UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                  FORM 10-KSB


(MARK ONE)

/X/      ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
         OF 1934

         For the fiscal year ended March 31, 2004

/ /      TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
         ACT OF 1934

         For the transition period from __________ to __________

                         Commission file number: 0-25377

                                 Nurescell Inc.
                 (NAME OF SMALL BUSINESS ISSUER IN ITS CHARTER)

           Nevada                                       33-0805583
(STATE OR OTHER JURISDICTION OF             (I.R.S. EMPLOYER IDENTIFICATION NO.)
 INCORPORATION OR ORGANIZATION)

                       P.O. Box 116, North Haven, CT 06473
               (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)

                    Issuer's telephone number: (203) 239-9734

         Securities registered under Section 12(b) of the Exchange Act:

Title of each class                   Name of each exchange on which registered
       None                                          None

         Securities registered under Section 12(g) of the Exchange Act:
                         Common Stock, $.0001 par value
                                (TITLE OF CLASS)

         Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the issuer was required to file such reports), and (2) has
been subject to such filing requirements for the past 90 days. Yes /X/ No / /

         Check if there is no disclosure of delinquent filers in response to
Item 405 of Regulation S-B contained in this form, and no disclosure will be
contained, to the best of issuer's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB. /X/

         The issuer's revenues for its most recent fiscal year (ended March 31,
2004) were $-0-.

         The aggregate market value of the voting and non-voting common equity
held by non-affiliates of the issuer, based upon the average bid and asked price
of such common equity on June 22, 2004, as reported by the OTC Bulletin Board,
was approximately $907,800. Shares of common stock held by each officer and
director and by each person who owns 5% or more of the outstanding common stock
have been excluded in that such persons may be deemed to be affiliates. This
determination of affiliate status is not necessarily a conclusive determination
for other purposes.

         The number of outstanding shares of the issuer's common stock on
June 22, 2004 was 1,187,916,949.

         Documents incorporated by reference: None.

    Transitional Small Business Disclosure Format (CHECK ONE): Yes /X/ No / /




<PAGE>

                                     PART I

              NOTE: NURESCELL INC. HAS ELECTED TO FOLLOW DISCLOSURE
                ALTERNATIVE 2 IN THE PREPARATION OF THIS REPORT.

ITEM 6. DESCRIPTION OF BUSINESS.
--------------------------------

         GENERAL. Nurescell Inc. (the "Company") is a development stage company
that was formed in 1998 for the purpose of developing and commercially
exploiting a proprietary radiation shielding technology (the "Nurescell
Technology") for use by the nuclear power industry and others producing,
handling or storing radioactive materials. The Nurescell Technology material,
which is comprised of a unique composite of materials, was designed for
incorporation into the structural components of new and existing nuclear
reactors and other facilities in order to provide a cost-effective safeguard
from the lethal effect of radiation while achieving a minimal disruption to
existing facilities. In addition, it was expected to provide an innovative
shielding material for various other purposes, including nuclear accelerator and
defense research applications. The Company, however, failed to generate any
significant revenue from the Nurescell Technology. Having exhausted all of its
funding and without any source of revenue, the Company was forced to reduce its
operations to a minimal level. On January 21, 2004, the Company completed
certain transactions under a Restructure Agreement (the "Restructure Agreement")
with Triton Private Equities Fund, L.P. ("Triton"), Advanced Technology
Industries, Inc. ("ATI") (a related party) and ATI's subsidiary, ATI Nuklear AG
("AG"), pursuant to which Triton has taken control of the Company and the
Company has divested itself of the Nurescell Technology, as described in more
detail below.

         PRODUCT TESTING AND MARKETING. Since inception, the Company had spent
approximately $475,000 on research and development activities with respect to
the Nurescell Technology. Due to the pending consummation of the Restructure
Agreement and the Company's financial condition, the Company ceased all product
testing and marketing some time ago.

         INTELLECTUAL PROPERTY RIGHTS. All exiting patents for the Nurescell
Technology have been transferred to ATI and AG pursuant to the Restructure
Agreement.

         PERSONNEL. During the fiscal year ended March 31, 2004, the Company has
had no employees, with the services of Lawrence Shatsoff (the Company's sole
director and officer) being provided pursuant to a consulting agreement between
Mr. Shatsoff, the Company and Triton. See "Item 11. Interest of Management and
Others in Certain Transactions."

         THE RESTRUCTURE AGREEMENT. Pursuant to the Restructure Agreement, the
Company transferred to ATI or AG all right, title and interest in and to the
Nurescell Technology in return for the cancellation by ATI and AG of all debts
and other obligations owed to either of them by the Company, consisting
primarily of a $1 million promissory note, plus interest, secured by the
Nurescell Technology (among other things) and approximately $200,000 in
short-term cash advances and payments made by ATI to or on behalf of the
Company. In connection with the Restructure Agreement, most of the amounts owed
under the Company's notes payable to Triton were converted into 1,067,111,062
shares of common stock of the Company, giving Triton a controlling interest in
the Company.

         Following the transfer of the Nurescell Technology, the Company has
essentially no assets. However, after that transfer, as well as certain
conversions of outstanding debt into common stock by Triton and others, the
Company has been left with only approximately $400,000 in liabilities. It is
expected that those remaining liabilities that are still collectible by former
vendors will either be converted into common stock, settled for cash using funds
provided by Triton or paid with funds provided by a third party in conjunction
with a possible merger or other consolidation with the Company (which is
currently being investigated by Triton). As the transfer of the Nurescell
Technology involved a transfer of assets in return for cancellation of certain
indebtedness, the Company's stockholders received no payment as a result of that
transfer and retained their equity interests in the Company following the
consummation of the transaction. For accounting purposes, the Company treated
the transfer of the Nurescell Technology as an exchange for the extinguishment
of debt.

                                       1

<PAGE>

ITEM 7. DESCRIPTION OF PROPERTY.
--------------------------------

         The Company now operates out of the home of Lawrence Shatsoff at no
charge. Due to its minimal level of operations, the Company expects that this
arrangement will be sufficient for its executive offices for the foreseeable
future.

ITEM 8. DIRECTORS, EXECUTIVE OFFICERS AND SIGNIFICANT EMPLOYEES.
----------------------------------------------------------------

         Set forth below is information regarding the sole director and officer
of the Company. The Company has no employees.

          Name                      Age                 Positions
          ----                      ---                 ---------

     Lawrence Shatsoff              50           President, Chief Financial
                                                 Officer, Secretary and director

         Mr. Shatsoff has been the Company's sole director and officer since
March 21, 2003, when all of the then existing officers and directors resigned
pursuant to the Restructure Agreement. From June 2001 until December 2002, Mr.
Shatsoff was President of Markland Technologies, Inc., a publicly-held
technology company involved in the sale and marketing of home theater products.
Prior to becoming President of Markland Technologies, Mr. Shatsoff served from
June 2000 to June 2001 in various executive capacities and as a director of
Corzon, Inc., a publicly-held telecommunications company. From 1995 to 2000, Mr.
Shatsoff was the Vice President and Chief Operations Officer of DCI Telecom,
Inc., a publicly-held company, and from 1991 to 1994, he served as Vice
President and Chief Operations Officer of Alpha Products, a privately-held
computer circuit board sales and manufacturing company. Mr. Shatsoff also
performs independent management consulting services through his own company,
Business Analysis Group, LLC. Mr. Shatsoff graduated in 1975 from Rider College
with a B.S. Degree in Decision Sciences and Computers.

         Subject to prior resignation or removal, the Company's director serves
in that capacity until the next annual meeting of stockholders or until his
successor is elected or appointed and duly qualified. Officers are appointed by
the Board of Directors and serve in that capacity until resignation or removal.
Except as provided in the Restructure Agreement or as agreed upon between Mr.
Shatsoff and Triton, there are no arrangements or understandings between Mr.
Shatsoff and any other person pursuant to which he was selected for his office
or position. Within the past five years (i) no petition under the federal
Bankruptcy Act or any state insolvency law has been filed by or against Mr.
Shatsoff, and no receiver, fiscal agent or similar officer has been appointed by
a court for the business or property of such person, or any partnership in which
such person was a general partner at or within the two years before the time of
such filing, or any corporation or business association of which such person was
an executive officer at or within the past two years and (ii) Mr. Shatsoff has
not been convicted in a criminal proceeding (excluding traffic violations and
other minor offenses).

ITEM 9. REMUNERATION OF DIRECTORS AND OFFICERS.
-----------------------------------------------

         EXECUTIVE COMPENSATION. The following table sets out the compensation
paid on a cash basis during the fiscal year ended March 31, 2004 to (i) each of
the Company's three highest paid officers or directors and (ii) the Company's
officers and directors as a group:

Name or Identity of Group            Title                          Compensation
-------------------------            -----                          ------------

  Lawrence Shatsoff           President, Secretary, Chief
                              Financial Officer and Director (1)     $31,000 (1)

(1) Has occupied the positions shown since March 21, 2003. Mr. Shatsoff is not
an employee of the Company but receives compensation for his services pursuant
to a consulting agreement with the Company and Triton. See "Item 11. Interest of
Management and Others in Certain Transactions."

                                       2

<PAGE>

         STOCK OPTION PLAN. Under the Company's 1998 Stock Option Plan (the
"Option Plan"), all officers and directors of the Company, as well as its
employees and consultants, are eligible to be selected to participate. The
purpose of the Option Plan is to promote the interests of the Company by
providing participants with an inducement to maintain their status with the
Company and to further advance the interests of the Company. Options are granted
in consideration of things such as past and potential future contributions to
the Company.

         As of March 31, 2004, no options were outstanding under the Option
Plan. The aggregate number of shares of common stock deliverable upon the
exercise of all options granted under the Option Plan cannot exceed 360,000
shares. In the event of any merger, reorganization, recapitalization, stock
dividend, stock split or reverse split or other act or event which effects a
restructure of the Company's common stock (but not including the issuance of
additional shares of Common Stock or preferred stock), the total number of
shares covered by the Option Plan, the exercise price, and number of shares
covered by outstanding options granted pursuant to the Option Plan, and the
rights, preferences and privileges incident to such shares will be appropriately
adjusted as to any remaining options. Any shares covered by options granted
pursuant to the Option Plan which expire or are canceled are available for
reissuance under the Option Plan.

         There is no maximum or minimum number of shares that may be subject to
options granted to any one individual under the Option Plan. The exercise price
of the stock covered by each option is determined at the time of grant;
provided, however, that (i) as to incentive stock options, such exercise price
will not be less than an amount equal to 100% of the "fair value" of the stock
(as determined pursuant to the Option Plan) on the date the option is granted
(110% for options granted to persons who hold 10% or more of the Company's
common stock) and (ii) as to all other options, such exercise price will not be
less than an amount equal to 85% of the fair value of the stock on the date the
option is granted. Subject to the express provisions of the Option Plan, the
terms of each option granted under the Option Plan, including the exercise
price, manner of exercise, vesting and duration of each option, shall be as
specified in the applicable option agreement between the Company and the option
holder.

