**UNITED STATESSECURITIES AND EXCHANGE COMMISSION       Washington, D.C. 20549**

**FORM 10-QSB**

(Mark One)     [X] Quarterly report under Section 13 or 15(d) of the Securities Exchange Act     of 1934 For the quarterly period ended March 31, 2005     [ ] Transition report under Section 13 or 15(d) of the Securities Exchange     Act of 1934 For the transition period from _____ to _____

**Commission file number: 000-26095**

| **ENVIROKARE TECH, INC.**                                         |
|-------------------------------------------------------------------|
|                                                                   |
| (Exact name of small business issuer as specified in its charter) |

| **Nevada**               |   | **88-0412549**                       |
|--------------------------|--------|--------------------------------------|
|                          |   |                                      |
| (State of incorporation) |   | (IRS Employer Identification Number) |

| **5850 T.G. Lee Blvd., Suite 535,             Orlando, Florida 32822** |
|------------------------------------------------------------------------|
|                                                                        |
| (Address of principal executive office)                                |

| **(407) 856-8882**          |
|-----------------------------|
|                             |
| (Issuer's telephone number) |

Transitional Small Business Disclosure Format (Check one): Yes [ ] No [X]

----

| **TABLE OF CONTENTS**

**Part I - FINANCIAL INFORMATION**

Item 1. Financial Statements:                   Consolidated Balance Sheets                   Consolidated Statements of Operations                   Consolidated Statements of Cash Flows                   Condensed Notes to the Consolidated Financial Statements           Item 2. Management's Discussion and Analysis or Plan of Operations           Item 3. Control and Procedures

**Part II - OTHER INFORMATION**

Item 1. Legal Proceedings           Item 2. Changes in Securities           Item 3. Defaults Upon Senior Securities           Item 4. Submission of Matters to a Vote of Security Holders           Item 5 Other Information           Item 6. Exhibits and Reports on Form 8-K

**SIGNATURES** |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

**CAUTIONARY INFORMATION ABOUT FORWARD-LOOKING STATEMENTS**

                This document contains forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. All statements, other than statements of historical facts, included in or incorporated by reference into this Form 10-QSB which address activities, events or developments which the Company expects, believes or anticipates will or may occur in the future are forward-looking statements. The words "believes," "intends," "expects," "anticipates," "projects," "estimates," "predicts" and similar expressions are also intended to identify forward-looking statements. These forward-looking statements include, among others, statements concerning: expectations, anticipations, beliefs, estimations, projections, and other similar matters that are not historical facts, including such matters as future capital and development expenditures and expansion and growth of business operations.

                These statements are based on certain assumptions and analysis made by the management of Envirokare Tech Inc., ("ENVIROKARE") in light of its experience and its perception of historical trends, current conditions and expected future developments as well as other factors it believes are appropriate in the circumstances.

                Envirokare cautions the reader that these forward-looking statements are subject to risks and uncertainties, including those associated with: the financial environment, general economic, market and business conditions, the regulatory environment, business opportunities that may be presented to and pursued by Envirokare, changes in laws or regulations, availability to obtain additional financing on favorable conditions, trend projections, and other factors, many of which are beyond the Company's control that could cause actual events or results to differ materially from those expressed or implied by the statements. Such risks and uncertainties include those risks and uncertainties identified in the Description of the Business and Management's Discussion and Analysis sections of this document and risk factors discussed from time to time in the Company's filings with the Securities and Exchange Commission.

                Significant factors that could prevent Envirokare from achieving its stated goals include: the inability of Envirokare to obtain financing for capital expenditures and acquisitions, declines or failure to develop in the market for the Company's products, development of superior products by competition, and adverse changes in the regulatory environment affecting the Company.

                The cautionary statements contained or referred to in this document should be considered in connection with any subsequent written or oral forward-looking statements that may be issued by Envirokare or persons acting on its or their behalf.

                Envirokare undertakes no obligation to release publicly any revisions to any forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

----

**PART I - FINANCIAL INFORMATION**

**ITEM 1. FINANCIAL INFORMATION**

| **ENVIROKARE TECH, INC.**                                                                                             |                            |
|-----------------------------------------------------------------------------------------------------------------------|---------------------------------|
| **(A Development Stage Company)**                                                                                     |                            |
| **CONSOLIDATED BALANCE SHEETS**                                                                                       |                            |
|                                                                                                                  |                            |   |   |   |   |   |   |   |
|                                                                                                                  |                            |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                  |                            |   |   |   |   | March 31,               2005                (unaudited) |   |   | December 31,                2004 |   |
|                                                                                                                  |                            |   |   |   |   |   |   |   |
|                                                                                                                  |                            |   |   |   |   |   |   |   |
|                                                                                                                  |                            |   |   |   |   |  |   |   |  |   |
| ** A S S E T S**                                                                                                 |                            |   |   |   |   |   |   |   |   |
|                                                                                                                  | CURRENT ASSETS                  |   |   |   |   |   |   |   |   |   |
|                                                                                                                  |                            | Cash and cash equivalents |   |   | $ | 2,574,635 |   |   | $ | 432,155 |   |
|                                                                                                                  |                            | Deposits and retainers |   |   |   | 22,466 |   |   |   | 22,466 |   |
|                                                                                                                  |                            | Employee and related party receivables |   |   | 6,127 |   |   |   | 1,864 |   |
|                                                                                                                  |                            | Inventory |   |   |   | 43,216 |   |   |   | 43,216 |   |
|                                                                                                                  |                            |   |   |   |  |   |   |  |   |
|                                                                                                                  |                            |   | TOTAL CURRENT ASSETS |   |   |   | 2,646,443 |   |   |   | 499,700 |   |
|                                                                                                                  |                            |   |   |   |   |  |   |   |  |   |
|                                                                                                                  |                            |   |   |   |   |   |  |   |   |   |  |   |
|                                                                                                                  | PROPERTY AND EQUIPMENT          |   |   |   |  |   |   |   |  |   |
|                                                                                                                  |                            | Furniture and fixtures |   |   |   | 7,129 |   |   |   | 7,129 |   |
|                                                                                                                  |                            | Equipment |   |   |   | 375,292 |   |   |   | 25,292 |   |
|                                                                                                                  |                            | Molds |   |   |   | 170,912 |   |   |   | 170,912 |   |
|                                                                                                                  |                            | Real estate and building |   |   |   | 400,000 |   |   |   | - |   |
|                                                                                                                  |                            |   Less accumulated depreciation |   |   |   | (22,825 | ) |   |   | (12,538 | ) |
|                                                                                                                  |                            |   |   |   |  |   |   |  |   |
|                                                                                                                  |                            |   | TOTAL PROPERTY AND EQUIPMENT |   |   | 930,508 |   |   |   | 190,795 |   |
|                                                                                                                  |                            |   |   |   |  |   |   |  |   |
|                                                                                                                  |                            |   |   |   |   |   |  |   |   |   |  |   |
|                                                                                                                  | OTHER ASSETS                    |   |   |   |  |   |   |   |  |   |
|                                                                                                                  |                            | License agreement |   |   |   | - |   |   |   | 525,000 |   |
|                                                                                                                  |                            | Patents, net |   |   |   | 10,616,551 |   |   |   | 1,958,939 |   |
|                                                                                                                  |                            |   |   |   |  |   |   |  |   |
|                                                                                                                  |                            |   | TOTAL OTHER ASSETS |   |   |   | 10,616,551 |   |   |   | 2,483,939 |   |
|                                                                                                                  |                            |   |   |   |   |  |   |   |  |   |
|                                                                                                                  |                            |   |   |   |   |   |  |   |   |   |  |   |
|                                                                                                                  |                            | **TOTAL ASSETS** |   |   | $ | 14,193,503 |   |   |  $ | 3,174,435 |   |
|                                                                                                                  |                            |   |   |   |  |   |   |  |   |
|                                                                                                                  |                            |   |   |   |   |   |  |   |   |   |  |   |
| **L I A B I L I T I E S   &   S T O C K H O L D E R S '   E Q U I T Y  ** |                            |   |  |   |   |   |  |   |
|                                                                                                                  | CURRENT LIABILITIES             |   |   |   |  |   |   |   |  |   |
|                                                                                                                  |                            | Accounts payable |   |   | $ | 423,502 |   |   |  $ | 330,933 |   |
|                                                                                                                  |                            | Deposits from customers |   |   |   | 61,215 |   |   |   | 61,215 |   |
|                                                                                                                  |                            | Deposit owed on exclusivity agreement |   |   | - |   |   |   | 280,000 |   |
|                                                                                                                  |                            | Accrued compensation |   |   |   | 114,500 |   |   |   | 182,325 |   |
|                                                                                                                  |                            | Accrued interest |   |   |   | 39,363 |   |   |   | 37,835 |   |
|                                                                                                                  |                            | Accrued interest to stockholders |   |   |   | 6,373 |   |   |   | 8,936 |   |
|                                                                                                                  |                            | Capital equipment lease payable, current portion |   |   | 7,365 |   |   |   | 5,200 |   |
|                                                                                                                  |                            | Notes payable, current portion |   |   |   | 3,026 |   |   |   | 64,902 |   |
|                                                                                                                  |                            | Notes payable to shareholders, current portion |   |   | 104,000 |   |   |   | 100,197 |   |
|                                                                                                                  |                            |   |   |  |   |   |  |   |
|                                                                                                                  |                            |   | TOTAL CURRENT LIABILITIES |   |   | 759,343 |   |   |   | 1,071,542 |   |
|                                                                                                                  |                            |   |   |   |  |   |   |  |   |
|                                                                                                                  |                            |   |   |   |   |   |  |   |   |   |  |   |
|                                                                                                                  | LONG-TERM LIABILITIES           |   |   |   |  |   |   |   |  |   |
|                                                                                                                  |                            | Capital equipment lease payable, net of current portion |   |   | 3,626 |   |   |   | 5,791 |   |
|                                                                                                                  |                            | Notes payable, net of current portion |   |   | 5,729,129 |   |   |   | 10,499 |   |
|                                                                                                                  |                            | Notes payable to shareholders, net of current portion |   |   | 1,456,963 |   |   |   | 1,476,594 |   |
|                                                                                                                  |                            |   |   |  |   |   |  |   |
|                                                                                                                  |                            |   | TOTAL LONG-TERM LIABILITIES |   |   | 7,189,718 |   |   |   | 1,492,884 |   |
|                                                                                                                  |                            |   |   |   |  |   |   |  |   |
|                                                                                                                  |                            |   |   |   |   |   |  |   |   |   |  |   |
|                                                                                                                  | MINORITY INTEREST IN SUBSIDIARY |   |   | 4,995,764 |   |   |   | - |   |
|                                                                                                                  |                            |   |  |   |   |  |   |
|                                                                                                                  |                            |   |   |   |   |   |  |   |   |   |  |   |
|                                                                                                                  | COMMITMENTS AND CONTINGENCIES   |   |   | - |   |   |   | - |   |
|                                                                                                                  |                            |   |  |   |   |  |   |
|                                                                                                                  |                            |   |   |   |   |   |  |   |   |   |  |   |
|                                                                                                                  | STOCKHOLDERS' EQUITY            |   |   |   |  |   |   |   |  |   |
|                                                                                                                  |                            | Convertible preferred stock, 10,000,000 shares authorized, |   |   |  |   |   |   |  |   |
|                                                                                                                  |                            |   | $0.001 par value; 0 shares issued and outstanding |   |   | - |   |   |   | - |   |
|                                                                                                                  |                            | Common stock, 200,000,000 shares authorized, |   |   |  |   |   |   |  |   |
|                                                                                                                  |                            |   | $0.001 par value; 39,056,480 and 38,943,980 shares |   |   |  |   |   |   |  |   |
|                                                                                                                  |                            |   | issued and outstanding, respectively |   |   | 39,057 |   |   |   | 38,944 |   |
|                                                                                                                  |                            | Additional paid-in capital |   |   |   | 6,048,479 |   |   |   | 5,992,976 |   |
|                                                                                                                  |                            | Stock options and warrants |   |   |   | 3,177,584 |   |   |   | 2,452,199 |   |
|                                                                                                                  |                            | Accumulated deficit during development stage |   |   | (8,016,442 | ) |   |   | (7,874,110 | ) |
|                                                                                                                  |                            |   |   |  |   |   |  |   |
|                                                                                                                  |                            |   | TOTAL STOCKHOLDERS' EQUITY |   |   | 1,248,678 |   |   |   | 610,010 |   |
|                                                                                                                  |                            |   |   |   |  |   |   |  |   |
|                                                                                                                  |                            |   |   |   |   |   |  |   |   |   |  |   |
|                                                                                                                  |                            | **TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY** |   | $ | 14,193,503 |   |   |  $ | 3,174,435 |   |
|                                                                                                                  |                            |   |   |  |   |   |  |   |
|                                                                                                                  |                            |   |   |   |   |   |  |   |   |   |  |   |

