will depend upon
the Company's growth, profitability, financial condition and other relevant
factors.
The Company's common stock is traded on the bulletin board system
under the symbol "EMFP". The table below reflects the high and low bid and ask
quotations for each of the Company's fiscal quarters for the fiscal year covered
by this report. The prices reflect inter-dealer prices, without retail mark-up,
mark-down or commission and do not necessarily represent actual transactions.
5
The prices were obtained from the internet, the source of the
information is believed to be reliable.
2000
-----------------
HIGH LOW
------ ------
1st Quarter $1.625 $0.600
2nd Quarter $1.750 $0.900
3rd Quarter $1.125 $0.687
4th Quarter $0.750 $0.312
The Securities and Exchange Commission adopted Rule 15g-9, which
established the definition of a "penny stock", for purposes relevant to the
Company, as any equity security that has a market price of less that $5.00 per
share or with an exercise price of less that $5.00 per share, subject to certain
exceptions. For any transaction involving a penny stock, unless exempt, the
rules require: (i) that a broker or dealer approve a person's account for
transactions in penny stocks; and (ii) the broker or dealer receive from the
investor a written agreement to the transaction, setting forth the identity and
quantity of the penny stock to be purchased. In order to approve a person's
account for transactions in penny stocks, the broker or dealer must (i) obtain
financial information ad investment experience and objectives of the person; and
(ii) make a reasonable determination that the transactions in penny stocks are
suitable for that person and that person as sufficient knowledge and experience
in financial matters to be capable of evaluating the risks of transactions in
penny stocks. The broker or dealer must also deliver, prior to any transaction
in a penny stock, a disclosure schedule prepared by the Commission relating to
the penny stock market, which, in highlight form, (i) sets forth the basis on
which the broker or dealer made the suitability determination; and (ii) that the
broker or dealer received a signed, written agreement from the investor prior to
the transactions. Disclosure also has to be made about the risks of investing in
penny stock in both public offering and in secondary trading, and about
commissions payable to both the broker-dealer and the registered representative,
current quotations for the securities and the rights and remedies available to
an investor in cases of fraud in penny stock transactions. Finally, monthly
statements have to be sent disclosing recent price information for the penny
stock held in the account and information on the limited market in penny stocks.
For the initial listing on the NASDAQ SmallCap market, a company
must have net tangible assets of $4 million or market capitalization of $50
million or a net income (in the latest fiscal year or two of the last fiscal
years) of $750,000, a public float of 1,000,000 shares with a market value of $5
million. The minimum bid price must be $4.00 and there must be 3 market makers.
In addition, there must be 300
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shareholders holding 100 shares or more, and the company must have an operation
history of at least one year or a market capitalization of $50 million.
For continued listing in the NASDAQ SmallCap market, a company
must have net tangible assets of $2 million or market capitalization of $35
million or a net income (in the latest fiscal year or two of the last fiscal
years) of $500,000, a public float of 500,000 shares with a market value of $1
million. The minimum bid price must be $1.00 and there must be 2 market makers.
In addition, there must be 300 shareholders holding 100 shares or more.
Management intends to strongly consider undertaking a transaction
with any merger or acquisition candidate which will allow the Company's
securities to be traded without the aforesaid limitations. However, there can be
no assurances that, upon a successful merger or acquisitions, the Company will
qualify its securities for listing on NASDAQ or some other national exchange, or
be able to maintain the maintenance criteria necessary to insure continued
listing. The failure of the Company to qualify its securities or to meet the
relevant maintenance criteria after such qualification in the future may result
in the discontinuance of the inclusion of the Company's securities on a national
exchange. In such events, trading, if any, in the Company's securities may then
continue in the non-NASDAQ over-the-counter market. As a result, a shareholder
may find it more difficult to dispose of , or to obtain accurate quotations as
to the market value of, the Company's securities.
(b) Holders.
Item 6. Management's Discussion and Analysis of Plan of Operation
Financial Condition
Since the Company's inception, the Company has been involved in
the development of its technology. During this time, revenues have been minimal
and expenditures primarily attributed to research and development and, more
recently, a marketing driven sales effort. Without adequate revenues to offset
expenditures, the Company has reported a loss in each of its years of existence.
To date, the Company has funded itself by way of a series of private equity
sales. As of the end of fiscal 2000, the Company had offset its accumulated
deficit in this manner and has therefore not found it necessary to incur any
long-term debt. The most valuable asset of the Company is its intellectual
property and technology. The Company has acquired the rights to certain
intellectual property, which property includes title to the patent on a
component of an emergency CPR assistance device, called a dual-filtered rotary
isolation valve. Rights pertaining thereto include the right to maintain, sell
and improve the device, and to license those rights. Although the Company
believes its technology to be very valuable in the real sense, this value is not
quantified as such on the Company's Balance Sheet.
7
Operational Results
During 2000, the Company reported revenues of $163,497. Revenues
have been primarily from the sale of the emergency CPR assistance device and the
Company is now focusing on securing distribution and licensing agreements and on
a marketing-driven sales effort in order to increase revenues that will
ultimately cover total expenditures.
The cost of goods sold decreased as a percentage of sales in 2000
versus 1999. This decrease is due primarily to the benefits of economies of
scale from the increased sales in 2000 as compared to sales in 1999.
Total expenditures increased in 2000 as compared to 1999. The
primary reasons for this occurrence are:
Cost of sales increased from $30,194 to $83,504 during the fiscal
years ended December 31, 1999 and 2000, respectively, as a result of increased
sales.
