UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
[X] Quarterly Report Pursuant to Section 13 or 15 (d) of the Securities
Exchange Act of 1934
For the Quarterly Period Ended: March 31, 2005
or
[_] Transition Report Pursuant to Section 13 or 15 (d) of the Securities
Exchange Act of 1934
For the Period from __________ to __________
Commission File Number: 0-6333
HYDRON TECHNOLOGIES, INC.
-------------------------
(Exact name of Registrant as specified in its charter)
New York 13-1574215
(State or other jurisdiction of (I.R.S. Employer Identification Number)
incorporation or organization)
2201 West Sample Road, Building 9, Suite 7B
Pompano Beach, FL 33073 (954) 861-6400
-------------------------------------------- --------------
(Address of Principal Executive Offices) (Registrant's telephone number)
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the Registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. [X] Yes [_] No.
Number of shares of common stock outstanding as of May 9, 2005: 9,320,336
1
TABLE OF CONTENTS PAGE
Part I. Financial Information
Item 1. Financial Statements (Unaudited)
Condensed Consolidated Balance Sheets -- March 31, 2005 and 3
December 31, 2004
Condensed Consolidated Statement of Operations -- Three months 4
ended March 31, 2005 and 2004
Condensed Consolidated Statements of Cash Flow -- Three months 5
ended March 31, 2005 and 2004
Notes to Condensed Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial Condition 9
and Results of Operations
Item 4. Controls and Procedures 14
Part II. Other Information
Item 6. Exhibits and Reports on Form 8-K. 16
Signatures 17
Certification of Chief Officers Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002 and Item 307 of Regulation S-K 18
Certification Pursuant to 18 U.S.C., Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 20
2
HYDRON TECHNOLOGIES, INC.
Condensed Consolidated Balance Sheets
March 31, 2005 December 31, 2004
(unaudited) Note
-------------- -----------------
ASSETS
Current Assets
Cash and cash equivalents $ 213,347 $ 339,679
Trade accounts receivable 1,518 9,614
Accounts Receivable, affiliates -- --
Inventories 479,223 481,996
Prepaid expenses and other current assets 42,046 67,190
------------ ------------
Total current assets 736,134 898,479
Property and equipment, less accumulated
depreciation of $210,574 and $209,329 at
2005 and 2004, respectively 11,428 12,673
Deposits 19,587 19,587
Investment in affiliates -- --
Deferred product costs, less accumulated
amortization of $170,027 and $162,135 at
2005 and 2004, respectively 170,027 162,135
------------ ------------
Total Assets $ 937,176 $ 1,092,874
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable 42,336 $ 90,440
Loans payable 379 751
Royalties payable 27,751 29,132
Deferred revenues 141,572 91,180
Accrued liabilities 229,966 229,953
------------ ------------
Total current liabilities 442,004 441,456
Commitments and contingencies
Minority interest in consolidated partnership 276,646 285,191
Shareholders' equity
Preferred stock - $.01 par value
5,000,000 shares authorized; no shares issued
or outstanding -- --
Common stock - $.01 par value
30,000,000 shares authorized; 9,320,336 shares
issued and 9,320,336 shares outstanding at 2005;
and 2004, respectively 93,203 93,203
Additional paid-in capital 20,736,049 20,736,049
Accumulated deficit (20,591,145) (20,427,661)
Treasury stock, at cost 10,000 at 2005
and 2004 (7,816) (7,816)
------------ ------------
Total Shareholders' equity 230,291 393,775
------------ ------------
Total liabilities and shareholders equity $ 948,941 $ 1,120,422
============ ============
Note: The balance sheet at December 31, 2004 has been derived from the audited
financial statements at that date but does not include all of the
information and footnotes required by generally accepted accounting
principles for complete financial statements.
See accompanying notes to condensed consolidated financial statements
3
HYDRON TECHNOLOGIES, INC.
Condensed Consolidated Statements of Operations
(Unaudited)
Three months ended March 31,
2005 2004
---- ----
Net sales $ 255,914 $ 386,132
Cost of sales 97,259 157,630
----------- -----------
Gross profits 158,655 228,502
Expenses
Royalty expense 7,725 11,967
Research and development 38,970 64,745
Selling, general & administration 275,274 309,031
Depreciation & amortization 9,137 8,550
----------- -----------
Total expenses 331,106 394,293
----------- -----------
Operating loss (172,452) (165,791)
Interest income - net of interest expense 422 820
----------- -----------
Loss before income taxes (172,030) (164,971)
Minority interest in net loss 8,545 --
Income taxes expense -- --
----------- -----------
Net loss $ (163,484) $ (164,971)
=========== ===========
Basic and diluted loss per share
Net loss per common share $ (0.02) $ (0.02)
=========== ===========
Weighted average shares
outstanding (basic and diluted) 9,320,336 9,260,136
=========== ===========
See accompanying notes to condensed consolidated financial statements.
