| **UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

Washington, DC 20549

**FORM 10-QSB**

[X]   Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

          For the quarterly period ended  March 31, 2006

[ ]   Transition Report pursuant to 13 or 15(d) of the Securities Exchange Act of 1934

          For the transition period __________ to ___________

**Commission File Number    _______________**

**EP Global Communications, Inc.**

(Exact name of small Business Issuer as specified in its charter) |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| **Delaware**

(State or other jurisdiction of 

incorporation or organization) | **14-1818396**

(IRS Employer Identification No.) |
|-------------------------------------------------------------------------------------|---------------------------------------------------|

| **C/O Exceptional Parent Magazine**

551 Main Street, Johnstown, PA

(Address of principal executive offices) | **15901**

(Postal or Zip Code) |
|---------------------------------------------------------------------------------------------------------------|---------------------------------|
| **(814) 361-3860**

Issuer's telephone number, including area code                                            |                            |

| Checkwhether the issuer (1) filed all reports required to be filed bySection 13 or 15(d) of the Securities Exchange Act of 1934 during thepreceding 12 months (or for such shorter period that the issuer wasrequired to file such reports), and (2) has been subject to such filingrequirements for the past 90 days 

[X] Yes [  ] No

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). 

Yes [  ] No [X]

Statethe number of shares outstanding of each of the issuer's classes ofcommon stock, as of the latest practicable date:  

25,695,818 shares of $0.0001 par value common stock outstanding as of May 11, 2006.

Transitional Small Business Disclosure Format        Yes [_]   No [X] |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**PART I FINANCIAL INFORMATION**

**Item 1.  Financial Statements**

Certaininformation and footnote disclosures required under accountingprinciples generally accepted in the United States of America have beencondensed or omitted from the following consolidated financialstatements pursuant to the rules and regulations of the Securities andExchange Commission.  It is suggested that the followingconsolidated financial statements be read in conjunction with theyear-end consolidated financial statements and notes thereto includedin the Company's Annual Report on Form 10-KSB for the year endedDecember 31, 2005.

The results ofoperations for the three months ended March 31, 2006 and 2005 are notnecessarily indicative of the results for the entire fiscal year or forany other period.

| Index |
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|                                                                                                               | Page   |
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|                                                                                                          |   |
| Unaudited Consolidated Balance Sheet as of March 31, 2006                                                     | 1 - 2  |
|                                                                                                          |   |
| Unaudited Consolidated Statements of Operations for the three months ended March 31, 2006 and 2005:           | 3      |
|                                                                                                          |   |
| Unaudited Consolidated Statement of Shareholders’ Deficiency for the three months ended March 31, 2006: | 4      |
|                                                                                                          |   |
| Unaudited Consolidated Statements of Cash Flows for the three months ended March 31, 2006 and 2005:           | 5 - 6  |
|                                                                                                          |   |
| Notes to Unaudited Financial Statements                                                                       | 7 - 17 |
|                                                                                                          |   |

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                                                   EP Global Communications, Inc.

                                              Consolidated BalanceSheet (Unaudited)

                                        See Accompanying Notes to Financial Statements.

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**                                                           EP GlobalCommunications, Inc.**

**                                                   Consolidated Balance Sheet (Unaudited)**

                                             See Accompanying Notes toFinancial Statements.****

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**                                                                                    EP Global Communications, Inc.**

**                                                                      ConsolidatedStatements of Operations (Unaudited)**

****

 

                                                                                     See Accompanying Notes to Financial Statements.

                                                                                                                             3

** **

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**EP Global Communications, Inc.**

**Consolidated Statement of Shareholders’ Deficiency (Unaudited)**

****

See Accompanying Notes to Financial Statements.****

4

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**                                                                    EP GlobalCommunications, Inc.**

**                                                   Consolidated Statements of Cash Flow (Unaudited)**

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                                                                      Statementcontinued next page.

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**                                                                           EP Global Communications, Inc.**

**                                                         ConsolidatedStatement of Cash Flow (Unaudited)**

****

                                                                  See Accompanying Notes toFinancial Statements.****

                                                                                                                   6

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**EP Global Communications, Inc.**

**Notes to Consolidated Financial Statements**

**March 31, 2006**

** (Unaudited)**

**1.  Description Of Business And Summary Of Significant Accounting Policies**

Basis of Presentation

OnNovember 28, 2003, East Coast Airlines, Inc.  ("East Coast")entered into a share exchange agreement with Psy-Ed Corporation. In connection with the share exchange, East Coast acquired theassets and assumed the liabilities of Psy-Ed Corporation.  Foraccounting purposes, the share exchange agreement has been treated as arecapitalization of Psy-Ed Corporation as the acquirer.  

Organization

EPGlobal Communications, Inc., formerly East Coast Airlines, Inc., andSubsidiaries (“EP” or the “Company”), operatesits primary business through its subsidiary, Psy-Ed Corporation (d/b/aExceptional Parent Magazine).   In late 2004 and early 2005,EP entered into a joint venture, which has been consolidated in theCompany’s financial statements, to promote on line educationalseminars, using a web based medium presenting topics that relate to thecare of special needs individuals.

EPpublishes and distributes Exceptional Parent Magazine, an internationalpublication, designed to serve the information needs of families andprofessionals who are involved in the care and development of childrenand adults with disabilities and special health care needs.  EPalso develops and implements online accredited Continued MedicalEducation Programs; has its own library of over 1,000 disability booktitles and publishes clinical monographs which are disseminated tophysicians, researchers and allied health care professionals as well asfamilies and caregivers all over the world.  

Significant Accounting Policies

Principles of Consolidation

Theconsolidated financial statements include the accounts of the Companyand its majority-owned subsidiaries.  All intercompanytransactions and balances have been eliminated.  

Use of Estimates

Thepreparation of the consolidated financial statements in conformity withaccounting principles generally accepted in the United States ofAmerica requires management to make estimates and assumptions thataffect the reported amounts of assets and liabilities and disclosure ofcontingent assets and liabilities at the date of the financialstatements and the reported amounts of revenues and expenses during thereporting period.  Actual results could differ from thoseestimates.

Concentration of Credit Risk

Financialinstruments which potentially subject the Company to concentrations ofcredit risk consist principally of cash and trade receivables.

TheCompany's cash and cash equivalents are concentrated primarily in twobanks in the United States.  At times, such deposits could be inexcess of insured limits.  Management believes that the financialinstitutions that hold the Company's financial instruments arefinancially sound and, accordingly, minimal credit risk is believed toexist with respect to these financial instruments.

TheCompany grants credit primarily to advertisers based on an evaluationof the customer’s financial condition, without requiringcollateral.  Exposure to losses on these receivables is 

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**EP Global Communications, Inc.**

**Notes to Consolidated Financial Statements**

**March 31, 2006**

** (Unaudited)**

principallydependent on each customer’s financial condition.  Amajority of the subscription income is received in advance and presentslittle risk to the Company.  The Company controls its exposure tocredit risk through monitoring procedures and establishes appropriateallowances for anticipated losses.