Depreciation and amortization expense increased from $22,876 to
$28,399 during the fiscal year ended December 31, 1999 and 2000, respectively.
General and administrative costs increased from $920,319 to
$1,138,520 during the fiscal years ended December 31, 1999 and 2000,
respectively, primarily as a result of increased expenditures for asset
acquisition and compensation for professional services in the form of stock
options.
Capital Funding
The Company currently is unable to generate sufficient cash from
operations to sustain its business efforts as well as to accommodate its growth
plans. Until it is able to generate sufficient cash flow, the Company will seek
capital funding from outside resources. The company presently has no commitment
for such funding and has not concluded what form, whether debt or equity, such
funding will be derived through.
The Company's cost-efficient business model emphasizes: (1)
in-house research and development; (2) accumulation of intellectual property
assets; (3) ownership of key production equipment; and (4) outsourcing of all
manufacturing, distribution, warehousing, and order fulfillment. Accordingly,
the Company benefits from low overhead, as well as the pricing advantages
inherent in proprietary specialty products.
8
The Company's management is now completing transformation from a
technology-driven research and development business to a marketing-driven
proprietary products company. Product development efforts remain an important
priority, but are now balanced by an increasing focus on elements of production
and sales.
The Company's current product line includes:
- RespAide(TM) CPR Isolation Mask. The company has received Federal
Drug Administration ("FDA") approval for its RespAide (TM) CPR
isolation mask incorporating the VIV filter, and recently commenced
volume manufacturing and distribution of complete units and
replacement filters (the RespAide(TM) filter needs to be replaced
after each use). In tests by Nelson Laboratories, RespAide(TM) was
found to be greater than 99.9% effective against bacterial and viral
transmission -- the highest rating testing labs will issue for
medical devices, and believed by management of the Company to be
superior to any competing product on the market.
- Disposable Filters for BVMs. The same filter used in the RespAide(TM)
product is ideal for preventing contamination of "bag valve masks",
which are single-use ventilators. The disposable filter keeps the
equipment contaminant-free, thereby allowing a BVM to be safely
reused with a new filter -- a considerable economic benefit due to
the lower replacement and disposal costs of the filter versus
discarding the entire BVM unit. The Company has applied for FDA
approval.
- Ventilator Circuits. To extend its market reach from emergency
response sites to the vast number of respiratory procedures conducted
within medical facilities, the Company has introduced two new
configurations of its VIV technology: (1) a one-way ventilator
circuit that eliminates the exhalation ports of patient's breath in
favor of permitting a T-valve attachment of monitoring CO2 levels --
suitable for any inline ventilator connection; and (2) a two-way
ventilator circuit for applications where ambient air flow must pass
evenly in both directions while still protecting equipment and hoses.
This is suitable for use in anesthesia and general respiratory
procedures. The company has applied for FDA approval.
In addition, the Company is developing another configuration of
the technology for the BVM market that incorporates a self-contained nebulizer,
a filter, and a bag with built-in CO2 monitoring capabilities. A patent has been
granted for this product and the Company has executed an agreement whereby it
acquired the rights for commercial exploitation of the patent. The Company is
currently conducting prototype development.
The market for air purification filters for protection against
communicable diseases has grown rapidly since the mid-1980's - from practically
nil,
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to an estimated 1,460,000,000 in 1997. Demand has been driven largely by such
factors as the spread of AIDS and Hepatitis C, the resurgence of Tuberculosis in
many urban settings, and growing concerns in the medical community about new
drug-resistant strains of bacteria. Such concerns are clearly evident in the
results of recent independent surveys indicating that approximately 45% of
doctors, 57% of EMTs, 80% of nurses, and substantially all paramedics surveyed
would refuse to perform mouth-to-mouth resuscitation on an adult stranger
without barrier protection. Indeed, many of the respondents indicated that they
had already walked away from situations in the community requiring
mouth-to-mouth resuscitation.
In addition to emergency ambulance services, police departments,
firefighters, hospitals, doctors, the military, and major CPR training
organizations such as the American Heart Association, management believes that
the market also includes government and private sector entities that will
choose, or may be required by law to keep CPR isolation masks on hand.
The Company currently holds military national stocking numbers
for the RespAide(TM) CPR isolation mask and replacement filters. These stocking
numbers make both products acceptable for inventory in all four branches of the
military and the U.S. Coast Guard. The Company received and fulfilled orders
from the Defense Supply Center Philadelphia for the RespAide(TM) device and its
replacement parts in the fourth quarter of 2000 which account for a significant
percentage of sales for the fiscal year.
To reach the market, the Company has entered into contractual
arrangements with a number of U.S. and international medical product
distributors. Additionally, the Company is actively pursuing licensing
agreements with other companies that have market penetration.
The Company intends to firmly establish its reputation for
supplying the best medical air filters available, and then begin aggressively
commercializing the technology in the enormous HVAC category. The Company
estimates that the addition of HVAC applications will increase the total
addressable market for dual-filtered (2H) technology.
Competition
The medical device industry is a highly competitive sector of the health
care industry and there are a large number of established and well financed
entities with significantly greater financial resources, technical expertise and
in depth managerial capabilities than the Company. Although the Company has
achieved patent protection for the RespAide(TM), there is no assurance that
other entities may not compete in or enter the medical and commercial market in
competition with the Company.
Item 7. Financial Statements.