4
HYDRON TECHNOLOGIES, INC.
Condensed Consolidated Statements of Cash Flow
(Unaudited)
Three Months ended March 31,
2005 2004
---- ----
Operating activities
Net loss $(163,484) $(164,971)
Adjustments to reconcile net loss to
net cash used by operating activities
Minority Interest (8,545) --
Depreciation and amortization 9,137 8,550
Change in operating assets and liabilities
Trade accounts receivables 8,096 8,366
Inventories 2,773 4,501
Prepaid expenses and other current assets 25,143 15,306
Deposits -- --
Accounts payable (48,104) 60,204
Royalties payable (1,381) 11,967
Deferred revenues 50,392 (26,198)
Accrued liabilities 13 2,991
--------- ---------
Net cash used in operating activities (125,960) (79,284)
Investing activities
Capital expenditures, net -- --
Deferred product costs -- --
--------- ---------
Net cash used in investing activities -- --
Financing activities
Payment on loan payable (372) (942)
--------- ---------
Net decrease in cash and cash equivalents (126,332) (80,226)
Cash and cash equivalents at beginning of period 339,679 964,723
--------- ---------
Cash and cash equivalents at end of period $ 213,347 $ 884,497
========= =========
See accompanying notes to condensed consolidated financial statements.
5
Hydron Technologies, Inc.
Notes to Condensed Consolidated Financial Statements
Note A -- Basis of Presentation
The accompanying unaudited financial statements have been prepared in
accordance with generally accepted accounting principles for interim financial
information and with the instructions to Form 10-Q and Article 10 of Regulation
S-X. Accordingly, they do not include all of the information and footnotes
required by generally accepted accounting principles for complete financial
statements. In the opinion of management of Hydron Technologies, Inc. (the
"Company"), all adjustments (consisting of normal recurring adjustments)
considered necessary for a fair presentation have been included. Operating
results for the three-month period ended March 31, 2005 are not necessarily
indicative of the results that may be expected for the year ending December 31,
2005. For further information, refer to the financial statements and footnotes
included in the Company's Annual Report on Form 10-K for the year ended December
31, 2004.
Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires Management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.
Note B - Inventories
Inventories consist of the following:
March 31, December 31,
2005 2004
--------- -----------
Finished Goods $ 95,724 $ 93,312
Raw materials and components 383,499 388,684
-------- --------
$479,223 $481,996
======== ========
Note C - Distribution
The majority of the Company's products are currently sold in the United
States through the Company's direct marketing channels (proprietary Catalog and
the World Wide Web site). The Company also sells its products to private label
customers, television retailers and, to a lesser extent, internationally through
salons and doctors offices.
6
Hydron Technologies, Inc.
Notes to Condensed Consolidated Financial Statements
Note D - Earnings Per Share
On January 25, 2005, the Board of Directors, by unanimous consent,
re-authorized the issuance of 743,500 stock options from the 2003 Stock Plan to
Directors and Officers of the Company. Since the original approval date was more
than 12 months before the shareholder adoption of the 2003 Stock Plan, the
options had to be re-authorized to include them under the plan.
There were no options granted to employees during the three months ended
March 31, 2005 that would require adjustments to the pro forma information
regarding net income and earnings per share required by FASB Statement No. 123.
Note E - Accrued Liabilities
Accrued liabilities represent expenses that apply to the reported period
and have not been billed by the provider or paid by the Company. Accrued
liabilities consisted of the following:
March 31, December 31,
2005 2004
---- ----
Dividends payable $ 83,163 $ 83,163
Director fees payable 86,017 81,016
Legal fees 31,600 40,754
Other 29,186 25,020
-------- --------
$229,966 $229,953
======== ========
Note F - Going Concern
The accompanying condensed financial statements were prepared assuming
that the Company will continue as a going concern. This basis of accounting
contemplates the recovery of the Company's assets and the satisfaction of its
liabilities in the normal course of operations.