TheCompany has a major customer that comprised 16% and 12% of theCompany’s revenue in the three months ended March 31, 2006 and2005, respectively.  There were no other customers that comprisedgreater than 10% of the total company revenues in those years.

Provision for Losses on Uncollectible Receivables

Theprovisions for losses on uncollectible trade receivables are determinedprincipally on the basis of specific identification and past collectionexperiences.  The allowance for doubtful accounts on accountsreceivable balances was $79,000 at March 31, 2006.

Inventories

Inventories,consisting primarily of books, are stated at the lower of cost ormarket, determined on the first-in, first-out (FIFO) method.  

Minority Interests

Minorityinterests consist of a fifty percent (50%) ownership interest in EPEducational Network LLC (“LLC”) from September 2004 throughSeptember 2005 (see Note 9).  

Duringthis period, the income from the operation of the entity and itsrespective minority interests have been reflected in theCompany’s statement of operations and, beginning in October 2005,the LLC became a single member LLC with all transactions consolidatedin the financial statements.

Revenue Recognition

TheCompany recognizes revenue in accordance with the guidance contained inSEC Staff Accounting Bulletin No. 101, “Revenue Recognition inFinancial Statements” (“SAB101”), and StaffAccounting Bulletin No. 104, “Revenue Recognition in FinancialStatements” (“SAB104”).  Under thesepronouncements, revenue is recognized when persuasive evidence of anarrangement exists, delivery of services and/or products has occurred,the sales price is fixed or determinable, and collectibility of thesales price is reasonably assured. In addition to these general revenuerecognition criteria, the following specific revenue recognitionpolicies are followed:

Advertisingrevenue, which consists predominantly of graphic and text displays, isrecorded in the period corresponding to the presentation in thepublication. Online services advertising revenues, primarily derivedfrom the sale of banner advertisements and sponsorships on theCompany's web sites, is recognized in the period the advertising isdisplayed.  The costs to develop this internet income are periodcosts and are expensed when incurred. Print publication advertising andcirculation revenues are recognized, net of agency commissions andestimated returns and allowances, when publications are issued. List rental income is recognized, net of commission, when a listis sold or rented.

Subscriptionincome is recognized based upon the monthly pro-ration of income withinthe reporting period for a given subscription.

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**EP Global Communications, Inc.**

**Notes to Consolidated Financial Statements**

**March 31, 2006**

** (Unaudited)**

Deferredsubscription income, net of agency commission, is recorded whensubscription orders are received.  The Company uses a fulfillmenthouse, which calculates the revenue to be recorded for all periods. Customers generally subscribe to the magazine for three years. Deferred subscription income represents the portion of theprepaid subscription not earned by the Company and paid for in advanceof fulfillment by the Company to the customer.  

Revenue from the production of on line educational seminars is recorded at the time of the the seminar is conducted.

Specialproject revenue recognition occurs at the time of delivery of theproduct or service that constitutes the special project.  Specialprojects include such undertakings as custom communications as well asthe Company’s “Disability Awareness Night” program.

Cost of Sales

Cost of sales consist of those costs that are associated with the production of income for a given business activity.  

Depreciation and Amortization

Propertyand equipment are stated at cost less accumulated depreciation andamortization.  Depreciation of property and equipment iscalculated on the straight-line method over the estimated useful livesof the respective assets, ranging from three to five years. Leaseholdimprovements are amortized over the lesser of the useful life of theasset or the term of the lease.  

Stock-Option Plan

Priorto December 31, 2005, the Company accounted for equity-basedcompensation issued to employees in accordance with AccountingPrinciples Board (“ABP”) Opinion No.  25“Accounting for Stock Issued to Employees”.  APB No. 25 requires the use of the intrinsic value method, which measurescompensation cost as the excess, if any, of the quoted market price ofthe stock at the measurement date over the amount an employee must payto acquire the stock.  The Company made disclosures of pro formanet earnings and earnings per share as if the fair-value-based methodof accounting had been applied as required by SFAS No. 123“Accounting for Stock-Based Compensation.”

InDecember 2004, the FASB issued SFAS No. 123R, Share-Based Payment,which establishes standards for the accounting for transactions inwhich an entity exchanges its equity instruments for goods or services.A key provision of this statement is the requirement of a public entityto measure the cost of employee and non-employee services received inexchange for an award of equity instruments (including stock options)based on the grant-date fair value of the award. That cost will berecognized over the period during which an employee is required toprovide service in exchange for the award (i.e., the requisite serviceperiod or vesting period). This standard becomes effective on January1, 2006 for small business issuers.  Although the Company adoptedSFAS 123R beginning in the first quarter of 2006, there was no impactto the financial statements.

Therewere no awards or outstanding compensatory options or warrants in thethree months ended March 31, 2006 or 2005; accordingly, hadcompensation cost for the Company's stock option plan been determinedbased on the fair value at the grant date for awards in 2006 and 2005consistent with the provisions of SFAS No. 123, the Company's resultsof operations, as reported, would not have changed.

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**EP Global Communications, Inc.**

**Notes to Consolidated Financial Statements**

**March 31, 2006**

** (Unaudited)**

ocompensatory options or warrants were granted during the three monthsended March 31, 2006 or 2005.  See Note 4 for discussion ofwarrants issued during 2005 in connection with a debt financing.

Income Taxes

TheCompany accounts for income taxes using an asset and liability approachunder which deferred income taxes are recognized by applying enactedtax rates applicable to future years to the differences between thefinancial statement carrying amounts and the tax bases of reportedassets and liabilities.  

Theprincipal items giving rise to deferred taxes are certain expenseswhich have been deducted for financial reporting purposes which are notcurrently deductible for income tax purposes and the future tax benefitof certain net operating loss carryforward.  

Evaluation of Long-Lived Assets

TheCompany reviews property and equipment for impairment whenever eventsor changes in circumstances indicate the carrying value may not berecoverable in accordance with guidance in SFAS No. 144“Accounting for the Impairment or Disposal of Long-Lived Assets. ” If the carrying value of the long-lived asset exceeds thepresent value of the related estimated future cash flows, the assetwould be adjusted to its fair value and an impairment loss would becharged to operations in the period identified.

(Loss) / Income Per Share  

Basic(loss) / income per common share is computed by dividing net (loss) /income by the weighted average number of common shares outstandingduring the period.  Diluted (loss) / income per common share iscomputed by dividing net (loss) / income by the weighted average numberof common shares and potential common shares outstanding during theperiod.  The basic weighted average shares were used incalculating quarter ended March 31, 2006 and 2005 diluted (loss) /income per share, as inclusion of the incremental shares shown in thiscalculation would be antidilutive.  Potential common shares usedin computing diluted (loss) / income per share at March 31, 2006 relateto common stock warrants convertible into 5,000,000 shares of commonstock and convertible preferred stock convertible into 719,801 sharesof common stock.  

Fair Value of Financial Instruments

Forfinancial instruments including cash, accounts payable, accruedexpenses and notes payable, it was assumed that the carrying amountapproximated fair value because of the short maturities of suchinstruments.