         The Board of Directors of the Company may amend, suspend or terminate
the Option Plan at any time. Unless terminated sooner, the Option Plan will
terminate on June 15, 2008 and no options may be granted thereafter. No
amendment, suspension or termination of the Option Plan will, without the
consent of the option holder, be made which would alter or impair any rights or
obligations under any option then outstanding. Upon the dissolution or
liquidation of the Company, the Option Plan will terminate, and any option
previously granted thereunder and not yet exercisable in full will also
terminate. In the event, however, that the Company is succeeded by another
corporation, the Option Plan and any remaining options granted thereunder will
be assumed by such successor corporation, subject to such adjustments as may be
necessary due to the capital structure of the successor corporation. It is not
expected that any options will be granted in the future under the Option Plan.
There is no plan currently to change or terminate the Option Plan due to the
Restructure Agreement.

         STOCK COMPENSATION PLAN. On July 21, 2003, the Board of Directors of
the Company adopted the 2003 Stock Compensation Plan (the "Plan"). Pursuant to
the Plan, the Company can offer up to 80,000,000 shares of its common stock to
those officers, directors, employees and consultants (including attorneys who
provide legal services to the Company) who have agreed to accept such shares in
lieu of a cash payment for services previously rendered or to be rendered. Such
shares are not subject to any resale restrictions. As of March 31, 2004, a total
of 74,745,862 shares have been issued under the Plan.

         In the event of any merger, reorganization, consolidation,
recapitalization, dividend (other than a cash dividend), stock split, reverse
stock split, or other change in corporate structure affecting the Company's
common stock, such substitution or adjustment shall be made in the aggregate
number of shares of common stock reserved for issuance under the Plan as may be
determined to be appropriate by the Company's President in order to prevent
dilution or enlargement of rights.


                                       3

<PAGE>

         The Company's President determines (i) the eligible persons to whom and
the time or times at which common stock shall be issued under the Plan, (ii) the
number of shares of common stock to be issued to each participant, (iii) the
amount to be paid for such shares by each participant (based on services
rendered or to be rendered) and (iv) all other terms and conditions of such
issuance, to the extent consistent with the Plan. Each participant enters into
an agreement specifying the foregoing (to the extent applicable) with respect to
each issuance of common stock to such participant. Payment for common stock is
only in the form of forgiveness of amounts owed or to be owed by the Company for
services rendered or to be rendered, and no participant is required or permitted
to pay cash for the issuance of common stock.

         The Company's Board of Directors may at any time, and from
time-to-time, waive, amend, suspend or eliminate any of the provisions of the
Plan, but no waiver, amendment, suspension or elimination will be made which
would impair the rights of a participant under any agreement previously entered
into without the consent of such participant.

         Unless terminated earlier by the Company's Board of Directors, the Plan
will continue in effect until such time as all shares of common stock allocated
to the Plan have been issued.

         COMPENSATION TO DIRECTORS. Except as noted above, the Company has not
compensated its directors for their services as such, although in the past they
have been granted options under the Option Plan. It is, however, the policy of
the Company to reimburse directors for reasonable expenses incurred in attending
meetings of the Board of Directors.

ITEM 10. SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN SECURITY HOLDERS.
-----------------------------------------------------------------------

         COMMON STOCK. The following table sets forth the record ownership of
the Company's common stock (the Company's only class of voting stock) as of June
22, 2004 as to (i) each person or entity who owns more than 10% of the Company's
common stock, (ii) each person named in the table appearing in "Item 9.

Remuneration of Directors and Officers" and (iii) all officers and directors of
the Company as a group:

<TABLE>
<CAPTION>
Name and Address of Owner                 Number of Shares Owned (1)        Percent of Class (2)
-------------------------                 --------------------------        --------------------
<S>                                           <C>                                  <C>
Triton Private Equities Fund, L.P.            1,097,134,705 (3)                    92.4%
225 N. Market St., Suite 333
Wichita, Kansas  67202

Lawrence Shatsoff                                     -0- (3)                       N/A
P.O. Box 116
North Haven, Connecticut  06473

All officers and directors                            -0-(3)                        N/A
as a group (one person)
</TABLE>

(1) To the Company's knowledge, the persons named in the table have sole voting
and investment power with respect to all shares of common stock owned by them,
subject to community property laws where applicable.

(2) Based on 1,187,916,949 shares of common stock outstanding, without taking
into account any shares issuable upon the exercise of outstanding options,
warrants or other rights.

(3) Does not include shares which can be obtained pursuant to the exercise of
options, warrants and other stock acquisition rights, as described in the table
below.

   The Company has no class of non-voting securities presently outstanding.


                                       4

<PAGE>

         OPTIONS, WARRANTS AND OTHER RIGHTS. The following table sets forth the
options, warrants and other rights to acquire securities of the Company which
were held as of March 31, 2004 by (i) each person or entity who owns more than
10% of the Company's common stock, (ii) each person named in the table appearing
in "Item 9. Remuneration of Directors and Officers," where the total market
value of securities obtainable by such person under all outstanding options
exceeds $10,000, and (iii) all officers and directors of the Company as a group:
<TABLE>
<CAPTION>

                                        Title and Amount of
                                        Common Stock Called
                                       For by Options, Warrants                    Date of
Name of Holder                            And Other Rights       Exercise Price    Exercise
--------------                            ----------------       --------------    ---------

<S>                                       <C>                         <C>              <C>
Triton Private Equities Fund, L.P.        48,357,489(1)               (1)              (1)

Lawrence Shatsoff                              (2)                    (2)              (2)

All officers and directors
as a group (one person)                        (2)                    (2)              (2)
</TABLE>

(1)      As of March 31, 2004, Triton had loaned to the Company or provided for
         its benefit $224,856 for operating expenses (the "Operating Loans"). As
         of that date, the Operating Loans, together with accrued interest, were
         convertible into up to 48,357,489 shares of common stock based on a
         conversion amount which varies based on a percentage of a specified
         average closing bid price of the common stock during a specified period
         prior to the conversion date.

(2)      For his services to the Company, Mr. Shatsoff is entitled to receive
         shares of the Company's common stock in an amount to be determined at
         some future date by mutual agreement between the Company, Triton and
         Mr. Shatsoff. See "Item 11. Interest of Management and Others in
         Certain Transactions."


ITEM 11. INTEREST OF MANAGEMENT AND OTHERS IN CERTAIN TRANSACTIONS.
-------------------------------------------------------------------

         The following is a description of those transactions by the Company in
the past two fiscal years or which are presently proposed in which (i) any
Company director, officer or greater than 10% stockholder (or a relative or
spouse thereof, or any relative of such spouse) has or is to have a direct or
indirect interest and (ii) the amount involved exceeds $50,000.

         Triton, ATI (which was formerly a significant shareholder of the
Company) and AG are all parties to the Restructure Agreement described above in
"Item 6. Description of Business."

         Triton has loaned to the Company, or provided for its benefit, the
Operating Loans, such amounts to be repaid by the Company under the terms of a
Convertible Promissory Note dated March 21, 2003. The Operating Loans, together
with accrued interest, are convertible into shares of the Company's common stock
at a rate based on a conversion amount which varies based on a percentage of a
specified average closing bid price of the common stock during a specified
period prior to the conversion date, resulting in up to 48,357,489 shares of
common stock being issuable to Triton as a result of the Operating Loans as of
March 31, 2004.

         As of April 1, 2003, the Company, Triton and Lawrence Shatsoff entered
into a Consulting Agreement pursuant to which Mr. Shatsoff is acting as an
officer and director of the Company. For his services, Mr. Shatsoff is paid
$3,000 per month and is entitled to receive shares of the Company's common stock
in an amount to be determined by mutual agreement between the Company, Triton
and Mr. Shatsoff. The agreement is terminable by the Company at any time, with
or without cause, on no more than 30 days prior notice.


                                       5

<PAGE>

                                     PART II

ITEM 1. MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT'S COMMON EQUITY AND
        OTHER SHAREHOLDER MATTERS.
---------------------------------------------------------------------------

         The Company's common stock is quoted on the OTC Bulletin Board under
the symbol "NUSL." The following table sets forth the quarterly high and low
bids for the Company's common stock as reported by the OTC Bulletin Board for
the past two fiscal years:

        Fiscal Year 2003                                      High*       Low*
        ----------------                                      -----       ----
        First quarter ....................................... $0.045     $0.009
        Second quarter ...................................... $0.015     $0.001
        Third quarter ....................................... $0.001     $0.001
        Fourth quarter ...................................... $0.001     $0.001

         Fiscal Year 2004
        ----------------
        First quarter ....................................... $0.005     $0.001
        Second quarter ...................................... $0.007     $0.001
        Third quarter ....................................... $0.009     $0.001
        Fourth quarter ...................................... $0.03      $0.001

* These quotations reflect inter-dealer prices, without retail mark-up,
mark-down or commission, and may not represent actual transactions.

         The Company has not paid any cash dividends on its common stock since
its incorporation and anticipates that, for the foreseeable future, any earnings
will be retained for use in its business. As of June 22, 2004, the number of
record holders of the Company's common stock was approximately 300.

         For information regarding shares of common stock authorized for
issuance under the Company's equity compensation plans, see "Item 9.
Remuneration of Directors and Officers - Stock Option Plan" and "- Stock
Compensation Plan" and "Item 10. Security Ownership of Management and Certain
Security Holders - Options, Warrants and Other Rights."

ITEM 3.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS.
-------------------------------------------------------

   None.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
-------------------------------------------------------------

         There were no matters submitted to a vote of security holders during
the quarter ended March 31, 2004.

ITEM 5.  COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT.
-----------------------------------------------------------

         Section 16 of the Securities Exchange Act requires that officers and
directors of the Company, as well as those persons who beneficially own more
than 10% of the outstanding common stock of the Company, file reports of
security ownership and changes in such ownership on Forms 3, 4 and 5 with the
Securities and Exchange Commission within specified time periods. Based solely
on a review of copies of such reports furnished to the Company, the Company
believes that during the year ended March 31, 2004, such filing requirements
were complied with by its officers, directors and applicable stockholders.

ITEM 6. REPORTS ON FORM 8-K.
----------------------------

         One report on Form 8-K was filed during the Company's fiscal quarter
ended March 31, 2004. Such report is dated January 21, 2004 and provided
disclosure under Item 2 regarding completion of the transactions under the
Restructure Agreement. Financial statements under Item 7 were required to be
filed with such report, consisting of a pro forma balance sheet which shows the
pro forma effects of the transfer of the Nurescell Technology and completion of
the Restructure Agreement.