F-1

----

| **ENVIROKARE TECH, INC.**                 |                              |
|-------------------------------------------|-----------------------------------|
| **(A Development Stage Company)**         |                              |
| **CONSOLIDATED STATEMENTS OF OPERATIONS** |                              |
|                                      |                              |   |   |   |   |   |   |   |   |   |   |
|                                      |                              |   |   |   |   |   |   |   |   |   |   |   |   |
|                                      |                              |   |   |   |   |   |   |   |   |   |   | **Period from** |   |
|                                      |                              |   |   |   |   |   |   |   |   |   |   | **June 15,1998** |   |
|                                      |                              |   |   | **Three Months Ended** |   |   |   | **(inception) to** |   |
|                                      |                              |   |   | **March 31,** |   |   |   | **March 31,** |   |   |   | **March 31,** |   |
|                                      |                              |   |   | **2005** |   |   |   | **2004** |   |   |   | **2005** |   |
|                                      |                              |   |   | **(unaudited)** |   |   |   | **(unaudited)** |   |   |   | **(unaudited)** |   |
|                                      |                              |   |   |  |   |   |   |  |   |   |   |  |   |
| REVENUES                                  |  $                           | -   |   |   | $ | -   |   |   |  $ | 62,150 |   |
|                                      |                              |   |   |  |   |   |   |  |   |   |   |  |   |
| COST OF GOODS SOLD                        |                              | -   |   |   |   | -   |   |   |   | (17,500 | ) |
|                                      |                              |  |   |   |   |  |   |   |   |  |   |
|                                      |                              |   |   |  |   |   |   |  |   |   |   |  |   |
|                                      | GROSS PROFIT                      |   | -   |   |   |   | -   |   |   |   | 44,650 |   |
|                                      |                              |   |  |   |   |   |  |   |   |   |  |   |
|                                      |                              |   |   |  |   |   |   |  |   |   |   |  |   |
| E X P E N S E S                           |                              |  |   |   |   |  |   |   |   |  |   |
|                                      | Consulting fees - related parties |   | 54,532 |   |   |   | 100,002 |   |   |   | 1,555,460 |   |
|                                      | Consulting fees - other           |   | -   |   |   |   | -   |   |   |   | 1,045,437 |   |
|                                      | Board of directors fees           |   | -   |   |   |   | -   |   |   |   | 1,384,590 |   |
|                                      | Rent                              |   | 29,163 |   |   |   | 23,172 |   |   |   | 422,370 |   |
|                                      | General and administrative        |   | 96,254 |   |   |   | 52,036 |   |   |   | 1,124,901 |   |
|                                      | Depreciation and amortization     |   | 38,596 |   |   |   | 1,396 |   |   |   | 54,096 |   |
|                                      | Professional fees                 |   | 160,253 |   |   |   | 62,213 |   |   |   | 1,283,352 |   |
|                                      | Research and development          |   | 1,377 |   |   |   | 5,059 |   |   |   | 91,145 |   |
|                                      | Wages and salaries                |   | 14,488 |   |   |   | 21,378 |   |   |   | 234,324 |   |
|                                      |                              |   |  |   |   |   |  |   |   |   |  |   |
|                                      |                              | TOTAL EXPENSES |   | 394,663 |   |   |   | 265,256 |   |   |   | 7,195,675 |   |
|                                      |                              |   |   |  |   |   |   |  |   |   |   |  |   |
|                                      |                              |   |   |  |   |   |   |  |   |   |   |  |   |
| LOSS FROM OPERATIONS                      |                              | (394,663 | ) |   |   | (265,256 | ) |   |   | (7,151,025 | ) |
|                                      |                              |   |   |  |   |   |   |  |   |   |   |  |   |
| OTHER INCOME (EXPENSES)                   |                              |  |   |   |   |  |   |   |   |  |   |
|                                      | Gain on sale of assets            |   | -   |   |   |   | -   |   |   |   | 577 |   |
|                                      | Gain on exclusivity agreement     |   | 280,000 |   |   |   | -   |   |   |   | 280,000 |   |
|                                      | Financing costs                   |   | -   |   |   |   | -   |   |   |   | (469,290 | ) |
|                                      | Interest income (expense)         |   | (31,905 | ) |   |   | (63,567 | ) |   |   | (680,940 | ) |
|                                      |                              |   |  |   |   |   |  |   |   |   |  |   |
|                                      |                              | TOTAL OTHER EXPENSE |   | 248,095 |   |   |   | (63,567 | ) |   |   | (869,653 | ) |
|                                      |                              |   |   |  |   |   |   |  |   |   |   |  |   |
|                                      |                              |   |   |  |   |   |   |  |   |   |   |  |   |
| LOSS BEFORE INCOME TAXES                  |                              | (146,568 | ) |   |   | (328,823 | ) |   |   | (8,020,678 | ) |
|                                      |                              |   |   |  |   |   |   |  |   |   |   |  |   |
| INCOME TAXES                              |                              | -   |   |   |   | -   |   |   |   | -   |   |
|                                      |                              |  |   |   |   |  |   |   |   |  |   |
|                                      |                              |   |   |  |   |   |   |  |   |   |   |  |   |
| MINORITY INTEREST ALLOCATION              |                              | 4,236 |   |   |   | -   |   |   |   | 4,236 |   |
|                                      |                              |  |   |   |   |  |   |   |   |  |   |
|                                      |                              |   |   |  |   |   |   |  |   |   |   |  |   |
| NET LOSS                                  | $                                 | (142,332 | ) |   | $ | (328,823 | ) |   |  $ | (8,016,442 | ) |
|                                      |                              |  |   |   |   |  |   |   |   |  |   |
|                                      |                              |   |   |  |   |   |   |  |   |   |   |  |   |
|                                      |                              |   |   |  |   |   |   |  |   |   |   |  |   |
|                                      | BASIC AND DILUTED NET LOSS        |   |  |   |   |   |  |   |   |   |  |   |
|                                      | PER COMMON SHARE                  | $ | nil | $ |   |   | (0.01 | ) |   |   |  |   |
|                                      |                              |   |  |   |   |   |  |   |   |   |  |   |
|                                      |                              |   |   |  |   |   |   |  |   |   |   |  |   |
|                                      | WEIGHTED AVERAGE NUMBER           |   |  |   |   |   |  |   |   |   |  |   |
|                                      | OF BASIC AND DILUTED COMMON       |   |  |   |   |   |  |   |   |   |  |   |
|                                      | STOCK SHARES OUTSTANDING          |   | 38,975,924 |   |   |   | 34,021,677 |   |   |   |  |   |
|                                      |                              |   |  |   |   |   |  |   |   |   |  |   |
|                                      |                              |   |   |  |   |   |   |  |   |   |   |  |   |

