-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Tg97l5Gez53Qh1HE0oc/+YC264MD23XIFUkg/7Gn3P9INZ3ZdNjqycESrIb4R8cF d2mEB08INjsPNQ17Pe0dyA== 0001094328-05-000226.txt : 20051027 0001094328-05-000226.hdr.sgml : 20051027 20051027121109 ACCESSION NUMBER: 0001094328-05-000226 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20050831 FILED AS OF DATE: 20051027 DATE AS OF CHANGE: 20051027 FILER: COMPANY DATA: COMPANY CONFORMED NAME: RMD Technologies, Inc. CENTRAL INDEX KEY: 0001312112 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-BUSINESS SERVICES, NEC [7389] IRS NUMBER: 330970212 STATE OF INCORPORATION: CA FISCAL YEAR END: 0531 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-51109 FILM NUMBER: 051159245 BUSINESS ADDRESS: STREET 1: 308 WEST 5TH STREET CITY: HOLTVILLE STATE: CA ZIP: 92250 BUSINESS PHONE: 760-356-2039 MAIL ADDRESS: STREET 1: 308 WEST 5TH STREET CITY: HOLTVILLE STATE: CA ZIP: 92250 10QSB 1 rmd10qsb102705woex.txt U.S. SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-QSB (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED AUGUST 31, 2005 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM ______________ TO ______________ COMMISSION FILE NUMBER: 0-51109 RMD TECHNOLOGIES, INC. (Exact Name of Company as Specified in Its Charter) California 72-1530833 State or Other Jurisdiction of Incorporation (I.R.S. Employer or Organization) Identification No.) 308 West 5th Street, Holtville, California 92250 (Address of Principal Executive Offices) (760) 356-2039 (Company's Telephone Number) ______________________________________________________________ (Former Name, Former Address, and Former Fiscal Year, if Changed Since Last Report) Indicate by check mark whether the Company (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 Company was required to file such reports), and (2) been subject to such filing requirements for the past 90 days. Yes X No . As of August 31, 2005, the Company had 15,002,300 shares of common stock issued and outstanding. Transitional Small Business Disclosure Format (check one): Yes No X . TABLE OF CONTENTS PART I - FINANCIAL INFORMATION PAGE ITEM 1. FINANCIAL STATEMENTS (UNAUDITED) BALANCE SHEET AS OF AUGUST 31, 2005 3 STATEMENTS OF OPERATIONS FOR THE THREE MONTHS ENDED AUGUST 31, 2005 AND AUGUST 31, 2004 4 STATEMENTS OF CASH FLOWS FOR THE THREE MONTHS ENDED AUGUST 31, 2005 AND AUGUST 31, 2004 5 NOTES TO FINANCIAL STATEMENTS 6 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 8 ITEM 3. CONTROLS AND PROCEDURES 15 PART II - OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS 16 ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS 16 ITEM 3. DEFAULTS UPON SENIOR SECURITIES 16 ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS 16 ITEM 5. OTHER INFORMATION 16 ITEM 6. EXHIBITS 16 SIGNATURES 16 PART I - FINANCIAL INFORMATION ITEM 1. FINANCAL STATEMENTS. RMD TECHNOLOGIES, INC. BALANCE SHEET AUGUST 31, 2005 (Unaudited) ASSETS Current Assets Cash $ 412 Escrow deposit 2,000 Accounts receivable 16,573 Inventory 200 Total Current Assets 19,185 Furniture and equipment - net of accumulated depreciation of $22,053 50,180 Other Assets Security deposits 911 Total Assets 70,276 LIABILITIES AND STOCKHOLDERS' DEFICIT Current Liabilities Accounts payable 142,444 Current portion - capital leases 8,918 Short term notes payable, net of $25,000 of unamortized debt Discount 36,320 Payable to related individuals 98,044 Total Current Liabilities 285,726 Long Term Liabilities Capital leases payable 17,374 Total Liabilities 303,100 Stockholders' Deficit Common stock, no par value, 100,000,000 shares authorized, 15,002,300 shares issued and outstanding 17,300 Additional paid-in capital 25,000 Accumulated deficit (275,124) Total Stockholders' Deficit (232,824) Total Liabilities and Stockholders' Deficit 70,276 See Accompanying Notes to Financial Statements RMD TECHNOLOGIES, INC. STATEMENTS OF OPERATIONS (Unaudited) For the Three Months Ended August 31, 2005 2004 Revenues Sales $ 22,288 $ 27,179 Recycling 53,164 53,301 Total Revenues 75,452 80,480 Cost of Revenues Cost of sales 10,942 8,302 Cost of recycling revenues 29,401 29,587 Total Cost of Revenues 40,343 37,889 Gross Profit 35,109 42,591 Selling, General, and Administrative expenses Depreciation 1,631 2,388 Other selling, general, and administrative expenses 85,457 41,274 Total Selling, General, and Administrative Expenses 87,088 43,662 Total Loss From Operations (51,979) (1,071) Other Expenses Interest expense 3,159 -- Other expense -- 1,984 Total Income (Loss) (55,138) (3,055) Basic and Diluted Net Loss per Weighted Average Share (.004) (.020) Weighted Average Number of Common Shares Used to Compute Net Loss per Weighted Average Share 15,002,300 165,343 See Accompanying Notes to Financial Statements RMD TECHNOLOGIES, INC. STATEMENTS OF CASH FLOWS (Unaudited) For the Three Months Ended August 31, 2005 2004 Operating Activities Net loss $ (55,138) $ (3,055) Adjustments to reconcile net loss to cash