                                       6

<PAGE>

ITEM 7. PRINCIPAL ACCOUNTANT FEES AND SERVICES
----------------------------------------------

                                                       Years Ended December 31,
                                                       -------------------------
                                                          2003          2002
                                                       -----------   -----------

Audit fees                                             $    39,500   $    39,000

Audit related fees                                     $        --   $        --

Tax fees (1)                                           $     5,775   $        --

All other fees (2)                                     $     9,787   $     5,000

(1)  Preparation of corporate tax returns.
(2)  Review of registration statement filings.

                                       7


<PAGE>


                                    PART F/S

                          INDEX TO FINANCIAL STATEMENTS

                                                                        Page No.
                                                                        --------

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM                      F-1

BALANCE SHEET                                                                F-2
  At March 31, 2004

STATEMENTS OF OPERATIONS                                                     F-3
  For the Years Ended March 31, 2004 and 2003
  For the Period from Inception (May 12, 1998) to March 31, 2004

STATEMENTS OF STOCKHOLDERS' DEFICIENCY                                 F-4 - F-7
  For the Period from Inception (May 12, 1998) to March 31, 2004

STATEMENTS OF CASH FLOWS                                               F-8 - F-9
  For the Years Ended March 31, 2004 and 2003
  For the Period from Inception (May 12, 1998) to March 31, 2004

NOTES TO FINANCIAL STATEMENTS                                        F-10 - F-22



<PAGE>

To the Board of Directors and Stockholders
Nurescell Inc.

            REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
            -------------------------------------------------------

We have audited the accompanying balance sheet of Nurescell Inc. (a development
stage company) (the "Company") as of March 31, 2004, and the related statements
of operations, stockholders' deficiency and cash flows for the years ended March
31, 2004 and 2003 and for the period from inception (May 12, 1998) to March 31,
2004. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audit.

We conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
And perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Nurescell Inc. (a development
stage company) as of March 31, 2004 and 2003, and the results of its operations,
changes in stockholders' deficiency and cash flows for the years then ended and
for the period from inception (May 12, 1998) to March 31, 2004, in conformity
with U.S. generally accepted accounting principles.

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. The Company incurred losses from
operations since inception and, as of March 31, 2004, had a deficit accumulated
during the development stage of $11,361,465 and a working capital deficit of
$391,791 . As discussed further in Note 1 to the financial statements, these
factors raise substantial doubt about the Company's ability to continue as a
going concern. Management's plans in regard to these matters are also described
in Note 1. The financial statements do not include any adjustments that might
result from the outcome of this uncertainty.


                                         /S/ MARCUM & KLIEGMAN LLP


New York, New York
June 15, 2004

                                       F-1


<PAGE>
<TABLE>

                                      NURESCELL INC.
                           (A Company in the Development Stage)

                                      BALANCE SHEET

                                      MARCH 31, 2004

                                          ASSETS
                                          ------
<CAPTION>
<S>                                                                          <C>
CURRENT ASSETS:

 Cash                                                                       $      3,682
                                                                            -------------
       TOTAL ASSETS                                                         $      3,682
                                                                            =============

                        LIABILITIES AND STOCKHOLDERS' DEFICIENCY
                        ----------------------------------------

CURRENT LIABILITIES:

    Accounts payable                                                        $    135,552
    Accrued expenses                                                              21,034
    Note payable and accrued interest - related party                            238,887
                                                                            -------------
          TOTAL CURRENT LIABILITIES                                              395,473
                                                                            -------------
  STOCKHOLDERS' DEFICIENCY:
    Preferred stock - $0.0001 par value; 1,000,000 shares
      authorized; -0- shares issued and outstanding                                   --
    Common stock - $0.0001 par value; 2,000,000,000 shares
      authorized; 1,187,927,162 shares issued and 1,187,916,949
      shares outstanding                                                         118,793
    Additional paid-in capital                                                10,880,881
    Treasury stock, at cost - 10,213 shares                                      (30,000)
    Deficit accumulated during the development stage                         (11,361,465)
                                                                            -------------
          TOTAL STOCKHOLDERS' DEFICIENCY                                        (391,791)
                                                                            -------------
          TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIENCY                    $      3,682
                                                                            =============


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



                                           F-2
</TABLE>


<PAGE>

<TABLE>

                                     NURESCELL INC.
                          (A Company in the Development Stage)

                                STATEMENTS OF OPERATIONS

<CAPTION>
                                        For the Years Ended              For the Period
                                             March 31,                  from May 12, 1998
                                   -----------------------------       (Date of Inception)
                                       2004             2003            to March 31, 2004
                                   ------------     ------------        -----------------
<S>                                <C>              <C>                   <C>
SALES                              $         --     $         --          $         --
                                   ------------     ------------          ------------

OPERATING EXPENSES:
  Bad debts                                  --           25,000                33,700
  General and administrative            170,117           51,326               321,127
                                   ------------     ------------          ------------
    TOTAL OPERATING EXPENSES            170,117           76,326               354,827
                                   ------------     ------------          ------------
LOSS FROM OPERATIONS                   (170,117)         (76,326)             (354,827)
                                   ------------     ------------          ------------

INTEREST EXPENSE                        (14,343)          (8,313)              (30,579)
                                   ------------     ------------          ------------

LOSS FROM CONTINUING OPERATIONS        (184,460)         (84,639)             (385,406)

LOSS FROM DISCONTINUED
     OPERATIONS                        (281,096)        (364,689)          (10,976,059)
                                   ------------     ------------          ------------
NET LOSS                           $   (465,556)    $   (449,328)         $(11,361,465)
                                   ============     ============          ============

BASIC AND DILUTED LOSS PER SHARE:
  Continuing operations            $      0.00    $       (0.01)
  Discontinued operations                 0.00            (0.02)
                                   ------------     ------------
      NET LOSS PER SHARE           $      0.00    $       (0.03)
                                   ============     ============
WEIGHTED AVERAGE NUMBER OF COMMON
  SHARES OUTSTANDING
    Basic and diluted               136,793,117       16,892,156
                                   ============     ============




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

                                          F-3
</TABLE>


<PAGE>

<TABLE>

                                           NURESCELL INC.
                                (A Company in the Development Stage)

                               STATEMENTS OF STOCKHOLDERS' DEFICIENCY

                   FOR THE PERIOD FROM INCEPTION (MAY 12, 1998) TO MARCH 31, 2004
<CAPTION>

                                                    Common Stock          Additional       Stock
                                             --------------------------    Paid-in      Subscription
                                                Shares        Amount       Capital       Receivable
                                             ------------  ------------  ------------   ------------
<S>                                             <C>        <C>           <C>            <C>
 Issuance of common stock
   Cash - Founding Shareholders
    (May and June 1998 at $.001 per share)      2,500,000  $        250  $      2,250   $         --
   Purchase of Technology
    (June 1998 at $.0001)                      10,000,000         1,000        (1,000)            --
   Cash - $1.00 per share (August 1998)           498,000            50       497,950             --
   Cash - $5.00 per share, net of
     issuance cost (September 1998)                79,000             8       349,992             --
   Common stock subscriptions                       5,000            --        25,000             --
 Fair value of options granted                         --            --        30,000             --
 Net loss, as restated for March 31, 1999              --            --            --             --
                                             ------------  ------------  ------------   ------------
 BALANCE, MARCH 31, 1999                       13,082,000         1,308       904,192             --

 Issuance of common stock
   Consulting/other services (May 1999
     through December 1999 at
     $1.12 - $3.51 per share)                     692,000            69     1,591,138             --
   Exercise of stock options
     (October 1999 at $.50 per share)             120,000            12        59,988             --
   Exercise of stock options
     (January 2000 at $1.00 per share)             15,000             2        14,998             --
   Exercise of stock options
     (March 2000 at $2.00 per share)               10,000             1        19,999             --
   Settlement of related party accruals
     (January 2000 at $2.13 per share)            524,226            52     1,113,928             --
   Award to directors and officers
     (January 2000 at $2.13 per share)            734,562            74     1,560,870             --
   Cash (April 1999 at $5.00)                      14,000             1        69,999             --
   Purchase of 10,213 shares of
     treasury stock at $2.94 per share                 --            --            --             --
 Fair value of options granted                         --            --       691,756             --
 Fair value of warrants granted                        --            --       102,696             --
 Net loss                                              --            --            --             --
                                             ------------  ------------  ------------   ------------
 BALANCE, MARCH 31, 2000                       15,191,788  $      1,519  $  6,129,564   $         --
                                             ============  ============  ============   ============


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


                                                 F-4
</TABLE>

<PAGE>

<TABLE>

                                            NURESCELL INC.
                                 (A Company in the Development Stage)

                                STATEMENTS OF STOCKHOLDERS' DEFICIENCY

                    FOR THE PERIOD FROM INCEPTION (MAY 12, 1998) TO MARCH 31, 2004
<CAPTION>

                                                     Common Stock          Additional       Stock
                                               ------------------------     Paid-in      Subscription
                                                  Shares        Amount      Capital       Receivable
                                               ------------  ------------  ------------  ------------
<S>                                              <C>         <C>           <C>           <C>
  BALANCE, MARCH 31, 2000                        15,191,788  $      1,519  $  6,129,564  $         --

  Issuance of common stock
    Exercise of stock options (May 2000
      at $1.00 per share)                             7,500             1         7,499            --
    Exercise of stock options (June 2000
      at $0.25 per share)                           100,000            10        24,990       (25,000)
    Settlement of lawsuit (August 2000
      at $1.03 per share)                            34,000             3        35,058            --
    Settlement of lawsuit (February 2001
      at $0.34 per share)                            50,000             5        17,185            --
    Conversion of debt (August 2000 at
      $0.53 per share)                              250,000            25       132,475            --
    Conversion of debt (January 2001 at
      $0.30 per share)                              336,950            34       100,000            --
    To employee (August 2000 at $0.62
      per share)                                    100,000            10        62,490            --
  Fair value of options and warrants granted             --            --       158,890            --
  Net loss                                               --            --            --            --
                                               ------------  ------------  ------------  ------------
  BALANCE, MARCH 31, 2001                        16,070,238         1,607     6,668,151       (25,000)

  Net loss                                               --            --            --            --
                                               ------------  ------------  ------------  ------------
  BALANCE, MARCH 31, 2002                        16,070,238         1,607     6,668,151       (25,000)

  Conversion of debt (March 2003 at
      $0.001 per share)                          30,000,000         3,000        27,000            --
  Write-off of stock subscription receivable             --            --            --        25,000

  Net loss                                               --            --            --            --
                                               ------------  ------------  ------------  ------------
  BALANCE, MARCH 31, 2003                        46,070,238  $      4,607  $  6,695,151  $         --
                                               ============  ============  ============  ============

  Accounts payable and accrued expenses
    Satisfied by issuance of common stock
    (March 2004 at .01 per share)                74,745,862  $      7,475  $    739,984  $         --

  Conversion of debt (March 2004 at
       $.00126666 per share)                  1,067,111,062       106,711     1,244,962            --

  Forgiveness of debt related parties
       March 2004                                        --            --       391,597            --

  Exchange of debt to related party for
    Nurescell Technology                                 --            --     1,359,187            --