F-2

----

| **ENVIROKARE TECH, INC.**                       |                                          |
|-------------------------------------------------|-----------------------------------------------|
| **(A Development Stage Company)**               |                                          |
| **CONSOLIDATED STATEMENTS OF CASH  FLOWS** |                                          |
|                                            |                                          |   |   |   |   |   |   |   |   |   |   |   |   |
|                                            |                                          |   |   |   |   |   |   |   |   |   |   |   | **Period from** |   |   |
|                                            |                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   | **June 15,1998** |   |   |
|                                            |                                          |   |   |   |   |   |   | **Three Months Ended** |   | **(Inception) to** |   |   |
|                                            |                                          |   |   |   |   |   |   | **March 31,** |   |   |   | **March 31,** |   |   |   | **March 31,** |   |   |
|                                            |                                          |   |   |   |   |   |   | ** 2005** |   |   |   | ** 2004** |   |   |   | **2005** |   |   |
|                                            |                                          |   |   |   |   |   |   | ** (unaudited)** |   |   |   | ** (unaudited)** |   |   |   | ** (unaudited)** |   |   |
|                                            |                                          |   |   |   |   |   |   |  |   |   |   |  |   |   |   |  |   |   |
| CASH FLOWS FROM OPERATING ACTIVITIES:           |                                          |   |   |   |   |   |  |   |   |   |  |   |   |
|                                            | Net loss                                      |   |   |   |  $ | (142,332 | ) |   | $ | (328,823 | ) |   | $ | (8,016,442 | ) |   |
|                                            | Loss allocated to minority interest           |   |   | (4,236 | ) |   |   | -   |   |   |   | (4,236 | ) |   |
|                                            |                                          |   |   |  |   |   |   |  |   |   |   |  |   |   |
|                                            |                                          |   |   |   |   |   |   | (146,568 | ) |   |   | (328,823 | ) |   |   | (8,020,678 | ) |   |
|                                            |                                          |   |   |   |   |   |   |  |   |   |   |  |   |   |   |  |   |   |
|                                            | Adjustments to reconcile net loss to          |   |   |  |   |   |   |  |   |   |   |  |   |   |
|                                            |   net cash used by operating activities: |   |   |  |   |   |   |  |   |   |   |  |   |   |
|                                            |                                          | Depreciation and amortization |   |   | 38,596 |   |   |   | 1,396 |   |   |   | 54,096 |   |   |
|                                            |                                          | Intangible asset expensed |   |   | -   |   |   |   | -   |   |   |   | 9,520 |   |   |
|                                            |                                          | Impairment of molds |   |   | -   |   |   |   | -   |   |   |   | 27,000 |   |   |
|                                            |                                          | Gain on sale of assets |   |   | -   |   |   |   | -   |   |   |   | (577 | ) |   |
|                                            |                                          | Stock options issued for consulting fees |   |   | -   |   |   |   | -   |   |   |   | 1,418,987 |   |   |
|                                            |                                          | Stock options issued for directors fees |   |   | -   |   |   |   | -   |   |   |   | 854,779 |   |   |
|                                            |                                          | Common stock issued for consulting fees |   |   | -   |   |   |   | -   |   |   |   | 169,094 |   |   |
|                                            |                                          | Common stock issued for payment of expenses |   |   | -   |   |   |   | -   |   |   |   | 134,000 |   |   |
|                                            |                                          | Warrants issued for financing expenses |   |   | -   |   |   |   | -   |   |   |   | 469,290 |   |   |
|                                            |                                          | Warrant term extension granted for accrued compensation |   |   | -   |   |   |   | -   |   |   |   | 24,000 |   |   |
|                                            |                                          | Interest paid with refinance of debt |   |   | -   |   |   |   | -   |   |   |   | 350,890 |   |   |
|                                            | Changes in assets and liabilities:            |   |   |  |   |   |   |  |   |   |   |  |   |   |
|                                            |                                          | Customer deposits |   |   | -   |   |   |   |     -   |   |   |   | 61,215 |   |   |
|                                            |                                          | Inventory |   |   |   | -   |   |   |   |     -   |   |   |   | (43,216 | ) |   |
|                                            |                                          | Employee and related party receivables |   |   | (4,263 | ) |   |   |     -   |   |   |   | (6,127 | ) |   |
|                                            |                                          | Prepaid expenses |   |   | -   |   |   |   | (2,789 | ) |   |   | -   |   |   |
|                                            |                                          | Accounts payable |   |   | 92,569 |   |   |   | 90,247 |   |   |   | 423,502 |   |   |
|                                            |                                          | Accrued compensation |   |   | (67,825 | ) |   |   |     -   |   |   |   | 114,500 |   |   |
|                                            |                                          | Accrued interest payable |   |   | (1,035 | ) |   |   | 2,567 |   |   |   | 60,489 |   |   |
|                                            |                                          | Deposit owed on exclusivity agreement |   |   | (280,000 | ) |   |   |     -   |   |   |   | -   |   |   |
|                                            |                                          |   |   |   |  |   |   |   |  |   |   |   |  |   |   |
|                                            |                                          | Net cash used by operating activities |   |   | (368,526 | ) |   |   |     -   |   |   |   | (3,899,236 | ) |   |
|                                            |                                          |   |   |   |  |   |   |   |  |   |   |   |  |   |   |
|                                            |                                          |   |   |   |   |   |   |  |   |   |   |  |   |   |   |  |   |   |
| CASH FLOWS FROM INVESTING ACTIVITIES:           |                                          |   |  |   |   |   |  |   |   |   |  |   |   |
|                                            |                                          | Deposits and retainers |   |   | -   |   |   |   |     -   |   |   |   | (22,465 | ) |   |
|                                            |                                          | Purchase of molds |   |   | -   |   |   |   |     -   |   |   |   | (197,912 | ) |   |
|                                            |                                          | Payments on license agreement |   |   | -   |   |   |   |     -   |   |   |   | (525,000 | ) |   |
|                                            |                                          | Patent costs |   |   | (12,712 | ) |   |   |     -   |   |   |   | (22,841 | ) |   |
|                                            |                                          | Purchase of equipment |   |   | -   |   |   |   |     -   |   |   |   | (17,268 | ) |   |
|                                            |                                          | Proceeds from sale of equipment |   |   | -   |   |   |   |     -   |   |   |   | 1,275 |   |   |
|                                            |                                          |   |   |   |  |   |   |   |  |   |   |   |  |   |   |
|                                            |                                          | Net cash used in investing activities |   |   | (12,712 | ) |   |   | -   |   |   |   | (784,211 | ) |   |
|                                            |                                          |   |   |   |  |   |   |   |  |   |   |   |  |   |   |
|                                            |                                          |   |   |   |   |   |   |  |   |   |   |  |   |   |   |  |   |   |
| CASH FLOWS FROM FINANCING ACTIVITIES:           |                                          |   |  |   |   |   |  |   |   |   |  |   |   |
|                                            |                                          | Payment of capital equipment lease |   |   | -   |   |   |   | (884 | ) |   |   | (4,604 | ) |   |
|                                            |                                          | Payment of notes payable |   |   | (16,282 | ) |   |   | (21,004 | ) |   |   | (118,071 | ) |   |
|                                            |                                          | Proceeds from sale of preferred stock |   |   | -   |   |   |   | -   |   |   |   | 250,000 |   |   |
|                                            |                                          | Proceeds from sale of common stock |   |   | 40,000 |   |   |   | 279,350 |   |   |   | 3,181,797 |   |   |
|                                            |                                          | Proceeds from sale of warrant term extension |   |   | -   |   |   |   | -   |   |   |   | 102,825 |   |   |
|                                            |                                          | Repurchase of common stock |   |   | -   |   |   |   | -   |   |   |   | (7,500 | ) |   |
|                                            |                                          | Proceeds from notes payable, related parties |   |   | -   |   |   |   | -   |   |   |   | 1,353,635 |   |   |
|                                            |                                          | Proceeds from minority interest capital contribution |   |   | 5,000,000 |   |   |   |  |   |   |   | 5,000,000 |   |   |
|                                            |                                          | Payment on acquisition agreement |   |   | (2,500,000 | ) |   |   | -   |   |   |   | (2,500,000 | ) |   |
|                                            |                                          |   |   |   |  |   |   |   |  |   |   |   |  |   |   |
|                                            |                                          | Net cash provided by financing activities |   |   | 2,523,718 |   |   |   | 257,462 |   |   |   | 7,258,082 |   |   |
|                                            |                                          |   |   |   |  |   |   |   |  |   |   |   |  |   |   |
|                                            |                                          |   |   |   |   |   |   |  |   |   |   |  |   |   |   |  |   |   |
| Net increase in cash                            |                                          |   | 2,142,480 |   |   |   | 257,462 |   |   |   | 2,574,635 |   |   |
|                                            |                                          |   |   |   |   |   |   |  |   |   |   |  |   |   |   |  |   |   |
| Cash and cash equivalents, beginning of period  |                                          |   | 432,155 |   |   |   | 65,810 |   |   |   | -   |   |   |
|                                            |                                          |   |  |   |   |   |  |   |   |   |  |   |   |
|                                            |                                          |   |   |   |   |   |   |  |   |   |   |  |   |   |   |  |   |   |
| Cash and cash equivalents, end of period        |                                          | $ | 2,574,635 |   |   | $ | 323,272 |   |   | $ | 2,574,635 |   |   |
|                                            |                                          |   |  |   |   |   |  |   |   |   |  |   |   |
|                                            |                                          |   |   |   |   |   |   |  |   |   |   |  |   |   |   |  |   |   |
| SUPPLEMENTAL CASH FLOW INFORMATION:             |                                          |   |  |   |   |   |  |   |   |   |  |   |   |
|                                            |                                          | Interest paid |   | $ | 32,760 |   |   | $ | 60,376 |   |   | $ | 87,095 |   |   |
|                                            |                                          |   |   |   |  |   |   |   |  |   |   |   |  |   |   |
|                                            |                                          | Income taxes paid |   | $ | -   |   |   | $ | -   |   |   | $ | -   |   |   |
|                                            |                                          |   |   |   |  |   |   |   |  |   |   |   |  |   |   |
|                                            |                                          |   |   |   |   |   |   |  |   |   |   |  |   |   |   |  |   |   |
| NON-CASH TRANSACTIONS:                          |                                          |   |  |   |   |   |  |   |   |   |  |   |   |
|                                            |                                          | Common stock issued for acquisition of subsidiary |   | $ | -   |   |   | $ | -   |   |   | $ | 1,925,000 |   |   |
|                                            |                                          | Note issued for purchase of property, equipment, |   |   |  |   |   |   |  |   |   |   |  |   |   |
|                                            |                                          |   |  and operating expenses |   | $ | -   |   |   | $ | -   |   |   | $ | 3,635 |   |   |
|                                            |                                          | Note issued for pending patent to related party |   | $ | -   |   |   | $ | -   |   |   | $ | 33,330 |   |   |
|                                            |                                          | Note issued for deposit for stock |   | $ | -   |   |   | $ | -   |   |   | $ | 100,000 |   |   |
|                                            |                                          | Warrants issued for financing expenses |   | $ | -   |   |   | $ | -   |   |   | $ | 469,290 |   |   |
|                                            |                                          | Stock options issued for consulting fees |   | $ | -   |   |   | $ | -   |   |   | $ | 1,418,987 |   |   |
|                                            |                                          | Stock options issued for directors fees |   | $ | -   |   |   | $ | -   |   |   | $ | 854,779 |   |   |
|                                            |                                          | Common stock issued for consulting fees |   | $ | -   |   |   | $ | -   |   |   | $ | 169,094 |   |   |
|                                            |                                          | Common stock issued for payment of expenses |   | $ | -   |   |   | $ | -   |   |   | $ | 134,000 |   |   |
|                                            |                                          | Warrant term extension granted for accrued compensation |   | $ | -   |   |   | $ | -   |   |   | $ | 24,000 |   |   |
|                                            |                                          | Interest paid with refinance of debt |   | $ | -   |   |   | $ | -   |   |   | $ | 350,890 |   |   |
|                                            |                                          | Stockholder's contribution for equipment |   | $ | -   |   |   | $ | -   |   |   | $ | 1,847 |   |   |
|                                            |                                          | Equipment acquired via capital lease |   | $ | -   |   |   | $ | -   |   |   | $ | 15,595 |   |   |
|                                            |                                          | Stock options issued in acquistion |   | $ | 741,000 |   |   | $ | -   |   |   | $ | 741,000 |   |   |
|                                            |                                          | Debt incurred in acquisition of subsidiary's property |   |   |  |   |   |   |  |   |   |   |  |   |   |
|                                            |                                          |   | and patents |   | $ | 8,157,208 |   |   | $ | -   |   |   | $ | 8,157,208 |   |   |
|                                            |                                          |   |   |   |   |   |   |  |   |   |   |  |   |   |   |  |   |   |