The Company anticipates that present working capital balances and
internally generated funds will be sufficient to meet our working capital needs
for the next three months and maybe longer based on management decisions and
sales. Beyond that point, it will be necessary to consummate a merger, sell
selected assets, or obtain an infusion of capital. The Company's independent
accountants issued a "going concern" opinion since the Company has incurred
significant losses over the past five years and generates a negative cash flow
on a monthly basis.
7
Hydron Technologies, Inc.
Notes to Condensed Consolidated Financial Statements
Note F - Going Concern (continued)
On January 28, 2005, the Company entered into a marketing agreement with
Clinical Results, Inc. and Bioceutical Research, Inc. to license its technology
and the Hydron branded products, respectively. Any impact on cash flow is not
expected to be realized for six to nine months. In addition, the Company has
lowered its operating expenses by reducing research and development and payroll
costs.
The Company is considering several additional options to resolve the
negative cash flow, including merging with parties that have a broad channel of
distribution, forming a new private entity and transferring the operating assets
to it, then selling the public shell, and selling one or more selected assets.
One of these alternatives and/or an infusion of additional capital will be
required in order to generate the cash required in the short term.
Accordingly, there are no assurances that the Company will be successful
in achieving the above plans, or that such plans, if consummated, will enable
the Company to obtain profitable operations or continue as a going concern.
8
Item 2. Management's Discussion and Analysis of Financial Condition And Results
of Operations
Business
The Company's primary focus has been to conduct research and development
into products and medical applications utilizing its patented tissue oxygenation
technology.
The Company's research and development efforts during 2004 concentrated on
accumulating data for a Food and Drug Administration (FDA) application related
to the Company's oxygenation technology. A formal Request For Designation (RFD)
was filed with the FDA in September 2004 to request that the FDA formally
designate the Hydron MicroO2 Oxygenation Apparatus as a medical device. The FDA
agreed in October. On January 10, 2005, the Company attended a
Pre-Investigational Device Exemption meeting with the FDA to present the device,
however, a clear pathway for safety and clinical research requirements could not
be determined at that time. It was suggested that filing a complete 510(k)
application would provide the FDA with an opportunity to review additional
information from Hydron. The Company is considering if and when to pursue the
510(k) filing.
The Company's other proprietary technologies include: patented polymer
skin care formulas that provide superior skin moisturization benefits and
sunscreen delivery; a patented formula for a wrinkle reduction serum, and,
patent-pending technology associated with an evaporating emulsifier used in
cosmetic treatments and acne products.
The Company also markets a broad range of cosmetic and oral health care
products using a moisture-attracting ingredient (the "Hydron(R) polymer") and a
topical delivery system for active ingredients, including pharmaceuticals. The
Company holds U.S. and international patents on, what Management believes is,
the only known cosmetically acceptable method to suspend the Hydron polymer in a
stable emulsion for use in personal care/cosmetic products. The Company is
developing other personal care/cosmetic products for consumers using its
patented technology and would, when appropriate, either seek licensing
arrangements with third parties, or develop and market proprietary products
through its own efforts. Management believes that because of their unique
properties, products that utilize the Hydron polymer have the potential for wide
acceptance in consumer and professional health care markets.
Catalog Sales - The Company's full-color brochure offers personal care products
for sale directly to consumers. The brochure also provides information on new
products, educates consumers on proper skin care, and facilitates consumer
re-ordering. The Company sells its products on the World Wide Web and regularly
transmits E-mail broadcasts to its customer base. The Company is continuing to
explore new ways to enhance Catalog sales and operations through retail
distribution of its brands and formula technologies.
9
Item 2. Management's Discussion and Analysis of Financial Condition And Results
of Operations (continued)
Private Label Contracting - Effective March 1, 2001, the Company entered into an
agreement with Reliv International, Inc ("Reliv") to develop and manufacture a
line of private label skin care products under their brand name, ReversAge(R).
Reliv is a public company traded on NASDAQ (symbol RELV). Private label sales
represented approximately 19.2% of Hydron's total annual sales in 2004. Private
label sales accounted for 16.8% of total sales during the three months ended
March 31, 2005.
International - The Company sells products to an Australia-based health and
beauty products distributor for retail sale in salon stores and medical offices
in Australia and New Zealand. The Company also distributes dental products in
Spain and, to a lesser extent, other countries. Although this category is not
significant at this time, Management believes that it will expand with the
introduction of the Company's brands and technologies through retail
distribution channels.
Retail - The Company has established minor levels of retail distribution.
