791,190<Page>
U.S. Securities and Exchange Commission
Washington, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2001
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[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
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Commission File No. 02-23729
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HYDROMAID INTERNATIONAL, INC.
-----------------------------
(Exact name of Small Business Issuer in its Charter)
NEVADA 87-0575839
------ ----------
(State or Other Jurisdiction of (I.R.S. Employer I.D. No.)
incorporation or organization)
1350 E. Draper Parkway
Draper, Utah 84020
------------------------------
(Address of Principal Executive Offices)
Issuer's Telephone Number: (801) 553-8790
Not applicable.
(Former name, former address and former fiscal year, if changed since last
report):
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 Company was required to file such reports), and (2) has
been subject to such filing requirements for the past 90 days.
(1) Yes X No (2) Yes X No
--- --- --- ---
(APPLICABLE ONLY TO CORPORATE ISSUERS)
State the number of shares outstanding of each of the Issuer's classes
of common equity, as of the latest practicable date:
August 15, 2001: Common Stock - 26,991,205 shares
DOCUMENTS INCORPORATED BY REFERENCE
Transitional Small Business Issuer Format Yes No X
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HYDROMAID INTERNATIONAL, INC.
TABLE OF CONTENTS
<Table>
<Caption>
Page
PART I. FINANCIAL INFORMATION 3
Item 1. Condensed Financial Statements: 3
Condensed Balance Sheets as of June 30, 2001 (unaudited) and December 31, 2000 (audited) 4
Unaudited Condensed Statements of Operations for the Three-month and Six-month
Periods Ended June 30, 2001 and June 30, 2000. 5
Unaudited Condensed Statements of Cash Flows for the Six-month Periods Ended
June 30, 2001 and June 30, 2000. 6
Notes to Unaudited Condensed Financial Statements for the Three-month and
Six-month Periods Ended June 30, 2001 and June 30, 2000. 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 12
PART II. OTHER INFORMATION 14
Item 1. Legal Proceedings 14
Item 2. Changes in Securities 14
Item 3. Defaults Upon Senior Securities 14
Item 4. Submission of Matters to a Vote of Security Holders 14
Item 5. Other Information 14
Item 6. Exhibits and Reports on Form 8-K 14
SIGNATURES 14
</Table>
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PART I - FINANCIAL INFORMATION
All statements, other than statements of historical fact, included
in this Form 10-QSB, including the statements under "Management's Discussion
and Analysis," are, or may be deemed to be, "forward-looking statements"
within the meaning of Section 27A of the Securities Act of 1933, as amended
(the "Securities Act"), and Section 21E of the Securities Exchange Act of
1934 (the "Exchange Act"). Such forward-looking statements involve
assumptions, known and unknown risks, uncertainties and other factors which
may cause our actual results, performance or achievements to be materially
different from any future results, performance, or achievements expressed or
implied by such statements contained in this Form 10-QSB. Such potential
risks and uncertainties include, without limitation, competitive technology
advancements and other pressures from competitors, economic conditions
generally and in our research and development efforts, availability of
capital, cost of labor (foreign and domestic), cost of raw materials,
occupancy costs, and other risk factors detailed herein and in our filings
with the Securities and Exchange Commission. We assume no obligation to
update the forward-looking statements or to update the reasons actual results
could differ from those projected in such statements. Readers are cautioned not
to place undue reliance on these forward-looking statements.
Item 1. Financial Statements.
The Unaudited Condensed Financial Statements of the Company required
to be filed with this 10-QSB Quarterly Report were prepared by management and
commence on the following page, together with related Notes. In the opinion of
management, these Unaudited Condensed Financial Statements fairly present the
financial condition of the Company, but should be read in conjunction with the
Audited Financial Statements of the Company and Form 10-KSB for the year ended
December 31, 2000 previously filed with the Securities and Exchange Commission.
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HYDROMAID INTERNATIONAL, INC.
