10-Q 1 v117909_10q.htm Unassociated Document
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

FORM 10-Q

x
Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
   
 
For the quarterly period ended April 30, 2008                  
 
 
o
Transition Report pursuant to 13 or 15(d) of the Securities Exchange Act of 1934
   
 
For the transition period from_______________________to_______________________                               

Commission File Number  000-33391

HYBRID TECHNOLOGIES, INC.
(Exact name of Small Business Issuer as specified in its charter)

Nevada
  
88-0490890
(State or other jurisdiction of
  
(IRS Employer Identification No.)
incorporation or organization)
    
     
     
4894 Lone Mountain #168, Las Vegas NV
  
89130
(Address of principal executive offices)
  
(Postal or Zip Code)
 
Issuer's telephone number, including area code: 818-780-2403
 
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 registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. x Yes o No

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act. Yes o No x

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a smaller reporting company. (Check One):

Large accelerated filer o
Accelerated filer o
  
     
Non-accelerated filer o
Smaller reporting company x
(Do not check if a smaller reporting company)
    
 
APPLICABLE ONLY TO CORPORATE ISSUERS
 
The number of shares outstanding the issuer's common stock, $.001 par value, was 23,347,257 as of June 3, 2008.

 
HYBRID TECHNOLOGIES, INC.

TABLE OF CONTENTS
 
   
Page No.
     
PART I. FINANCIAL INFORMATION
  
1
     
ITEM 1 - Financial Statements
  
1
     
ITEM 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations.
  
12
     
ITEM 3 - Quantitative and Qualitative Disclosures about Market Risk
  
18
     
ITEM 4T- Controls and Procedures.
  
18
     
PART II. OTHER INFORMATION
  
18
     
ITEM 1 - Legal Proceedings
  
18
     
ITEM 6 - Exhibits
  
19
     
EXHIBIT 31 - Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
    
     
EXHIBIT 32 - Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
    
 

PART I. FINANCIAL INFORMATION
 
HYBRID TECHNOLOGIES, INC.
 
I N D E X

   
Page No.
     
ITEM I - Unaudited Consolidated Financial Statements
    
     
Consolidated Balance Sheets as of April 30, 2008 (Unaudited) and July 31, 2007 (Audited)
  
2
     
Consolidated Statements of Operations for the Three and Nine Months Ended April 30, 2008 and 2007 and from Inception (April 12, 2000) to April 30, 2008 (Unaudited)
  
3
     
Consolidated Statement of Stockholders Equity (Deficit) (Unaudited)
  
4
     
Consolidated Statements of Cash Flows for the Three and Nine Months Ended April 30, 2008 and 2007 and from Inception (April 12, 2000) to April 30, 2008 (Unaudited)
  
5
     
Notes to Unaudited Consolidated Financial Statements
  
6-11
 
1

HYBRID TECHNOLOGIES, INC.
A Development Stage Company

Consolidated Balance Sheets

   
(unaudited)
      
   
April 30,
  
July 31, 
  
       
  
2008
  
2007
  
           
ASSETS              
               
Current assets:
              
Cash
  
$
15,612
  
$
3,775
  
Marketable securities - restricted
    
-
   
41,224
 
Accounts receivable, net of allowance for doubtful accounts of $0 at April 30, 2008 and $139,003, at July 31, 2007
    
75,015
   
1,994
 
Inventories
    
204,930
   
425,775
 
Other current assets
    
10
   
60,233
 
Due from related parties
    
142,467
   
16,300
 
Total current assets
    
438,034
   
549,301
 
               
Property and equipment, net
    
2,023,051
   
2,120,343
 
               
Other long term assets:
              
Other assets
    
56,661
   
51,600
 
Deferred patent costs
    
21,987
   
-
 
Total other long term assets
     78,648     51,600  
   
$
2,539,733
  
$
2,721,244
  
               
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIENCY)
              
               
Current liabilities:
              
Current portion of long-term debt
  
$
30,418
  
$
241,460
  
Accounts payable and accrued expenses
    
326,953
   
481,583
 
Customer deposit
    
65,800
   
-
 
Deferred revenue
    
-
   
2,990
 
Total current liabilities
    
423,171
   
726,033
 
               
Long-term debt - less current portion above
    
4,364,361
   
803,258
 
               
Commitments and contingencies
    
-
   
-
 
               
Minority interest
    
-
   
2,377
 
               
Stockholders' equity (deficiency):
              
Preferred stock, $.001 par value, 5,000,000 shares authorized, no shares issued
   
-
   
-
 
Common stock, $.001 par value, 35,714,285 authorized; 15,847,257 shares issued and outstanding at April 30, 2008 39,500,511 shares issued and outstanding at July 31, 2007
    
5,847
   
39,501
 
Additional paid in capital
    
47,808,009
   
46,569,703
 
Deficit accumulated during the development stage
    
(50,061,655
)
  
(45,411,768
)
Cumulative other comprehensive (loss)
    
-
   
(7,860
)
Total stockholders' equity (deficiency)
    
(2,247,799
)
  
1,189,576
 
               
   
$
2,539,733
  
$
2,721,244
  

SEE NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

2

A Development Stage Company

Consolidated Statements of Operations
(UNAUDITED)

   
NINE MONTHS ENDED
  
THREE MONTHS ENDED
  
INCEPTION
  
   
APRIL 30,
  
APRIL 30,
  
THROUGH
  
   
  
2008
  
2007
  
2008
  
2007
  
April 30, 2008
  
                       
Sales
  
$
809,006
  
$
985,316
  
$
169,981
  
$
384,023
  
$
2,578,259
  
Cost of sales
    
672,650
   
1,014,609
   
59,803
   
396,444
   
2,821,946
 
Gross Profit (loss)
    
136,356
   
(29,293
)
  
110,178
   
(12,421
)
  
(243,687
)
                                 
Costs and expenses:
                                
General and administrative
    
2,944,590
   
11,563,252
   
970,536
   
3,929,071
   
41,122,522
 
Compensatory element of stock
    
804,652
   
-
   
804,652
   
-
   
804,652
 
Research and development
    
1,058,180
   
793,226
   
657,350
   
461,100
   
7,027,796
 
     
4,807,422
   
12,356,478
   
2,432,538
   
4,390,171
   
48,954,970
 
                                 
Loss from operations
    
(4,671,066
)
  
(12,385,771
)
  
(2,322,360
)
  
(4,402,592
)
  
(49,198,657
)
                                 
Other income (expense):
                                