Initially, the Company sold product on a limited, promotional basis to several
retailers utilizing excess inventory and current packaging configurations. It is
anticipated that any significant retail effort involving core Hydron products
would require investment in repackaging.
Licensing - Effective January 28, 2005, the Company entered into a non-exclusive
licensing agreement with Clinical Results, Inc. ("CRI"), which allows for
certain Hydron cosmetic skincare technologies, sold and manufactured by CRI, to
be offered to third parties under private label contracts. The Company receives
royalties based on wholesale sales by CRI to its customers. The agreement
includes the patented Hydron polymer and sunscreen technology, patented line
smoothing technology, and patent-pending emulsifier technology.
Effective January 28, 2005 Hydron licensed Bioceutical Research, Inc.
("BRI") the non-exclusive right to market Hydron(R) and Hydronamins(R) branded
products to retail accounts, including drug stores, mass-merchandisers, club
stores, and salon/spa accounts. BRI will pay Hydron royalties on wholesale sales
while undertaking responsibility for manufacturing, marketing, and sales.
Results of Operations
Total net sales for the three months ended March 31, 2005 were $255,914, a
decrease of $130,218 or 33.7% from net sales of $386,132 for the three months
ended March 31, 2004. Skin care products' net sales for the three months ended
March 31, 2005 were $225,644, a decrease of $125,213 or 35.7% from sales of
$350,857 for the three months ended March 31, 2004. Professional products' net
sales for the three months ended March 31, 2005 were $1,188, a decrease of
$2,212 or 65.1% from sales of $3,400 for the three months ended March 31, 2004.
Shipping and handling revenues for the three months ended March 31, 2005 were
$27,641, a decrease of $2,409 or 8.0% from shipping and handling revenues of
$30,050 for the three months ended March 31, 2004. The decrease in catalog sales
was the result of the slow attrition of the Company's customer base without
marketing spending to replace those customers.
10
Item 2. Management's Discussion and Analysis of Financial Condition And Results
of Operations (continued)
Skin care products sales consist primarily of catalog sales and private
label sales. During the three months ended March 31, 2005, direct marketing
catalog sales decreased by $40,852, or 17.9%, from $228,474 for the three months
ended March 31, 2004, to $187,622. Private label sales for the three months
ended March 31, 2005 were $38,021, a decrease of $84,362, or 68.9%, from
$122,383 for the three months ended March 31, 2004. These sales tend to
fluctuate from quarter to quarter as purchase orders cover more than one year's
supply and products in the line are purchased only approximately four to six
times a year.
Historically, over 98% of the Company's products are sold in the United
States. The Company sells skin care products in Australia and dental products in
Spain and Canada. These sales are not material at this time and represented 0.0%
and 0.0% of total sales for the three months ended March 31, 2005 and 2004,
respectively.
Cost of sales was $97,259 for the three months ended March 31, 2005, a
decrease of $60,371, or 38.3%, from cost of sales of $157,630 for the three
months ended March 31, 2004. Cost of sales was 38.0% of total sales the three
months ended March 31, 2005, compared to 40.8% for the three months ended March
31, 2004. The decrease in the cost of sales percentage reflects the shift in
product mix to higher-margin catalog sales relative to private label sales for
the quarter. Shipping and handling costs for the first quarter of 2005 were
$27,641, a decrease of $2,409, or 8.0%, from shipping and handling cost of
$30,050 for the same period in 2004. This decrease reflects the decline in
catalog sales plus savings realized by performing more of the shipping and
handling tasks in-house.
The Company's overall gross profit margin increased to 62.0% of net sales
for the three months ended March 31, 2005, versus 59.2% for the three months
ended March 31, 2004. The increase in gross margin reflects the shift in product
mix to higher margin catalog sales relative to private label sales for the
quarter.
Royalty expenses for the three months ended March 31, 2005 were $7,725; a
decrease of $4,242, or 35.4%, from royalty expenses of $11,967 for the three
months ended March 2004. The decrease in royalty expenses is consistent with the
decrease in skin care product sales for the same period.
Research and development ("R&D") expenses reflect the Company's efforts to
identify new product opportunities, obtain regulatory approval, develop and
package the products for commercial sale, perform appropriate efficacy and
safety tests, and conduct consumer panel studies and focus groups. R&D expenses
for the three months ended March 31, 2005 were $38,970 a decrease of $25,775, or
39.8%, from R&D expenses of $64,745 for the three months ended March 31, 2004.