CONDENSED BALANCE SHEETS
JUNE 30, 2001 AND DECEMBER 31, 2000
<Table>
<Caption>
JUNE 30, 2001 DECEMBER 31, 2000
(UNAUDITED) (AUDITED)
------------- -----------------
ASSETS
CURRENT ASSETS
CASH $ 19,672 $ 711,904
ACCOUNTS RECEIVABLE 288,026 621,208
NOTES RECEIVABLE 1,054,403 1,325,000
INVENTORY, NET 977,099 974,206
PREPAID EXPENSES AND OTHER ASSETS 721,118 798,845
------------ ------------
TOTAL CURRENT ASSETS 3,060,318 4,431,163
PROPERTY AND EQUIPMENT, NET 709,084 804,415
PATENTS, NET 152,915 85,183
ADVANCES TO RELATED PARTIES 494,875 303,833
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TOTAL ASSETS $ 4,417,192 $ 5,624,594
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
ACCOUNTS PAYABLE AND ACCRUED EXPENSES $ 626,570 $ 372,983
STOCKHOLDERS' EQUITY
COMMON STOCK, par value $.001/ share, 30,000,000 shares authorized 26,991 26,915
June 30, 2001: 26,991,205 outstanding
December 31, 2000: 26,914,538 outstanding
ADDITIONAL PAID-IN CAPITAL 18,293,640 18,274,550
SUBSCRIPTIONS, STOCK OPTIONS AND DEFERRED COMPENSATION (74,789) (131,576)
ACCUMULATED DEFICIT (14,455,220) (12,918,278)
------------ ------------
TOTAL STOCKHOLDERS' EQUITY 3,790,622 5,251,611
------------ ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 4,417,192 $ 5,624,594
============ ============
</Table>
The accompanying notes are an integral part of these financial statements.
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HYDROMAID INTERNATIONAL, INC.
CONDENSED STATEMENTS OF OPERATIONS
FOR THE THREE-MONTH AND SIX-MONTH PERIODS ENDED JUNE 30, 2001 AND 2000
UNAUDITED
<Table>
<Caption>
THREE MONTHS THREE MONTHS SIX MONTHS SIX MONTHS ENDED
ENDED JUNE 30, ENDED JUNE 30, ENDED JUNE 30, JUNE 30,
2001 2000 2001 2000
------------- ------------- ------------- ----------------
REVENUES
SALES $ 35,644 $ 72,855 $ 90,792 $ 167,359
LESS RETURNS AND ALLOWANCES (92,031) (11,280) (99,310) (21,305)
------------ ------------ ------------ ------------
(56,387) 61,575 (8,518) 146,054
COST OF SALES (15,023) 20,963 5,956 47,767
------------ ------------ ------------ ------------
GROSS PROFIT/(LOSS) (41,364) 40,612 (14,474) 98,287
OPERATING EXPENSES
SELLING AND DISTRIBUTION 262,610 283,988 557,329 607,612
GENERAL AND ADMINISTRATIVE 389,032 869,197 794,395 1,691,904
RESEARCH AND DEVELOPMENT 139,548 57,039 225,209 100,663
------------ ------------ ------------ ------------
791,190 1,210,224 1,576,933 2,400,179
------------ ------------ ------------ ------------
LOSS BEFORE INCOME TAX BENEFIT (832,554) (1,169,612) (1,591,407) (2,301,892)
INTEREST INCOME 21,776 54,544 54,464 116,960
INCOME TAX BENEFIT, NET OF
VALUATION ALLOWANCE - - - -
------------ ------------ ------------ ------------
NET (LOSS) $ (810,778) $(1,115,068) $(1,536,943) $(2,184,932)
============ ============ ============ ============
BASIC AND DILUTED LOSS PER SHARE $ (0.03) $ (0.04) $ (0.06) $ (0.08)
============ ============ ============ ============
</Table>
The accompanying notes are an integral part of these financial statements.
5
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HYDROMAID INTERNATIONAL, INC.