Interest expense
    
(142,349
)
  
(63,901
)
  
(97,264
)
  
(22,747
)
  
(883,786
)
Interest income
    
594
   
1,537
   
118
   
305
   
21,455
 
(Gain) loss from sale of assets
    
(1,985
)
  
-
   
(5,888
)
  
-
   
(1,985
)
Loss from sale of other assets
    
-
   
(314,381
)
  
-
   
(314,381
)
  
(316,366
)
Other income (expenses)
    
413
   
1,834
   
(14,408
)
  
160
   
891,394
 
Loss from sale of subsidiaries
    
162,129
   
-
   
162,129
   
-
   
-
 
                                 
Net loss before discontinued operations and minority interest
    
(4,652,264
)
  
(12,760,682
)
  
(2,277,673
)
  
(4,739,255
)
  
(49,487,945
)
                                 
Loss from discontinued operations
    
-
   
-
   
-
   
-
   
(757,024
)
     
(4,652,264
)
  
(12,760,682
)
  
(2,277,673
)
  
(4,739,255
)
  
(50,244,969
)
                                 
Minority interest in net loss
    
2,377
   
-
   
-
   
-
   
19,200
 
                                 
Net loss
    
(4,649,887
)
  
(12,760,682
)
  
(2,277,673
)
  
(4,739,255
)
  
(50,225,769
)
                                 
Other comprehensive income – Foreign currency translation
    
5,579
   
496
   
7,270
   
496
   
(2,281
)
                                 
Net comprehensive loss
  
$
(4,644,308
)
$
(12,760,186
)
$
(2,270,403
)
$
(4,738,759
)
$
(50,228,050
)
                                 
Net loss per share - basic and diluted
  
$
(0.30
)
$
(0.47
)
$
(0.14
)
$
(0.15
)
      
                                 
Weighted number of shares - basic and diluted
    
15,666,348
   
27,268,268
   
15,713,385
   
31,792,620
       
 
SEE NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

3

HYBRID TECHNOLOGIES, INC.
A Development Stage Company

Consolidated Statement of Stockholder's Equity (Deficiency)
(Unaudited)

 
 
 
 
 
 
 
 
Deficit 
 
 
 
 
 
 
 
 
 
 
 
 
 
Accumulated
 
Cumulative
 
 
 
 
 
 
 
 
 
Additional
 
During the 
 
Other
 
 
 
 
 
Common stock
 
 
 
Paid-in
 
Development
 
Comprehensive
 
 
 
 
 
Shares
 
Amount
 
Capital
 
Stage
 
Income (loss)
 
Total
  
Balance July 31, 2006
    
25,895,130
  
$
25,895
  
$
37,598,409
  
$
(34,792,011
)
$
-
  
$
2,832,293
  
                                       
Stock issuances
                                      
Value of stock options issued
                
2,103,600
               
2,103,600
 
Exercise of options (valued at $3.55 per share)
    
1,206,000
   
1,206
   
4,280,094
   
-
   
-
   
4,281,300
 
Value of stock issued for services
    
3,100,000
   
3,100
   
2,596,900
   
-
   
-
   
2,600,000
 
Stock dividends
    
9,299,381
   
9,300
   
(9,300
)
  
-
   
-
   
-
 
Net loss for the year
    
-
   
-
   
-
   
(10,619,757
)
  
-
   
(10,619,757
)
                                       
Foreign currency transactions
    
-
   
-
   
-
   
-
   
(7,860
)
  
(7,860
)
     
 
   
  
   
 
   
 
   
 
   
 
 
Balance July 31, 2007
    
39,500,511
   
39,501
   
46,569,703
   
(45,411,768
)
  
(7,860
)
  
1,189,576
 
                                       
Stock issuances
                                      
Value of stock options issued
                
-
               
-
 
Exercise of options (valued at $2.00 per share)
    
200,000
   
204
   
399,796
   
-
   
-
   
400,000
 
Common stock issued as collateral pre-reverse stock split
    
10,000,000
   
-
   
-
   
-
   
-
   
-
 
Reverse stock split
    
(42,424,681
)
  
(33,858
)
  
33,858
   
-
   
-
       
Common stock issued as collateral post-reverse stock split
    
8,571,427
   
-
   
-
   
-
   
-
   
-
 
Stock based compensation expense
                
804,652
               
804,652
 
                                       
Net loss for the period
    
-
   
-
   
-
   
(4,649,887
)
  
-
   
(4,649,887
)
                                       
Foreign currency transactions
    
-
   
-
   
-
   
-
   
7,860
   
7,860
 
     
 
   
 
   
 
   
 
   
 
   
 
 
Balance April 30, 2008
    
15,847,257
  
$
5,847
  
$
47,808,009
  
$
(50,061,655
)
$
-
  
$
(2,247,799
)
 
SEE NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 
4
 

A Development Stage Company

Consolidated Statements of Cash Flows
(UNAUDITED)

           
Inception
  
   
NINE MONTHS ENDED
  
through
  
   
APRIL 30,
  
April 30,
  
   
2008
  
2007
  
2008
  
               
Cash provided (used in) Operating Activities:
              
Net (loss) for the period
  
$
(4,649,887
)
$
(12,760,682
)
$
(50,061,655
)
Adjustments to reconcile net (loss) to cash
                    
Depreciation & Amortization
    
90,674
    
111,504
    
807,233
  
Bad debt expense
    
9,678
    
-
    
186,582
  
Gain/loss of sale of other assets
    
-
    
314,381
    
314,381
  
Minority interest in loss
    
(2,377
)
  
-
    
(19,200
)
Stock-based compensation
    
804,652
    
8,059,600
    
24,550,293
  
(Increase) decrease in marketable securities - restricted
    
41,224
    
-
    
41,224
  
(Increase) in accounts receivable
    
(82,699
)
  
7,816
    
(261,597
)
(Increase) decrease in inventories
    
220,845
    
(78,879
)
  
(204,930
)
(Increase) decrease in prepaid expenses and other assets
    
60,223
    
(7,774
)
  
(10
)
(Gain) on sale of property and equipment
    
(1,918
)
  
-
    
(1,918
)
(Increase) decrease in other assets
    
(5,061
)
  
-
    
(55,061
)
Increase (decrease) in accounts payable and accrued expenses
    
(154,630
)
  
162,236
    
335,158
  
Increase in customer deposits
    
65,800
    
-
    
65,800
  
(Increase) decrease in deferred revenue
    
(2,990
)
  