This decrease is due principally to the Company's reduced use of outside FDA
consultants in association with its oxygenation technology during the first
quarter 2005 versus 2004. The amount of annual R&D expenses will vary year to
year depending on the Company's research requirements.
11
Item 2. Management's Discussion and Analysis of Financial Condition And Results
of Operations (continued)
Selling, general, and administrative ("SG&A") expenses for the three
months ended March 31, 2005 were $275,274, representing a decrease of $33,757,
or 10.9%, from SG&A expenses of $309,031 for the three months ended March 31,
2004. Employment expense was $131,044 for the three months ended March 31, 2005,
a decrease of $3,982, or 2.9%, from $135,026 for the three months ended March
31, 2004. This decrease was due primarily to the elimination of a managerial
position in order to control operating costs. Postage expense was $11,041 for
the three months ended March 31, 2005, a decrease of $6,177, or 35.9%, from
$17,218 for the three months ended March 31, 2004. This decrease was related
principally to a new catalog marketing strategy, which reduces mailing frequency
to customers who have not purchased in the last 24 months. All other expenses
were $133,189 for the three months ended March 31, 2005, a decrease of $23,598,
or 15.0%, from $156,787 for the three months ended March 31, 2004.
Depreciation and amortization expense was $9,137 for the three months
ended March 31, 2005, an increase of $587, or 6.8%, from $8,550 for the three
months ended March 31, 2004.
Net interest income was $422 for the three months ended March 31, 2005,
compared to net interest income of $820 for the three months ended March 31,
2004. The Company maintains a conservative investment strategy with respect to
its cash balances, deriving investment income primarily from U.S. Treasury
securities.
The Company had a net loss of $163,484, representing a decrease of $1,487,
or 0.9%, for the three months ended March 31, 2005, from a net loss of $164,971
for the three months ended March 31, 2004, a result primarily of the factors
discussed above.
Liquidity and Financial Resources
The Company anticipates that present working capital balances and
internally generated funds will be sufficient to meet its working capital needs
for the next three months, perhaps longer based on management decisions and
order flow. Beyond that point, it will be necessary to consummate a merger, sell
selected assets, or obtain an infusion of capital. The Company's independent
accountants issued a "going concern" opinion since the Company has incurred
significant losses over the past five years and generates a negative cash flow
on a monthly basis.
The Company's working capital was approximately $294,130 for the three
months ended March 31, 2005, including cash and cash equivalents of
approximately $213,347. Cash used by operating activities was $125,960. Net
funds used for financing activities were $372.
12
Item 2. Management's Discussion and Analysis of Financial Condition And Results
of Operations (continued)
The Company does not have any material debt, long-term capital leases, or
long-term operating leases. The lease on the current office facility expires
August 31, 2005 and the Company expects to renew the lease on a short-term
basis. There are no capital expenditures under construction and no long-term
commitments other than royalty payments under an agreement with Valera
Pharmaceuticals, Inc. The Company does not have any lines of credit. There are
no purchase order commitments that exceed 90 days.
The Company completed a non-brokered private placement of 1,750,000 Units
at $.20 per Unit ($350,000), on December 10, 2002 to several accredited
investors. Each Unit is comprised of one share of Common Stock and one
three-year option to buy one additional common share at $.20. As of March 31,
2005, all 1,750,000 options were outstanding.
On November 14, 2003, the Company completed a non-brokered private
placement of 2,210,000 Units at $.50 per Unit ($1,105,000) to accredited
investors. Each Unit is comprised of one share of Common Stock and one five-year
warrant to buy one additional common share at $1.00. As of March 31, 2005, all
2,210,000 warrants were outstanding.
The Company registered these outstanding shares and 4,481,500 underlying
shares of outstanding warrants/options with the Securities and Exchange
Commission effective July 22, 2004. The warrants/options are a future source of
capital for the Company and could generate up to $2,560,000 if they are
exercised.
The Company's independent accountants issued a "going concern" opinion
since the Company has incurred significant losses over the past five years and
generates a negative cash flow on a monthly basis. The ability of the Company to
continue as a going concern is dependent upon increasing sales, managing
operating expenses and obtaining additional equity financing.
Management's plan includes implementing one or more of the following
elements:
o Conducting merger negotiations with third parties that have
distribution networks in place. The synergies, combined sales, and
reduced overhead would create a solid operational foundation and
improved financial position.
o Forming a new private entity and transferring the operating assets
to it, then selling the public shell to one of the interested
parties.
o Selling one or more selected assets.
o Obtaining an infusion of capital that will sustain the Company's
operation until the newly established licensing arrangements can
produce positive cash flow.
o Continuing to reduce overhead and operating costs.