  Related party unearned revenue in connection
    with Restructure Agreement                           --            --       450,000            --

  Net Loss                                               --            --            --            --
                                              -------------  ------------  ------------  ------------
  BALANCE, MARCH 31, 2004                     1,187,927,162  $    118,793  $ 10,880,881  $         --
                                              =============  ============  ============  ============


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

                                                 F-5
</TABLE>


<PAGE>

<TABLE>

                                            NURESCELL INC.
                                 (A Company in the Development Stage)

                                STATEMENTS OF STOCKHOLDERS' DEFICIENCY

                    FOR THE PERIOD FROM INCEPTION (MAY 12, 1998) TO MARCH 31, 2004
<CAPTION>

                                                               Treasury    Accumulated
                                                                Stock        Deficit        Total
                                                             ------------  ------------  ------------
<S>                                                          <C>           <C>           <C>
  Issuance of common stock
    Cash - Founding Shareholders
     (May and June 1998 at $.001 per share)                  $         --  $         --  $      2,500
    Purchase of Technology
     (June 1998 at $.0001)                                             --            --            --
    Cash - $1.00 per share (August 1998)                               --            --       498,000
    Cash - $5.00 per share, net of
      issuance cost (September 1998)                                   --            --       350,000
    Common stock subscriptions                                         --            --        25,000
  Fair value of options granted                                        --            --        30,000
  Net loss, as restated for March 31, 1999                             --      (674,526)     (674,526)
                                                             ------------  ------------  ------------
  BALANCE, MARCH 31, 1999                                              --      (674,526)      230,974

  Issuance of common stock
    Consulting/other services (May 1999
      through December 1999 at
      $1.12 - $3.51 per share)                                         --            --     1,591,207
    Exercise of stock options
      (October 1999 at $.50 per share)                                 --            --        60,000
    Exercise of stock options
      (January 2000 at $1.00 per share)                                --            --        15,000
    Exercise of stock options
      (March 2000 at $2.00 per share)                                  --            --        20,000
    Settlement of related party accruals
      (January 2000 at $2.13 per share)                                --            --     1,113,980
    Award to directors and officers
      (January 2000 at $2.13 per share)                                --            --     1,560,944
    Cash (April 1999 at $5.00)                                         --            --        70,000
    Purchase of 10,213 shares of
      treasury stock at $2.94 per share                           (30,000)           --       (30,000)
  Fair value of options granted                                        --            --       691,756
  Fair value of warrants granted                                       --            --       102,696
  Net loss                                                             --    (6,416,192)   (6,416,192)
                                                             ------------  ------------  ------------
  BALANCE, MARCH 31, 2000                                    $    (30,000) $ (7,090,718) $   (989,635)
                                                             ============  ============  ============




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

                                                 F-6
</TABLE>

<PAGE>

<TABLE>

                                              NURESCELL INC.
                                   (A Company in the Development Stage)

                                  STATEMENTS OF STOCKHOLDERS' DEFICIENCY

                      FOR THE PERIOD FROM INCEPTION (MAY 12, 1998) TO MARCH 31, 2004
<CAPTION>

                                                                Treasury      Accumulated
                                                                 Stock          Deficit         Total
                                                             ------------    ------------    ------------
<S>                                                          <C>             <C>             <C>
 BALANCE, MARCH 31, 2000                                     $    (30,000)   $ (7,090,718)   $   (989,635)

 Issuance of common stock
   Exercise of stock options (May 2000
     at $1.00 per share)                                               --              --           7,500
   Exercise of stock options (June 2000
     at $0.25 per share)                                               --              --              --
   Settlement of lawsuit (August 2000
     at $1.03 per share)                                               --              --          35,061
   Settlement of lawsuit (February 2001
     at $0.34 per share)                                               --              --          17,190
   Conversion of debt (August 2000 at
     $0.53 per share)                                                  --              --         132,500
   Conversion of debt (January 2001 at
     $0.30 per share)                                                  --              --         100,034
   To employee (August 2000 at $0.62
     per share)                                                        --              --          62,500
 Fair value of options and warrants granted                            --              --         158,890
 Net loss                                                              --      (1,037,792)     (1,037,792)
                                                             ------------    ------------    ------------
 BALANCE, MARCH 31, 2001                                          (30,000)     (8,128,510)     (1,513,752)

 Net loss                                                              --      (2,318,071)     (2,318,071)
                                                             ------------    ------------    ------------
 BALANCE, MARCH 31, 2002                                          (30,000)    (10,446,581)     (3,831,823)

 Conversion of debt (March 2003 at
     $0.001 per share)                                                 --              --          30,000
 Write-off of stock subscription receivable                            --              --          25,000

 Net loss                                                              --        (449,328)       (449,328)
                                                             ------------    ------------    ------------
 BALANCE, MARCH 31, 2003                                     $    (30,000)   $(10,895,909)   $ (4,226,151)
                                                             ============    ============    ============

 Accounts payable and accrued expenses
   Satisfied by issuance of common stock
   (March 2004 at .01 per share)                             $         --    $         --    $    747,459

 Conversion of debt (March 2004 at
      $.00126666 per share)                                            --              --       1,351,673

 Forgiveness of debt related parties
      March 2004                                                       --              --         391,597

 Exchange of debt to related party for
   Nurescell Technology                                                --              --       1,359,187

 Related party unearned revenue in connection
   with Restructure Agreement                                          --              --         450,000

 Net loss                                                              --        (465,556)       (465,556)
                                                             ------------    ------------    ------------
 BALANCE, MARCH 31, 2004                                     $    (30,000)   $(11,361,465)   $   (391,791)
                                                             ============    ============    ============



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

                                                   F-7
</TABLE>

<PAGE>

<TABLE>

                                              NURESCELL INC.
                                   (A Company in the Development Stage)

                                         STATEMENTS OF CASH FLOWS
<CAPTION>

                                                                                            For the Period
                                                                For the Years Ended         from Inception
                                                                      March 31,             (May 12, 1998)
                                                            -----------------------------    to March 31,
                                                                2004            2003             2004
                                                            -------------   -------------   -------------
<S>                                                         <C>             <C>             <C>
 CASH FLOWS FROM OPERATING ACTIVITIES
   Net loss                                                 $    (465,556)  $    (449,328)  $ (11,361,465)
   Adjustments to reconcile net loss to net
     cash used in operating activities:
       Depreciation                                                    --          15,427          60,145
       Bad debts                                                       --          25,000          33,700
       Inventory write-down                                            --          10,022          64,537
       Write-off of intangible assets                                  --              --          87,944
       Amortization of discount on notes payable                       --              --         556,579
       Loss on abandonment of computer software                        --          32,248          39,026
       Issuance of stock for services                                  --              --       4,380,882
       Fair value of options and warrants                              --              --         880,646
       Gain on conversion of debt                                      --              --        (280,000)
   Changes in operating assets and liabilities:
       Accounts receivable - related party                             --              --          (8,700)
       Inventory                                                       --              --         (64,537)
       Prepaid expenses                                                --              --              --
       Accounts payable                                            27,381          39,355         323,780
       Accrued expenses                                           250,110         490,855       1,790,965
       Accrued termination fee                                         --             --        1,000,000
       Unearned income                                                 --        (200,000)        450,000

                                                            -------------   -------------   -------------
       NET CASH USED IN OPERATING ACTIVITIES                     (188,065)        (36,421)     (2,046,498)
                                                            -------------   -------------   -------------
 CASH FLOWS FROM INVESTING ACTIVITIES
   Purchases of property and equipment                                 --              --         (99,171)
   Acquisition of intangibles                                          --              --         (87,944)
                                                            -------------   -------------   -------------
       NET CASH USED IN INVESTING ACTIVITIES                           --              --        (187,115)
                                                            -------------   -------------   -------------
 CASH FLOWS FROM FINANCING ACTIVITIES
   (Repayment of) proceeds from overdraft                              --            (849)             --
   Proceeds from sale of common stock                                  --              --       1,018,000
   Prepaid financing costs                                             --              --         (96,349)
   Proceeds from stockholder and former officers
     loans-net                                                         --          42,395         254,022
   Proceeds from issuance of convertible notes                    186,622              --       1,061,622
                                                            -------------   -------------   -------------
      NET CASH PROVIDED BY FINANCING ACTIVITIES                   186,622          41,546       2,237,295
                                                            -------------   -------------   -------------
 INCREASE (DECREASE) IN CASH                                       (1,443)          5,125           3,682
 CASH - BEGINNING OF YEAR                                           5,125              --              --
                                                            -------------   -------------   -------------
 CASH - END OF YEAR                                          $      3,682     $     5,125     $     3,682
                                                            =============   =============   =============



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


                                                   F-8
</TABLE>

<PAGE>

<TABLE>

                                         NURESCELL INC.
                              (A Company in the Development Stage)

                                    STATEMENTS OF CASH FLOWS
<CAPTION>


                                                                                   For the Period
                                                       For the Years Ended         from Inception
                                                             March 31,             (May 12, 1998)
                                                   -----------------------------    to March 31,
                                                       2004            2003            2004
                                                   -------------   -------------   -------------
<S>                                                <C>             <C>             <C>

 SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
 --------------------------------------------------

   Cash paid during the year for:

     Interest                                      $          --   $          --   $       7,359
                                                   =============   =============   =============
     Income taxes                                  $          --   $          --   $       1,600
                                                   =============   =============   =============

   Non-Cash Investing and Financing Activities:

     Accounts payable and accrued expenses
       satisfied by issuance of common stock
                                                   $     747,459   $          --   $     747,459
                                                   =============   =============   =============

     Conversion of debt                            $   1,351,673   $      30,000   $   1,381,673
                                                   =============   =============   =============

     Forgiveness of debt related parties
       March 2004                                  $     391,597   $          --   $     391,597
                                                   =============   =============   =============
     Exchange of debt to related party for
       Nurescell Technology                        $   1,359,187   $          --   $   1,359,187
                                                   =============   =============   =============

    Related party unearned revenue in connection
       with Restructure Agreement                 $     450,000   $          --    $     450,000
                                                  =============   =============    =============


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


                                               F-9
</TABLE>

<PAGE>


                                 NURESCELL INC.
                      (A Company in the Development Stage)

                          NOTES TO FINANCIAL STATEMENTS

NOTE 1 - BUSINESS AND CONTINUED OPERATIONS

Nurescell Inc. (the "Company") is a development stage company that was formed in
1998 for the purpose of developing and commercially exploiting a radiation
shielding technology (the "Nurescell Technology") for use by the nuclear power
industry and others producing, handling or storing radioactive materials. To
date, the Company has failed to generate any significant revenue from the
Nurescell Technology. Having exhausted all of its funding and without any source
of revenue, the Company has been forced to reduce its operations to a minimal
level. On January 21, 2004, the Company completed a Restructure Agreement (the
"Restructure Agreement") with Triton Private Equities Fund, L.P. ("Triton"),
Advanced Technology Industries, Inc. ("ATI") (a related party) and ATI's
subsidiary, ATI Nuklear AG ("AG"), pursuant to which Triton has taken control of
the Company and the Company has divested itself of the Nurescell Technology.