2,990
    
-
  
(Gain) on sale of subsidiary
    
(162,129
)
  
-
    
(162,129
)
Investment in subsidiaries
    
(52,871
)
  
-
    
(52,871
)
Write off of mineral property
    
-
    
-
    
5,150
  
Loss from discontinued operations
    
-
    
-
    
757,024
  
Cash used in operating activities
    
(3,821,466
)
  
(4,188,808
)
  
(23,756,526
)
                     
Cash provided (used in) Investing Activities:
                    
Increase in other assets
    
-
    
(5,473
)
  
(1,493,577
)
Proceeds from sale of other assets
    
-
    
1,133,372
    
1,136,372
  
Increase in restricted cash
    
-
    
-
    
(40,215
)
Purchase of mineral property
    
-
    
-
    
(5,150
)
Proceeds from sale of subsidiary
    
215,000
    
-
    
215,000
  
(Sale) of property and equipment
    
(20,469
)
  
(155,766
)
  
(1,052,551
)
Proceeds from sale of property and equipment
    
29,005
    
-
    
29,005
  
(Increase) in deferred patent costs
    
(21,987
)
  
-
    
(21,987
)
Cash used in investing activities
    
201,549
    
972,133
    
(1,233,103
)
                     
Cash provided (used in) by Financing Activities:
                    
Sale of minority interest in subsidiaries
    
-
    
-
    
19,200
  
Proceeds from the exercise of stock options
    
400,000
    
2,271,999
    
15,692,895
  
Collection of stock receivable
    
-
    
-
    
50,000
  
Proceeds from the issuance of debt
    
4,421,662
    
-
    
7,341,662
  
Advances from related parties
    
3,539,995
    
4,424,678
    
12,382,226
  
Payments of related party advances
    
(3,666,162
)
  
(3,919,795
)
  
(9,333,159
)
Payments of debt
    
(1,071,601
)
  
(147,601
)
  
(1,406,883
)
Proceeds from the issuance of common stock
    
-
    
-
    
259,300
  
Cash provided by financing activities
    
3,623,894
    
2,629,281
    
25,005,241
  
                     
Effect of exchange rate changes on cash and cash equivalents
    
7,860
    
496
    
-
  
                     
Net increase (decrease) in cash
    
11,837
    
(586,898
)
  
15,612
  
                     
Cash at beginning of period
    
3,775
    
519,181
    
-
  
                     
Cash at end of period
  
$
15,612
  
$
(67,717
)
$
15,612
  
                     
Supplemental information:
                    
Cash paid during the year for:
                    
Interest paid
  
$
45,006
  
$
63,800
        
Income taxes paid
  
$
-
  
$
-
        
Non - cash financing activities:
                    
Fixed assets acquired by the issuance of debt
  
$
-
  
$
-
  
$
1,300,000
  
Shares issued for related party advances
  
$
-
  
$
-
  
$
3,000,000
  
 
SEE NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 
5

HYBRID TECHNOLOGIES, INC.
A Development Stage Company
 
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 
Note 1. Financial statement presentation

The financial statements have been prepared in accordance with Securities Exchange Commission requirements for interim financial statements. Therefore, they do not include all information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. These financial statements should be read in conjunction with the financial statements and notes thereto contained in the Company's Annual Report on Form 10-KSB for the year ended July 31, 2007 as filed with the Securities Exchange Commission.

The results of operations for the interim periods shown in this report are not necessarily indicative of results to be expected for the full year. In the opinion of management, the information contained herein reflects all adjustments necessary to make the results of operations for the interim period a fair statement of such operations. All such adjustments are of a normal recurring nature.

History and Nature of Business

On April 16, 2008 the Company sold their controlling interest of approximately 69% of the outstanding common stock in Zingo, Inc. (now Superlattice Power, Inc., “SPI”), which provided telecommunication services to business and residential customers utilizing VOIP technology, for $215,000. In connection with the sale of the Company’s controlling interest in SPI, the Company recognized a loss of $162,129.

Effective April 15, 2008, the Company entered into a license agreement with Superlattice Power, Inc. (formerly a subsidiary, Zingo, Inc.) providing for their license to SPI of their patent applications and technologies for rechargeable lithium ion batteries for hybrid vehicles and other applications (“licensed products”). Under the license agreement, the Company has the right to purchase their requirements of lithium ion batteries from SPI, and their requirements of lithium ion batteries shall be supplied by SPI in preference to, and on a priority basis as compared with, supply and delivery arrangements in effect for other customers of SPI. The Company’s cost for lithium ion batteries purchased from SPI shall be SPI’s actual manufacturing costs for such batteries for the fiscal quarter of SPI in which the Company’s purchase takes place.

SPI has agreed to invest a minimum of $1,500,000 in each of the next two years in development of the technology for the Licensed Products.

Reclassification
Certain reclassifications have been made to the prior year’s financial statements to conform to the current year presentation. These reclassifications have had no impact on the net equity or income (loss) from operations.

Deferred patent costs
The Company capitalizes costs directly incurred in pursuing patent applications as deferred patent costs. When such applications result in an issued patent, the related costs are amortized over the remaining legal life of the patents, which is assumed to be 17 years, using the straight-line method. On a quarterly basis, the Company reviews the issued patents and pending patent applications and if the Company determines to abandon a patent application, or an issued patent no longer has economic value, the unamortized balance in deferred patent costs relating to that patent is immediately expensed. As of April 30, 2008 there were only pending patent applications.
 
6

HYBRID TECHNOLOGIES, INC.
A Development Stage Company
 
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 
Note 1. Financial statement presentation - continued

Financial accounting standards
In December 2007, the FASB issued SFAS No. 141(R), “Business Combinations.” This standard establishes principles and requirements for how an acquirer recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, any non-controlling interest in the acquired and the goodwill acquired. This statement also establishes disclosure requirements which will enable users to evaluate the nature and financial effects of the business combination. SFAS No. 141(R) is effective for us for acquisitions made after December 15, 2008. The Company is evaluating the impact of this standard and does not expect the adoption of SFAS 141(R) to have a material impact on its financial statements.

Note 2. Property and equipment

Property and equipment consist of:

   
(unaudited)
      
   
April 30, 2008
  
July 31, 2007
  
Building improvements
 
$
1,272,352
  
$
1,270,637
  
Computer equipment
   
-
    
22,286
  
Furniture and fixtures
   
142,425
    
115,944
  
Office equipment
   
-
    
92,539
  
Machinery and equipment
   
33,497
    
27,389
  
Vehicles
   
60,979
    
73,203
  
Software costs
   
2,298
    
19,993
  
Land
   
700,000
    
700,000
  
     
2,211,551
    
2,321,991
  
Less accumulated depreciation
   
(188,500
)
  
(201,648
)
   
$
2,023,051
  
$
2,120,343
  
 
Depreciation expense for the nine months ended April 30, 2008 and 2007 was $90,674 and $111,504, respectively.

