Pure Earth Inc (fka PREA)

[AliAngel]

PURE EARTH, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS

March 31, 2010 December 31, 2009
(Unaudited)

ASSETS

CURRENT ASSETS
Cash and cash equivalents $ 210,556 $ 796,553

Restricted cash — 211,122
Accounts receivable, less allowance for doubtful accounts of $427,179 and $410,105 6,908,789 6,588,321
Due from affiliates 108,191 118,270
Inventories 505,025 392,562
Prepaid expenses 1,090,934 765,220
Other current assets 1,736,845 1,487,667
Deferred income tax asset 209,568 209,568
Assets of discontinued operations 184,977 1,383,593
Total Current Assets 10,954,885 11,952,876

PROPERTY AND EQUIPMENT
Land 1,085,940 1,085,940
Buildings and improvements 7,114,752 7,114,752
Leasehold improvements 220,560 220,560
Machinery and equipment 10,081,248 10,081,248
Trucks and automobiles 1,136,619 1,136,619
Office furniture, fixtures and computer software 324,439 324,439
19,963,558 19,963,558
Less: accumulated depreciation and amortization (6,625,455 ) (5,987.934 )
Property and Equipment, Net 13,338,103 13,975,624

OTHER ASSETS
Deposits and other assets 1,300,505 1,417,117
Deferred financing costs, net of accumulated amortization of $192,196 and $553,407 515,682 544,245
Goodwill 565,484 565,484
Permits 2,200,000 2,200,000
Other intangible assets, net of accumulated amortization 1,554,495 1,647,191
Idle machinery 4,158,100 4,158,100
Total Other Assets 10,294,266 10,532,137

TOTAL ASSETS $ 34,587,254 $ 36,460,637



The accompanying notes are an integral part of these condensed consolidated financial statements.


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PURE EARTH, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS


LIABILITIES AND STOCKHOLDERS’ EQUITY


March 31, 2010 December 31, 2009
(Unaudited)
CURRENT LIABILITIES
Line of credit $ 3,162,863 $ 1,884,529
Notes payable- related party 1,011,348 1,011,348
Current portion of long-term debt 1,841,048 1,445,576
Accounts payable 5,313,659 4,992,431
Accrued expenses 1,022,114 1,025,883
Accrued payroll and payroll taxes 259,725 151,408
Other current liabilities 595,601 541,736
Accrued disposal costs 485,453 468,942
Liabilities from discontinued operations 94,093 850,594
Total Current Liabilities 13,785.904 12,372,447

LONG-TERM LIABILITIES
Long-term debt, net of current portion 6,709,048 7,188,931
Mandatorily redeemable Series B preferred stock, $.001 par value; authorized 20,000 shares; issued and outstanding 6,300 and 6,300 shares 5,529,793 5,359,206
Accrued disposal costs 364,436 282,172
Contingent consideration 1,176,235 1,176,235
Warrants with contingent redemption provisions 383,168 383,168
Deferred income taxes 1,734,011 2,272,043
Deferred income taxes – permits 880,000 880,000
Total Long-Term Liabilities 16,776,691 17,541,755
TOTAL LIABILITIES 30,562,595 29,914,202

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS’ EQUITY

Preferred Stock, $.001 par value, authorized 500,000 shares;
Series C Convertible Preferred Stock $.001 par value, authorized 260,000 shares; issued and outstanding 105,350 and 105,350 shares, liquidation preference $1,088,616 105 105

Common stock, $.001 par value; authorized 25,000,000 shares; issued and outstanding 17,587,899 and 17,575,399 shares, respectively 17,588 17,576
Additional paid-in capital 15,040,834 15,034,596
Accumulated deficit (11,033,868 ) (8,505,842 )

TOTAL STOCKHOLDERS’ EQUITY 4,024,659 6,546,435

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 34,587,254 $ 36,460,637



The accompanying notes are an integral part of these condensed consolidated financial statements.
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PURE EARTH INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

For the Three Months Ended
March 31,
2010 2009
(Unaudited) (Unaudited)
REVENUES $ 7,017,726 $ 11,641,981

COST OF REVENUES (including depreciation and amortization expense of $615,882 and $483,181 for the three months ended March 31, 2010 and 2009) 7,007,291 9,392,783

GROSS PROFIT 10,435 2,249,198

OPERATING EXPENSES
Salaries and related expenses 878,434 1,342,786
Occupancy and other office expenses 172,088 235,860
Professional fees 617,002 534,594
Other operating expenses 242,194 331,801
Insurance 259,169 241,369
Depreciation and amortization 114,334 117,196
TOTAL OPERATING EXPENSES 2,283,221 2,803,606

LOSS FROM OPERATIONS (2,272,786 ) (554,408 )

OTHER INCOME (EXPENSES)
Interest income — 6,707
Interest expense (645,054 ) (575,197 )
Loss from equity investment (10,079 ) (103,597 )
Other income (expense) 91,021 (16,254 )
TOTAL OTHER INCOME (EXPENSES) (564,112 ) (688,341 )

LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES (2,836,898 ) (1,242,749 )

BENEFIT FROM INCOME TAXES (537,982 ) (656,043 )

NET LOSS FROM CONTINUING OPERATIONS (2,298,916 ) (586,706 )

DISCONTINUED OPERATIONS
Loss from discontinued operations (301,134 ) (221,634 )
Benefit from income taxes — —
Net loss from discontinued operations (301,134 ) (221,634 )
Gain on sale of assets and liabilities from discontinued operations 98,362 —
TOTAL LOSS FROM DISCONTINUED OPERATIONS (202,772 ) (221,634 )

NET LOSS (2,501,688 ) (808,340 )

Less: Series C Convertible Preferred Stock dividends 26,338 —

NET LOSS AVAILABLE FOR COMMON STOCKHOLDERS $ (2,528,026 ) $ (808,340 )

NET LOSS PER COMMON SHARE FROM CONTINUING OPERATIONS
Basic and Diluted $ (0.13 ) $ (0.04 )
NET LOSS PER COMMON SHARE FROM DISCONTINUED OPERATIONS
Basic and Diluted $ (0.02 ) $ (0.01 )
NET LOSS PER COMMON SHARE FROM SALE OF DISCONTINUED OPERATIONS
Basic and Diluted $ 0.01 —
TOTAL LOSS PER COMMON SHARE FROM DISCONTINUED OPERATIONS
Basic and Diluted $ (0.01 ) $ (0.01 )
NET LOSS PER COMMON SHARE
Basic and Diluted $ (0.14 ) $ (0.05 )
WEIGHTED AVERAGE SHARES OF COMMON STOCK OUTSTANDING
Basic and Diluted 17,582,899 17,223,021