F-3

----

**ENVIROKARE TECH, INC.         (A DEVELOPMENT STAGE COMPANY)         CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS         MARCH 31, 2005**

**NOTE 1 – ORGANIZATION AND DESCRIPTION OF BUSINESS**

Envirokare Tech, Inc. (hereinafter, "the Company" or "Envirokare") was incorporated in June 1998 under the laws of the State of Nevada.  In December 1998, the Company acquired assets of a business engaged in developing a rubber mold technology and patent rights potentially applicable to future development of a pallet made of recycled materials.  The Company believes the early-stage rubber mold technology to be of marginal commercial value.

During 2001, the Company acquired the licensing rights to a proprietary thermoplastic processing technology, the Thermoplastic Flow forming process (variously referred to herein as "TPF Process", the "Process" or "TPF technology").  The licensing agreement provides the Company with the ability to utilize the TPF technology to design, develop, manufacture, market, license and sublicense a wide range of large structural parts, including the Company's proprietary pallet.  The pallet is now composed of long-fiber reinforced thermoplastic composite and will be manufactured using the acquired TPF technology.

In March 2005, the Company acquired the assets of Thermoplastic Composite Designs, Inc. (hereinafter "TCD").  These assets were subsequently contributed to LRM Industries, LLC, a joint venture with Nova Chemicals, Inc. (hereinafter "Nova"), to commercialize the Company's TPF technology.  The joint venture is being accounted for as a majority control subsidiary, with Nova's interest treated as a minority interest.  See Note 10.

The Company's current operating strategy is based on developing products to be manufactured by the TPF Process, as well as marketing the TPF technology to potential sublicensees.  The Company maintains offices in Orlando, Florida. The Company has elected a fiscal year-end of December 31.

The Company's consolidated financial statements include the following entities:  Electroship Acquisition Corporation, Envirokare Composite Corp., Thermoplastic Composite Designs, Inc., and LRM Industries, LLC.

**NOTE 2 – BASIS OF PRESENTATION**

The foregoing unaudited interim financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-QSB and Regulation S-B as promulgated by the Securities and Exchange Commission ("SEC").  Accordingly, these financial statements do not include all of the disclosures required by generally accepted accounting principles in the United States of America for complete financial statements.  These unaudited interim financial statements should be read in conjunction with the audited financial statements for the year ended December 31, 2004.  In the opinion of management, the unaudited interim financial statements furnished herein include all adjustments, all of which are of a

F-4

----

**ENVIROKARE TECH, INC.         (A DEVELOPMENT STAGE COMPANY)         CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS         MARCH 31, 2005**

**NOTE 2 – BASIS OF PRESENTATION (continued)**

normal recurring nature, necessary for a fair statement of the results for the interim period presented.

The preparation of financial statements in accordance with generally accepted accounting principles in the United States of America requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities known to exist as of the date the financial statements are published, and the reported amounts of revenues and expenses during the reporting period.  Uncertainties with respect to such estimates and assumptions are inherent in the preparation of the Company's financial statements; accordingly, it is possible that the actual results could differ from these estimates and assumptions and could have a material effect on the reported amounts of the Company's financial position and results of operations.

Operating results for the three month period ended March 31, 2005 are not necessarily indicative of the results that may be expected for the year ending December 31, 2005.

Going Concern

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern.  This basis of accounting contemplates the recovery of the Company's assets and the satisfaction of its liabilities in the normal course of operations. 

As shown in the accompanying financial statements, the Company has incurred an accumulated deficit of $8,016,442 through March 31, 2005, and has had no revenues.  These factors raise substantial doubt about the Company's ability to continue as a going concern.   The Company's financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that might be necessary in the event the Company cannot continue in existence.

**NOTE 3 – PROPERTY AND EQUIPMENT**

Property and equipment are stated at cost.  Depreciation is provided using the straight line method over the estimated useful lives of the assets, which range from five to seven years.  Molds will be depreciated over their estimated useful lives once placed in service. Depreciation expense for the three months ended March 31, 2005 and 2004 was $10,287 and $1,396, respectively.

F-5

----

**ENVIROKARE TECH, INC.         (A DEVELOPMENT STAGE COMPANY)         CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS         MARCH 31, 2005**

**NOTE 3 – PROPERTY AND EQUIPMENT (continued)**

The following is a summary of the Company's property and equipment and related accumulated depreciation:
|                                 |   | March 31, |   |   |   | December 31, |   |
|--------------------------------------|--------|-----------|--------|--------|--------|--------------|--------|
|                                 |   | 2005      |   |   |   | 2004         |   |
|                                 |   |           |   |   |   |              |   |
| Furniture and fixtures               | $      | 7,129     |   |   | $      | 7,129        |   |
| Equipment                            |   | 375,292   |   |   |   | 25,292       |   |
| Molds                                |   | 170,912   |   |   |   | 170,912      |   |
| Buildings                            |   | 50,000    |   |   |   | -            |   |
| Land                                 |   | 350,000   |   |   |   | -            |   |
|                                 |   |           |   |   |   |              |   |
|                                 |   | 953,333   |   |   |   | 203,333      |   |
| Less:  Accumulated depreciation |   | (22,825   | )      |   |   | (12,538      | )      |
|                                 |   |           |   |   |   |              |   |
|                                 | $      | 930,508   |   |   | $      | 190,795      |   |
|                                 |   |           |   |   |   |              |   |

**NOTE 4 – INTANGIBLE ASSETS**

Intangible assets are tested for impairment on an annual basis. At March 31, 2005, the Company considered the acquisition costs of its intangible assets to be fully recoverable.  The Company will commence the amortization of such costs when the assets are placed in service.  