CONDENSED STATEMENTS OF CASH FLOWS
FOR THE SIX-MONTH PERIODS ENDED JUNE 30, 2001 AND 2000
UNAUDITED
<Table>
<Caption>
SIX MONTHS SIX MONTHS
ENDED JUNE 30, ENDED JUNE 30,
2001 2000
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CASH FLOWS FROM OPERATING ACTIVITIES
Net (loss) $(1,536,943) $(2,184,932)
Adjustments to reconcile net (loss) to net cash used by operating
activities:
Depreciation and amortization 131,655 108,163
Stock option and grant expense 56,788 647,621
Changes in operating assets and liabilities:
Accounts receivable 333,182 (2,253)
Inventory (2,892) (133,359)
Prepaid expenses and other expenses 77,727 (704,717)
Accounts payable and accrued expenses 253,584 (220,632)
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NET CASH (USED) BY OPERATING ACTIVITIES (686,899) (2,490,109)
------------ ------------
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of property and equipment (27,863) (240,486)
Acquisition of patents (76,193) (16,023)
Proceeds from notes receivable 270,597 -
------------ ------------
NET CASH PROVIDED (USED) BY INVESTING ACTIVITIES 166,541 (256,509)
------------ ------------
CASH FLOWS FROM FINANCING ACTIVITIES
Advances to related party (191,041) (52,331)
Proceeds from issuance of common stock - 3,368,155
Proceeds from exercise of stock options 19,167 -
------------ ------------
NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES (171,874) 3,315,824
------------ ------------
NET INCREASE (DECREASE) IN CASH (692,232) 569,206
CASH AT BEGINNING OF PERIOD 711,904 2,901,758
------------ ------------
CASH AT END OF PERIOD $ 19,672 $ 3,470,964
============ ============
</Table>
The accompanying notes are an integral part of these financial statements.
6
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HYDROMAID INTERNATIONAL, INC.
Notes to the Unaudited Condensed Financial Statements
For the Three-month and Six-month Periods Ended June 30, 2001 and June 30, 2000.
1. NATURE OF BUSINESS, REORGANIZATION AND BASIS OF PRESENTATION
NATURE OF BUSINESS
HydroMaid International, Inc. (the "Company") was incorporated in 1992 in the
State of Nevada and engages in the development, manufacture, and sale of a
patented water-powered garbage disposal known as the HydroMaid(R) (the
"Product"). Technological improvements and field-testing were completed in
1997, and the Product was introduced to the market in 1998. The Company is
presently engaged in improving the Product to achieve universal compliance
with plumbing codes and to enhance the overall quality and performance of the
Product. The Company intends to market the Product worldwide. The Company
operates from a leased facility near Salt Lake City, Utah. One contractor in
China performs the majority of the Company's manufacturing.
AGREEMENT WITH GENERAL ELECTRIC
On March 10, 2000, the Company entered into a non-binding Letter of Intent with
the Appliance Division of General Electric Company ("GEA") under which GEA might
have obtained exclusive distribution rights to the Hydromaid(R) in the United
States and Canada through October 31, 2003. The mutual exploration conducted
under this Letter of Intent was terminated on April 19, 2001 with no further
obligations on the part of either party.
BASIS OF PRESENTATION
The Company has prepared its condensed financial statements for the three-month
and six-month periods ended June 30, 2001 and 2000 without audit by the
Company's independent auditors. In the opinion of management, all adjustments
necessary to present fairly the financial position, results of operations, and
cash flows of the Company as of June 30, 2001 and for the three-month and
six-month periods ended June 30, 2001 and 2000 have been made. Such adjustments
consist only of normal recurring adjustments.
Certain note disclosures normally included in the Company's annual financial
statements prepared in accordance with GAAP have been condensed or omitted. The
accompanying condensed financial statements should be read in conjunction with
the audited financial statements and
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notes thereto included in the Company's Form 10-KSB annual report for
2000 filed with the Securities and Exchange Commission.
The results of operations for the three-month and six-month periods ended June
30, 2001 and 2000 are not necessarily indicative of the results to be expected
for the full year.
Certain amounts in the 2000 financial statements have been reclassified to
conform to their 2001 presentation.
2. RECENT ACCOUNTING PRONOUNCEMENTS
For the three-month and six-month periods ended June 30, 2001, the Company
adopted Statement of Financial Accounting Standards No. 133, "Accounting for
Derivative Instruments and hedging activities" ("SFAS 133"), as amended. Since
the Company does not presently engage in activities covered by SFAS 133, there
was no significant effect on the Company's June 30, 2001 financial statements.
In July, 2001, the Financial Accounting Standards Board issued Statements No.
141, "Business Combinations" ("SFAS 141") and No. 142 "Goodwill and Other
Intangible Assets" ("SFAS 142"). SFAS 141 supersedes APB Opinion No. 16,
"Business Combinations" and SFAS 38, "Accounting for Pre-acquisition
Contingencies of Purchased Enterprises." SFAS 141 is effective for fiscal
years beginning after June 30, 2001 and requires that all business
combinations be accounted for by the purchase method. SFAS 142 supersedes APB
Opinion No. 17, "Intangible Assets." SFAS 142 is effective for fiscal years
beginning after December 15, 2001 and provides that all existing and newly
acquired goodwill and intangible assets will no longer be amortized but will
be tested for impairment annually and written down only when impaired. Except
as future acquisition(s) may occur, management believes these requirements
will have no affect on the Company's financial statements.