Basis of Presentation

Theaccompanying financial statements have been prepared assuming that theCompany will continue as a going concern. This basis of accountingcontemplates the recovery of the Company’s assets and thesettlement of its liabilities in the normal course of conductingbusiness.  In the two most recent years, the Company has obtainedcash from various debt financings to fund capital expenditures and forcash used by existing operations.  From September 2005 throughJanuary 2006, the Company used proceeds from a $3.0 million loan torepay a substantial portion of its debt and to provide for continuingoperations through the third quarter of calendar year 2006.  TheCompany is continuing initiatives to produce significant increases inrevenues and to enact cost reduction programs.

10

**2.  Property And Equipment**

Property and equipment at March 31, 2006 consists of the following:

Depreciation expense for the three months ended March 31, 2006 and 2005 was $15,244 and $13,530, respectively.   

**3.  Accrued Expenses**

Accrued expenses at March 31, 2006 consist of the following:

**4.  Debt**

Long-Term Debt

Long-term debt at March 31, 2006 consists of the following:

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**EP Global Communications, Inc.**

**Notes to Consolidated Financial Statements**

**March 31, 2006**

** (Unaudited)**

The following are maturities of long-term debt:

OnSeptember 23, 2005, the Company completed financing agreements byexecuting a securities purchase agreement with the following entities:AJW Partners, LLC, AJW Offshore, Ltd., AJW Qualified Partners, LLC andNew Millenium Capital Partners II, LLC.

Underthe securities purchase agreement, the Company will issue up to$3,720,000 in callable secured convertible notes. The notes areconvertible into shares of our common stock. The conversion price isbased on the lesser of $0.12 or the average of the lowest 3 intra-daytrading prices during the 20 trading days immediately prior to theconversion date discounted by 40%. The timing of the conversion is atthe option of the holder. The notes are secured by a grant of a generalsecurity interest in all of our assets both tangible and intangible. Inaddition, our chief executive officer individually pledged 3,371,093shares of common stock.

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**EP Global Communications, Inc.**

**Notes to Consolidated Financial Statements**

**March 31, 2006**

** (Unaudited)**

Inaddition, the Company issued 5,000,000 stock purchase warrantsconvertible into shares of our common stock on a one for one basis. The exercise price is $.15 and the term of the warrants is 5years. 

Aprivate investment firm received a commission of $240,000 (8% of theaggregate net proceeds of $3,000,000) for arranging for this financing.

Through March 31, 2006, the Company received net proceeds of $3,000,000 under the terms of the securities purchase agreement. 

The convertible debt instrument bears interest at 8% per annum and is due beginning in September 23, 2008.

Inaccordance with Emerging Issues Task Force Topic 00-27 and SFAS 150,“Accounting for Certain Financial Instruments withCharacteristics of both liabilities and Equity”, the Companyperformed calculations allocating the proceeds from the issuance ofconvertible debt with detachable warrants and the beneficial conversionprivileges to each respective security at their fair values.  The Company referred to SFAS 133, “Accounting forDerivative Instruments and Hedging Activities,” and EITF 00-19,“Accounting for Derivative Financial Instruments Indexed to, andPotentially Settled in, a Company's Own Stock,” in determiningwhether the conversion option is an embedded derivative instrument. In the case of the detachable warrants and the beneficialconversion privileges, the Company concluded the fair value was nil;accordingly, the entire amount recorded as a liability was associatedwith the convertible debt. The calculated fair value of the convertibledebt of $ 3,079,576 was recorded as a long term liability as of March31, 2006.  The convertible debt will be accreted to its face valueof $3.7 million under the interest method until it is either convertedor matures.  As of March 31, 2006, the cumulative accretion was$89, 464 of which $54,264 was recognized in the first quarter of 2006and $35,200 was recognized as of December 31, 2005.

Duringthe first quarter of 2006, the holder of the convertible debt exercisedtheir rights to convert a portion of the debt to 1,200,000 shares ofcommon stock.  The exercise price of the stock was $9,888 and themarket value of the stock at March 31, 2006 was $12,000.

Ifthe obligation had been settled on March 31, 2006, under the formulafor conversion, the Company would issue approximately 513,265,000shares of its common stock (with a fair value, based solely on thequoted market price per share as of March 31, 2006, of $5,133,000). However, under the terms of the agreement, the maximum number ofshares that could be required to be issued is 206,666,666, and themaximum number of shares of common stock that are authorized to beissued by the Company is 500,000,000.

Providedthe Company in not in default under the financing documents, it has asufficient number of authorized shares of its common stock reserved forissuance upon full conversion of the promissory notes and its commonstock is trading at or below $.15 per share, the Company shall have theright, exercisable on not less than 10 trading days prior writtennotice to the holders of the promissory notes, to prepay all of theoutstanding promissory notes. If the Company exercises its right toprepay the promissory notes, it shall make payment to the holders of anamount in cash equal to either (i) 125% (for prepayments occurringwithin 30 days of the issue date of the promissory notes), (ii) 130%for prepayments occurring between 31 and 60 days of the issue date ofthe promissory notes, or (iii) 140% (for prepayments occurring afterthe 60th day following the issue date of the promissory notes,multiplied by the sum of the then outstanding principal amount of thepromissory notes plus default interest.  

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**EP Global Communications, Inc.**

**Notes to Consolidated Financial Statements**

**March 31, 2006**

** (Unaudited)**

Short-Term debt

Short-termbank obligations at March 31, 2006 consist of an unsecured line ofcredit with MBNA in the amount of  $19,206, interest at 21.25%. 

**5. Related Party Transactions**

Amounts due to shareholders at March 31, 2006 consists of the following:

Thedeferred compensation amounts due the Chief Executive Officer and ChiefOperating Officer represent unpaid compensation due each individualbased upon their normal annual compensation that remains unpaid at theend of the first quarter 2006.  These balances are non interestbearing and are expected to be paid during 2006. 

**6.  Income Taxes**

Theliability method, prescribed by SFAS No. 109, “Accounting forIncome Taxes”, is used by the Company in accounting for incometaxes.  Under this method, deferred tax assets and liabilities aredetermined based on differences between financial reporting and taxbasis of assets and liabilities and are measured using the enacted taxrates and laws that are expected to be in effect when the differencesare expected to reverse.  

Duringthe quarter ended March 31, 2006, the Company recorded a deferred taxasset associated with its net operating loss (“NOL”)carryforwards that was fully offset by a valuation allowance due to thedetermination that it was more likely than not that the Company wouldbe unable to utilize these benefits in the foreseeable future. The Company’s NOL carryforward expires beginning in 2010through 2018.  

Thereis no provision for income taxes for the quarters ended March  31,2006 and 2005 as there was no taxable income in either year.

Thetypes of temporary differences between tax basis of assets andliabilities and their financial reporting amounts that give rise to thedeferred tax liability and deferred tax asset and their approximate taxeffects are as follows:

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**EP Global Communications, Inc.**

**Notes to Consolidated Financial Statements**

**March 31, 2006**

** (Unaudited)**

Theprovision for income taxes on earnings differs from the amount computedusing the federal statutory rate of 34% as a result of the following:

SeeNote 1 regarding the Company's business combination pursuant to a shareacquisition agreement.  The business combination was a tax-freemerger pursuant to Internal Revenue Code Section 368. Accordingly, inconnection with this merger, the Company's ultimate recognition of itsNOL became subject to Internal Revenue Code Section 382.