Under the Restructure Agreement, effective January 21, 2004, the Company
transferred to ATI or AG all rights, title and interest in and to the Nurescell
Technology in return for the cancellation by ATI and AG of all debts and other
obligations owed to either of them by the Company (the "ATI Obligations"),
consisting primarily of a $1 million promissory note, plus interest, secured by
the Nurescell Technology (among other things) and approximately $200,000 in
short-term cash advances and payments made by ATI to or on behalf of the
Company. The agreement also resulted in conversion of most of the Company's
notes payable to Triton, which gave Triton a controlling interest in the
Company.

Following the transfer of the Nurescell Technology, the Company has essentially
no assets. However, the Company is left with only $395,473 in liabilities that
are still collectible by former vendors. It is expected that those remaining
liabilities will either be converted into common stock, settled for cash using
funds provided by Triton or paid with funds provided by a third party in
conjunction with a possible merger or other consolidation with the Company
(which is currently being investigated by Triton).

The transfer of the Nurescell Technology for the debt did not result in a gain
or loss for this extinguishment transaction in the Company's financial
statements. Accounting Principles Board Opinion ("APB") No. 26 provides that
extinguishment transactions between related parties are a capital transaction.
Any difference between the historical carrying value of the technology asset and
the debt extinguished has been reflected through additional paid-in-capital.

As part of the Restructure Agreement, the remaining unearned revenue on the
license agreement with AG did not result in a gain or loss, but the remaining
amount has been reflected through additional paid-in capital.

As a result of this Restructure Agreement, the operations of the Company were
classified as a discontinued operation (Note 12).

The accompanying financial statements have been prepared in conformity with U.S.
generally accepted accounting principles, which contemplate continuation of the
Company as a going concern. However, as shown in the accompanying financial
statements, the Company is in the development stage and has incurred losses from
operations since inception. As of March 31, 2004, the Company had an accumulated
deficit since inception of $11,361,465. All of the factors discussed above raise
substantial doubt about the Company's ability to continue as a going concern.

Management's business plan will require additional financing. To support its
operations during the year ended March 31, 2004, the Company borrowed monies
from Triton in the amount of $186,622.

The Company is actively seeking a merger or other business combination with a
private company. The Company's ability to continue as a going concern is
dependent upon additional financing, restructuring its existing liabilities, and
the successful completion of a merger or other business combination. No
assurance can be given that the Company will be successful in locating a
candidate for a merger or other business combination and/or completing such
transaction. The financial statements do not include any adjustments that might
result from the outcome of this uncertainty.

                                       F-10

<PAGE>
                                 NURESCELL INC.
                      (A Company in the Development Stage)

                          NOTES TO FINANCIAL STATEMENTS

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Use of Estimates
----------------

The preparation of financial statements in conformity with U.S. generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosures of contingent assets and liabilities at the date of the financial
statements, as well as the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.

Income Taxes
------------

Deferred taxes represent the tax effects of differences between the financial
reporting and tax bases of the Company's assets and liabilities at the enacted
tax rates in effect for the years in which the differences are expected to
reverse. The Company evaluates the recoverability of deferred tax assets and
establishes a valuation allowance when it is more likely than not that some
portion or all of the deferred tax assets will not be realized. Income tax
expense consists of the tax payable for the period and the change during the
period in deferred tax assets and liabilities.

Research and Development Costs
------------------------------

Research and development costs are expensed as incurred. The amount charged to
research and development for the years ended March 31, 2004 and 2003
approximated $-0- and $-0-, respectively, and is reflected in loss from
discontinued operations in the accompanying statements of operations.

Net Loss Per Common Share
-------------------------

Basic Earnings (Loss) Per Share ("EPS") is calculated by dividing income or loss
available to common stockholders (the "numerator") by the weighted average
number of common shares outstanding (the "denominator") during the period. The
computation of diluted EPS is similar to the computation of basic EPS, except
that the denominator is increased to include the number of additional common
shares that would have been outstanding if the dilutive potential common shares
(that is, securities such as options, warrants, convertible securities, or
contingent stock agreements) had been issued. In addition, in computing the
dilutive effect of convertible securities, the numerator is adjusted to add back
(a) any convertible preferred dividends and (b) the after-tax amount of interest
recognized in the period associated with any convertible debt. The computation
of diluted EPS shall not assume conversion, exercise, or contingent issuance of
securities that would have an antidilutive effect on EPS.

Fair Value of Financial Instruments
-----------------------------------

The reported carrying amount of the Company's cash, accounts payable, accrued
expenses and notes payable to a related party approximates the estimated fair
values due to the short-term maturities of those financial instruments.



                                      F-11

<PAGE>

                                 NURESCELL INC.
                      (A Company in the Development Stage)

                          NOTES TO FINANCIAL STATEMENTS

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Stock Options and Similar Equity Instruments
--------------------------------------------

As permitted under SFAS No. 148, "Accounting for Stock-Based Compensation -
Transaction and Disclosure"' which amended SFAS N0. 123, "Accounting for
Stock-Based Compensation", the Company has elected to continue to follow the
intrinsic value method in accounting for its stock-based employee compensation
arrangements as defined by APB No. 25, "Accounting for Stock Issued to
Employees", and related interpretations including FASB Interpretation No. 44,
"Accounting for Certain Transactions Involving Stock Compensation", an
interpretation of APB. 25. No stock-based employee compensation cost is
reflected in operations, as all options granted under those plans have an
exercise price equal to or above the market value of the underlying common stock
on the date of grant. The following table illustrates the effect on net loss and
net loss per share as if the Company had applied the fair value recognition
provisions of SFAS No. 123 to stock- based employee compensation:

                                                         For the Year Ended
                                                             March 31,
                                                          2004         2003
                                                     ---------------------------

Net loss attributable to common shareholders
 As reported                                         $  (465,556)   $  (449,328)
 Less:  Stock-based employee compensation
  expense determined under fair value-based
  method for all awards                                       --             --
                                                     ------------   ------------
 Pro forma                                           $  (465,556)   $  (449,328)
                                                     ============   ============
Basic and diluted net loss per share
 As reported
        Continuing operations                        $      0.00    $     (0.01)
        Discontinued operations                             0.00          (0.02)
                                                     ------------   ------------
 Net loss per share                                  $      0.00    $     (0.03)
                                                     ============   ============
 Pro forma
        Continuing operations                        $      0.00    $     (0.01)
        Discontinued operations                             0.00          (0.02)
                                                     ------------   ------------
 Net loss per share                                  $      0.00    $     (0.03)
                                                     ============   ============

                                      F-12

<PAGE>

                                 NURESCELL INC.
                      (A Company in the Development Stage)

                          NOTES TO FINANCIAL STATEMENTS

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Recent Accounting Pronouncements and Adoption of New Policies
-------------------------------------------------------------

In January 2003, the FASB issued Interpretation Number 46, "Consolidation of
Variable Interest Entities" ("FIN No. 46"). This interpretation of Accounting
Research Bulletin ("ARB") No. 51, "Consolidated Financial Statements," provides
guidance for identifying a controlling interest in a variable interest entity
("VIE") established by means other than voting interests. FIN No. 46 also
requires consolidation of a VIE by an enterprise that holds such a controlling
interest. In December 2003, the FASB completed its deliberations regarding the
proposed modification to FIN No. 46 and issued Interpretation Number 46(R),
"Consolidation of Variable Interest Entities - an Interpretation of ARB No. 51"
("FIN No. 46(R)"). The decisions reached included a deferral of the effective
date and provisions for additional scope exceptions for certain types of
variable interests. Application of FIN No. 46(R) is required in financial
statements of public entities that have interests in VIEs or potential VIEs
commonly referred to as special-purpose entities for periods ending after
December 15, 2003. Application by public small business issuers' entities is
required in all interim and annual financial statements for periods ending after
December 15, 2004. Management does not believe that the adoption of this
pronouncement will have a material effect on the Company's financial statements.



                                      F-13


<PAGE>

                                 NURESCELL INC.
                      (A Company in the Development Stage)

                          NOTES TO FINANCIAL STATEMENTS

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Recent Accounting Pronouncements and Adoption of New Policies (Continued)
-------------------------------------------------------------

In May 2003, the FASB issued SFAS No. 150, "Accounting for Certain Financial
Instruments with Characteristics of Both Liabilities and Equity"("SFAS No.
150"). SFAS No. 150 establishes standards for classification and measurement in
the statement of financial position of certain financial instruments with
characteristics of both liabilities and equity. It requires classification of a
financial instrument that is within its scope as a liability (or an asset in
some circumstances). SFAS No. 150 is effective for financial instruments entered
into or modified after May 31, 2003 and, otherwise, is effective at the
beginning of the first interim period beginning after June 15, 2003. The
adoption of SFAS 150 did not have any impact on the Company's consolidated
results of operations, financial position or cash flows.

NOTE 3 - PROPERTY AND EQUIPMENT

During the quarter ending March 31, 2003, the Company wrote-off its remaining
property and equipment in the amount of $32,248 due to abandonment by the
Company. However, before abandoning of such assets, depreciation expense for the
year ended March 31, 2003 amounted to $15,427. Such amounts are reflected in
discontinued operations in the statements of operations.

NOTE 4 - NOTES PAYABLE AND ADVANCES - ATI (Related Party)

In 2001, the Company executed a $1 million secured promissory note payable to
ATI or AG (formerly known as Nurescell AG) bearing interest at 8% per annum,
with principal and interest to be paid in 32 equal monthly payments of $34,805
each, beginning on November 30, 2001. Any remaining principal balance and
accrued interest was due and payable on September 30, 2004. The note was secured
by (i) 15,000,000 shares of the Company's common stock,(ii) a first priority
security interest in the Company's technology and (iii) all royalties due to AG.
The Company did not make scheduled monthly payments and had been in default as
to the principal and interest payments (see Note 11). In addition, ATI made
advances to the Company of $174,310. These advances were non- interest bearing
and were due on demand.

In January 2004, the Company, pursuant to the Restructure Agreement, exchanged
the Nurescell Technology for forgiveness of the note payable to AG and the
related accrued interest of $184,877 and the advances of $174,310, collectively
$1,359,187.



                                      F-14

<PAGE>

                                 NURESCELL INC.
                      (A Company in the Development Stage)

                          NOTES TO FINANCIAL STATEMENTS

NOTE 5 - CONVERTIBLE NOTES PAYABLE - Triton (Related Party)

On December 15, 1999 and February 8, 2000, respectively, the Company signed
convertible promissory notes to Triton, each with a face value of $385,000 and
bearing interest at 8% per annum ("December Note" and "February Note"). Interest
for the December and February Notes was due quarterly beginning March 31, 2000
and June 30, 2000, respectively. The Company was also liable for certain
penalties due to a breach of a registration rights agreement in connection with
the notes. Total penalties accrued amounted to $550,038.