3. NOTES RECEIVABLE
In August 2000, the Company loaned $500,000 to an unrelated party in the
water filtration business. The loan is evidenced by an unsecured note
receivable maturing August 7, 2001 and bearing interest at 12% per annum.
Interest is payable monthly. As of March 31, 2001, principal and accrued
interest amounted to approximately $535,000. Culley W. Davis, CEO of the
Company, agreed to personally guarantee the obligation under this note.
During the three-month period ended June 30, 2001, Mr. Davis made principal
and accrued interest payments to the Company in the amount of $313,000 toward
this loan. Subsequent thereto, Mr. Davis made additional payments to or on
behalf of the Company in the amount of approximately $120,000. Accordingly,
the balance due on this loan as of August 20, 2001 is approximately $117,000.
The Company loaned $300,000 to Lighthouse, Inc., a related party, on November
8, 2000 in exchange for a note receivable. The note bears interest at the
rate of 6.2% per annum; principal and unpaid interest are due November 8,
2001. Accrued interest receivable on this note approximated $20,000 at
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June 30, 2001. As of August 20, 2001, $30,000 of principal and accrued
interest had been paid back to the Company in relation to this note.
Additionally, the Company loaned $525,000 to Liquitek Enterprises, Inc., a
related party, in exchange for a note receivable. The note bears interest at
the rate of 6.2% per annum; principal and unpaid interest were due March 31,
2001. This note and accrued interest were paid in full by Liquitek
Enterprises, Inc. on August 10, 2001.
4. INVENTORY
Inventory consists of the following at June 30, 2001 and December 31, 2000:
<Table>
<Caption>
2001 2000
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Components $ 563,099 $ 551,039
Finished goods 817,931 827,098
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1,381,030 1,378,137
Less valuation allowance (403,931) (403,931)
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$ 977,099 $ 974,206
========== ==========
</Table>
At June 30, 2001 and December 31, 2000, the inventory valuation allowance
included approximately $385,000 resulting from write-downs for estimated
obsolescence created by design changes during the Product's development.
Subsequent to June 30, 2001, the Company began to sell off the obsolete
inventory at scrap metal prices in order to avoid moving it in conjunction
with a warehouse relocation.
Included in finished goods inventory at June 30, 2001, is approximately
$28,000 of inventory held by a European distributor (Note 7).
5. ADVANCES TO RELATED PARTIES
During the three-month period ended June 30, 2001, the Company paid employees
whose time is divided between work for the Company and work for Liquitek
Enterprises, Inc., a related party. The portion of such labor costs
attributable to Liquitek Enterprises, Inc. is billed to that company. The
receivable on the books of the Company for such billings grew by
approximately $108,000 during the three-month period ended June 30, 2001.
6. STOCK OPTIONS EXERCISED
During the three-month period ended June 30, 2001, a former employee of the
Company exercised an option to acquire 66,667 shares of the Company's common
stock at $0.25 per share. The remainder of this former employee's options,
50,000 shares at $5.50 and 10,000 shares at $5.00, were forfeited. No stock
options expired or were granted during the period.
7. SALES RETURN
During the three-month period ended June 30, 2001, the Company agreed to
accept the return of product sold to a European distributor during the year
ended December 31, 2000, with a sales price and inventory cost approximating
$85,000 and $28,000, respectively. The terms of the original sale did not
provide for the right of return. The Company and the distributor entered into
an agreement for the return during the three-month period ended June 30,
2001, and the return was recorded in this period as a reduction in cost of
goods sold and accounts receivable and an increase in inventory and returns
and allowances expense.
8. STOCK-BASED COMPENSATION AND OTHER EXPENSES
On October 20, 1999, the Company entered into an agreement with Steve Young
("Young") to retain his services as a Director and a consultant for a two-year
period (the "Young Agreement"). Young is a retired quarterback for the San
Francisco 49ers, a professional football team. The Young Agreement provides that
the Company will compensate Young by (a) issuing to him 200,000 shares of its
restricted common stock for his first year of service as a Director, and (b)
agreeing to issue to Young an additional 100,000 shares of restricted common
stock after he has completed one year of service as a Director. Based on the
market price of the Company's common stock when the issuance of the 200,000
shares was authorized, the Company recorded compensation expense of
approximately $587,000 for the six-month period ended June 30, 2000 and no
comparable expense existed for the six-month period ended June 30, 2001.