Note 3. Going concern

The Company's financial statements are prepared based on the going concern principle. That principle anticipates the realization of assets and payments of liabilities through the ordinary course of business. No adjustments have been made to reduce the value of any assets or record additional liabilities, if any, if the Company were to cease to exist. The Company has incurred significant operating losses since inception. These operating losses have been funded by the issuance of capital, loans and advances. There are no guarantees that the Company will continue to be able to raise the funds necessary. Additionally, the lack of capital may limit the Company's ability to establish a viable business.
 
7
 
HYBRID TECHNOLOGIES, INC.
A Development Stage Company
 
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 
Note 4. Inventories

Inventories consist of the following:

   
(unaudited)
      
   
April 30, 2008
  
July 31, 2007
  
Raw materials and work in progress
 
$
204,930
 
$
323,170
  
Finished goods
   
-
    
102,605
 
   
$
204,930
 
$
425,775
  
 
Note 5. Long-term debt

Long-term debt consists of:

   
(unaudited)
      
   
April 30, 2008
  
July 31, 2007
  
Note payable to Richard Howard, paid in full in November 2007
 
$
-
  
$
1,044,718
  
               
10.875% note payable to Bayview Loan Servicing, LLC, payable in monthly installments of approximately $11,388 including interest, collateralized by real property due in full on or before December 2022
   
988,779
   
-
  
               
10% note payable to Wyndom Capital Investments, Inc., payable in October 2010 collateralized by 10,000,000 shares of the Company's common stock
   
3,406,000
   
-
  
     
4,394,779
   
1,044,718
 
Less current portion
   
(30,418
)
  
(241,460
)
   
$
4,364,361
 
$
803,258
  
 
Principal maturities on continuing operations are as follows as of April 30, 2008:

2009
 
$
30,418
  
2010
   
3,439,896
 
2011
   
37,771
 
2012
   
42,090
 
2013
   
46,902
 
Thereafter
   
797,702
 
   
$
4,394,779
  
 
In October 2007, the Company entered into a loan agreement with Wyndom Capital Investments, Inc. The Company issued 10,000,000 pre-reverse stock split shares (computes to 1,428,573 post-reverse stock split shares) of outstanding stock as collateral for the above note and 8,571,427 post reverse stock split shares of outstanding stock as collateral to total 10,000,000 post reverse stock split shares. The agreement provides loans up to $4,000,000 with interest payable monthly at a rate of 10% per annum and due in full in October of 2010. Loans under the agreement are secured by the Company’s shares of common stock at a rate of two and one half shares to each dollar of principal. As of June 12, 2008, the Company has borrowed $3,697,000 under the loan agreement. The Company paid interest to Wyndom of approximately $95,000 for the nine months ended April 30, 2008 and $0 for the nine months ended April 30, 2007. 
 
8
 

HYBRID TECHNOLOGIES, INC.
A Development Stage Company
 
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 
Note 5. Long-term debt – continued
 
As of the date of the report on the financial statements, Wyndom has not declared default and the shares are not deemed outstanding. If Wyndom were to declare default and take possession of the collateral, the number of shares is sufficient to make Wyndom the controlling shareholder.

In November 2007 the Company refinanced their loan for their building in North Carolina. The Company paid off the remainder of their old loan to Richard Howard, approximately $50,000 in cash and $1,000,000 with a new loan. The new loan with Bayview Loan Servicing, LLC is $1,000,000. The loan has an initial interest rate at 10.875% per annum with a monthly payment of $11,388, including interest. The loan is due in full on December 1, 2022. After the first 24 months, the interest rate adjusts to Prime plus 4.875 %. Interest rate changes are limited to 2% increase or decrease in any annual adjustments. Interest paid to Richard Howard was waived for the nine months ended April 30, 2008 due to a full payment of the loan in advance; $63,200 of interest was paid for the nine months ended April 30, 2007. Interest paid for the nine months ended April 30, 2008 and 2007 for Bayview Loan Servicing, LLC is approximately $46,900 and $0, respectively.

Note 6. Stockholders’ Equity

In December 2007, the Company’s shareholders approved a 1:7 reverse stock split. Except for the presentation of common shares authorized and issued on the consolidated balance sheet and shares presented in the consolidated statement of stockholders’ equity (deficit), all shares and par share information has been revised to give retroactive effect to the reverse stock split. Authorized shares were 50,000,000 and were increased to 250,000,000 on December 24, 2007 (computes to 35,714,285 post-reverse stock split authorized shares). Wyndom Capital Investments, Inc. currently holds 10,000,000 post reverse stock split shares as collateral for a loan of up to $4,000,000 as discussed in Note 5.

Note 7. Leases

Effective April 16, 2008, SPI agreed to lease approximately 5,000 square feet of space in the Company’s North Carolina facility. The leased space will be suitable for, and utilized by SPI for, SPI’s developmental and manufacturing operations for licensed products pursuant to the license agreement. The leased space is leased on a month-to-month basis at a monthly rental of $2,500, the monthly rental to be escalated five (5%) percent annually. Although the lease was signed, the space is not available as of April 30, 2008. Therefore, through mutual agreement, no rent has been paid yet. Also, effective April 16, 2008, the Company also sold to SPI for the purchase price of $29,005, specified equipment and supplies related to the licensed agreement.
 
9
 
HYBRID TECHNOLOGIES, INC.
A Development Stage Company
 
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 
Note 8. Segment information

FASB Statement No. 131, Disclosures about Segments of an Enterprise and Related Information, establishes standards for reporting information about operating segments. Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by management. The Company is organized by line of business and geographical area. The Company has two businesses, telecommunication services and the development and sale of electric powered vehicles.