Interest on the notes could be paid in shares of the Company's common stock at
the discretion of the Company, as defined in the agreement. The notes became due
and payable on December 1, 2001. The holder of the notes could convert them into
shares of the Company's common stock at its option, at any time at a conversion
price for each share of common stock equal to the lesser of (a) one hundred
twenty-five percent (125%) of the closing price of the Company's common stock at
the date of the note or (b) 95% of the average of the three lowest bid prices of
the Company's common stock for twenty trading days prior to the conversion date.

On March 21, 2003, pursuant to the Restructure Agreement, Triton converted
$30,000 in principal amount of the December Note into 30,000,000 shares of
common stock at the price of $.001 per share, thus giving Triton approximately
65% of the Company's outstanding common stock and voting control over the
Company.

On March 2, 2004, pursuant to the Restructure Agreement, Triton converted all
$690,000 in remaining principal amount of the December and February Notes and
the related interest and penalties totaling $661,673 into 1,067,111,062 shares
of common stock at the price of $.00126666 per share, thus giving Triton
approximately 92% of the Company's outstanding common stock and additional
voting control over the Company. The amount converted to equity was deemed as
payment in full for all additional outstanding balances owed to Triton under
those notes. The value of the accrued interest and penalties converted was less
than the total accrual on the Company's books. The forgiveness of debt in the
amount of $270,356 was recorded as a credit to additional paid-in capital.

On March 21, 2003, the Company entered into a new convertible promissory note
with Triton calling for interest at 10% per annum on all monies advanced to the
Company. The aggregate principal amount, plus all accrued interest, is payable
thirty days after the Company receives written notice from Triton. The note
entitles Triton to convert, at its option and at any time, all or any portion of
the aggregate principal amount, and accrued interest, into common stock of the
Company at a conversion price which varies based on a percentage of a specified
average closing bid price of the common stock during a specified period prior to
the conversion date. As of March 31, 2004, the principal and accrued interest on
the note was $238,887.

NOTE 6 - ACCRUED EXPENSES

        Accrued expenses consist of the following at March 31, 2004:


           Accrued payroll taxes                         $     5,476
           Other advances                                     15,558
                                                         -----------
                                                         $    21,034
                                                         ===========





                                      F-15

<PAGE>

                                 NURESCELL INC.
                      (A Company in the Development Stage)

                          NOTES TO FINANCIAL STATEMENTS

NOTE 7 - DUE TO STOCKHOLDERS AND FORMER OFFICERS

Due to stockholders and former officers consisted of a $63,877 cash advance from
Mr. Adrian Joseph, a stockholder and former officer of the Company, payable on
demand, and bearing interest at 10% per annum. There was also a cash advance of
$15,835 from Mr. James Samuelson, a former officer and director of the Company.
That advance was non-interest bearing and was payable on demand. On March 2,
2004, pursuant to individual agreements, the Company converted the above
advances into shares of common stock in full satisfaction of the debt. A total
of 34,233,500 shares of common stock were issued during the year ended March 31,
2004, in settlement of the advances and other accrued expenses to Mr. Adrian
Joseph and Mr. James Samuelson.

NOTE 8 - COMMON STOCK

In March 1999, the Company received subscriptions for 5,000 shares of the
Company's common stock at $5 per share. Subsequently, in April 1999, the monies
were received and the stock was issued.

During the year ended March 31, 2000, the Company received $95,000 for the
exercise of 145,000 stock options. In addition, the Company issued 14,000 shares
for $70,000 to outside investors.

From May 1999 to December 1999, the Company issued 692,000 shares to employees
and outside third parties for past services pursuant to consulting agreements
and as approved by the Company's Board of Directors. These shares were valued at
prices ranging from $1.12 to $3.51 per share based upon closing prices of the
Company's common stock on the dates of the agreements.

In January 2000, the Board of Directors approved the issuance of 524,226 shares
of common stock for the payment of past director fees, annual salaries and
various unreimbursed expenses due to officers and directors. In addition, the
Board of Directors approved an award of 734,562 shares of common stock to
officers and directors on that same date. These issuances were valued at
approximately $2.13 per share, based upon the closing price of the Company's
common stock on the date of approval.

During the year ended March 31, 2001, the Company received $7,500 for the
exercise of 7,500 stock options. In addition, the Company issued 100,000 shares
of restricted stock at $0.25 per share and recorded a stock subscription
receivable. Restriction on this stock will not be removed until the $25,000 is
received.

From May to July 2000, the Company borrowed $412,500 from a non-related party.
This debt was converted to 250,000 shares of common stock on August 11, 2000 at
a fair market value of $0.53 per share. The Company recognized a gain on
conversion of debt of $280,000.



                                      F-16


<PAGE>

                                 NURESCELL INC.
                      (A Company in the Development Stage)

                          NOTES TO FINANCIAL STATEMENTS

NOTE 8 - COMMON STOCK (Continued)

On August 17, 2000 the Company issued 34,000 shares of common stock with a fair
market value of approximately $1.03 per share in settlement of a lawsuit.

On September 13, 2000 the Company issued a stock bonus to William Wilson, a
former President of the Company. A total of 100,000 shares with a fair market
value of $0.625 per share were issued.

Triton converted a portion of the December Note on January 9, 2001 into 336,950
shares of common stock of the Company with a fair market value of approximately
$0.30 per share.

On February 20, 2001, the Company settled a lawsuit by issuing 50,000 shares of
its common stock with a fair market value of approximately $0.34 per share.

On March 21, 2003 pursuant to the Restructure Agreement, Triton converted
$30,000 in principal amount of the December Note into 30,000,000 shares of
common stock at the price of $.001 per share, thus giving Triton approximately
65% of the Company's outstanding common stock and voting control over the
Company.

In January 2004, pursuant to the Restructure Agreement, ATI, a related party,
exchanged its non- interest bearing cash advances of $174,310 and a note of
$1,000,000 in principal and the related accrued interest of $184,877 for all
rights, title and interest in and to the Nurescell Technology. The Company
recorded this cancellation of debt and other obligations from the related party
as a contribution to paid-in capital in the amount of $1,359,187 in accordance
with APB No. 26.

On March 2, 2004, pursuant to the Restructure Agreement, Triton converted all
$690,000 in remaining principal amount of the December and February Notes and
the related accrued interest and penalties totaling $661,673 into 1,067,111,062
shares of common stock at the price of $.00126666 per share, thus giving Triton
approximately 92% of the Company's outstanding common stock and additional
voting control over the Company. The amount converted to equity was deemed as
payment in full for all additional outstanding balances owed to Triton under
those notes. The value of the accrued interest and penalties converted was less
than the total accrual on the Company's books. The excess balance in the amount
of $270,356 was recorded as additional paid-in capital from forgiveness of debt.

On March 2, 2004, pursuant to individual agreements, the Company converted
$747,459 in accrued liabilities into 74,745,862 shares of common stock at the
price of $.01 per share. Certain debt holders agreed to base their conversion
calculation on an amount less than the total value owed to them. In those
instances, the debt holder agreed to waive any remaining debt in excess of the
amount calculated. The forgiveness of debt from related parties resulted in an
additional credit to additional paid-in capital of $121,241.

Stock Options
-------------

The Company has a Non-Qualified Stock Option Plan (the "Plan") whereby the
Company may grant options to directors, officers, employees or consultants to
purchase the Company's common stock at the fair market value at the time of
grant. The aggregate number of the Company's common shares which may be granted
under the Plan is 360,000 shares.



                                      F-17


<PAGE>

                                 NURESCELL INC.
                      (A Company in the Development Stage)

                          NOTES TO FINANCIAL STATEMENTS


NOTE 8 - COMMON STOCK (Continued)

Stock Options - Continued
-------------

The following is a summary of Plan and non-Plan stock options activity through
March 31, 2004:

                                                                   Weighted
                                                                    Average
                                             Number of Shares       Prices
                                             ----------------   -------------

     Balance outstanding at March 31, 1999        484,000            $0.63
       Granted                                    661,000            $1.24
       Exercised                                 (145,000)           $0.66
       Expired                                       -                 -
                                                ----------           -----
     Balance outstanding at March 31, 2000      1,000,000            $1.03
       Granted                                    150,000            $0.83
       Exercised                                 (107,500)           $0.30
       Expired                                   (585,000)             -
                                                ----------           -----
     Balance outstanding at March 31, 2001        457,500            $1.46
       Granted                                       -                 -
       Exercised                                     -                 -
       Expired                                   (207,500)             -
                                                ----------           -----
     Balance outstanding at March 31, 2002        250,000            $1.64
       Granted                                       -                 -
       Exercised                                     -                 -
       Expired                                   (250,000)           (1.64)
                                                ----------          ------
     Balance outstanding at March 31, 2003           -              $  -
         Granted                                     -                 -
         Exercised                                   -                 -
         Expired                                     -                 -
                                                 ----------         -------
Balance outstanding at March 31, 2004                -                 -
                                                 ==========         =======

There is no plan currently to change or terminate the Plan due to the
Restructure Agreement.

                                      F-18



<PAGE>

                                 NURESCELL INC.
                      (A Company in the Development Stage)

                          NOTES TO FINANCIAL STATEMENTS

NOTE 8 - COMMON STOCK (Continued)

Warrants
--------

The following is a summary of all warrants granted to stockholders, consultants
and others to acquire the Company's common stock through March 31, 2004:

                                    Number of Shares
                                       Subject to         Exercise
                                        Warrants        Price Range
                                    ----------------  --------------

         Balance - April 1, 1999            98,000         $1.00
           Granted                         100,000    $2.25 - $4.00
           Exercised                          -             -
                                         ---------   ---------------
         Balance - March 31, 2000          198,000     $1.00 - $4.00
           Granted                            -              -
           Exercised                          -              -
           Expired                            -              -
                                         ---------   ----------------
         Balance - March 31, 2001          198,000     $0.50 - $4.00
           Granted                            -              -
           Exercised                          -              -
                                         ---------   ----------------
         Balance - March 31, 2002          198,000     $0.50 - $4.00
           Granted                            -              -
           Exercised                          -              -
           Expired                        (198,000)  $(0.50) - $(4.00)
                                         ---------   ----------------

         Balance - March 31, 2003             -              -
            Granted                           -              -
            Exercised                         -              -
            Expired                           -              -
                                         ---------       --------
          Balance - March 31, 2004            -          $   -
                                         =========       ========

Securities that could potentially dilute basic earnings per share ("EPS") in the
future, and were not included in the computation of diluted EPS because to do so
would have been anti-dilutive for the periods presented, consist of the
following:

           Convertible note payable (assumed conversion
             at March 31, 2004 at a conversion price of $0.00494)

           Total as of March 31, 2004                        48,357,489
                                                             ==========


                                      F-19

<PAGE>

                                 NURESCELL INC.
                      (A Company in the Development Stage)

                          NOTES TO FINANCIAL STATEMENTS

NOTE 9 - INCOME TAXES

During the years ended March 31, 2004 and 2003, no provision for taxes was
required, except for minimum state franchise tax, since the Company has recorded
valuation allowances against its net operating loss carryforwards for tax
purposes.