The Young Agreement provides that, if it is terminated early for any reason
related to Young's inability to perform the specified services or his alleged
breach of contract, Young is required to (a) return any
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unearned shares of stock on a pro rata basis and (b), if applicable, waive
his right to receive the additional 100,000 shares. If the Young Agreement is
terminated early because of the Company's alleged breach of contract, Young
will receive all 300,000 shares. The additional 100,000 shares have not been
issued as of June 30, 2001. The Company and Mr. Young have agreed that such
additional shares will be issued as he performs consulting services in the
future.
9. COMMITMENTS AND CONTINGENCIES
At June 30, 2001, the Company had outstanding commitments of approximately
$1,925,000 to purchase finished goods from a vendor in China. The vendor has
agreed to suspend production of certain units representing approximately
$1,650,000 of such commitment. The Company has indemnified the vendor in the
amount of approximately $670,000 for any loss that may result from vendor-owned
components if such inventory becomes obsolete due to a change in the Product's
design.
During the quarter ended June 30, 2001, the Company committed to relocating
its warehouse operations to a different facility owned by the same landlord
that owned the facility in which we had been operating for the previous two
years. The lease on the space being vacated was due to expire on September
30, 2001. We were allowed to move into the new space on July 1, 2001, by
paying the old space rental rate ($4,148 per month) for three months, then
the new space rental rate ($3,955 per month through September 2002, $4,074
for October 2002 through September 2003 and $4,196 for October 2003 through
September 2004) for the balance of the three year commitment on the new space.
10. LIQUIDITY CONSIDERATIONS
As discussed in Note 1, the Company manufactures and markets the HydroMaid(R)
water-powered garbage disposal. Since the introduction of the HydroMaid(R) to
the marketplace in 1998, sales have not been sufficient to provide positive
operating cash flow. The Company's operating cash flow deficit for the
six-month period ended June 30, 2001 was approximately $687,000. Management
believes that the Company will have sufficient cash to meet its obligations
for the next 12 months based upon the June 30, 2001 cash balance, collection
of accounts and notes receivable, and sales of inventory, aggregating
approximately $2,000,000. The anticipated sales of inventory are premised on
negotiations presently underway with a modular home builder who can design
and build around the absence of a vacuum breaker in the Company's present
product. Management also anticipates that additional equity investment will
be required in the future and has commenced the pursuit of such investment
through private offering of the Company's common stock.
11. LOSS PER COMMON SHARE
Loss per common and common equivalent share is based on the weighted average
number of shares of common stock and potential common stock outstanding during
the period in accordance with Statement of Financial Accounting Standards No.
128, "Earnings per Share."
The weighted average numbers of common shares outstanding for the three-month
and six-month periods ended June 30, 2001 were approximately 26,981,000 and
26,951,000, respectively, while the same data for the corresponding periods
ending June 30, 2000 were approximately 26,853,000 and 26,837,000
respectively.
As more fully described in the notes to the audited financial statements in the
Company's annual report on Form 10-KSB for 2000, securities that could
potentially dilute basic loss per share in the
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future were not included in the diluted-loss-per-share computation because
their effect is anti-dilutive.
12. CONCENTRATION OF CREDIT RISK
At June 30, 2001, one international customer accounted for approximately 60% of
the trade accounts receivable balance. The balance due the Company from this
customer is being withheld pending the results of a service call, which is
scheduled for late August, 2001, in conjunction with a sales and manufacturing
visit to the Far East. Management believes that certain units were not adjusted
properly upon installation and that the dispute can be resolved without
significant cost to the Company and that no allowance for doubtful accounts
should be established at June 30, 2001.
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Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations.