The following is financial information relating to the Company’s business segments:

   
(UNAUDITED)
  
(UNAUDITED)
  
(UNAUDITED)
  
(UNAUDITED)
  
   
NINE MONTHS
  
NINE MONTHS
  
THREE MONTHS
  
THREE MONTHS
  
   
ENDED
  
ENDED
  
ENDED
  
ENDED
  
   
April 30, 2008
  
April 30, 2007
  
April 30, 2008
  
April 30, 2007
  
                   
Revenues from external customers
                  
Telecommunication services
                 
United States
 
$
600,303
  
$
936,566
  
$
169,981
  
$
335,273
  
India
   
-
    
-
    
-
    
-
  
Canada
   
-
    
-
    
-
    
-
  
Electric powered vehicle sales
                         
United States
   
208,703
   
48,750
   
-
    
48,750
 
Hong Kong
   
-
    
-
    
-
    
-
  
Total revenues
 
$
809,006
  
$
985,316
  
$
169,981
  
$
384,023
  
                           
Loss from operations
                          
Telecommunication services
                         
United States
 
$
(243,033
)
$
(1,158,306
)
$
(36,353
)
$
(237,180
)
India
   
(281,665
)
  
(37,470
)
  
(90,273
)
  
(37,470
)
Canada
   
(18,430
)
  
(43,613
)
  
(6
)
  
(43,613
)
Electric powered vehicle sales
                         
United States
   
(4,127,688
)
  
(11,146,350
)
  
(2,195,728
)
  
(4,084,523
)
Hong Kong
   
(250
)
  
(32
)
  
-
    
194
  
Total loss from operations
 
$
(4,671,066
) 
$
(12,385,771
) 
$
(2,322,360
) 
$
(4,402,592
)
 
Note 9. Subsequent events

The Company is in the process of forming an additional subsidiary in India to carry on certain support operations.

On May 5, 2008, the Company entered into a loan agreement with Crystal Capital Ventures Inc. (Crystal Capital). The loan agreement provides for loans to the Company of up to $3,000,000, with a minimum initial loan of $500,000 the disbursement of which to us took place on May 19, 2008. The notes evidencing the installments of the loans bear interest payable monthly in arrears at the rate of 10% per annum; and mature and are due and payable three years from the date of issuance. The loans under the loan agreement are secured by shares of the Company’s common stock held by Crystal Capital.
 
10

HYBRID TECHNOLOGIES, INC.
A Development Stage Company
 
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 
Note 9. Subsequent events - continued

The Company is required to issue shares as collateral at the rate of two and one half shares of the Company’s common stock for each dollar principal amount of the loan advanced to the Company. After Crystal Capital has disbursed the first $1,000,000 principal amount of the Loan to the Company, Crystal Capital is entitled to receive a certificate for the balance of the 5,000,000 shares of common stock representing the collateral for the $2,000,000 balance of the funds that may be disbursed under the loan agreement. Following disbursement of the first $1,000,000 of funds pursuant to the loan agreement, on May 27, 2008, the Company issued 7,500,000 shares of common stock as collateral to Crystal Capital.

Crystal Capital disbursed loans in the aggregate amount of $1,000,000 under the loan agreement as of May 31, 2008.
 
11
 
Item 2.  Management's Discussion and Analysis of Financial Condition and Results of Operations.

FORWARD LOOKING STATEMENTS

This quarterly report contains forward-looking statements that involve risks and uncertainties. We use words such as anticipate, believe, plan, expect, future, intend and similar expressions to identify such forward-looking statements. You should not place too much reliance on these forward-looking statements. Our actual results are likely to differ materially from those anticipated in these forward-looking statements for many reasons, including the risks faced by us described in this section.

RESULTS OF OPERATION

During the period since inception on April 12, 2000 to April 30, 2008, we have incurred operating losses aggregating $49,198,657. At April 30, 2008, we had liabilities of $4,787,532 and a working capital surplus of $14,863.

At the annual shareholders meeting in Calgary, December 2007, the Board of Directors was directed to sell  all of the Company's  interest in Zingo, Inc.,  which included the  Zingo shares  owned by the Company and receivables  from Zingo. The Company sold all its interests in Zingo for the total appraised value of these assets of $215,000, received on April 18, 2008.  We have  written off our receivables from Zingo in our financials as a result of this sale. In connection with this sale, we recognized a loss of $162,129.

The continuation of the Company as a going concern is dependent upon the continued financial support from our shareholders, our ability to obtain necessary debt and equity financing to continue operations, and the attainment of profitable operations. Our auditors have expressed substantial doubt concerning our ability to continue as a going concern.

As of April 30, 2008, we had $15,612 cash on hand.

NINE MONTHS ENDED APRIL 30, 2008 and 2007

We incurred a net loss of $4,649,887 for the nine months ended April 30, 2008, which included general and administrative costs of $2,944,590, research and development expense of $1,058,180 and stock based compensation expense of $804,652. The net loss for this period included a loss of $162,129 incurred in connection with the sale of our controlling interest in Zingo, Inc.

Our net loss for the nine-month period ended April 30, 2008 decreased from the comparative period in fiscal 2007 (from $12,760,682 in 2007 to $4,649,887 in 2008). This was primarily due to a decrease in general and administrative expense from $11,563,272 in the nine-month period ended April 30, 2007, to $2,944,590 for the comparable period in 2008, and an increase in stock based compensation expense from $-0- in 2007 to $804,652 in 2008. In 2008, we also incurred interest expense of $142,349 related to loans payable, as compared with $63,901 for the comparable period in 2007.

THREE MONTHS ENDED APRIL 30, 2008 and 2007

We incurred a net loss of $2,277,673 for the three months ended April 30, 2008, which included general and administrative costs of $970,536, research and development expense of $657,350 and stock based compensation expense of $804,652. The net loss for this period included a loss of $162,129 incurred in connection with the sale of our controlling interest in Zingo, Inc.

12

Our net loss for the three-month period ended April 30, 2008 decreased from the comparative period in fiscal 2007 (from $4,739,255 in 2007 to $2,277,673 in 2008). This was primarily due to a decrease in general and administrative expense from $3,929,071 in the three-month period ended April 30, 2007, to $970,536 for the comparable period in 2008, and an increase in stock based compensation expense from $-0- in 2007 to $804,652 in 2008; an increase in research and development expense from $461,100 in 2007 to $657,350 in 2008; and a decrease in sales from $384,023 in the three-month period ended April 30, 2007, to $169,981 in 2008. In 2008, we also incurred interest expense of $97,264 related to loans payable, as compared with $22,747 for the comparable period in 2007.

Telecommunications Services

On April 16, 2008 we sold our controlling interest of approximately 69% of the outstanding common stock in Zingo, Inc. (now Superlattice Power, Inc.), which provided telecommunication services to business and residential customers utilizing VoIP technology.