C O N T E N T S
Independent Auditors' Report.................................................. 3
Balance Sheet................................................................. 4
Statements of Operations...................................................... 6
Statements of Stockholders' Equity (Deficit).................................. 7
Statements of Cash Flows...................................................... 8
Notes to the Financial Statements............................................. 10
10
INDEPENDENT AUDITORS' REPORT
To the Board of Directors and Stockholders of
Emergency Filtration Products, Inc.
Las Vegas, Nevada
We have audited the accompanying balance sheet of Emergency Filtration Products,
Inc. as of December 31, 2000, and the related statements of operations,
stockholders' equity (deficit), and cash flows for the years ended December 31,
2000 and 1999. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Emergency Filtration Products,
Inc. as of December 31, 2000 and the results of its operations and its cash
flows for the years ended December 31, 2000 and 1999 in conformity with
generally accepted accounting principles.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 5 to the
financial statements, the Company has not generated revenues sufficient to cover
its operating costs, which raises substantial doubt about its ability to
continue as a going concern. Management's plans in regard to these matters are
also described in Note 5. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty.
HJ & Associates, LLC
Salt Lake City, Utah
March 16, 2001
11
EMERGENCY FILTRATION PRODUCTS, INC.
Balance Sheet
ASSETS
December 31,
2000
------------
CURRENT ASSETS
Cash $ 6,985
Accounts receivable, net (Note 1) 67,962
Prepaid expenses 1,513
Inventory (Note 1) 84,394
---------
Total Current Assets 160,854
---------
PROPERTY AND EQUIPMENT (Note 1)
Molds 109,650
Furniture and office equipment 33,989
Accumulated depreciation (69,415)
---------
Total Property and Equipment 74,224
---------
OTHER ASSETS
Deposits 4,141
Patents, net (Note 2) 154,190
---------
Total Other Assets 158,331
---------
TOTAL ASSETS $ 393,409
=========
The accompanying notes are an integral part of these financial statements
4
12
EMERGENCY FILTRATION PRODUCTS, INC.
Balance Sheet (Continued)
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
December 31,
2000
-----------
CURRENT LIABILITIES
Accounts payable $ 108,151
Accounts payable - related parties (Note 3) 364,374
Accrued expenses 28,459
Note payable (Note 4) 17,988
Note payable - related, current (Note 3) 11,197
-----------
Total Current Liabilities 530,169
-----------
LONG-TERM DEBT
Note payable - related (Note 3) 135,303
-----------
Total Long-Term Debt 135,303
-----------
Total Liabilities 665,472
-----------
COMMITMENTS AND CONTINGENCIES (Notes 2 and 6)
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock, par value $0.001; authorized
50,000,000 shares; 9,567,758 shares issued
and outstanding 9,568
Additional paid-in capital 4,931,054
Accumulated deficit (5,212,685)
-----------
Total Stockholders' Equity (Deficit) (272,063)
-----------
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY (DEFICIT) $ 393,409
===========
The accompanying notes are an integral part of these financial statements
5
13
EMERGENCY FILTRATION PRODUCTS, INC.
Statements of Operations
For the Year Ended
December 31,
-----------------------------
2000 1999
----------- -----------
NET SALES $ 163,497 $ 49,701
EXPENSES
Cost of sales 83,504 30,194
Depreciation and amortization 28,399 22,876
Bad debt expense 2,030 1,092
Research and development 10,615 57,328
General and administrative 1,138,520 920,319
----------- -----------
Total Expenses 1,263,068 1,031,809
----------- -----------
LOSS FROM OPERATIONS (1,099,571) (982,108)
----------- -----------
OTHER INCOME (EXPENSE)
Loss on disposal of assets (250) --
Gain on forgiveness of debt 9,117 --
Interest expense (1,084) (1,401)
----------- -----------
Total Other Income (Expense) 7,783 (1,401)
----------- -----------
NET LOSS $(1,091,788) $ (983,509)
=========== ===========
BASIC LOSS PER SHARE $ (0.13) $ (0.13)
=========== ===========
WEIGHTED AVERAGE NUMBER OF SHARES
OUTSTANDING 8,700,138 7,598,780
=========== ===========
The accompanying notes are an integral part of these financial statements
6
14
EMERGENCY FILTRATION PRODUCTS, INC.
Statements of Stockholders' Equity (Deficit)
Common Stock Additional
--------------------- Paid-In Accumulated
Shares Amount Capital Deficit
--------- ------ ----------- -----------
Balance, December 31, 1998 7,078,107 $7,078 $3,191,923 $(3,137,388)
Common stock issued for
cash at $1.00 per share 601,061 601 600,460 --
Common stock issued on
exercise of stock options
at $0.75 per share 67,000 67 50,183 --
Common stock issued for
services at $1.00 per share 77,597 78 77,519 --
Additional capital contribution -- -- 562 --
Net loss for the year ended
December 31, 1999 -- -- -- (983,509)
--------- ------ ---------- -----------
Balance, December 31, 1999 7,823,765 7,824 3,920,647 (4,120,897)
Common stock issued for cash
at prices ranging from $0.18
to $0.75 per share 853,835 854 254,967 --
Common stock issued for
services at prices ranging
from $0.40 to $1.05 per share 782,158 782 518,091 --
Common stock issued through
exercise of options at $0.75
per share 88,000 88 65,912 --
Common stock issued for
patents at $1.00 per share 20,000 20 19,980 --
Additional expense recorded
from granting of options -- -- 151,457 --
Net loss for the year ended
December 31, 2000 -- -- -- (1,091,788)
--------- ------ ---------- -----------
Balance, December 31, 2000 9,567,758 $9,568 $4,931,054 $(5,212,685)
========= ====== ========== ===========
The accompanying notes are an integral part of these financial statements
7
15
EMERGENCY FILTRATION PRODUCTS, INC.