Thegeneral tax principle underlying Code Section 382 is that lossesincurred by a corporation may be utilized by offsetting income it latergenerates, as long as its separate existence and the identity of itsmajor shareholders are basically unchanged. However, significantlimitations to the use of the Company's NOL may apply if there is anownership change.  The testing period is defined as the three-yearperiod ending on the day of any shift involving a five-percentshareholder or the equity structure.

Whilethe Company does not believe the ultimate realization of its NOLcarryforward will be impacted by the merger, it can give no assurancethat limitations that may exist under the prevailing, or future, CodeSection 382 will not apply.

**7.  Stock Issuances and Other Transactions**

Theholder of the Company’s convertible note exercised their optionto convert a portion of the debt to 1,200,000 shares of theCompany’s common stock.  See Note 4.

Forthe quarter ended March 31, 2006, the Company issued 225,000 shares ofthe Company's common stock to employees and non-employees asstock-based compensation in the amount of $7,500, that has beenrecorded as an expense in the Company’s financial statements. 

The Company accounts for the services using the fair market value of the services rendered.

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**EP Global Communications, Inc.**

**Notes to Consolidated Financial Statements**

**March 31, 2006**

** (Unaudited)**

Inconnection with the dismissal of legal action against the Company (seeNote 10), the plaintiffs returned 1,182,000 shares of theCompany’s common stock.  At the time the Company reflectedthe stock as issued and outstanding, it recognized consulting expensesapproximating $10,638.  Accordingly, in connection with the returnand retirement of these shares of common stock, the Company has reducedconsulting expenses for the quarter ended March 31, 2006 by $10,638.

During the first quarter of 2006, the Company issued 250,000 shares of its common stock to discharge a $2,500 accrued liability.

**8.  Stockholders' Deficiency**

Common Stock

TheCompany is authorized to issue 500,000,000 shares of $.0001 par valuecommon stock.  All the outstanding Common Stock is fully paid andnon-assessable.

Preferred Stock

Preferred Stock – Series A

TheCompany is authorized to issue 5,000,000 shares of $ .01 par valuePreferred Stock – Series A.  All the outstanding PreferredStock is fully paid and non-assessable. Each share of the PreferredStock is convertible, at the option of the holder at any time, into 190shares of the Company’s Common Stock.  

Preferred Stock – Series B

TheCompany is authorized to issue 5,000,000 shares of $1.00 par valuecumulative Preferred Stock – Series B.  All the outstandingPreferred Stock is fully paid and non-assessable. Each share of thePreferred Stock is convertible, at the option of the holder at anytime, into 277 shares of the Company’s Common Stock.

Theholders of Series A and Series B Preferred Stock have certain rightsmore fully described in the footnotes to the Company’s December31, 2005 financial statements included on Form 10KSB as filed with theSecurities and Exchange Commission on April 14, 2006.

**9. Interest In LLC**

EPGlobal, during September 2004, entered into a joint venture with theInforMedx Group, LLC, (“InforMedx”) a subsidiary of theConemaugh Health System of Johnstown, Pennsylvania, to promote on lineeducational seminars, using a web based medium presenting topics thatrelate to the care of special needs individuals.  The content ofthe seminars is medically based in most instances.  The intendedaudiences are professional, and aligned and family caregivers ofspecial needs individuals.  

Toimplement the joint venture, EP has established a limited liabilitycompany, EP Educational Network LLC, (“Network”) andInforMedx agreed to pay $210,000 for a one half interest in this newlyestablished entity.  Of this amount $100,000 was received inSeptember 2004 with the balance due September 2005.  

Allcontent used is to remain the property of EP with any jointly developedcontent being the property of seminars with each of the parties able toutilize the content in any manner so long as that use is not 

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**EP Global Communications, Inc.**

**Notes to Consolidated Financial Statements**

**March 31, 2006**

** (Unaudited)**

disruptiveto the purpose, intent or in conflict with the business activities ofseminars.  Profits were to allocated based on the ownership ratio. 

EP has recognized the transaction as an addition to minority interest.

InJune of 2005, shortly after a change in senior management at Conemaugh,InforMedx informed the Company that it had reconsidered its continuingparticipation in the joint venture and made a determination thatcontinued participation would not be consistent with Conemaugh’sstrategic goals.  Accordingly, InforMedx returned its one-halfownership of the LLC to the company in exchange for being released frommaking the $110,000 contribution in September 2005.  Consequently,the Company has transferred $100,000 of minority interest to additionalpaid in capital.  Also, the minority interest was further reduced,with an offset to paid in capital, by $7,173.  There are noobligations to InforMedx at March 31, 2006.

**10.  Commitments and Contingencies**

Operating Leases

TheCompany has operating leases for office space and temporary livingspace expiring in 2006 and office equipment expiring in 2007. Total operating lease expense amounted to $148,814 and $111,988in 2005 and 2004, respectively.  Subsequent lease payments are$134,949 in 2006 and $6,035 in 2007.   

Legal Proceedings

TheCompany is a plaintiff against a former director and shareholder whohas not satisfied the terms of his agreement with the Company of April1998.  The action resulted in the Company suspending payments tohim under that agreement which at the time of suspension had a balanceof $119,651.  It is the Company’s belief that it will not beliable for the payments and that it has meritorious defenses to theamount claimed and well supported counter-claims that exceed the amountsought in this action.

OnJuly 27, 2005, the Company received notice that an action has beencommenced against the Company alleging breach of contract and othercauses of action seeking specific performance and other unspecifieddamages.  The Company denied liability and counter-claimed forfraud.  In January 2006, the parties agreed to settle the matter,and the action was dismissed.

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**Item 2. Management's Discussion and Analysis or Plan of Operation**

FORWARD LOOKING STATEMENTS

This quarterlyreport contains forward-looking statements that involve risks anduncertainties.  We use words such as anticipate,  believe,plan, expect, future, intend and similar expressions to identify suchforward-looking  statements. You should not place too much reliance  on these  forward-looking  statements. Our actual results are likely to differ materially from thoseanticipated in these forward-looking statements for many reasons.

Plan of Operation

It ismanagement’s intent to continue and expand our 35 year heritageof providing “Information that matters from those who care”to the special needs market. The 35 year heritage is based on ourwholly owned subsidiary, Psy-Ed Corporation. In 2004, we beganimplementing a growth strategy that consists of a three-pointinitiative as outlined below to increase revenues and profitability for2006 and beyond.