Electric Vehicle Operations

We convert vehicles in our developmental facility in Mooresville, North Carolina. Our team of highly qualified engineers oversee groups of electrical and mechanical staff. This 40,000 square foot facility has room for both conversions and storage with the potential for future growth, enabling us to work on many projects and vehicles concurrently.

With the license of our lithium battery technology described below, we are concentrating on sales of our vehicles. We have initiated several nationwide newspaper advertising campaigns which have generated orders for our vehicles, and we are also seeing as a result a significant increase in inquiries about our electric vehicle products.

Effective April 15, 2008, we entered into a License Agreement (the “License Agreement”) with Superlattice Power, Inc. (formerly our subsidiary, Zingo, Inc., “SPI”) providing for our license to SPI of our patent applications and technologies for rechargeable lithium ion batteries for hybrid vehicles and other applications (“Licensed Products”). Under the License Agreement, we have the right to purchase our requirements of lithium ion batteries from SPI, and our requirements of lithium ion batteries shall be supplied by SPI in preference to, and on a priority basis as compared with, supply and delivery arrangements in effect for other customers of SPI. Our cost for lithium ion batteries purchased from SPI shall be SPI’s actual manufacturing costs for such batteries for the fiscal quarter of SPI in which our purchase takes place.

SPI has agreed to invest a minimum of $1,500,000 in each of the next two years in development of the technology for the Licensed Products.
 
Effective April 16, 2008, SPI agreed to lease approximately 5,000 square feet of space (“Leased Space”) in our North Carolina facility, such Leased Space to be suitable for, and utilized by SPI for, SPI’s developmental and manufacturing operations for Licensed Products pursuant to the License Agreement. The Leased Space is leased on a month-to-month basis at a monthly rental of $2,500, the monthly rental to be escalated five (5%) percent annually. Effective April 16, 2008, we also sold to SPI for the purchase price of $29,005, specified equipment and supplies related to the Licensed Field.

13

Commercial Initiatives

On February 5, 2004 we announced the initiation of a lithium-ion conversion project with the United States Navy. We have funded the initial 3kw prototype for this project, and the prototype has been completed and delivered to the Navy. The NYC Taxi Commission agreed to test a PT Cruiser which was delivered January 2007. The converted PT Cruiser Taxi was driven for two months in New York City. The vehicle has been returned and the project is completed. Paratransit, Sacramento, California, a company providing community transportation services, purchased two converted PT Cruisers. We have signed a Space Act agreement with NASA and several vehicles are being tested by NASA at the Kennedy Space Center in Florida. We are also constructing a “green” home in Calgary, Alberta. We signed an agreement in June 2007, pursuant to which the Canadian Ministry of Transportation purchased a Smart Car and PT Cruiser, both of which have been delivered. In September 2007, we signed a contract to provide a PT Cruiser to Arcadis, a contractor to the U.S. Environmental Protection Administration.

5.2 Liquidity and Capital Resources

Since our incorporation, we have financed our operations almost exclusively through the sale of our common shares to investors and borrowings. We expect to finance operations through the sale of equity in the foreseeable future as we receive minimal revenue from our current business operations. There is no guarantee that we will be successful in arranging financing on acceptable terms.

During the nine months ended April 30, 2008, we received proceeds of $4,421,662 from the issuance of promissory notes for debt, of which $3,406,000 were notes issued pursuant to the Wyndom Capital loan agreement described below, and the balance of the debt was incurred in connection with the refinancing of our facility in North Carolina. Our ability to raise additional capital is affected by trends and uncertainties beyond our control.

Sterling Capital Loan Agreement

On February 24, 2004, we announced receipt of $1 million dollars of a $3 million dollar non-recourse loan to be collateralized by stock. On April 14, 2004, we drew down an additional $1,000,000 on this loan, and on April 22, 2004, we drew down the final $1,000,000 of the loan. The lender was Sterling Capital, Inc., and the loan was collateralized by 9,000,000 shares of restricted common stock (split adjusted), which shares, together with shares issuable by reason of stock splits and dividends, totaling 12,732,500 shares, were issued to Sterling Capital at the maturity of the loan, since the recourse of Sterling Capital in the event of nonpayment of the loan at maturity was solely to the shares held in escrow as collateral.

Wyndom Capital Loan Agreement

On October 29, 2007, we entered into a Loan Agreement with Wyndom Capital Investments, Inc. (referred to in this paragraph as the “Lender”). The Loan Agreement provides for loans to the Company of up to $4,000,000, with a minimum initial loan of $500,000 the disbursement of which to us took place in late October, 2007. The notes evidencing the installments of the loans bear interest payable monthly in arrears at the rate of 10% per annum, and mature and are due and payable three years from the date of issuance. The loans under the Loan Agreement are secured by shares of our common stock held by the Lender. We are required to issue shares as collateral at the rate of two and one half shares of our common stock for each dollar principal amount of the loan advanced to us. If there is a trading halt in our common stock or we file for bankruptcy or reorganization, the Lender has full recourse against the Company to collect the unpaid amounts owing under the Loan Agreement and notes issued pursuant thereto, including a first priority lien on all of our assets. In the event of the occurrence of another type of default, which we do not cure in a timely fashion, the Lender, as its sole recourse, is entitled to take possession for its sole benefit of the shares of common stock designated as collateral for the principal amount of the Loan that is in default. After the Lender has disbursed the first $1,000,000 principal amount of the Loan to us, the Lender is entitled to receive a certificate for the balance of the 7,500,000 shares of common stock representing the collateral for the $3,000,000 balance of the funds that may be disbursed under the Loan Agreement. To the extent the $3,000,000 balance of funds are not delivered, we are entitled to cancel such certificate, with the Lender retaining the appropriate number of shares as collateral for advances in excess of $1,000,000. Following disbursement of the first $1,000,000 of funds pursuant to the Loan Agreement, on November 19, 2007, we issued 10,000,000 shares of common stock as collateral to the Lender. Following the one-for-seven reverse split effective in January 2008, we issued 8,571,427 shares of common stock to Wyndom to bring the number of their collateral shares back up to 10,000,000, as required by the Wyndom Loan Agreement.

14

We have been disbursed loans in the aggregate amount of $3,406,000 under the Wyndom Capital Loan Agreement as of April 30, 2008.