Statements of Cash Flows
For the Year Ended
December 31,
---------------------------
2000 1999
----------- ---------
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $(1,091,788) $(983,509)
Adjustments to reconcile net loss to net
cash (used by) operating activities:
Depreciation and amortization 28,399 22,876
Loss on disposal of assets 250 --
Gain on forgiveness of debt (9,117) --
Bad debts 2,030 1,092
Common stock issued for services 518,873 77,597
Expense on options granted 151,457 --
Changes in operating assets and liabilities:
(Increase) decrease in inventory 6,543 (27,241)
(Increase) decrease in prepaid expenses (555) 4,830
(Increase) decrease in accounts receivable (60,387) 2,465
Increase (decrease) in cash overdraft (1,176) 1,176
Increase (decrease) in accrued expenses 6,844 12,861
Increase (decrease) in accounts payable
and accounts payable - related parties 144,471 199,027
----------- ---------
Net Cash (Used by) Operating Activities (304,156) (688,826)
----------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of equipment (815) (12,625)
Cash received on disposal of fixed assets 2,329 --
Patent costs (11,650) (8,345)
----------- ---------
Net Cash (Used by) Investing Activities (10,136) (20,970)
----------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of stock 321,821 651,311
Additional capital contributed -- 562
Proceeds from note payable 22,296 22,480
Payment on notes and leases payable (22,840) (25,741)
----------- ---------
Net Cash Provided by Financing Activities 321,277 648,612
----------- ---------
NET INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS 6,985 (61,184)
CASH AT BEGINNING OF PERIOD -- 61,184
----------- ---------
CASH AT END OF PERIOD $ 6,985 $ --
=========== =========
The accompanying notes are an integral part of these financial statements
8
16
EMERGENCY FILTRATION PRODUCTS, INC.
Statements of Cash Flows (Continued)
For the Year Ended
December 31,
--------------------------
2000 1999
----------- ---------
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for:
Interest $ 1,084 $ 1,401
Income taxes $ -- $ --
NON-CASH FINANCING ACTIVITIES:
Common stock issued for services $ 518,873 $ 77,597
Common stock issued for patent costs $ 20,000 $ --
The accompanying notes are an integral part of these financial statements
9
17
EMERGENCY FILTRATION PRODUCTS, INC.
Notes to the Financial Statements
December 31, 2000
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a. Organization
Emergency Filtration Products, Inc. (the Company) was incorporated
in the State of Nevada on November 1, 1991 as Lead Creek Unlimited.
In March 1996, pursuant to a Plan of Reorganization, the Company
changed its name to Emergency Filtration Products, Inc.
Between November 1, 1991 and February 9, 1996, the Company had no
line of business. As of the latter date, the Company entered into an
agreement to acquire title to a technology in the emergency
respiration equipment field. The Company is currently engaged in the
development, production and sale of this equipment.
b. Accounting Method
The Company's financial statements are prepared using the accrual
method of accounting. The Company has elected a December 31 year
end.
c. Cash and Cash Equivalents
The Company considers all highly liquid investments with a maturity
of three months or less when purchased to be cash equivalents.
d. Accounts Receivable
Accounts receivable are shown net of the allowance for doubtful
accounts of $3,122 at December 31, 2000.
e. Provision for Taxes
At December 31, 2000, the Company had net operating loss
carryforwards of approximately $4,100,000 that may be offset against
future taxable income through 2020. No tax benefit has been reported
in the financial statements because the potential tax benefits of
the net operating loss carryforwards are offset by a valuation
allowance of the same amount.
The income tax benefit differs from the amount computed at federal
statutory rates of approximately 38% as follows:
For the Years Ended
December 31,
-------------------------
2000 1999
--------- ---------
Income tax benefit at statutory rate $ 414,879 $ 373,733
Change in valuation allowance (414,879) (373,733)
--------- ---------
$ -- $ --
========= =========
10
18
EMERGENCY FILTRATION PRODUCTS, INC.
Notes to the Financial Statements
December 31, 2000
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
e. Provision for Taxes (Continued)
Deferred tax assets (liabilities) are comprised of the following:
For the Years Ended
December 31,
-----------------------------
2000 1999
----------- -----------
Income tax benefit at statutory rate $ 1,558,000 $ 1,140,000
Change in valuation allowance (1,558,000) (1,140,000)
----------- -----------
$ -- $ --
=========== ===========
Due to the change in ownership provisions of the Tax Reform Act of
1986, net operating loss carryforwards for Federal income tax
reporting purposes are subject to annual limitations. Should a
change in ownership occur, net operating loss carryforwards may be
limited as to use in future years.
f. Property and Equipment
Property and equipment are stated at cost. Expenditures for small
tools, ordinary maintenance and repairs are charged to operations as
incurred. Major additions and improvements are capitalized.
Depreciation is computed using the straight-line and accelerated
methods over estimated useful lives as follows:
Molds 7 years
Furniture and office equipment 5 to 7 years
Depreciation expense for the years ended December 31, 2000 and 1999
was $21,795 and $20,940, respectively.
g. Inventory
Inventory is stated at the lower of cost (computed on a first-in,
first-out basis) or market. The inventory consists of raw materials
used in the assembly and production of the emergency respiration
equipment.
h. Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles 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
revenues and expenses during the reporting period. Actual results
could differ from those estimates.