License Agreement

In March 2001, the Company obtained the rights to its TPF process in exchange for cash consideration of $525,000.  The licensing agreement provides the Company with the ability to utilize the TPF technology to design, develop, manufacture, market, license and sublicense a wide range of large structural parts, including the Company's proprietary pallet.  This license agreement was treated as part of the acquisition costs and eliminations in the acquisition of TCD.  See Note 10.

Patents and Patents Pending

The Company acquired rights in an invention and its related provisional patent application entitled "Apparatus and Method for Facilitating Shipping and Commerce" in connection with its December 2000 merger with Electroship Acquisition Corporation.  This application expired.  The Company re-filed the application and the patent is presently pending.  The Company is evaluating options to develop aspects of the electronic technology as it relates to shipping and commerce applications.  Amortization expense for the three months ended March 31, 2005 was $28,309.

In March 2005, the Company acquired the assets of Thermoplastic Composite Designs, Inc., which included patents and other intellectual property.  See Note 10.

F-6

----

**ENVIROKARE TECH, INC.         (A DEVELOPMENT STAGE COMPANY)         CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS         MARCH 31, 2005**

**NOTE 5 – NOTES PAYABLE TO SHAREHOLDERS**

During the year ended December 31, 2003, the Company entered into a promissory note arrangement with two Company shareholders, in the principal amount of $100,000.  The note bears an interest rate of 15% per annum with principal and interest payment payable in 36 equal monthly installments of $3,467 commencing September 1, 2003.  Three common stock warrants are attached to each dollar of debt, with an exercise price of $0.20 per share.  These warrants are fully exercisable for up to three years from the date of issuance.

During the year ended December 31, 2003, the Company entered into a promissory note with a director and shareholder, in the principal amount of $200,000.  The note bears an interest rate of 15% per annum, with principal and interest payment payable in 36 equal monthly installments of $6,933, commencing January 1, 2003.  Three common stock warrants are attached to each dollar of debt, with an exercise price of $0.20 per share. These warrants are fully exercisable for up to three years.  

Also in December 2003, the Company rolled a portion of its outstanding notes payable and accrued interest to related parties into new notes.  These notes bear an interest rate of 12% per annum, with interest only payable in equal monthly installments of varying amounts, commencing on January 1, 2004.  Common stock warrants totaling 5,125,000 were attached to these loans, with an exercise price of $0.20 per share.  These warrants are fully exercisable for up to three years from the date of issuance.   

**NOTE 6 – COMMON STOCK**

During the three months ended March 31, 2005, the Company issued 62,500 shares of its common stock when warrants were exercised at $0.40 per share for a total of $25,000.  In addition, 50,000 shares were issued when stock options were exercised at $0.30 per share for a total of $15,000. 

F-7

----

**ENVIROKARE TECH, INC.         (A DEVELOPMENT STAGE COMPANY)         CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS         MARCH 31, 2005**

**NOTE 7 – STOCK OPTIONS AND WARRANTS**

Stock Options

Summarized information about stock options outstanding and exercisable at March 31, 2005 is as follows:
|   | Options Outstanding |   | Options Exercisable              |
|--------|---------------------|--------|----------------------------------|
|   |                     |   |                                  |
|   | Exercise Price      |   | Number               Outstanding |   | Weighted               Average               Remaining               Contractual               Life (Years) |   |   | Weighted               Average               Exercise Price |   | Number               Exercisable |   |   | Weighted               Average               Exercise Price |
|   |                     |   |                                  |   |  |   |   |  |   |  |   |   |  |
| $      | 0.23                |   | 7,525,000                        |   | 7.60 |   | $ | 0.23 |   | 7,525,000 |   | $ | 0.23 |
|   | 0.30                |   | 50,000                           |   | 4.50 |   |   | 0.30 |   | 50,000 |   |   | 0.30 |
|   | 0.40                |   | 250,000                          |   | 4.50 |   |   | 0.40 |   | 250,000 |   |   | 0.40 |
|   | 0.57                |   | 250,000                          |   | 4.50 |   |   | 0.57 |   | 250,000 |   |   | 0.57 |
|   | 0.94                |   | 1,300,000                        |   | 2.90 |   |   | 0.94 |   | 1,300,000 |   |   | 0.94 |
|   |                     |   |                                  |   |  |   |   |  |   |  |   |   |  |
| $      | 0.23 - 0.57         |   | 9,375,000                        |   | 6.77 |   | $ | 0.34 |   | 9,375,000 |   | $ | 0.25 |
|   |                     |   |                                  |   |  |   |   |  |   |  |   |   |  |
| Equity Compensation               Plans Approved by               Shareholders |   | Shares Issuable               Upon Exercise of               Outstanding Options |   | Weighted Average               Exercise Price |   | Shares Available for               Issuance |
|--------------------------------------------------------------------------------|--------|----------------------------------------------------------------------------------|--------|-----------------------------------------------|--------|---------------------------------------------|
|                                                                                |   |                                                                                  |   |                                               |   |                                             |
| 1999 Equity Incentive Plan                                                     |   |  700,000                                                                    |   | $0.43                                         |   |  3,300,000                             |

Following is a summary of the Company's stock option activity during the three months ending March 31, 2005:
|                                     |   |  Shares |   |   |   |  Weighted               Average               Exercise Price |
|------------------------------------------|--------|--------------|--------|--------|--------|-------------------------------------------------------------------|
|                                     |   |              |   |   |   |                                                                   |
| Options outstanding at December 31, 2004 |   | 8,125,000    |   |   | $      | 0.25                                                              |
| Granted                                  |   | 1,300,000    |   |   |   | 0.94                                                              |
| Canceled                                 |   | -            |   |   |   | -                                                            |
| Exercised                                |   | (50,000      | )      |   |   | 0.30                                                              |
|                                     |   |              |   |   |   |                                                                   |
| Options outstanding at March 31, 2005    |   | 9,375,000    |   |   | $      | 0.34                                                              |
|                                     |   |              |   |   |   |                                                                   |

F-8

----

**ENVIROKARE TECH, INC.         (A DEVELOPMENT STAGE COMPANY)         CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS         MARCH 31, 2005**

**NOTE 7 – STOCK OPTIONS AND WARRANTS (continued)**

Common Stock Warrants

Summarized information about common stock warrants outstanding and exercisable at March 31, 2005 is as follows:
|                       |   |  Common Shares               Under Warrants                      |   | Exercise Price               Per Share |   | Weighted Average               Fair Value Per Share               At Grant Date |   | Expiration               Date |
|----------------------------|--------|-----------------------------------------------------------------------|--------|----------------------------------------|--------|---------------------------------------------------------------------------------|--------|-------------------------------|
|                       |   |                                                                       |   |                                        |   |                                                                                 |   |                               |
| Balance, December 31, 2004 |   |       20,390,000                             |   | $0.20 - $0.75                          |   | $0.20                                                                           |   | 2/05 - 9/14                   |
|                       |   |                                                                  |   |                                   |   |                                                                            |   |                          |
| Exercise of warrants       |   |            (62,500) |   | $0.40                                  |   | $0.25                                                                           |   | 2/06                          |
|                       |   |                                                                  |   |                                   |   |                                                                            |   |                          |
| Expiration of warrants     |   |            (20,000) |   | $0.75                                  |   | $0.23                                                                           |   | 2/05                          |
|                       |   |                                                                       |   |                                   |   |                                                                            |   |                          |
| Balance, March 31, 2005    |   |       20,307,500                             |   |                                   |   |                                                                            |   |                          |
|                       |   |                                                                       |   |                                   |   |                                                                            |   |                          |

**NOTE 8 – INCOME TAXES**

At March 31, 2005, the Company had net deferred tax assets of approximately $2,120,000, principally arising from net operating loss carryforwards for income tax purposes.  The Company calculates its deferred tax asset using a combined State and Federal tax rate of 39.5%.  As the Company's management cannot determine that it is more likely than not that the Company will realize the benefit of the net deferred tax asset, a valuation allowance equal to the net deferred tax asset has been established at March 31, 2005. 

The significant components of the deferred tax asset at March 31, 2005 and December 31, 2004 are as follows:  
|                                   |   |   |       |   |      |  March 31, |       |   |      |  December 31, |   |
|----------------------------------------|--------|--------|------------|--------|-----------|-----------------|------------|--------|-----------|--------------------|--------|
|                                   |   |   |       |   |      |  2005      |       |   |      |  2004         |   |
|                                   |   |   |       |   |      |                 |       |   |      |                    |   |
| Net operating loss carryforward        |   | $      | 5,366,000  |   |      | $               | 5,220,000  |   |
|                                   |   |   |       |   |      |                 |       |   |      |                    |   |
| Deferred tax asset                     |   |   |       | $      | 2,120,000 |            |       | $      | 2,060,000 |               |
|                                   |   |   |       |   |           |            |       |   |           |               |
| Deferred tax asset valuation allowance |   | $      | (2,120,000 | )      |      | $               | (2,060,000 | )      |
|                                   |   |   |            |   |      |            |            |   |

At March 31, 2005, the Company had net operating loss carryforwards of approximately $5,366,000, which expire in the years 2018 through 2025.  The change in the allowance account from December 31, 2004 to March 31, 2005 was $60,000. 