Crystal Capital Ventures Loan Agreement

On May 5, 2008, we entered into a Loan Agreement with Crystal Capital Ventures Inc. (referred to in this paragraph as the “Lender”). The Loan Agreement provides for loans to the Company of up to $3,000,000, with a minimum initial loan of $500,000 the disbursement of which to us took place on May 19, 2008. The notes evidencing the installments of the loans bear interest payable monthly in arrears at the rate of 10% per annum, and mature and are due and payable three years from the date of issuance. The loans under the Loan Agreement are secured by shares of our common stock held by the Lender. We are required to issue shares as collateral at the rate of two and one half shares of our common stock for each dollar principal amount of the loan advanced to us. If there is a trading halt in our common stock or we file for bankruptcy or reorganization, the Lender has full recourse against the Company to collect the unpaid amounts owing under the Loan Agreement and notes issued pursuant thereto, including a priority lien on all of our assets. In the event of the occurrence of another type of default, which we do not cure in a timely fashion, the Lender, as its sole recourse, is entitled to take possession for its sole benefit of the shares of common stock designated as collateral for the principal amount of the Loan that is in default. After the Lender has disbursed the first $1,000,000 principal amount of the Loan to us, the Lender is entitled to receive a certificate for the balance of the 5,000,000 shares of common stock representing the collateral for the $2,000,000 balance of the funds that may be disbursed under the Loan Agreement. To the extent the $2,000,000 balance of funds are not delivered, we are entitled to cancel such certificate, with the Lender retaining the appropriate number of shares as collateral for advances in excess of $1,000,000. Following disbursement of the first $1,000,000 of funds pursuant to the Loan Agreement, on May 27, 2008, we issued 7,500,000 shares of common stock as collateral to the Lender.

We have been disbursed loans in the aggregate amount of $1,000,000 under the Crystal Capital Loan Agreement as of May 31, 2008.

Our current operating funds are less than necessary for commercialization of our planned products, and therefore we will need to obtain additional financing in order to complete our business plan. We anticipate that up to $2,000,000 of additional working capital will be required over the next 12 months for market introduction of these products through joint venture partners or otherwise. We do not have sufficient cash on hand to meet these anticipated obligations.

Apart from the Wyndom Capital and Crystal Capital Loan Agreements, which may not furnish us with all of the capital that we will require, we do not currently have any other arrangements for financing, and we may not be able to find such financing if required. Obtaining additional financing would be subject to a number of factors, including investor sentiment. Market factors may make the timing, amount, terms or conditions of additional financing unavailable to us.

15


Our auditors are of the opinion that our continuation as a going concern is in doubt. Our continuation as a going concern is dependent upon continued financial support from our shareholders and other related parties.

CRITICAL ACCOUNTING ISSUES
 
The Company's discussion and analysis of its financial condition and results of operations are based upon the Company's financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of the financial statements requires the Company to make estimates and judgments that affect the reported amount of assets, liabilities, and expenses, and related disclosures of contingent assets and liabilities. On an on-going basis, the Company evaluates its estimates, including those related to intangible assets, income taxes and contingencies and litigation. The Company bases its estimates on historical experience and on various assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or
conditions.
 
Other Matters
 
Accounting Pronouncements

In September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements,” which enhances existing guidance for measuring assets and liabilities using fair value.  The new Statement provides a single definition of fair value, together with a framework for measuring it, and requires additional disclosure about the use of fair value to measure assets and liabilities.  SFAS No. 157 also emphasizes that fair value is a market-based measurement, not an entity-specific measurement, and sets out a fair value hierarchy with the highest priority being quoted prices in active markets.  Under SFAS No. 157, fair value measurements are disclosed by level within that hierarchy.  While SFAS No. 157 does not add any new fair value measurements, it does change current practice.  SFAS No. 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years.  The Company does not believe that SFAS No. 157 will have a material impact on its financial statements.
 
In July 2006, the Financial Accounting Standards Board ("FASB") issued Interpretation No. 48 "Accounting for Uncertainty in Income Taxes" ("FIN 48"). The interpretation requires a two step approach for recognizing and measuring tax benefits based on a recognition threshold of "more likely than not." FIN 48 also requires explicit disclosures about uncertainties in tax positions including a detailed rollforward of tax benefits that do not qualify for financial statement recognition. The adoption of FIN 48 is effective for fiscal years beginning after December 15, 2006, The implementation of FIN 48 could have a material effect on the consolidated balance sheets and results of operations but the effect of such implementation is not determinable at this time.
 
In December 2004 the FASB issued SFAS No. 153, an amendment of APB Opinion No. 29, "Exchange of Nonmonetary Assets." SFAS No. 153 amends APB Opinion No.29 by eliminating the exception under APB No. 29 for nonmonetary assets of similar productive assets and replaces it with a general exception for exchanges on nonmonetary assets that do not have commercial substance. A nonmonetary exchange has commercial substance if the future cash flows of the entity are expected to change significantly as a result of the exchange. SFAS no. 153 is effective for fiscal years beginning after June 15, 2005. The adoption of SFAS No. 153 did not have a material effect on the Company's consolidated financial position or results of operations.

16

New Financial Accounting Standards

In September 2006, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 157 “Fair Value Measurements,” (“SFAS 157”) which enhances existing guidance for measuring assets and liabilities using fair value. This standard provides a single definition of fair value, together with a framework for measuring it, and requires additional disclosure about the use of fair value to measure assets and liabilities. SFAS 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years. The Company does not believe that SFAS 157 will have a material impact on its financial statements.

In February 2007, the FASB issued SFAS No. 159 “The Fair Value Option for Financial Assets and Financial Liabilities,” (“SFAS 159”) providing companies with an option to report selected financial assets and liabilities at fair value. The standard’s objective is to reduce both complexity in accounting for financial instruments and the volatility in earnings caused by measuring related assets and liabilities differently. It also requires entities to display the fair value of those assets and liabilities for which the Company has chosen to use fair value on the face of the balance sheet. SFAS 159 is effective for fiscal years beginning after November 15, 2007. The Company is currently evaluating the impact of the adoption of this Statement on its financial statements.

In December 2007, the FASB issued SFAS No. 141 (revised 2007) (“SFAS 141 (R)”) “Business Combinations”, which replaces SFAS 141 “Business Combinations”. This Statement improves the relevance, completeness and representational faithfulness of the information provided in financial reports about the assets acquired and the liabilities assumed in a business combination. This Statement requires an acquirer to recognize the assets acquired, the liabilities assumed, and any noncontrolling interest in the acquiree at the acquisition date, measured at their fair values as of that date, with limited exceptions specified in the Statement. Under SFAS 141(R), acquisition-related costs, including restructuring costs, must be recognized separately from the acquisition and will generally be expensed as incurred. That replaces SFAS 141’s cost-allocation process, which required the cost of an acquisition to be allocated to the individual assets acquired and liabilities assumed based on their estimated fair values. SFAS 141(R) shall be applied prospectively to business combinations for which the acquisition date is on or after the beginning of the first annual report period beginning on or after December 15, 2008. The Company will implement this Statement in 2009.