Managementbelieves that our core services, consisting of ad revenue, customcommunications and EPGL special project segments including“Disabilities Awareness Night” conducted in various sportsmediums as well as our innovative on line interactive educationalprograms are all forecast to experience significant growth beginning inthe second quarter of 2006

| Special Projects:                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
|-----------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| Disability Awareness Night -      | Ineach of the preceding three years, the Disability Awareness Night (DAN)campaign launched in 2002 has grown substantially.  In 2002, westarted with two teams, the New York Yankees and the Boston Red Sox. In 2003, the participation expanded to fourteen teams.  In2004, we grew to twenty-seven teams and in 2005 we had DAN events inthirty-one stadiums including the Hall of Fame Game in Cooperstown, NewYork. In 2005, we experienced the participation of our lead sponsorwhose financial contribution has now expanded from $150,000 to $300,000with ancillary sponsorship totaling approximately $200,000 for printand other services. We also benefited from additional sponsorshipprovided by other national entities such as Genzyme, ShirePharmaceuticals and Volvo. |
|                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| Educational On Line Programming - | InDecember 2005 we launched the first of four on-line interactive live TVquality educational programs under unrestricted educational grants froma major pharmaceutical company, Allergan Inc. This will be followed byother series dealing with conditions such as epilepsy and expandednewborn screening utilizing tandem mass spectronomy (MS/MS). It isexpected that in 2006 the preponderance of an appropriation of$1,000,000 to provide education and informationsl access toprofessional and family military caregivers will be dedicated toproviding this education using our on line medium.                                                                                                                                                                                                |
|                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| Strategic Initiatives:            | Ourplatform for growth in part is due to a number of marketing jointinitiatives that have been entered into allow EPGL to address targetmarkets in a concentrated manner. Listed below are the keyrelationships we now have that are intended to result in additionalrevenue for the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| Child Neurology Foundation -      | Agreementto co produce on line seminars in 2006. No other entity has thisopportunity. The CNF is the recognized extension of the more than 1,300child and adult neurologists in the United States and the acknowledgedentity by this group to conduct educational programming.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| Vemics, Inc. -                    | Relating to technology exclusivity in health care.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |

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|                               |                                                                                                                                                                                                                                                                                                                                                                                                                              |
|------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| CTC Foundation and John Williams - | EPGLand CTC / John Williams have agreed to joint market to assistivetechnology companies capitalizing on the work and writings alreadyperformed by John Williams an acknowledged expert in the field ofassistive technology. Mr. Williams is a regular contributor topublications such as USA today, writing on trends and developments inassistive technology an area of c critical importance to individualswith special needs. |
|                               |                                                                                                                                                                                                                                                                                                                                                                                                                              |

We have beennotified that as of March 31, 2006, the bill containing anappropriation earmarked for EP Global in the amount of $1,000,000 haspassed both houses of Congress and been signed by the president. Please refer to the commentary that follows for furtherexplanation of the process that will lead to the funding of thisappropriation.   These funds will be used to provide ongoingeducation for military families and physicians caring for children withdisabilities and special health care needs.

We have alsoexpanded our sales force from four individuals in 2006 to eightindividuals and one outside representative responsible for West Coastsales in support of our selling efforts primarily of space advertisingin our various markets across the nation.

To improveefficiency and allow for greater promotion of our magazine to stimulatesubscription income we have outsourced our entire circulationmanagement to a firm specializing in this area.   Theincremental cost of doing this is not material in relation to the coststo date.  Previously, circulation management has been handledinternally by our existing staff.  Our business, with its multipleproduct lines and multi media approach to publishing andcommunications, suggests that we might best be able to grow ourexisting paid circulation base under the direction of an experiencedand professional circulation management team who can also oversee theshift to a smaller more effective fulfillment firm; one more suited tothe nature of our business which is heavily involved in medical andhealth care related activities.  Accordingly, we are shiftingcompensation and related expenses to outside professional circulationservices that have experience in both consumer as well asmedical/professional publishing.  The cost differential associatedwith this shift, as noted, is negligible but the potential forsignificant increases in paid circulation and related developmentactivities such as bundled advertising and sponsored bulk distributionof the monthly magazine should yield higher revenue performance for us.

The agreementwith ProCirc, based in Miami, Florida, is for one year and can beexpanded or terminated depending on its performance.  There areincentives built into the agreement to reward performance. Finally, it is important to note that increases in unitcirculation will also result in increases in advertising as we will bereaching a larger audience which should justify increases in ad pagesales from a larger number of ad page sales as well as ad page rateincreases.

In 2006, we havecontinued our expanded Disabilities Awareness Night programs,principally conducted in major league baseball parks since 2004. Prior to this time, our programs were taking place in NationalBasketball Association venues, minor league baseball parks and minorleague hockey arenas. On May 23, 2005, in conjunction with the NationalBaseball Hall of Fame in Cooperstown, New York, we hosted prior to theannual “Hall of Fame” game, a ceremony honoring returningdisabled veterans from Iraq and Afghanistan.  This was done inconjunction with Walter Reed Army Medical Hospital and its CommandingGeneral who presented awards to returning veterans and their familiesselected for the honor. Also at that event, one of the honoreesreceived his “Purple Heart” for wounds received in Iraq. Wewill, once again, on May 15, 2006 hold an event at the 2006 “Hallof Fame” game in Cooperstown. Sponsorship for the event is beingprovided by Mass Mutual Financial Group and Bearing Point, a nationalconsulting firm headquartered in Tysons Corners, Virginia.

On December 1-3,2005 the Annual World Congress and Exhibition on Disabilities was heldin Philadelphia, Pennsylvania.  Previously, in October 2004, ithad been held in Orlando, Florida with approximately 6,000 attendees. We conducted over 100 individual education sessions during theevent with world renowned guest lecturers providing education on topicsincluding autism, ADHD (Attention Deficit Hyperactivity Disorder),cerebral palsy and mental retardation.

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We havedisengaged from the World Congress and Exhibition as an entity and areexpected to pursue alternative venues to continue the production ofhosted educational sessions in a forum environment. This in addition toour interactive on line initiatives.

It should also benoted that further internal growth is expected to result fromExceptional Parent Magazine being designated as the officialpublication of the American Academy of Developmental Medicine andDentistry (“AADMD”), a national organization of over 1,000doctors and dentists who have dedicated their efforts to providing“best practices” advice to caregivers on how to medicallyand dentally care for the special needs individual. Beginning with theJuly 2005 issue of Exceptional Parent Magazine, AADMD is providingarticles for the magazine and the opportunity for physicians to secureup to 2 credit hours of Continuing Medical Education by completing atest that is to follow each article. Management believes thatExceptional Parent Magazine is the first consumer publication ever tooffer Continuing Medical Education credits to physicians. Ourrelationship with the AADMD is in addition to relationships we enjoywith numerous disabilities groups throughout the United States as wellas with medical societies such as the Child Neurology Society.

It should also benoted that our officer and director, Joseph M. Valenzano Jr. is theonly non-physician to hold a board seat on the AADMD and Mr. Valenzanocurrently chairs the Executive Advisory Board of the AADMD.