For Federal income tax purposes, approximately $10,000,000 of net operating loss
carryforwards exists to offset future taxable income. These carryforwards expire
in 2018-2013; however utilization may be subject to limitation upon ownership
change, as defined by the Internal Revenue Code. If such a change should occur,
the actual utilization of the Company's net operating loss carryforwards, for
tax purposes, would be limited annually to a percentage of the fair market value
of the Company at the time of such change.

No tax benefit has been reported in the accompanying financial statements,
however, because of the uncertain realization of these benefits. Accordingly, at
March 31, 2004, the $3,400,000 estimated tax benefit of the cumulative
carryforwards has been offset by a valuation allowance of the same amount. Due
to the change in control of the Company, utilization of this net operating loss
carryforward is substantially limited.

NOTE 10 - COMMITMENTS

On April 1, 2003, the Company entered into a Consulting Agreement with Larry
Shatsoff, d/b/a Business Analysis Group, LLC (the "Consultant"). The Consultant
currently acts as the President, Secretary, Treasurer and sole director of the
Company and performs all duties customarily required or expected in such
capacities. As part of the consideration for this agreement, the Company pays
$3,000 per month and will issue to the Consultant shares of common stock in an
amount to be determined.



                                      F-20


<PAGE>

                                 NURESCELL INC.
                      (A Company in the Development Stage)

                          NOTES TO FINANCIAL STATEMENTS

NOTE 11 - ATI NUKLEAR AG (RELATED PARTY)

On August 22, 2000, the Company entered into a joint venture agreement with ATI
to form AG. Pursuant to that agreement, AG was to be owned 51% by the Company
and 49% by ATI. The Company's 51% interest in AG was acquired by it as
additional consideration for granting the license to AG described below. ATI and
the Company agreed to fund AG based on their respective ownership in AG. In
addition, ATI agreed to advance the sum of $1,000,000 to AG in consideration for
its 49% interest therein.

On August 22, 2000, the Company also entered into a licensing agreement (the "AG
License"), whereby the Company granted to AG the exclusive right and license to
market and sell the Nurescell Technology for a period of five years in a
specified territory. The AG License provided for the payment of a license fee of
$1,000,000. The Company recorded this transaction as unearned revenue and was
recognizing the revenue over a five-year period (the term of the AG License).

Through March 31, 2003, $550,000 of revenue had been recognized and the
remaining $450,000 was recorded through additional paid-in capital during the
year ended March 31, 2004 as a result of the Restructure Agreement.

In January 2001, ATI acquired 3,500,000 shares of the Company's common stock in
a private transaction. In April 2001, ATI acquired an additional 1,090,000
shares of the Company's common stock in another private transaction. Together,
those transactions gave ATI approximately 29% of the Company's outstanding
common stock at such time.

On June 11, 2001, the Company entered into an agreement to modify the AG License
(the "Modification Agreement"). The Modification Agreement granted to AG an
exclusive, transferable, right and license to market, distribute, sublicense,
sell, transfer and, otherwise, commercially market the Nurescell Technology and
products in the European Union, the British Isles, Russian Federation,
Uzbekistan, Krygikistan, Afghanistan, Pakistan, Kazakhstan, Iran, Turkey,
Ukraine, the Baltic Republics, Georgia, Poland, Hungary, Czech Republic,
Slovakia, Slovenia, Egypt, South Africa, Israel, Algeria, Libya, the UAE, Iraq,
Lebanon, Saudi Arabia and Kuwait.

Under the Modification Agreement, AG was to pay the Company a royalty in the
amount of 8% of the net sales of the Nurescell Technology. In the event that the
technology or products were incorporated into another product, the royalty was
to be computed on the entire price of the products, as well as the coating or
application of the product on another substance or substances. In addition,
under the terms of the Modification Agreement, (i) the Company agreed to assign
to ATI all ownership in AG, which was then renamed ATI Nuklear AG, and (ii) a
convertible promissory note (the "Convertible Note") for all amounts advanced by
AG under the AG License was executed by the Company in the amount of $1,000,000.
As part of the agreement, ATI agreed to continue to finance certain amounts of
the Company's continued monthly operations on a non-interest bearing basis,
advancing a total of $174,310 through March 31, 2003 (see Note 4).

As of September 30, 2001, the Company, ATI and AG modified the Modification
Agreement, the result of which was, among other things, (i) the Company was
released from any and all past, present and future obligations, whether past due
or otherwise, with respect to the funding of AG, (ii) the Company agreed that
all payments required of AG, pursuant to the AG License (other than the 8%
royalty payments), were deemed paid in full, (iii) the Convertible Note was
cancelled and (iv) the Company executed a $1 million secured promissory note
(the "Secured Promissory Note") payable to AG representing a termination fee.

In January 2004, pursuant to the Restructure Agreement, ATI, a related party,
exchanged its non-interest bearing cash advances of $174,310 and its Secured
Promissory Note and related interest for the Nurescell Technology (see Note 8).


                                      F-21

<PAGE>

                                 NURESCELL INC.
                      (A Company in the Development Stage)

                          NOTES TO FINANCIAL STATEMENTS

NOTE 12 - DISCONTINUED OPERATIONS

In connection with the Restructure Agreement (see Note 1), the Company has
transferred the Nurescell Technology to AG. Accordingly, the Company's
operations have been reflected as discontinued operations in the accompanying
statements of operations.

The following information summarizes the operating results of the Nurescell
Technology for the periods indicated below:
<TABLE>
<CAPTION>


                                                                      For the Period
                                       For the Year Ended March 31,  From May 12, 1998
                                      ----------------------------- (Date of Inception)
                                          2004            2003       to March 31, 2004)
                                      -------------   -------------   -------------
<S>                                   <C>             <C>             <C>
Operating Results:
  Revenue - net                       $         --    $    200,000    $    546,661
                                      -------------   -------------   -------------
  Expenses:
    Research and development                    --              --         472,476
    General and administrative
      expenses                              45,319         206,614       8,352,211
    Depreciation expense                        --           15,427         58,923
    Interest expense, net                  235,777         310,400       1,727,603
    Termination fee                             --              --       1,000,000
    Loss on inventory write down                --              --          64,537
    Write-off of intangible assets              --              --          87,944
    Loss on abandonment of computer
      software                                  --          32,248          39,026
   Gain on conversion of debt                   --              --        (280,000)
                                      -------------   -------------   -------------
        Total Expenses                     281,096         564,689      11,522,720
                                      -------------   -------------   -------------
  Loss from discontinued
    operations                        $   (281,096)    $  (364,689)   $(10,976,059)
                                      =============   =============   =============

</TABLE>




                                      F-22

<PAGE>

MANAGEMENT'S DISCUSSION AND ANALYSIS.
-------------------------------------

THIS SECTION CONTAINS FORWARD-LOOKING STATEMENTS, INCLUDING STATEMENTS REGARDING
THE COMPANY'S PROSPECTS FOR CONTINUED OPERATION AND EXISTENCE AND STATEMENTS
REGARDING THE COMPANY'S PLANS, OBJECTIVES, EXPECTATIONS AND INTENTIONS. THOSE
FORWARD-LOOKING STATEMENTS ARE BASED ON MANAGEMENT'S CURRENT EXPECTATIONS AND
ARE SUBJECT TO A NUMBER OF RISKS, FACTORS AND UNCERTAINTIES THAT MAY CAUSE
ACTUAL RESULTS, EVENTS AND PERFORMANCE TO DIFFER MATERIALLY FROM THOSE REFERRED
TO IN THE FORWARD-LOOKING STATEMENTS. THOSE RISKS, FACTORS AND UNCERTAINTIES
INCLUDE, BUT ARE NOT LIMITED TO, THE COMPANY'S HISTORY OF NET LOSSES,
UNCERTAINTY AS TO THE AVAILABILITY OF REQUIRED FUNDING AND UNCERTAINTY AS TO THE
COMPANY'S ABILITY TO MAINTAIN OPERATIONS AT ANY LEVEL. THE CAUTIONARY STATEMENTS
MADE IN THIS SECTION SHOULD BE READ AS BEING APPLIED TO ALL RELATED
FORWARD-LOOKING STATEMENTS WHEREVER THEY APPEAR IN THIS DOCUMENT.

         PLAN OF OPERATION. The Company is a development stage company, with its
operations to date principally consisting of research, development, testing and
marketing of the Nurescell Technology. From inception to March 31, 2004, the
Company obtained approximately $918,000 in financing through the sale of equity
securities in two private offerings and approximately $102,500 through the
exercise of stock options, as well as $1,061,622 through the issuance of
convertible promissory notes (the "Notes") to Triton. The Company utilized all
of those funds to (i) commence and pursue patent applications for the Nurescell
Technology, (ii) identify, negotiate and finalize suitable research, development
and testing contracts, (iii) identify, negotiate and finalize marketing
consulting contracts and (iv) provide working capital for the ongoing
administrative and financing acquisition costs of the Company.

         The Company has incurred losses since inception, including a net loss
of $465,556 for the fiscal year ended March 31, 2004. From May 12, 1998
(inception) through March 31, 2004, the Company has had a cumulative loss of
$11,361,465.

         Despite its efforts, the Company failed to generate any significant
revenue from the Nurescell Technology. Having exhausted all of its funding and
without any source of revenue, the Company has been forced to reduce its
operations to a minimal level. Faced with increasing pressure from Triton
regarding the Company's obligations under the Notes, on March 21, 2003, the
Company entered into the Restructure Agreement pursuant to which Triton has
taken control of the Company and the Company divested itself of the Nurescell
Technology on January 21, 2004, as described in more detail in "Item 6.
Description of Business - The Restructure Agreement." In connection with the
Restructure Agreement, the Company's Nurescell Technology operations have been
reflected as discontinued operations in the accompanying financial statements.
At this time, the Company believes that for the foreseeable future Triton will
provide funding for at least minimal Company operations (including continued
reporting under the Securities Exchange Act) while it determines whether the
Company has value as a candidate in a merger or other business combination (on
terms that may or may not be favorable to the Company's existing stockholders).
It is not expected, however, that Triton's funding will continue indefinitely.
Should Triton eventually determine that the Company has no value that would
justify continued funding, it is expected that the Company will be required to
discontinue operations entirely, seek protection under federal bankruptcy laws,
or both.

         RESULTS OF OPERATIONS FOR THE FISCAL YEARS ENDED MARCH 31, 2004 AND
2003. The Company had net sales of $0 for each of the fiscal years ended March
31, 2004 and March 31, 2003. As the Company has been in the development stage,
revenue generated since inception has been minimal.