In December 2007, the FASB issued SFAS No. 160 “Non-Controlling Interests in Consolidated Financial Statements – An Amendment of ARB No. 51” (“SFAS 160”). SFAS 160 establishes new accounting and reporting standards for the non-controlling interest in a subsidiary and for the deconsolidation of a subsidiary. Specifically, this statement requires the recognition of non-controlling interests (minority interest) as equity in the consolidated financial statements and separate from parent’s equity. The amount of net income attributable to the non-controlling interest will be included in consolidated net income on the face of the income statement. SFAS 160 clarifies that changes in a parent’s ownership in a subsidiary that does not result in deconsolidation are equity transactions if the parent retains its controlling financial interest. In addition, this statement requires that a parent recognize a gain or loss in net income when a subsidiary is deconsolidated. Such gain or loss will be measured using the fair value of the non-controlling equity investment of the deconsolidation date. SFAS 160 also includes expanded disclosure requirements regarding the interest of the parent and its non-controlling interest. SFAS 160 is effective for fiscal years, and interim periods other than fiscal years, beginning on or after December 15, 2008. The Company is currently evaluating the impact of the adoption of this Statement on its financial statements.

17

In January 2008, Staff Accounting Bulletin (“SAB”) 110 “Share-Based Payment” (“SAB 110”), was issued. Registrants may continue, under certain circumstances, to use the simplified method in developing estimates of the expected term of share options as initially allowed by SAB 107, “Share-Based Payments”. The adoption of SAB 110 should have no effect on the financial position and results of operations of the Company.

INTANGIBLES
 
In June 2001, the FASB issued SFAS No. 142, "Goodwill and Other Intangible Assets." SFAS No. 142 specifies the financial accounting and reporting for acquired goodwill and other intangible assets. Goodwill and intangible assets that have indefinite useful lives are not amortized but rather they are tested at least annually for impairment unless certain impairment indications are identified.
 

Item 3. Quantitative and Qualitative Disclosures About Market Risk
 
Interest Rate Risk - Interest rate risk refers to fluctuations in the value of a security resulting from changes in the general level of interest rates. Investments that are classified as cash and cash equivalents have original maturities of three months or less. Our interest income is sensitive to changes in the general level of U.S. interest rates. We do not have significant short-term investments, and due to the short-term nature of our investments, we believe that there is not a material risk exposure. Our debt is at fixed interest rates.

Credit Risk - Our accounts receivables are subject, in the normal course of business, to collection risks. We regularly assess these risks and have established policies and business practices to protect against the adverse effects of collection risks. As a result we do not anticipate any material losses in this area.

Item 4(T). Controls and Procedures.
 
As of the end of the fiscal quarter covered by this Form 10-Q, the Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer and Principal Financial and Accounting Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures as defined in Rule 13a-14 of the Securities Exchange Act of 1934. Based upon that evaluation, the Chief Executive Officer and Principal Financial and Accounting Officer concluded that the Company’s disclosure controls and procedures are effective in timely alerting her to material information relating to the Company (including its consolidated subsidiaries) required to be included in this Quarterly Report on Form 10-Q. There have been no changes in the Company’s internal controls or in other factors which could significantly affect internal controls subsequent to the date the Company carried out its evaluation.

PART II- OTHER INFORMATION

Item 1. Legal Proceedings.

Other than as described below, we are not a party to any material legal proceedings and to our knowledge, no such proceedings are threatened or contemplated. At this time we have no bankruptcy, receivership or similar proceedings pending.

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Securities and Exchange Commission Inquiry and Investigation

On July 30, 2004, we received a request for voluntary production of documents and information pursuant to a Securities and Exchange Commission informal inquiry. The documents requested include those related to our stock issuances, major corporate transactions, including the Azra shopping center, the Queens mineral property and the licensing agreements with RV Systems, agreements with consultants and related parties, as well as those relating to potential joint venture partners and customers. We fully cooperated with the Commission in response to its request for information.

On February 10, 2006, we received another request for voluntary production of documents and information pursuant to a Securities and Exchange Commission ("SEC") informal inquiry, and on April 24, 2006, we received a subpoena from the SEC issued in an investigation initiated by the SEC with respect to the matters covered by the inquiry and a broad range of other matters. Our President voluntarily testified and all requested documents were submitted.

The Depository Trust and Clearing Corporation Case

On November 23, 2004, the Company filed a Complaint in the Eighth Judicial District Court, County of Clark, State of Nevada, sitting in Las Vegas, Nevada, styled "Whistler Investments, Inc., et al. v. The Depository Trust and Clearing Corporation, et al.", Case No. A495703. The defendants include The Depository Trust Company and the National Securities Clearing Corporation. The action alleges 22 state law claims, including intentional and negligent misrepresentation, fraud, racketeering, negligence, conversion, interference with contractual relations and prospective economic advantages and conspiracy. A motion to dismiss has been filed by defendants. Our case is on appeal at the Ninth Circuit. Our Opening Brief has been filed. Briefing is still in progress. A decision is expected in 15-20 months.

Other Matters
 
On June 3, 2008, we were notified of a case filed on June 2, 2008, by Peter Strojnik, Attorney at Law, in the Federal Court for the District of Arizona (Peter Strojnik, P.C. v. The Energy Bull et al., 2:08-cv-1017 ROS). The complaint seeks damages against The Energy Bull and unknown defendants based on transmission of unsolicited facsimiles illegally promoting the stock of the Company to the plaintiff and members of the class that the plaintiff purports to represent. The Company is not a defendant in this case and disclaims, and has continually disclaimed on its web site and in its communications with the investing public, all responsibility for authorizing in any manner unsolicited facsimiles issued by The Raging Bull or other parties that seek to promote the Company’s stock.

Item 6. Exhibits

Ex 31
Certification of Chief Executive Officer and Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith.
   
Ex 32
Certification of Chief Executive Officer and Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002,filed herewith.
 
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SIGNATURES

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

Hybrid Technologies, Inc.
 
/s/Holly Roseberry
Holly Roseberry
President and Director
(Chief Executive Officer and
Principal Financial Officer)
Dated: June 20, 2008

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