13
Item 2. Management's Discussion and Analysis of Financial Condition And Results
of Operations (continued)
There can be no assurances that Management's plan will be successful and
the Company's actual results could differ materially. No estimate has been made
to the financial statements to account for the possibility that the plan may be
unsuccessful.
Cautionary Statement Regarding Forward-Looking Statements
The statements contained in this Report on Form 10-K that are not purely
historical are forward-looking statements within the meaning of Section 27A of
the Securities Act of 1933 and Section 21E of the Securities Exchange Act of
1934, including statements regarding the Company's expectations, hopes,
intentions, beliefs or strategies regarding the future, including, without
limitation, its plans regarding distribution and marketing of its products and
the development, acquisition and marketing of new products. Forward-looking
statements include the Company's liquidity, anticipated cash needs and
availability, and the anticipated expense levels under the heading "Management's
Discussion and Analysis of Financial Condition and Results of Operations." All
forward-looking statements included in this document are based on information
available to the Company on the date of this report, and the Company assumes no
obligation to update any such forward-looking statement. It is important to note
that the Company's actual results could differ materially from those expressed
or implied in such forward-looking statements.
Each forward-looking statement reflects the Company's current view of
future events and is subject to risks, uncertainties, and other factors that
could cause actual results to differ materially from any results expressed or
implied by the forward-looking statements. Important factors that could cause
actual results to differ materially from the results expressed or implied by any
forward-looking statements include:
o The volatility of the price of the Company's Common Stock;
o The Company's ability to fund future growth;
o The Company's ability to be profitable;
o The Company's ability to attract and retain qualified personnel;
o General economic conditions in the medical and cosmetic markets;
o Market demand for and market acceptance of the Company's products;
o Legal claims against the Company, including, but not limited to
claims of patent infringement;
o The Company's ability to protect its intellectual property;
14
Item 2. Management's Discussion and Analysis of Financial Condition And Results
of Operations (continued)
o Defects in the Company's products;
o The Company's obligation to indemnify certain customers;
o The Company's dependence on contact manufacturers and suppliers;
o The Company's dependence on a small number of customers for revenue
with respect to its products;
o The Company's ability to develop and maintain relationships with key
vendors;
o New regulations and legislation;
o General economic and business conditions;
o Other risks and uncertainties disclosed in the Company's Annual
Report on Form 10-K for the year ended December 31, 2004 and in the
Company's other filings with the SEC.
All subsequent forward-looking statements relating to the matters
described in this document and attributable to us or to persons acting on the
Company's behalf are expressly qualified in their entirety by such factors. The
Company has no obligation to publicly update or revise these forward-looking
statements to reflect new information, future events, or otherwise, except as
required by applicable Federal securities laws, and the Company cautions you not
to place undue reliance on these forward-looking statements.
Item 4. Controls and Procedures
As of the end of this period, the Company carried out an evaluation, under
the supervision and with the participation of management, including its Chief
Operating Officer and Chief Executive Officer, of the effectiveness of the
design and operation of the Company's disclosure controls and procedures
pursuant to Exchange Act Rule 13a-14. Based upon that evaluation, the Chief
Operating Officer and Chief Executive Officer concluded that the Company's
disclosure controls and procedures are effective to timely alert them to
material information required to be included in the Company's Securities
Exchange Act of 1934 filings.
There have been no significant changes in the Company's internal controls
or in other factors that could significantly affect internal controls subsequent
to the date that the Company carried out its evaluation.
15
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
31.1 Certification of Chief Executive Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002 and Item 307 of Regulation S-K (filed herewith)
31.2 Certification of Chief Operating Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002 and Item 307 of Regulation S-K (filed herewith)
32.1 Certification of Chief Executive Officer Pursuant to 18 U.S.C., Section
1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
(filed herewith)
32.2 Certification of Chief Operating Officer Pursuant to 18 U.S.C., Section
1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
(filed herewith)
(b) Reports on Form 8-K:
- Current Report on Form 8-K, dated September 30, 2004 reporting item
8.01 Other Events; formed a Limited Liability Limited Partnership
16
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.
HYDRON TECHNOLOGIES, INC.
/s/: Richard Banakus
--------------------------
Richard Banakus
Interim President
Dated: May 9, 2005
17