In March 2005, wesubmitted an appropriations request in the amount of $1,000,000 toCongress. Under the appropriation request, the Army would receive$1,000,000 and then develop a contract for delivery of service with EPGlobal for that approximate value. We have been notified that theappropriation has been approved by both houses of Congress and signedby the President. Further, in February 2006 we were notified that“these funds had been released to the appropriate department atFort Dietrich, MD which allows EP to begin the processing of itscontract.   A pre proposal submission has been made whichrepresents a condition precedent to actual contract development.between EP Global and the Army. We have been told that the actualcontract development is expected to take 90 -120 days which would meanthat funding for the programs to be undertaken could occur in the latespring to early summer of 2006 although there is not absolute assurancethat this will occur.

However, iffunded in 2006 as outlined, this would increase our education andinformation programs to military families with special needs dependentsand caregivers. It is our intent to build upon our existingrelationships within the military community to bring timely andmeaningful educational content in both print and on a web baseddelivery system to these families but also to the physicians chargedwith their care.  In this regard, we have already begun theprocess of exploring ways in which we can deliver high qualityeducational content focused in the chronic disability and special needsarea in cooperation with military hospitals such as Walter Reed ArmyMedical Center, Brooke Army Medical Center and the Uniformed MedicalServices School in Bethesda. This initiative, once operational, wouldresult in increased revenue of the entire $1,000,000, to be recognizedsubstantially in 2006 from subscriptions, on-line interactive trainingsessions and custom communication sales. We would account for allrevenues consistent with existing accounting policy which is toidentify revenue streams consistent with our core services which aresubscriptions, page advertising, and special projects/customcommunications and on line web based programming. We would alsoidentify these revenue streams as being generated from military fundingso as to distinguish the revenue streams from those funded by privatesponsorship.

Managementestimates that the overall cost associated with the planned educationalprogramming will approximate 65% to 75% of revenues received.

Our revenues are generated from the following activities:

Sale ofAdvertising Space in Exceptional Parent Magazine:  This is drivenby a number of factors, including our editorial content and focus. Our customers consist of large Fortune 500 companies:  Ford,Chrysler, Kimberly Clark, Novartis Pharmaceuticals, Johnson &Johnson, Massachusetts Mutual Life Insurance Company, Verizon andMerrill Lynch.  All purchase ad space in our publications is toenhance awareness and image for their products and services and brandrecognition for their names. Historically, revenues generated from thesale of advertising space has ranged from approximately $1.6 milliondollars to as high as $2.2 million in the past (1998).

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DisabilityAwareness Night Programs at Major and Minor League Stadiums:  Thisprogram generates revenue. Each of these DAN Events are sponsored on anational basis by a leading sponsor, MassMutual Financial Groupfollowed by regional and local sponsorships.  In 2005 for example,total revenues from this effort aggregated approximately $400,000. Wehave already signed the sponsorship agreement with our lead sponsor for2006 in the amount of $300,000 and have commitments from other sponsorsthat will yield revenues well in excess of $400,000 in 2006.  Thisdoes not include any sponsorship revenues from other venues such as theNBA Games and NHL and Minor League Hockey Games.

EP Bookstore: The EP Bookstore houses approximately 1,500 disability specificbooks, video and tapes dealing with a wide range of disability topics. We have been building this base for quite some time and are nowpoised to leverage its growth with some targeted marketing to specificmarket segments such as military bases and libraries across the nation.

The bulk of ourlibrary has been built through negotiating with third party publisherssuch as Baker and Taylor and McGraw Hill.  This has been done overa period of years and with great selectivity and sensitivity.  Weevaluate the extensive titles published by other book publishingcompanies and inquire about their sales.  Based on theintelligence we obtain, we approach these companies which roughlynumber about 90 and negotiate with them for bulk purchases of certaintitles our Editorial Advisory Board indicates are consistent with ourmission, goals and objectives.  In many cases we are able tonegotiate consignment inventory. All of this is possible because largebook publishers really do not have a good sense of the disabilitymarketplace and/or the needs of specific targeted audiences whetherconsumer or professional in nature. We have this expertise and we wentabout building our library of titles in specific disciplines.  Inthe process of building this library, we place importance inunderstanding the marketing requirements for reaching this audience andwhether or not we believe we can do so effectively through ourmagazine, web site and contacts within disability organizations andprofessional medical societies; and via distribution and sales at tradeshows and conferences.  The EP Library also consists of booktitles we own outright and exclusively.  Examples of such titlesinclude the following: No Apologies for Ritalin by Bhushan Gupta, MD;and Patient Persistence by Adele Gill, RN and approximately five othertitles.  None have a material impact taken individually orcollectively but the profit margins earned on these sales areapproximately 30% while the profit margins on other titles are in thevicinity of 10%.  Our decision to have a stake in book publishingis based on the fact that we receive countless number of requests topublish specific manuscripts as books. While most of these arerejected, the pipeline for such valuable information is of highimportance to us because some of this can be turned into productivetitles we can publish while others can serve as useful content for someof our other multi media publishing activities in print or on line. We do not envision total revenues from our book operation toreach levels much beyond $500,000 per year with profit margins on theorder of 15%.

Custom Publishing& Contract Publishing:  Over the years, we have takeneducational editorial series published in EP Magazine, had themreviewed by a panel of clinical thought and opinion leaders, edited andpackaged into stand alone monographs focused on a specific subject areaand distributed to key target market segments mutually identified by aproject sponsor and ourselves.  All of this work is completelyfunded under unrestricted educational grants secured from majorpharmaceutical companies, medical equipment device manufacturers,consumer packaged goods companies and financial services companies. At all times, we adhere to strict ACCME Standards for medicaleducation and strict standards that insure the separation of that whichis educational and that which is promotional in nature.  Anexample of this approach is as follows:

Our editorialadvisory board suggests a topic that is cutting edge and much needed inthe context of medical education.  An example is The Spectrum ofMitochondrial and Metabolic Disorders.   

A series ispublished on this subject featuring the very best medical andscientific research authorities we can find.  The series might bethree, four or six consecutive articles in EP magazine, each onefocused on a specific area.

Once complete,the series is then reviewed by a separate panel of experts to insurethat it is adequate and or needs additional bolstering if it is to bepackaged as a stand-alone monograph.  Additional content may ormay not be recommended and we would then take it forward to thesponsor/grantor.

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Thesponsor/grantor will decide whether to proceed with the development ofa stand-alone monograph.  We would price the project to includepaper, printing, distribution costs, packaging, etc.  A pricequote will be provided to the sponsor inclusive of our profit margin.

The project will be produced and implemented.

This descriptionfits A Primary Care Physicians Guide to Mitochondria and MetabolicDisorders and its companion publication, a Parent’s Guide toMitochondrial and Metabolic Disorders. Both publications are now intheir third printing with press runs in excess of 100,000 copies anddistributed all over the world and used at major teaching hospitals andclinics internationally.   Sponsorship revenue for these twoproducts aggregated over $250,000 in 2004 with profit margins ofapproximately 25%.  Extra supplies are always printed and thesecopies are sold through our EP Library at reduced rates, such as $5.00per copy intended to cover postage costs and yield a small profit.