F-9

----

**ENVIROKARE TECH, INC.         (A DEVELOPMENT STAGE COMPANY)         CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS         MARCH 31, 2005**

**NOTE 9 – COMMITMENTS AND CONTINGENCIES**

Operating Lease Agreements

The Company entered into a lease for office space in Orlando, Florida on September 16, 2002 for a period of 36 months.  Lease payments are currently $3,021 per month, with additional charges for common area.  A security deposit was paid in the amount of $2,600.  Total payments under this lease for the three months ended March 31, 2005 and 2004 were $9,064 and $8,719 respectively. 

The Company entered into a lease for office space in Boca Raton, Florida on February 7, 2001 for sixty months.  Lease payments, including charges for common area, are currently $4,942.  A security deposit and last month's rent were paid in the amount of $8,412.  A portion of this space is being subleased, with the sublessee reimbursing the Company $3,000 per month.  The Company's net lease payments amount to $1,942.  Total net lease payments for the three months ended March 31, 2005 and 2004 were $5,826 and $5,293, respectively. 

The future minimum lease payments below for the Boca Raton office are the total amount of the payments as if there was no sublease.  The Company anticipates the sublease to continue through the end of the lease term.

The Company also records as rent expense, payments to officers and directors for lodging reimbursement, but the Company is not contractually bound by lease agreements to make such payments.  For the three months ended March 31, 2005, the Company recorded $7,273 related to these transactions.

Future annual minimum operating lease payments for the terms of the Orlando and  Boca Raton lease agreements are as follows for the years ending December 31:
|   |   |   | Orlando               Office |   |   | Boca Raton               Office |   |   | Total  |
|--------|--------|--------|------------------------------|--------|--------|---------------------------------|--------|--------|--------|
|   |   |   |                              |   |   |                                 |   |   |        |
| 2005   |   | $      | 18,126                       |   | $      | 17,478                          |   | $      | 35,604 |
|   |   |   |                         |   |   |                            |   |   |   |
| 2006   |   | $      | -                            |   | $      | 3,884                           |   | $      | 3,884  |

The Company leases its facility in Mims, Florida, which was acquired in the acquisition of TCD, to its joint venture entity, LRM, LLC.  The two-year agreement provides for rents of $7,000 per month.  These transactions have been eliminated in the consolidation of these financial statements.

F-10

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**ENVIROKARE TECH, INC.         (A DEVELOPMENT STAGE COMPANY)         CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS         MARCH 31, 2005**

**NOTE 9 – COMMITMENTS AND CONTINGENCIES (continued)**

Capital Leases Agreements

During the year ended December 31, 2003, the Company acquired computer equipment through two capital leases.  The Company recognizes the value of the equipment in property, plant and equipment in the financial statements and the lease liability in both current liabilities and long-term liabilities on the financial statements.  The leases, totaling $9,463, are for 36 months, with interest and principal payments of $345 per month. 

During year ended December 31, 2004, the Company acquired additional computer equipment under capital lease agreements.  These leases, totaling $6,132, are for 36 months, with interest and principal payments of $222 per month. 

Litigation

The Company is a named defendant in an action filed by Mr. Real Morel in May 2000 in the Supreme Court of British Columbia, Canada. In this action, Mr. Morel alleges non-payment by the Company of amounts due pursuant to the aforementioned demand promissory notes.  After consultation with British Columbia legal counsel and a review of the circumstances surrounding the issuance of the notes, the Company has resolved to dispute this liability.  Management of the Company believes that the outcome will not have a material adverse effect on the financial position of the Company.

The Company is a named defendant along with others including a director of the Company in a proceeding filed in the Superior Court of Cumberland County, Maine by former employees of Sports Quest of New England LLC, for back wages and penalties, which could total more than $300,000.  The Company has denied all liability, ownership, or other involvement with Sport Quest LLC.  The matter is in the pleading stage. 

The Company is the defendant in an action commenced by its former law firm for unpaid legal services in the amount of $18,952.  The Company has filed a motion to dismiss.  The motion is still pending. Although the Company intends to vigorously defend the action, there have been discussions with the plaintiff concerning a settlement.  The Company has included in the accompanying financial statements a liability for $18,952.  

Schaefer Systems International, Inc.

On March 28, 2003, the Company entered into a product development agreement with Schaefer Systems International, Inc., (hereinafter "SSI") wherein the Company would design, develop and produce a quantity of prototypes for field testing.  An initial payment of $61,215 was made by SSI to the Company to facilitate the development of a proprietary product. 

F-11

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**ENVIROKARE TECH, INC.         (A DEVELOPMENT STAGE COMPANY)         CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS         MARCH 31, 2005**

**NOTE 9 – COMMITMENTS AND CONTINGENCIES (continued)**

Schaefer Systems International, Inc. (continued)

The Company has delivered part of the first run of development parts.  The initial period of the development contract has expired.  Due to changes from both SSI and the company that is constructing the prototypes, the final product has not been finished.  At such time as the product is delivered to SSI in its final form, the Company will recognize the initial deposit as revenue.

**NOTE 10 – ACQUISITIONS**

In March, 2005, the Company announced that it had executed a definitive merger agreement in which Thermoplastic Composite Design (hereinafter "TCD") merged with and into the Company's wholly-owned subsidiary, Envirokare Composites Corp. (hereinafter "ECC").  The transaction combined all of TCD's business, including its intellectual property, assets and contracts with ECC.  The merger agreement provided for an initial payment of $2.5 million to TCD shareholders and a subsequent schedule of payments over a seven-year period totaling $15 million.   The current value of this note was determined by applying a discount rate of 12%.  The original note value under this discount was $8,157,208, of which $2,500,000 was paid during the quarter.

Following is a summary of the assets acquired under the TCD merger agreement:
| Equipment       |   | $      |       350,000 |
|-----------------|--------|--------|----------------------------------------|
| Real property   |   |   |       400,000 |
| Patents         |   |   |    7,413,564                 |
|            |   |   |                                        |
| Assets acquired |   | $      |    8,163,564                 |
|            |   |   |                                        |

Also in March, 2005, the Company announced that ECC executed a 50:50 joint venture agreement with Nova Chemicals, Inc., and created a new company, LRM Industries LLC, to commercialize the Company's TPF technology.  The Company has contributed its intellectual property rights, technology, manufacturing equipment and all TPF business activities which were acquired through the merger with TCD into the joint venture, while Nova Chemicals has contributed $5,000,000 in cash and has agreed to contribute future services valued at $1,000,000.

F-12

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**ENVIROKARE TECH, INC.         (A DEVELOPMENT STAGE COMPANY)         CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS         MARCH 31, 2005**

**NOTE 10 – ACQUISITIONS (continued)**

Following is a summary of the net assets contributed to LRM by the Company:
| Equipment                            |   | $      |       350,000                   |
|--------------------------------------|--------|--------|----------------------------------------------------------|
| Patents                              |   |   |    8,679,564                                   |
| Future payments to TCD shareholders, |   |   |                                                     |
|   discounted at 12%             |   |   |   (8,157,208)                                       |
| Short-term debt due to Envirokare    |   |   |      (125,000)                       |
| Accounts payable                     |   |   |          (6,356) |
|                                 |   |   |                                                          |
| Net assets contributed               |   | $      |       741,000                   |
|                                 |   |   |                                                          |

The value ascribed to contributed patents includes $525,000 previously paid to TCD under a licensing agreement and 1,300,000 common stock options granted to former TCD shareholders, which were valued at $741,000.  

F-13

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**ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION**

                Envirokare Tech, Inc. (the "Company" or  "Envirokare") is engaged in the application design, development and manufacturing, utilizing proprietary thermoplastic composite technologies including Thermo Plastic Flowforming  for TPFTM.  Subsequent to end of the fiscal year and upon the closing of the  Merger Agreement between the Company's subsidiary Envirokare Composite Corp. and  Thermoplastic Composite Designs, Inc.  and of  the Joint Venture Agreement  (LRM Industries, LLC) between Envirokare Composite Corp. and  NOVA Chemicals, Inc.  described below, the Company's TPFTM business is being conducted through it position in LRM Industries, LLC.

*                Technology:*  The TPF Process is a proprietary process developed by Thermo Composite Designs, Inc., that enables the manufacture of large structural parts using long-fiber reinforced thermoplastic resins. The Process utilizes recycled or virgin resins and is designed to reuse its own production scrap, thereby eliminating production waste by-products. TPF Process patents are pending.

                Historically, advanced composite materials were utilized almost exclusively by the military and aerospace industries where such usage was normally restricted to the manufacture of small parts due to the inordinate cost of hand application, i.e., the process of manually applying layers of composite materials to a mold or shape. Management believes that the TPF Process provides a cost-effective alternative for the in-line production of larger, long-fiber reinforced plastic parts at very low processing costs. The Process has key advantages over many manufacturing processes currently in use such as compression molding, injection molding and rotational molding,  including significantly,  cost savings realized in the reduced labor required to create larger parts made using the TPF Process. The cost required to assemble multiple smaller components to generate a complete larger part, which often occurs in current production environments, is higher than with the TPF Process.   Material costs will typically also be lower because of its use of recycled material, reuse of its own production scrap and in-line compounding, which is the process of mixing raw material components as an actual part of the production process.