11
19
EMERGENCY FILTRATION PRODUCTS, INC.
Notes to the Financial Statements
December 31, 2000
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
i. Basic Loss Per Share
The computation of basic loss per share of common stock is based on
the weighted average number of shares outstanding during the period
of the financial statements. Common stock equivalents, consisting of
stock options, have not been included in the calculation as their
effect is antidilutive for the periods presented.
For the Year Ended
December 31, 2000
--------------------------------------------
Loss Shares Per Share
(Numerator) (Denominator) Amount
----------- ------------- ---------
$(1,091,788) 8,700,138 $(0.13)
=========== ========= ======
For the Year Ended
December 31, 1999
--------------------------------------------
Loss Shares Per Share
(Numerator) (Denominator) Amount
----------- ------------- ---------
$(983,509) 7,598,780 $(0.13)
========= ========= ======
j. Change in Accounting Principle
The Company has adopted the provisions of FASB Statement No. 138
"Accounting for Certain Derivative Instruments and Hedging
Activities, (an amendment of FASB Statement No. 133.)" Because the
Company had adopted the provisions of FASB Statement No. 133, prior
to June 15, 2000, this statement is effective for all fiscal
quarters beginning after June 15, 2000. The adoption of this
principle had no material effect on the Company's financial
statements.
The Company has adopted the provisions of FASB Statement No. 140
"Accounting for Transfers and Servicing of Financial Assets and
Extinguishments of Liabilities (a replacement of FASB Statement No.
125.)" This statement provides accounting and reporting standard for
transfers and servicing of financial assets and extinguishments of
liabilities. Those standards are based on consistent application of
a financial- components approach that focuses on control. Under that
approach, the transfer of financial assets, the Company recognized
the financial and servicing assets it controls and the liabilities
it has incurred, derecognizes financial assets when control has been
surrendered, and derecognizes liabilities when extinguished. This
statement provides consistent standards for distinguishing transfers
of financial assets that are sales from transfers that are secured
borrowings. This statement is effective for transfers and servicing
of financial assets and extinguishments of liabilities occurring
after March 31, 2001. This statement is effective for recognition
and reclassification of collateral and for disclosures relating to
securitization transactions and collateral for fiscal years ending
after December 15, 2000. The adoption of this principle had no
material effect on the Company's financial statements.
12
20
EMERGENCY FILTRATION PRODUCTS, INC.
Notes to the Financial Statements
December 31, 2000
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
j. Change in Accounting Principle (Continued)
The Company has adopted the provisions of FIN 44 "Accounting for
Certain Transactions Involving Stock Compensation (an interpretation
of APB Opinion No. 25.)" This interpretation is effective July 1,
2000. FIN 44 clarifies the application of Opinion No. 25 for only
certain issues. It does not address any issues related to the
application of the fair value method in Statement No. 123. Among
other issues, FIN 44 clarifies the definition of employee for
purposes of applying Opinion 25, the criteria for determining
whether a plan qualifies as a noncompensatory plan, the accounting
consequence of various modifications to the terms of a previously
fixed stock option or award, and accounting for an exchange of stock
compensation awards in a business combination. The adoption of this
principle had no material effect on the Company's financial
statements.
k. Advertising
The Company follows the policy of charging the costs of advertising
to expense as incurred.
l. Revenue Recognition
Revenue is recognized upon shipment of goods to the customer.
m. Equity Securities
Equity securities issued for services rendered have been accounted
for at the fair market value of the securities on the date of
issuance.
n. Stock Options
The Company applies Accounting Principles Board ("APB") 25,
"Accounting for Stock Issued to Employees," and related
interpretations in accounting for all stock option plans. Under APB
25, compensation cost is recognized for stock options granted to
employees when the option price is less than the market price of the
underlying common stock on the date of grant.
FASB Statement 123, "Accounting for Stock-Based Compensation" ("SFAS
No. 123"), requires the Company to provide proforma information
regarding net income (loss) and net income (loss) per share as if
compensation costs for the Company's stock option plans and other
stock awards had been determined in accordance with the fair value
based method prescribed in SFAS No. 123. The Company estimates the
fair value of each stock award at the grant date by using the
Black-Scholes options pricing model using the following assumptions.
The U.S. Treasury rate for the period equal to the expected life of
the options was used as the risk-free interest rate. The expected
life of the options is three years. The volatility used was 1.2246%
based upon the historical price per share of shares sold. There are
no expected dividends.
13
21
EMERGENCY FILTRATION PRODUCTS, INC.
Notes to the Financial Statements
December 31, 2000
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
n. Stock Options (Continued)
Under the accounting provisions of SFAS No. 123, the Company's net
loss for the years ended December 31, 2000 and 1999 would have
changed from the reported net loss as follows:
2000 1999
----------- ----
Net loss:
As reported $(1,091,788) $ --
Pro forma (1,416,952) --
Net loss per share:
As reported $ (0.13) $ --
Pro forma (0.16) --
NOTE 2 - PATENT
The Company entered into an agreement to acquire the rights to
certain intellectual property, which property includes title to the
patent on a component of an emergency CPR assistance device, called
a dual filtered rotary isolation valve. Rights pertaining thereto
include the right to maintain, sell and improve the device, and to
license those rights. The Company has agreed to pay a 5% royalty on
any sales related to the patented intellectual property. Royalty
expense on this patent for the years ended December 31, 2000 and
1999 was $8,014 and $-0-, respectively. Additional costs related to
the patent were capitalized during the years ended December 31, 2000
and 1999 which consist of legal and filing fees incurred to maintain
the patent throughout the world. Amortization is computed over an
estimated life of 15 years. Impairment of the patent is analyzed
annually. The patent was published by the U.S. Patent Office on
November 15, 1996, the U.S. Patent number is 5,575,279.