 

This formula isfollowed for all other such sponsored custom publishing projects.  However, in 2006, we will become the Contract Publisher forSpecial Care Dentistry and will be paid by that professional dentalsociety for its services.  We will also be able to share in therevenues and profits generated in excess of mutually agreeabletargets/goals. Historically, we have produced one or more significantcustom communications projects per year. In 2003 and 2004, revenue fromthis segment amounted to $235,000 and $75,000, respectively. In 2005,no major custom communications program was undertaken. However, lesserprojects involving the sale reprints of previously produced customcommunications were done.

On LineInteractive Educational Seminars:  Another element in our productmix is the EP On Line Interactive TV Quality Educational Seminars. This is a project that capitalizes on the relationships andcredibility we have built with major professional medical societies aswell as lay and consumer organizations representing the interests ofpeople with disabilities.  We have produced a total of twenty suchseminars over the past three years and now are poised to offer these inconcert with professional medical societies such as the AADMD, CNF andCNS.  The fact that all of these seminars offer continuing medicaleducation (CME) accreditation for physicians usually without fees,coupled with the fact that they do not have to travel but can insteadparticipate from the comforts of their homes or offices, help to reducecosts and improve efficiency and educational results.  To ourknowledge, no other company in the United States offers the kind ofcomprehensive authoritative educational programming focused exclusivelyon chronic life long conditions as we do. In addition, we do this byoffering on line real time live interactive TV quality manner utilizingproprietary software and delivered over the Internet.   Weexpect to conduct over 20 such seminars in 2006 in combination with ourmilitary initiative.  We had four on line seminars under contractas of December 30, 2005, and have added an additional two since thatdate without consideration of the military. We also have several otherproposals outstanding.

Results of Operations for the Period Ended March 31, 2006

Liquidity and Capital Resources

Liquidity hasimproved in the first quarter 2006 as compared to the first quarter2005 primarily as the result of the completion of a financing thatprovided the company with $3,000,000 of new working capital. Thattransaction is described below.

On September 23,2005, we completed financing agreements by executing a securitiespurchase agreement with the following entities: AJW Partners, LLC, AJWOffshore, Ltd., AJW Qualified Partners, LLC and New Millenium CapitalPartners II, LLC. Under the securities purchase agreement, we willissue up to $3,720,000 in callable secured convertible notes. The notesare convertible into shares of our common stock. The conversion priceis based on the lesser of $0.12 or the average of the lowest 3intra-day trading prices during the 20 trading days immediately priorto the conversion date discounted by 40%. The timing of the conversionis at the option of the holder. The notes are secured by a grant of ageneral security interest in all of our assets both tangible andintangible. In addition, our officer and director, Joseph Valenzanoindividually pledged 3,371,093 shares of our common stock.

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In addition, weare to issue stock purchase warrants convertible into shares of ourcommon stock on a one for one basis. The exercise price is $.15 and theterm of the warrants is 5 years.  

A privateinvestment firm, Westminster Securities Corporation based in New YorkCity, received a commission of $240,000 (8% of the net proceeds of$3,000,000) for arranging for this financing.

To date we havereceived $3,000,000 under the terms of the securities purchaseagreement. We have applied these funds in the manner outlined in thetable below. 

|   | Gross Proceeds Received |  $      3,000,000 |
|--------|-------------------------|-------------------------------------------------|

|   |   |   |     |
|--------|--------|--------|--------------------|

|   | Less - Use of Proceeds |   |
|--------|------------------------|--------|

|   |   | Closing Costs and Fees                            | 340,000   |
|--------|--------|---------------------------------------------------|-----------|
|   |   | Liquidation of line of credit and other bank debt | 470,000   |
|   |   | Pay down of trade debt                            | 889,000   |
|   |   | Pay down of private debt*                         | 826,291   |
|   |   | Pay down of debt to related parties               | 174,709   |
|   |   | Total Proceeds Utilized                           | 2,700,000 |
|   |   |                                              |      |

|   | Net Retained for operating expenses |  $300,000 |
|--------|-------------------------------------|----------------|

|   |   |   |   |
|--------|--------|--------|--------|

 *Thepay down of private debt included $140,000 owed to an individual where2,000,000 shares of our stock were contingently issuable as collateral. 

Underthe terms of the Securities Purchase Agreement, we were required tofile with the SEC a proxy to increase our authorized shares by no laterthan October 21, 2005.  Such proxy was not filed until November23, 2005.  We have been advised that the investors do not intendto seek any liquidated damages for our failure to file the proxy.Notwithstanding same, the investors have the right to request theliquidated damages.  If the investors choose to request theliquidated damages based on the failure to file the proxy in a timelymanner, then we would be required to pay a penalty of 2% of theoutstanding principal balance from the period the proxy should havebeen filed on October 21, 2005 until it was filed on November 23, 2005.

    

Withan existing forecast of minimum revenues of $4,000,000 in 2006,management believes that with the operational cash to be generated andthe retained working capital from our recent funding the overall cashrequirements of operations are expected to be met. While there is noabsolute guarantee that we will generate the forecast revenues,management believes that both the revenue generation forecast and theadditional funding received will meet the liquidity requirements ofEPGL for 2006.

Atthe present level of operations, working capital requirements tosustain operations approximates $325,000 per month exclusive of anyexisting debt service that approximates an additional $7,000 per month.

Toprovide additional liquidity, in the first quarter of 2006managementhas applied for a line of credit secured by accounts receivable. Apreviously held line of credit in the amount of $450,000 had been paidoff pursuant to the requirements of the securities purchase agreementunder which $3,000,000 has been received through January 31, 2006.Although there is no assurance that we would be able secure suchfunding, management believes that with its improved working capitalratios and its improving revenue production it is reasonable to believethat a working capital line would be able to be secured.

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Should2006 revenues not reach the forecast level noted above, resulting in anadditional need for working capital it is believed that additionalliquidity may be provided by a line of credit as well as an increasedin reliance on trade debt. This would in the short term provide theliquidity to support operations while adjustments are considered tobring revenues back on plan.  It should be noted that trade debthas been reduced from $600,000 (pre-funding) to under $300,000(post-funding).

It ismanagement’s estimate that with its existing working capitalresources and with the insurance of the contemplated additional fundingnoted, we will be able to meet the working capital requirements ofoperations for the coming twelve months of operations.

Results of Operations

Reflected in thetables below comparisons of revenue and sales and generaladministrative expenses for the quarters ended March  31, 2006 and2005 as well as commentary on significant variations noted between theperiods.

Sales for thethree months ended March 31, 2006 as compared to the same period in2005 increased as noted by approximately $26,000. The net increase isprincipally the result of the increase in special project revenues ofapproximately $75,000 balanced by decreases in all other segments, withthe exception of subscription revenue..

The increase inspecial projects income was due to greater sponsorship revenuesrelating to our Disability Awareness Night Program earned in the firstquarter 2006.

Operating Expenses Including Cost of Sales

Cost of sales in2006 decreased by approximately $27,000 as compared to 2005.  Thedecrease is primarily due to reducing print run expense including printand postage expense.

Commentary on the significant variations in selling, general and administrative expense follow the table that is noted below.