                The TPF Process has  application in a broad range of industries including: agriculture, automotive, material handling, transportation, marine, medical, waste management and aerospace.   TPF composite products are an advantaged replacement for many wood, aluminum, steel, other metal alloys, concrete, other plastic and fiberglass products, by providing products that have corrosion resistance, are lighter and cost less to manufacture. As a thermoplastic process, TPF has an additional advantage in that it does not emit volatile organic contaminants  (VOCs).

                The Company entered into agreements acquiring this technology through License and Merger Agreements with Thermo Composite Designs, Inc. dated March 30, 2001, the Company, through its wholly-owned subsidiary, Envirokare Composite Corp. ("ECC"), entered into a licensing agreement with TCD that allows the Company to commercially exploit the TPF Process.

                On March 3, 2005, the Company completed a merger of Thermoplastic Composite Designs, Inc. ("TCD"), a Florida corporation into ECC, its wholly owned subsidiary resulting in the acquisition of TCD assets including real property, plant, equipment and Intellectual property in exchange for cash and notes as outlined below.  These merger terms were modified from the March 30, 2001 agreement.

                The "Merger Consideration" equaled the sum of (i) fifteen million dollars ($15,000,000) (the "Fixed Merger Consideration") and (ii) the aggregate amounts payable in accordance with Section (h): (the "Contingent Merger Consideration").

                (a) At the Closing, ECC shall paid the Shareholders $2,500,000.

                (b) The balance of the Merger Consideration shall be paid to the TCD Shareholders in eight (8) annual installments following the Closing with the first such payment due on or prior to January 31, 2006 and the last such payment due on or prior to January 31, 2013 (and such payments shall be deemed to be distributed to the Shareholders of TCD in complete liquidation), with each annual payment to be equal to 2.5% of the "Consolidated EBIDTA" of LRM Industries, LLC ("LRM")  for each calendar year, commencing with the calendar year ending December 31, 2005, up to a maximum aggregate of $12,500,000 for all payments under this subsection (b).  LRM is the Company's Joint Venture Company with NOVA Chemicals, Inc.

                (c) "Consolidated EBIDTA" for the purposes of this paragraph 2.01 means: with respect to any fiscal period, LRM's and its subsidiaries' consolidated net earnings, if any, as determined before deduction for interest expense, taxes, depreciation and amortization for such period, as determined in accordance with generally accepted accounting principles as in effect from time to time in the United States, consistently applied ("GAAP") .

                (d) In the event that 2.5% of the Consolidated EBIDTA of LRM during the first four years after the Closing Date (ending on December 31, 2008) is less than an aggregate of $2,000,000, ECC shall pay to the Shareholders any amount by which $2,000,000 exceeds 2.5% of the aggregate Consolidated EBIDTA of LRM during this period within 31 days after the end of the fourth year.

                (e) In the event that 2.5% of the Consolidated EBIDTA of LRM during the years five six and seven after the Closing Date (ending on December 31, 2011) total less than an aggregate of $3,000,000, ECC shall pay to the Shareholders any amount by which $3,000,000 exceeds 2.5% of the aggregate Consolidated EBIDTA of LRM during the period, within 31 days after the end of the seventh year.

                (f) At the end of the eighth year (ending December 31, 2012), in the event that the TCD Shareholders have not been paid $15,000,000 by virtue of the payments set forth in Section 2.01 (a), (b), (d) and (e), ECC shall pay on or prior to January 31, 2013, any amount by which $15,000,000 exceeds all monies paid to the Shareholders to date under Section 2.01(a), (b), (d) and

                (e) so that the total payments made aggregate $15,000,000. In the event that a cash payment is due the Shareholders pursuant to this paragraph, any TCD Shareholder may elect to receive this payment in four equal annual payments beginning at the end of the eighth year set out above. Unpaid but due balances will carry interest equal to LIBOR plus one percent but not to the extent a Shareholder elects a deferral under the provisions of the prior sentence.

                (g) The assurance of any such payments to be made pursuant to this Section is provided only by ECC and guaranteed by LRM and Parent (Envirokare) as set forth below. The Parties acknowledge that no such assurance is being provided by NOVA or any of NOVA's affiliates or subsidiaries other than ECC, LRM and Parent.

                (h) Ongoing Payments. As additional Merger Consideration (the "Contingent Merger Consideration"), beginning January 1, 2013, the Shareholders shall be entitled to receive from ECC payments annually equal to their pro rata share of 1% of the Net Income of LRM payable to the extent of and at the time of distribution of such Net Income to ECC or 90 days after the end of each year, whichever is sooner; provided, however, that such obligation will cease if a majority of the equity in, or assets of, LRM are sold to an unaffiliated third-party of LRM, whether by merger, consolidation, exchange of interest or otherwise, excluding, however, any disposition by lease, license or any other similar transaction; further provided, that in connection with any such transaction, if such transaction is a sale of assets or equity by LRM, ECC will make a payment to the TCD Shareholders equal to 1% of the net proceeds of such transaction, or if such transaction takes the form of a sale by the Members of interests in LRM, ECC will make a payment to the TCD Shareholders equal to 1% of the aggregate net proceeds realized by all Members of LRM in such sale. In addition, in the event the ECC or any of its Affiliates (as defined below in 2.04) at any time sells any part of its interests in LRM in a transaction other than those described above, then ECC shall pay to the TCD Shareholders an amount equal to 1% of the gross proceeds of any such sale. "Net Income" means, with respect to any fiscal period, the consolidated net income of LRM and its subsidiaries for such period, as determined in accordance with GAAP.

                (i) Evidence of Obligation to Pay Guaranty; Security. ECC's obligation to pay the balance of the Fixed Merger Consideration is evidenced by a promissory note in favor of the Shareholders (the "Promissory Note"). The obligations of ECC to pay the Fixed Merger Consideration are secured by a lien and first interests in and to all of the assets acquired by LRM from ECC (the "TCD Assets") pursuant to that certain asset purchase agreement, such security interest evidenced by a security agreement executed and delivered by LRM in favor of the Shareholders.

                The obligations of ECC to pay the Fixed Merger Consideration and the Contingent Merger Consideration are guaranteed by LRM and the Company, to be evidenced by guaranties to be executed and delivered by the Company and LRM.

                As part of the transaction described above, ECC sold to LRM under an Asset Purchase Agreement, equipment and other personal property located in Mims, Florida and Intellectual Property acquired in the Merger transaction described in this paragraph. Other than real estate owned and leased to LRM these assets were substantially all of the assets of ECC sold to LRM as part of the transaction in which it acquired a 50% interest in the LRM, the joint venture company.

                On March the 3, 2005, the Company through it wholly owned subsidiary Envirokare Composite Corp. ("ECC") executed a Limited Liability Company Agreement with NOVA Chemicals, Inc.("NOVA) creating a Joint Venture Company, LRM Industries, LLC ("LRM") a Delaware limited liability company for the purpose of commercializing the Company's Thermoplastic Flowforming technology including but not limited to the manufacture, marketing, sales and/or licensing of the technology.

                LRM is owned one half each by ECC and NOVA and is capitalized as follows:

                1.1 Contribution of Envirokare. ECC shall make no Contributions to the Company, initially, and need not make any additional Contributions unless, in its sole discretion, it decides to do so, subject to approval. ECC is selling certain assets to the Company pursuant to the Asset Purchase Agreement and ECC shall be paid the amounts specified below as consideration for such transfer.

                1.2 Contributions of NOVA. NOVA has made and shall make Contributions to the Company as follows:

                On the date of this Agreement, NOVA will contribute five million dollars ($5,000,000.00) to the Company (the "NOVA Investment").

                                (a) In addition to the NOVA Investment, NOVA will also contribute one million dollars ($1,000,000.00) in services to the Company, pursuant to the NOVA Service Agreement, an exhibit to the Limited Liability Company Agreement.

                                (b) In no event will NOVA be required to make any additional Contributions to the Company, unless, in its sole discretion, it decides to make such additional contributions, subject to approvals as required of LLC.

                                (c) The Members by unanimous consent may also approve from time to time the payment by the Members, in proportion to their respective proportionate interests or otherwise, of further Contributions for any purpose deemed appropriate by the Members.

                1.3 Return of Capital. Except as provided in the Limited Liability Company Agreement, no Member shall have the right to demand or receive the return of any Contributions to the Company.

                1.4 No Interest on Contributions. Except as otherwise expressly provided herein, no Member shall receive any interest on its Contributions to the Company.

                1.5 Liability Limited to Contributions. The liability of each Member shall be limited to its Contributions. Except as provided in the Limited Liability Company Agreement and in the NOVA Service Agreement, neither of the Members shall have any further personal liability to make any Contributions to the Company or with respect to any liability or obligation of the Company.

                1.6 Advances Not Contributions. If either Member advances funds to the Company, other than as a contribution to capital pursuant to this Article, the amount of such advance shall not be deemed a Contribution. The amount of any such advance shall be a debt due from the Company to such Member and shall be repaid upon demand to such Member with interest at a rate agreed to by the Board of Managers and the Member making such advance.

                1.7 Capital Accounts. An individual capital account (the "Capital Account") shall be maintained by the Company for each Member as provided in the Tax Annex.