On June 28, 2000, the Company entered into a Contract for Assignment
of the rights to a BVM Bag invention. The BVM Bag is a portable
emergency safety resuscitator, subject to Patent number 6,062,217.
The Company acquired the rights, title and interest in the BVM Bag
for the following:
1. Issuance of 120,000 shares of restricted common stock. At
December 31, 2000, only 20,000 of the 100,000 had been issued
(valued at $1.00 per share), thus, a $100,000 liability was
recorded until the remaining 100,000 shares are issued.
2. 50,000 stock options each year on December 31, commencing on
December 31, 2000, exercisable at a 50% discount of the average
bid price over the preceding six-month period. Additional
expense of $1,239 was recorded for the year ended December 31,
2000 as a result of the initial 50,000 options granted.
3. In the event the Company is sold or merged with another entity,
the seller shall receive an additional 50,000 shares of
restricted shares or participate as a member of the negotiating
team concerning the sale or merger for the purpose of
negotiating a royalty on the Patent that shall not be less than
2.5% of gross sales of the patented product.
14
22
EMERGENCY FILTRATION PRODUCTS, INC.
Notes to the Financial Statements
December 31, 2000
NOTE 2 - PATENT (Continued)
The agreement, including the annual 50,000 stock options, shall last
until the date that the patent covering the BVM Bag Invention
expires.
Patent costs at December 31, 2000 are as follows:
Capitalized costs $ 164,888
Accumulated amortization (10,698)
---------
Net Patent Costs $ 154,190
=========
Amortization expense for the years ended December 31, 2000 and 1999
was $6,604 and $1,936, respectively.
NOTE 3 - RELATED PARTY TRANSACTIONS
At December 31, 1999, $135,000 was recorded by the Company which
represented an amount claimed to be owed to a shareholder and former
officer of the Company for unpaid wages and reimbursements. The
shareholder also claimed that he had legal rights to certain
trademarks of the Company until he was paid in full. On June 2,
2000, the Company entered into a Settlement Agreement and Mutual
Release with the shareholder, settling on an amount of $146,500. The
amount accrues interest at 10% per annum. Principal and interest are
to be paid in monthly installments of $1,800 beginning on July 1,
2000 until paid. The Company was behind on the monthly payments at
December 31, 2000. The balance on the note at December 31, 2000 was
as follows:
Total amount of settlement $ 146,500
Payments made during 2000 (1,800)
Interest accrual for 2000 year 8,644
---------
Balance, December 31, 2000 153,344
Less: accrued interest included in accrued expenses (6,844)
Less: current portion (11,197)
---------
Long-term note payable - related $ 135,303
=========
At December 31, 2000, the Company owed another related party
$10,000. An additional $100,000 is included in accounts payable -
related parties at December 31, 2000 as a result of the patent
acquisition as explained in Note 2.
Certain employees, officers and shareholders are also owed amounts
in past due wages and expense reimbursements as of December 31,
2000. In addition, certain shareholders of the Company have advanced
funds to the Company in order to cover operating costs. The total
amount owed to these related parties as of December 31, 2000 was
$254,374. The amounts are non-interest bearing, unsecured and due on
demand. Total accounts payable - related parties at December 31,
2000 was $364,374.
15
23
EMERGENCY FILTRATION PRODUCTS, INC.
Notes to the Financial Statements
December 31, 2000
NOTE 4 - NOTE PAYABLE
A note was signed by the Company to an insurance company for product
liability insurance for a one year period from October 2000 to
October 2001. The remaining amount due at December 31, 2000 was
$17,988.
NOTE 5 - GOING CONCERN
The Company's financial statements are prepared using generally
accepted accounting principles applicable to a going concern which
contemplates the realization of assets and liquidation of
liabilities in the normal course of business. The Company has
incurred significant losses which have resulted in an accumulated
deficit of $5,212,685 at December 31, 2000 which raises substantial
doubt about the Company's ability to continue as a going concern.
The accompanying financial statements do not include any adjustments
relating to the recoverability and classification of asset carrying
amounts or the amount and classification of liabilities that might
result from the outcome of this uncertainty. It is the intent of
management to create additional revenues through the development and
sales of its emergency respiration equipment and to rely upon
additional equity financing if required to sustain operations until
revenues are adequate to cover the costs.
NOTE 6 - COMMITMENTS AND CONTINGENCIES
The Company is leasing office space in Las Vegas, Nevada for three
years beginning October 15, 1998. The monthly rental payment is
currently $3,810.
Minimum future lease payments on the lease as of December 31, 2000
are as follows:
Year Ending
December 31, Amount
------------ -------
2001 $28,989
2002 --
2003 --
2004 --
2005 and thereafter --
-------
Total $28,989
=======
16
24
EMERGENCY FILTRATION PRODUCTS, INC.