         Operating expenses of $170,117 for the fiscal year ended March 31, 2004
were significantly higher than the operating expenses of $76,326 for the fiscal
year ended March 31, 2003, due primarily to increases in general and
administrative expenses which were primarily attributable to a significant
increase in legal expenses.

         There was a loss from discontinued operations of $281,096 for the
fiscal year ended March 31, 2004, as compared to a loss from discontinued
operations of $364,689 for the fiscal year ended March 31, 2003. The reduction
in the loss from discontinued operations was primarily related to a reduction in
operating expenses of $284,000 offset by the realization of $200,000 in revenue
from licensing fees for the fiscal year ended March 31, 2003, as compared to
$-0- for the fiscal year ended March 31, 2004.

     Interest expense of $14,343 for the fiscal year ended March 31, 2004 was
higher than the interest expense of $8,313 for the fiscal year ended March 31,
2003 due to the new promissory note issued to Triton in March 2003.

                                       8

<PAGE>

         Licensing fees generated revenue of $-0- for the fiscal year ended
March 31, 2004, as compared to $200,000 for the fiscal year ended March 31,
2003.

         As a result of the above factors, the net loss for the fiscal year
ended March 31, 2004 was $465,556, or $ .00 per share, as compared to a net loss
of $449,328, or $0.03 per share, for the fiscal year ended March 31, 2003.

         FINANCIAL POSITION. Total assets decreased from $5,125 at March 31,
2003 to $3,682 at March 31, 2004.

         Total liabilities decreased from $4,231,276 at March 31, 2003 to
$395,473 at March 31, 2004. The decrease is primarily attributed to the
conversion of notes payable and the related accrued interest and penalties, as
well as the conversion of certain accrued expenses into shares of the Company's
common stock.

         Total stockholders' deficiency decreased from $4,226,151 at March 31,
2003 to $391,791 at March 31, 2004. The decrease was primarily caused by
conversion of liabilities to equity.

         LIQUIDITY AND CAPITAL RESOURCES. The Company requires significant
funding for continued operations, even at minimal levels. At this point, the
amount of expenditures required to maintain operations far exceeds existing
cash, which was $3,682 at March 31, 2004.

         The Company's cash flow used in operating activities increased from
$36,421 for the fiscal year ended March 31, 2003 to $188,065 for the fiscal year
ended March 31, 2004. This is attributed to a decrease in unearned income offset
by a decrease in accrued expenses.

         During the fiscal year ended March 31, 2004, the Company has obtained
liquidity entirely from loans from Triton.

         The Company's financial statements for the year ended March 31, 2004
have been prepared assuming the Company will continue as a going-concern. As
noted in this annual report on Form 10-KSB, the presence of significant losses,
negative cash flows and limited working capital, together with the uncertainties
associated with the ability of the Company to obtain additional capital, raise
substantial doubts as to the Company's ability to continue as a going concern.
The Company's ability to continue as a going concern will be questionable until
such time as it is able to generate sufficient revenues in excess of expenses to
sustain its normal business activities. Until that time, the Company will depend
on its ability to raise additional capital through either loans or equity or
debt offerings. There can, however, be no guarantee that such financing will be
obtained or that any additional financing will be available on terms favorable
to the Company or its stockholders, if at all. As noted above, the Company
believes that for the foreseeable future Triton will provide funding for at
least minimal Company operations while it determines whether the Company has
value as a candidate in a merger or other business combination. It is not
expected, however, that Triton's funding will continue indefinitely. Should
Triton eventually determine that the Company has no value that would justify
continued funding, it is expected that the Company will be required to
discontinue operations entirely, seek protection under federal bankruptcy laws,
or both.

CRITICAL ACCOUNTING POLICIES

         The Company's critical accounting policies are those that it believes
require significant judgments, often as a result of the need to make estimates
about the effect of matters that are inherently uncertain.

Revenue Recognition
-------------------

         The Company generally recognizes revenue when persuasive evidence of an
arrangement exists, delivery has occurred, the price is fixed or readily
determinable, and collectibility is probable. The Company recognizes revenue in
accordance with SEC Staff Accounting Bulletin No. 101, "Revenue Recognition in
Financial Statements."


                                       9

<PAGE>

Stock-Based Compensation
------------------------

         As permitted under SFAS No. 148, "Accounting for Stock-Based
Compensation - Transaction and Disclosure"' which amended SFAS No. 123,
"Accounting for Stock-Based Compensation", the Company has elected to continue
to follow the intrinsic value method in accounting for its stock-based employee
compensation arrangements as defined by Accounting Principles Board Opinion
("APB") No. 25, "Accounting for Stock Issued to Employees", and related
interpretations including FASB Interpretation No. 44, "Accounting for Certain
Transactions Involving Stock Compensation", an interpretation of APB. 25. No
stock-based employee compensation cost is reflected in operations, as all
options granted under those plans have an exercise price equal to or above the
market value of the underlying common stock on the date of grant.

CONTROLS AND PROCEDURES.
------------------------

         The Company's Chief Executive Officer and Chief Financial Officer has
conducted an evaluation of the Company's disclosure controls and procedures as
of the end of the period covered by this report (the "Evaluation Date") and the
Chief Financial Officer has concluded that the Company's disclosure controls and
procedures are effective to ensure that information required to be disclosed by
the Company in reports that it files or submits under the Securities Exchange
Act is recorded, processed, summarized and reported within the time periods
specified in the applicable Securities and Exchange Commission rules and forms.

         Subsequent to the Evaluation Date, there were no significant changes in
the Company's internal controls or in other factors that could significantly
affect those controls, nor were any corrective actions required with regard to
significant deficiencies and material weaknesses.

                                       10


<PAGE>

                                    PART III

INDEX TO EXHIBITS AND DESCRIPTION OF EXHIBITS.

         The following Exhibits are included as part of this Report (with the
numbering corresponding to that used in the Company's prior filings on Form
10-QSB):

  Exhibit Number               Description
  --------------               -----------

    2             Restructure Agreement between the Company, Triton Private
                  Equities Fund, L.P., Advanced Technology Industries, Inc. and
                  ATI Nuklear AG dated as of March 21, 2003 (1)

    3.1           Articles of Incorporation, as amended (2)

    3.2           Bylaws (2)

    4.1           Form of $385,000 Series 1999-A Convertible Promissory Note due
                  December 1, 2001 (3)

    4.2           Form of $385,000 Series 2000-A Convertible Promissory Note due
                  December 1, 2001 (4)

    4.3           Secured Promissory Note dated September 30, 2001 for
                  $1,000,000 from the Company to ATI Nuklear AG (5)

    4.4           Securities Purchase Agreement between the Company and Triton
                  Private Equities Fund, L.P. dated December 15, 1999 (3)

    4.5           Securities Purchase Agreement between the Company and Triton
                  Private Equities Fund, L.P. dated February 8, 2000 (4)

    4.6           Registration Rights Agreement between the Company and Triton
                  Private Equities Fund, L.P. dated December 15, 1999 (3)

    4.7           Registration Rights Agreement between the Company and Triton
                  Private Equities Fund, L.P. dated February 8, 2000 (4)

    4.8           Promissory Note dated April 6, 2000 for $165,000 from the
                  Company to the Glenn A. Cramer Separate Property Trust (4)

    4.9           Promissory Note dated May 1, 2000 for $82,500 from the Company
                  to the Glenn A. Cramer Separate Property Trust (4)

    4.10          Promissory Note dated June 1, 2000 for $82,500 from the
                  Company to the Glenn A. Cramer Separate Property Trust (4)

    10.1          Consulting Agreement between the Company and John Longenecker
                  dated June 26, 1998 (2)

    10.2          Form of Stock Option Agreement between the Company and its
                  officers and directors (2)

    10.3          1998 Stock Option Plan (2)

    10.4          Form of Indemnification Agreement between the Company and its
                  officers and directors (2)

    10.5          Consulting Agreement between the Company and Shelby T. Brewer
                  dated December 1, 1999 (4)

    10.6          Investment Agreement between the Company and Nurescell AG
                  dated August 17, 2000 (6)

    10.7          License Agreement between the Company and Nurescell AG dated
                  as of August 15, 2000 (6)

    10.8          Registration Rights Agreement between the Company and
                  Nurescell AG dated August 15, 2000 (6)

    10.9          Modified License Agreement between the Company and Advanced
                  Technology Industries, Inc. Dated as of June 11, 2001 (7)

                                       11

<PAGE>

    10.10         Transaction Restructure Agreement between the Company,
                  Advanced Technology Industries, Inc. and ATI Nuklear AG dated
                  as of September 30, 2001 (8)

    10.11         Convertible Promissory Note dated March 21, 2003 from the
                  Company to Triton Private Equities Fund, L.P. (9)

    10.12         Consulting Agreement dated as of April 1, 2003 between the
                  Company, Larry Shatsoff and Triton Private Equities Fund, L.P.
                  (9)

    10.13         2003 Stock Compensation Plan (10)

    31            Rule 13a-14(a)/15d-14(a) Certifications.

    32            Section 1350 Certifications
---------------
    (1)           Incorporated by reference from the Company's Report on Form
                  10-QSB for the quarter ended December 31, 2002 (File No.
                  0-25377)

    (2)           Incorporated by reference from the Company's Registration
                  Statement on Form 10-SB (File No. 0- 25377).

    (3)           Incorporated by reference from the Company's Report on Form
                  10-QSB for the quarter ended December 31, 1999 (File No.
                  0-25377)

    (4)           Incorporated by reference from the Company's Report on Form
                  10-KSB for the year ended March 31, 2000 (File No. 0-25377)

    (5)           Incorporated by reference from the Company's Report on Form
                  10-QSB for the quarter ended September 30, 2001 (File No.
                  0-25377)

    (6)           Incorporated by reference from the Company's Report on Form
                  10-QSB for the quarter ended September 30, 2000 (File No.
                  0-25377)

    (7)           Incorporated by reference from the Company's Report on Form
                  10-QSB for the quarter ended June 30, 2001 (File No. 0-25377)

    (8)           Incorporated by reference from the Company's Report on Form
                  8-K dated September 30, 2001 (File No. 0-25377)

    (9)           Incorporated by reference from the Company's Report on Form
                  10-KSB for the year ended March 31, 2003 (File No. 0-25377)

    (10)          Incorporated by reference from the Company's Registration
                  Statement on Form S-8 (File No. 333-107430)


                                       12


<PAGE>

                                   SIGNATURES

         In accordance with the 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.

Date: July 2, 2004                            NURESCELL, INC.

                                                By: /s/ LAWRENCE SHATSOFF
                                                --------------------------------
                                                Lawrence Shatsoff, President and
                                                Chief Financial Officer

         In accordance with the Exchange Act, this report has been
signed below by the following persons on behalf of the registrant and in the
capacities and on the dates indicated.


/s/ LAWRENCE SHATSOFF            President, Chief Financial        July 2, 2004
----------------------------     Officer, Secretary and Director
Lawrence Shatsoff


                                       13