RESULTS OF OPERATIONS
Net sales for the three-month period ended June 30, 2001 were $(56,387)
compared to $61,575 for the comparable period in 2000. Net sales for the
six-month period ended June 30, 2001 were $(8,518) compared to $146,054 for
the comparable period in 2000. The negative net sales numbers for the 2001
periods resulted from allowing a European distributor to return a substantial
portion of product from a previous sale for full credit because of
water-pressure related performance problems of the product in their
marketplace. The terms of the original sale did not provide for the right of
return. The Company and the distributor entered into an agreement for the
return during the quarter ended June 30, 2001, and the return was recorded in
this period as a reduction in cost of goods sold and accounts receivable and
an increase in inventory and returns and allowances expense. These units are
being held by the distributor as Company inventory until they can be resold
to other distributors in nearby markets where the water-pressure problems are
not germane.
Cost of sales for the three-month period in 2001 was $(15,023) compared to
$20,963 for the comparable period in 2000, while cost of sales for the six-month
period in 2001 was $5,956 compared to $47,767 for the comparable period in 2000.
The negative and nearly negative cost of sales figures for 2001 relate to the
return allowance mentioned above.
The gross profit margin decreased from 66% for the three-month period ended
June 30, 2000 to 53%, not including the return described above, for the
comparable period in 2001. The gross profit margin decreased from 67% for the
six-month period ended June 30, 2000 to 55%, not including the return
described above, for the comparable period in 2001. We have not included the
sales return described above in the gross profit margin calculations because
its inclusion causes negative numbers and low percentage bases which confuse
the meaning of the ratios. The decreases in margins were caused primarily by
greater shares of overall sales at wholesale prices in 2001 than was the case
in 2000.
Operating expenses were $791,190 for the three-month period ended June 30, 2001
compared to $1,210,224 for the comparable period in 2000, while operating
expenses were $1,576,933 for the six-month period ended June 30, 2001 compared
to $2,400,179 for the comparable period in 2000. The decreases are attributable
to lower compensation expense in 2001 for services provided by Mr. Young as
noted in Item 1 above. Further, more of the compensation of employees being
shared with related parties was borne by those other companies in 2001.
The Company experienced a net loss after interest income and income tax benefit
and corresponding net loss per share of $810,778 and $0.03, respectively, for
the three-month period ended June 30, 2001, compared to a net loss after
interest income and income tax benefit and net loss per share of $1,115,068 and
$0.04, respectively, for the comparable period in 2000. The losses for the
six-month period ending June 30, 2001 were $1,536,943 and $0.06 compared to
losses for the same period of the preceding year of $2,184,932 and $0.08.
LIQUIDITY
As of June 30, 2001, the Company had $19,672 in cash, $288,026 in Accounts
Receivable and $1,054,403 in notes receivable due before the end of 2001. The
Company also had approximately $977,000 in inventory.
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The Company's operating cash flow deficit for the three-month period ended
June 30, 2001 was approximately $687,000. Management believes that the
Company will have sufficient cash to meet its obligations for the next 12
months based upon the June 30, 2001 cash balance, collection of accounts and
notes receivable, and sales of inventory aggregating approximately
$2,000,000. The anticipated sales of inventory are premised on negotiations
presently underway with a modular home builder who can design and build
around the absence of a vacuum breaker in the Company's present product.
Management also anticipates that additional equity investment will be
required in the future. Management has commenced the pursuit of such
investment through private offering of the Company's common stock.
SUBSEQUENT EVENTS
On August 10, 2001, Liquitek Enterprises, Inc. paid in full the principal and
accrued interest (approximately $546,000) on the note receivable that had
been in default since March 31, 2001. (See Note 3 to the Unaudited Condensed
Financial Statements.)
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PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
None.
Item 2. Changes in Securities.
During the quarter ended June 30, 2001, the Company issued 66,667 shares of
common stock at a price of $0.25 per share to a former employee who exercised
options that had vested at the time of his termination.
Item 3. Defaults Upon Senior Securities.
None.
Item 4. Submission of Matters to a Vote of Security Holders.
None.
Item 5. Other Information.
None.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits.*
None.
(b) Reports on Form 8-K.
None.
* A summary of any Exhibit is modified in its entirety by reference to
the actual Exhibit.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this Report to be signed on its behalf by the
undersigned thereunto duly authorized.
HYDROMAID INTERNATIONAL, INC.
Date: 08/20/01 By: /s/ CULLEY W. DAVIS
----------------------------------
President and Director
Date: 08/20/01 By: /s/ JOHN W. NAGEL
----------------------------------
Chief Financial Officer and
Director
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