Notes to the Financial Statements
December 31, 2000
NOTE 7 - STOCK OPTIONS
A summary of the status of the Company's stock options as of
December 31, 2000 and changes during the year ending December 31,
2000 are presented below:
Weighted Weighted
Average Average
Exercise Grant Date
Options Price Fair Value
---------- -------- ----------
Outstanding, December 31, 1999 3,838,000 $ 1.04 $ 0.00
Granted 4,000,000 0.75 0.12
Expired/Canceled -- -- --
Exercised (88,000) 0.75 0.00
---------- ------ ------
Outstanding, December 31, 2000 7,750,000 $ 0.89 $ 0.06
========== ====== ======
Exercisable, December 31, 2000 7,750,000 $ 0.89 $ 0.06
========== ====== ======
During 1998 and 1999, the Company granted stock options to various
individuals for a total of 3,905,000 restricted common shares at
exercise prices ranging from $0.60 to $5.00 per share. During the
year ended December 31, 1999, 67,000 options were exercised at
$0.75 per share for total proceeds of $50,250. During the year
ended December 31, 2000, additional stock options were granted for
a total of 4,000,000 restricted common shares at exercise prices
ranging from $0.37 to $0.75 per share, 88,000 options were
exercised at $0.75 per share for total proceeds of $66,000, and
300,000 shares were extended to have an expiration of December 31,
2003. The total amount of outstanding stock options at December 31,
2000 is summarized as follows:
Shares Price Expiration
--------- ----- -------------------
2,465,000 $0.75 January 8, 2001
100,000 $1.40 December 9, 2001
100,000 $0.60 December 30, 2001
150,000 $1.00 January 13, 2002
100,000 $2.50 January 13, 2002
75,000 $4.00 January 13, 2002
75,000 $5.00 January 13, 2002
150,000 $1.00 February 3, 2002
50,000 $2.50 February 3, 2002
50,000 $4.00 February 3, 2002
100,000 $1.00 March 18, 2002
1,800,000 $0.75 January 3, 2003
35,000 $1.00 March 19, 2003
50,000 $0.75 April 25, 2003
100,000 $0.75 July 12, 2003
2,000,000 $0.75 October 1, 2003
300,000 $0.60 December 30, 2003
50,000 $0.37 December 31, 2003
---------
7,750,000
=========
17
25
EMERGENCY FILTRATION PRODUCTS, INC.
Notes to the Financial Statements
December 31, 2000
NOTE 7 - STOCK OPTIONS (Continued)
Additional expense of $151,457 was recorded during the year ended
December 31, 2000 pursuant to the Black-Scholes calculation
pertaining to the fair value of the options granted during the year.
NOTE 8 - AUDIT ADJUSTMENTS
Certain audit adjustments were made at December 31, 2000 that
affected the Company's previously reported quarterly financial
statements. The following summarizes the effect for each quarter:
Quarter Ended
--------------------------------------------
March 31, June 30, September 30,
2000 2000 2000
--------- --------- -------------
Net loss:
As previously reported $(395,441) $(330,434) $(204,752)
Adjusted (500,554) (457,331) (204,752)
Net loss per share:
As previously reported $ (0.05) $ (0.04) $ (0.02)
Adjusted (0.06) (0.05) (0.02)
18
26
Item 8. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure.
The Company has not changed accountants since its formation and
there are no disagreements with the findings of said accountants.
Item 9. Directors, Executive Officers, Promoters and Control Persons;
Compliance with Section 16(a) of the Exchange Act.
The members of the Board of Directors of the Company serve until
the next annual meeting of the stockholders, or until their successors have been
elected. The officers serve at the pleasure of the Board of Directors.
Information as to the directors and executive officers of the Company is as
follows:
Name Age Position
- ---- --- --------
Michael J. Crnkovich 46 Chief Executive Officer, Director
(Chairman of the Board)
Douglas K. Beplate 46 President, Director
Peter Clark 49 Secretary, Treasurer, Director
Dr. Raymond C.L. Yuan 57 Director
J. Thomas Burns 62 Director
Sherman Lazrus 67 Director
The principal occupation and business experience during the last
five years for each of the present directors and executive officers of the
Company are as follows:
Michael J. Crnkovich, Chairman, and CEO, joined the Company as Director
of Marketing in 1997, and was appointed to his present positions later
that same year. Prior to his positions with the Company, Mr. Crnkovich
was employed as
27
the General Manager for an eight-line General Motors/Chrysler automobile
dealership, Billingsley Motors, in Winnemucca, Nevada.
Douglas K. Beplate, President, signed an agreement with the Company in
1996 whereby he provided consulting services and was subsequently
appointed to his present position and elected to the Board of Directors
in July, 2000.
Peter Clark, Vice President, Sales and Marketing, joined the Company in
1995 and was subsequently appointed Secretary/Treasurer and elected to
the Board of Directors in 1997.
Dr. Raymond C.L. Yuan, Director, was elected to the Board in December,
1997. Since 1993, Dr. Yuan has served as Managing Director of AsiaWorld
Medical Technology Limited, an exclusive master distributor of advanced
medical and healthcare products in South East Asia, including the
People's Republic of China. In addition, Dr. Yuan currently serves in
the following positions: President of the MedNet Group located in Hong
Kong, a group of healthcare education and communications companies;
Managing Director of Bio-health Consultancy Limited (Hong Kong), a
consulting firm specializing in bio-health and biotechnology consulting
to medical institutions; and Executive Director of Financial Resource
International, Limited located in Hong Kong, an international investment
banking firm.
J. Thomas Burns, Director, was elected to the Board in May, 1998. Mr.
Burns has more than 25 years of senior management and marketing
experience in the medical devices field. His most recent position was
President and CEO of Laerdal Medical Corporation (Armonk, New York), a
competitor of the Company and currently the leading supplier of CPR
isolation masks.