                1.8 No Deficit Restoration. No Member shall have any obligation to restore a deficit balance in its Capital Account.

                In addition to and as part of the Limited Liability Company Agreement ECC entered into a lease agreement providing for the lease of the plant property in Mims, Florida to LRM for a period of two years with an option to renew for an additional two years. Lease payments payable to ECC equal $84,000 per year for the first two years and $91,200 per year for the two year renewal period. In addition the property is subject to a cellular tower lease providing for additional payments to ECC as successor to TCD of $12,000 per year.

**Product Research, Development and Testing:**

*                General Product Technology Testing:* During the second quarter of 2002, the Company engaged the Metis Design Corporation, Inc. ("Metis Design"), formerly Horizon Defense and Aerospace Solutions, Inc., to conduct a review of the TPF technology. Metis Design, based in Cambridge, Massachusetts, is an advanced technology firm specializing in composites consulting, damage monitoring and structural concept design and analysis.

                In September 2002, Metis Design presented the Company's management with final findings regarding the TPF technology. In its report, Metis Design noted that, as the utilization of advanced thermoplastic composite materials has extended into market segments such as military and aerospace, commercial manufacturers are increasingly demanding lower cost, quicker and more flexible reinforced thermoplastic processing techniques. Metis Design found that the TPF Process has significant potential to address this need. In addition, Metis Design reported that the TPF Process could represent a solution to a long-standing need in the long-fiber reinforced composite manufacturing process the TPF Process enables manufacturers to mass-produce at high rates and labor efficiencies compared to many current production techniques, while retaining accuracy and the ability to utilize low molding pressures. The report also noted that the TPF Process provides economic advantages over other thermoplastic composite molding methods through reduced labor, material, tooling and machine costs.

                Metis conducted narrow coupon tensile tests on composite material samples produced from the TPF Process. These tests are the standard procedure for determining certain mechanical properties of a material. The test results demonstrated that the material properties exhibited in the product, as formed by the TPF Process, are comparable to those from products formed through traditional processes, and are similar to those properties published by commercially available materials.

*                Product Development - E Pallet:* Since inception, the Company has been engaged in the development of the Pallet.   In December 1998, acquired equipment, early-stage rubber mold technology and patent rights to the development of rubber mold technology for creating a pallet made of recycled materials.  In 1999, the Company and TCD entered into a product/technology contract for the continued development of the pallet. TCD undertook to assist the Company in optimizing earlier versions of the Pallet design. The contract required TCD to deliver a pallet that would meet design specifications including specified size and weight requirements and a customized composition matrix. The contract also provided that TCD would supply an engineered mold for the Company's first production facility. The Company's payments for the development of a first generation Pallet mold totaled $50,800 in 1999 and $83,000 in 2000.

                Commencing in May 2000, additional Pallet testing and evaluation was conducted by the Pallet and Container Research Laboratory of Virginia Polytechnic Institute and State University, located in Blacksburg, Virginia.  This laboratory is recognized for its work in the area of testing and analysis of products designed for use in the materials handling industry. Based on the initial test results, the Company and its product design contractor, TCD, made design adjustments to the Pallet. Further Pallet testing and evaluation through 2001 resulted in further design adjustments. As a result of the design adjustments and modifications, the first generation mold was deemed to be of no commercial value. The Company built a second generation mold during 2001, at a cost of $43,000, incorporating design modifications based on technical information derived from tests of the previous mold. Pallets produced from this mold were tested and evaluated at the Pallet and Container Research Laboratory during the second quarter of 2002. The study of the second mold evaluated the strength, stiffness and durability of the Pallet as a general purpose pallet with a 2,800 pound weight capacity set as the standard.

                The study findings included the following:

                a. The Pallet could safely support a 2,800 pound, uniformly distributed load in warehouse storage racks as well as on conveyors;

                b. The Pallet was found to be highly resistant to damage caused by rough handling, based on the drop test protocol carried out, which involved dropping empty Pallets from various heights after the Pallets were chilled to a temperature of -13 degrees Fahrenheit; and

                c. Because the Pallet's performance was found to significantly exceed requirements for a 2,800-pound uniform load standard, the study recommended that the Company consider reducing the Pallet's glass loading (i.e. the percentage of glass fiber used in the composite), or refining its design, to further reduce Pallet weight and cost.

                Based on the results of testing conducted on the second generation E Pallet, during the second quarter of 2002, the Company engaged Metis Design to optimize this Pallet redesign.  The Pallet design modifications, as proposed by Metis Design, allow for a significant weight reduction of the Pallet making the Pallet more cost-effective and easier to handle, while structural features are not anticipated to be materially affected.

*                Product Development - Beam*: The Company conducted product development for a structural beam having  application in the housing and marine industries.   A prototype mold was built by TCD for the company in 2002 at a cost of $16,000.  The Beam is designed to carry specific weights or loads and to act as an interconnector for structural components for modular structures an docks. 

*                Product Development - Schaefer Systems International, Inc.:* On March 28, 2003, the Company entered into a product development and purchase agreement with SSI replacing a earlier agreement dated August 6, 2002.  Under the terms of this agreement and pursuant to performance and dimensional criteria provided by SSI,  the Company designed and developed and produced a quantity of prototypes for field testing, field trials and related approvals. Payments to the Company for successful completion of product development will aggregate $185,500, with an additional $300,000 to be payable if SSI elects to develop an additional, similar product with different dimensions.  No work has been done since initial development on this contract and there is no assurance that further work will take place.  Several terms of the contract remain unexecuted.

**Product Marketing and Market Exploitation:**

                The Company's plan for the marketing and exploitation of its technologies over the next twelve (12) months through LRM Industries, LLC, its Joint Venture with NOVA Chemicals, Inc., includes:

                a. direct development and manufacturing of products for materials handling, construction, housing, marine and other commercial and consumer applications.

                b. 3rd party licensing  of TPFTM Technology for specific applications and products as well as for specific geographic areas.

                c. product development for 3rd parties applications and licensed manufacturing.

**Purchase of Plant and Significant Equipment and Expected Significant Changes in Number of Employees:**

                The closing of the Merger Agreement with TCD combining that company with its wholly owned subsidiary ECC brought into the Company an existing TPFTM production facility including equipment and leased premises. The size of this facility is limited and is used primarily for product development and small production runs. During the fiscal year, the Company  continued preliminary development work toward the end of creating a full scale production facility for manufacture of Company and third party products, however, no specific site has yet been contracted for. The Company's  business will be conducted through its position in LRM Industries, LLC.  (see above).  

                The Company expects that LRM Industries, LLC will add personnel required for the operation of the existing TCD facility and for expansion of the business.  Two of the  Company's consultants have become consultants of the Joint Venture.   The Company does not expect to add employees to its own staff during the year.

**Liquidity:**

                The Company has budgeted expenditures of $600,000 for the 12 months ending September 30, 2006.  During the period ended March 31, 2005, the Company raised $40,000 from the private placement of the Company's Common shares and had cash remaining at March 31, 2005 of $2,574,635 including cash balances in LRM Industries, LLC.    LRM Industries, LLC, the Company's joint venture with NOVA Chemicals, Inc. was funded with $5,000,000 in cash and $1,000,000 in services by NOVA Chemicals, Inc.  The Company expects to raise any additional funds required  through private placement of additional shares.   Although management believes these sources to be sufficient, there is no assurance that the Company will be successful in raising additional capital to fund operations.

**ITEM 3. CONTROL AND PROCEDURES**

                Within the 90 days prior to the filing date of this Quarterly Report, the issuer carried out an evaluation, under the supervision and with the participation of our Principal Executive Officer and Principal Accounting Officer, of the effectiveness of the design and operation of our disclosure controls and procedures as defined in Rule 13a-14(a) and Rule 15d-14(c) of the Securities Exchange Act of 1934. Based upon that evaluation, the Principal Executive Officer and the Principal Accounting Officer concluded that our disclosure controls and procedures are effective in timely alerting them to material information relating to us (including our consolidated subsidiaries) required to be included in this Quarterly Report. There have been no significant changes in our internal controls or in other factors, which could significantly affect such internal controls, subsequent to the date we carried out our evaluation.

**PART II - OTHER INFORMATION**

**ITEM 2. CHANGES IN SECURITIES**

                During the Three Months ended March 31, 2005, the Company issued 62,500 shares of its common stock when warrants were exercised at $0.40 per share for a total of $25,000. In addition 50,000 shares were issued when stock options were exercised at $0.30 per shares for a total of $15,000.

**ITEM 3. DEFAULTS UPON SENIOR SECURITIES**     None

**ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS**     None

**ITEM 5. OTHER INFORMATION**     None

**ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K**

|   | (a)    |   | Exhibits

Exhibit 31.1 - Certification Pursuant to 18 U.S.C. Section 1350, as adopted        pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 

Exhibit 31.2 - Certification Pursuant to 18 U.S.C. Section 1350, as adopted        pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 

Exhibit 32.1 - Certification Pursuant to 18 U.S.C. Section 1350, as adopted        pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
|--------|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                 |

**SIGNATURES**

                In accordance with Section 13 or 15(d) of the Exchange Act, the Registrant has caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on June 1, 2005.

|   |         |   |      | **ENVIROKARE TECH INC.**                 |
|--------|--------------|--------|-----------|------------------------------------------|
|   |         |   |      |                                     |
|   | June 1, 2005 |   | By:  | /s/ George Kazantzis                     |
|   |         |   |      |                                          |
|   |         |   |      | George Kazantzis        Acting President |