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The significant variations in the components of selling, general and administrative expense are discussed below.

Salaries and Benefits

The increasenoted in the first quarter 2006 in this category as compared to 2005 isrelated totally to the increase in the number of individuals (23 versus17) employed by EPGL. Increases have been made in both the sales andadministrative areas.

Investor Relations

EPGL had engagedan investor relations firm in November 2005 to manage informationprocessing relating to operations and activities relating to its stock.The organization Booke & Co. of New York City is paid $4,000 permonth for its services in addition to any out of pocket expensesincurred.

Professional Fees

The increase ofapproximately $45,000 in the first quarter 2006 as compared to 2005consists primarily of auditing, and accounting support fees thataccount for $34,000 of the noted increase with the remaining $11,000comprised of various amounts under $3,000.

Interest, Depreciation and Amortization

Interest andamortization expense has increased in the first quarter 2006 comparedto 2005 due to the accretion of $54,264 interest on the recentlycompleted financing and $26,111 of amortization, relating to $340,000of financing costs associated with that financing that are to beamortized over thirty six months.

Taxes

We reflected noprovision for income taxes in the first quarter of 2005 because of theavailability of a significant net operating loss carry forward tooffset any taxable income.

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Debt Expenses

In accordancewith Emerging Issues Task Force Topic 00-27 and SFAS 150,“Accounting for Certain Financial Instruments withCharacteristics of both Liabilities and Equity”, the Companyperformed calculations allocating the proceeds from the issuance ofconvertible debt with detachable warrants and the beneficial conversionprivileges to each respective security at their fair values.  The Company referred to SFAS 133, “Accounting forDerivative Instruments and Hedging Activities,” and EITF 00-19,“Accounting for Derivative Financial Instruments Indexed to, andPotentially Settled in, a Company's Own Stock,” in determiningwhether the conversion option is an embedded derivative instrument. In the case of the detachable warrants and the beneficialconversion privileges, the Company concluded the fair value was nil;accordingly, the entire amount recorded as a liability was associatedwith the convertible debt. The calculated fair value of the convertibledebt of $3,079,576 was recorded as a long term liability as of March31, 2006.  The convertible debt will be accreted to its face valueof $3.7 million under the interest method until it is either convertedor matures. As of March 31, 2006, the total accretion was $89,464 (ofwhich $54,264 was recorded in the three months ended March 31, 2006. Separately, the holder of the note exercised conversionprivileges for 1,200,000 shares of common stock thereby reducing theamount of the debt by $9,888.

We incurred debtissue costs of $340,000 relating to their convertible notes and will beexpensed over the term of the convertible debt.

Off Balance Sheet Arrangements

None

**Item 3.  Controls and Procedures**

Evalution of Disclosure Controls

During the courseof the most recent examination of our financial statements for theperiod ended December 31, 2005 by our independent accountants, we wereadvised of the existence of a material weakness in our internalaccounting controls that existed prior to September 2005.  We havesince applied the necessary corrective action and believe this weaknesshas been remediated.

Managementevaluated the effectiveness of the disclosure controls and proceduresas of April 12, 2006.  This evaluation was conducted by the chieffinancial officer (the principal accounting officer).

Disclosurecontrols are controls and other procedures that are designed to ensurethat information that is required to disclose in the reports filedpursuant to the Securities Exchange Act of 1934 is recorded, processed,summarized and reported.

Limitations on the Effective of Controls

Management doesnot expect that the disclosure controls or the internal controls overfinancial  reporting will prevent all error and fraud. A controlsystem, no matter how well  conceived and  operated, can provide only  reasonable,  but no absolute, assurance that the  objectives of a control system are met. Further, any control  system  reflects limitations  on resources,  and the benefits of acontrol system must be considered  relative to its costs. Theselimitations also include the realities that judgments in decision-making  can be faulty and that breakdowns can occurbecause of simple error or mistake. Additionally,  controls can becircumvented by the individual acts of some persons,  by collusionof two or more people or by  management  override  of acontrol.  A design of a control system is also based upon certainassumptions about potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of  compliance  with the  policies or  procedures  may  deteriorate.

Because  of the  inherent  limitations  in  a cost-effective  control  system, misstatements due toerror or fraud may occur and may not be detected.

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Conclusions

Based upon his evaluation  of the  controls,  the chief executive  officer and the chief financial officer(principal  accounting  officer) have concluded  that, subject to the  limitations noted  above,  the disclosure  controls  are  effective providing   reasonable assurance  that material  information  relating to the Company is madeknown to management  on a timely  basis  during the period  when the  reports  are being prepared. There were no changes in the internal  controls thatoccurred  during the  quarter  covered  by this report  that have  materially  affected,  orare reasonably likely to materially affect the internal controls.

**PART II - OTHER INFORMATION**

**Item 1.  Legal Proceedings**

See Item 3 of theCompany’s 2005 annual report on Form 10KSB as filed with theSecurities and Exchange Commission on April 14, 2006.

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

On February 21,2006, we issued 60,000 shares of our restricted common stock to RichardAnslow and 40,000 shares of our restricted common stock  to GregJaclin in consideration for legal services rendered to us.  Theissuance was valued at $.025 per share or $2,500.  Our shares wereissued in reliance on the exemption from registration provided bySection 4(2) of the Securities Act of 1933. No commissions were paidfor the issuance of such shares. The above issuance of shares of ourcommon stock qualified for exemption under Section 4(2) of theSecurities Act of 1933 since the issuance of such shares by us did notinvolve a public offering.  Messrs. Anslow and Jaclin aresophisticated investors and had access to information normally providedin a prospectus regarding us. The offering was not a “publicoffering” as defined in Section 4(2) due to the insubstantialnumber of persons involved, size of the offering, manner of theoffering and number of shares offered. We did not undertake an offeringin which we sold a high number of shares to a high number of investors.In addition, Messrs. Anslow and Jaclin had the necessary investmentintent as required by Section 4(2) since they agreed to and received ashare certificate bearing a legend stating that such shares arerestricted pursuant to Rule 144 of the 1933 Securities Act. Theserestrictions ensure that these shares would not be immediatelyredistributed into the market and therefore not be part of a“public offering.”  Based on an analysis of the abovefactors, we have met the requirements to qualify for exemption underSection 4(2) of the Securities Act of 1933 for the above transaction.

**Item 3. Defaults Upon Senior Securities**

         None.

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

         None.

**Item 5. Other Information**

         None.

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**Item 6. Exhibits and Reports on Form 8-K**

        A.  Exhibits

|   | 31     | Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
|--------|--------|------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                   |
|   | 32     | Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |

        B.  Reports on Form 8-K

          None.

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                                   SIGNATURES

In accordancewith the  requirements of the Exchange Act, the registrant caused this  report to be  signed on its  behalf by the  undersigned,  thereunto  duly authorized.

Dated:  May 22, 2006

/s/ Joseph M. Valenzano, Jr.

    Joseph M. Valenzano, Jr.

    President and Chief Executive Officer

/s/ Paul Cunningham

    Paul Cunningham

    Chief Financial Officer

29