Sherman Lazrus, Director, was elected to the Board in December 1998, and
has nearly 40 years' experience in government and private sector health
care and health care finance. Mr. Lazrus presently serves as President
of American Medical Capital, a division of American Medical Enterprises,
LLC located in Bethesda, Maryland, a financial services and investment
banking company specializing in the healthcare industry, a position he
has held since 1991.
The officers and directors may be deemed parents and promoters of
the Company as those terms are defined by the Securities Act of 1933, as
amended. All directors hold office until the next annual stockholders' meeting
or until their death, resignations, retirement, removal, disqualification, or
until their successors have been elected and qualified. Officers of the Company
serve at the will of the Board of Directors.
28
There are no agreements or understandings for any officer or
director of the Company to resign at the request of another person and none of
the officers or directors are acting on behalf of or will act at the direction
of any other person.
The Company has checked the box provided on the cover page of
this Form to indicate that there is no disclosure in this form of reporting
person delinquencies in response to Item 405 of Regulation S-B.
Item 10. Executive Compensation.
The following table sets forth the cash compensation which was
paid by the Company for services rendered to the Company. During fiscal years
indicated, the following payments were made:
Stock All
Name & Position Year Remuneration Options Other
- ----------------------- ---- ------------ -------- -----
Michael J. Crnkovich 2000 $51,830 $111,217 $0
Chief Executive Officer 1999 $48,000 $ 0 $0
Douglas K. Beplate 2000 $65,480 $141,114 $0
President 1999 $ 0 $ 0 $0
Peter Clark 2000 $ 6,000 $ 75,834 $0
Secretary/Treasurer 1999 $36,000 $ 0 $0
Item 11. Security Ownership of Certain Beneficial Owners and Management.
(a) Security Ownership of Certain Beneficial Owners.
The following table sets forth the security and beneficial
ownership for each class of equity securities of the Company for any person who
is known to be the beneficial owner of more than five percent of the Company:
Name and Amount and
Address of Nature of Percent
Title of Class Beneficial Owner Beneficial Owner of Class
- -------------- ----------------------- ---------------- --------
Common Peter Clark
2251 Wigwam Pkwy
#1823
Henderson, NV 89014 585,793 6.123%
29
Option Peter Clark
2251 Wigwam Pkwy
#1823
Henderson, NV 89014 1,300,000 --
Common China Bridge Holdings
The Creque Bldg
216 Main Street
Road Town, Tortola
B.V.I. 744,425 7.780%
--------- ------
Total 2,630,218 13.903%
The total of the Company's outstanding Common Shares are held by
154 persons.
(b) Security Ownership of Management.
The following table sets forth the beneficial ownership for each
class of equity securities of the Company beneficially owned by all directors
and officers of the Company.
Name and Amount and
Address of Nature of Percent
Title of Class Beneficial Owner Beneficial Owner of Class
- -------------- ----------------------- ---------------- --------
Common Michael J. Crnkovich 6,667 0.069%
1139 E. 6720 S. 1,600,000(2)
#11
Elko, NV 89801
Common Peter Clark 585,793 6.123%
2251 Wigwam Pkwy 1,300,000(2)
#1823
Henderson, NV 89014
Common Dr. Raymond C.L. Yuan 10,000 0.104%
4335 S. Industrial Road 100,000(2)
Las Vegas, NV 89103
Common J. Thomas Burns 100,000(2) --
4335 S. Industrial Road
Las Vegas, NV 89103
30
Common Sherman Lazrus 100,000(2) --
4335 S. Industrial Road
Las Vegas, NV 89103
Common Douglas K. Beplate 55,618 0.581%
2254 Candlestick Avenue 1,600,000(2)
Henderson, NV 89052
--------- -----
Total Shares 658,078 6.877%
(1) Beneficial, including options.
(2) The following options of the Company are owned by the directors and
officers and control persons of the Company:
# of Shares Price Expiration
----------- ----- ----------
Michael J. Crnkovich 100,000 $0.60 12/30/03
500,000 $0.75 01/08/01
500,000 $0.75 01/03/03
500,000 $0.75 10/01/03
Peter Clark 100,000 $0.60 12/30/03
500,000 $0.75 01/08/01
300,000 $0.75 01/03/03
400,000 $0.75 10/01/03
Douglas K. Beplate 500,000 $0.75 01/08/01
500,000 $0.75 01/03/03
100,000 $0.75 07/12/03
500,000 $0.75 10/01/03
Raymond C.L. Yuan 100,000 $0.60 12/30/03
J. Thomas Burns 100,000 $0.60 12/30/01
Sherman Lazrus 100,000 $1.40 12/09/01
---------
Total shares subject
to options 4,800,000
Item 12. Certain Relationship and Related Transactions.
31
There have been no related party transactions, or any other
transactions or relationships required to be disclosed pursuant to Item 404 of
Regulation S-B.
Item 13. Exhibits and Reports on Form 8-K.
The following documents are filed as part of this report:
(1) Financial Statements filed as part of this report prepared
by HJ & Associates, LLC, Certified Public Accountants for
the fiscal year ended 12/31/00, with the related
consolidated statements of operations and accumulated
deficit, and cash flow for the year then ended.
SIGNATURES
Pursuant to the requirements of Section 12 of the Securities
Exchange Act of 1934, the Company has duly caused this registration statement to
be signed on its behalf by the undersigned, thereunto duly authorized.
Date: March 30, 2001 Emergency Filtration Products, Inc.
/s/ MICHAEL J. CRNKOVICH
By: ------------------------------------
Michael J. Crnkovich
Chief Executive Officer