provided by (used in) operating activities: Depreciation 1,631 1,378 Changes in operating assets and liabilities: Change in accounts receivable (2,011) 20,031 Change in inventory -- (836) Change in accounts payable 31,904 1,334 Change in accrued interest within notes payable 563 -- Net Cash Provided by (Used in) Operating Activities (23,051) 18,852 Investing Activities Sale of equipment -- 3,008 Purchase of equipment -- (494) Net Cash Provided by Investing Activities -- 2,514 Financing Activities Proceeds from notes payable 25,000 -- Proceeds from loans from related individuals 2,565 -- Payments made on capital leases (1,972) -- Payments made on loans from related individuals -- (9,909) Net Cash Provided by (Used in) Financing Activities 25,593 (9,909) Increase in Cash 2,542 11,457 Cash at Beginning of Year (2,130) 4,398 Cash at End of Year 412 15,855 Interest paid 2,249 -- Taxes paid -- -- See Accompanying Notes to Financial Statements RMD TECHNOLOGIES, INC. NOTES TO FINANCIAL STATEMENTS (Unaudited) NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying unaudited financial statements of RMD Technologies, Inc., a California corporation ("Company") have been prepared in accordance with Securities and Exchange Commission ("SEC") requirements for interim financial statements. Therefore, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. The financial statements should be read in conjunction with the annual financial statements of the Company for the years ended May 31, 2005 and 2004 contained in its Form 10-KSB, as amended. The interim financial statements present the balance sheet, statements of operations, stockholders' equity and cash flows of the Company. The financial statements have been prepared in accordance with accounting principles generally accepted in the United States. The interim financial information is unaudited. In the opinion of management, all adjustments necessary to present fairly the financial position as of August 31, 2005 and the results of operations and cash flows presented herein have been included in the financial statements. All such adjustments are the recurring and normal nature. Interim results are not necessarily indicative of results of operations for the full year. The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Estimates The preparation of financial statements in accordance with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Because of the use of estimates inherent in the financial reporting process, actual results could differ significantly from those estimates. NOTE 2 CONVERTIBLE PROMISSORY NOTE In August 2005, an individual loaned the Company $25,000. The note bears an interest rate of 7.5% per annum and is due in August 2006. The note has a feature that allows the holder to convert the principle and any accrued interest into shares of common stock of the Company at a rate of $0.001 per share at any time after the Company clears all comments from the SEC on its Form 10-SB filing (which will then make the Company eligible for quotation on the Over the Counter Bulletin Board) until the note is satisfied. The Company has determined that there is a beneficial conversion feature associated with this convertible promissory note in the amount of $25,000 that has been reflected as unamortized debt discount and included in short-term notes payable of the accompanying balance sheet. This amount will be amortized as financing costs over the term of the note. ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. The following discussion and analysis of financial condition and results of operations is based upon, and should be read in conjunction with, the Company's audited financial statements and related notes included elsewhere in this Form 10-QSB, which have been prepared in accordance with accounting principles generally accepted in the United States. Overview. The Company is an electronics waste collector and recycler dedicated to providing customers a solution to their electronics waste handling problems. The Company believes it offers customers a reliable, efficient cost effective means of complying with current and anticipated government regulations regarding the disposal of electronic waste. In June 2001, the Company began providing electronics collection and recycling services to corporate customers in Southern California. In April 2004, Company began to expand its service area to include Northern California. The Company believes that its planned growth and profitability will depend in large part on the ability to promote its services, gain clients and expand its relationship with current clients. Accordingly, the Company intends to focus its attentions and investment of resources in marketing, strategic partnerships, and development of its client base. If the Company is not successful in promoting its services and expanding its client base, this may have a material adverse effect on its financial condition and the ability to continue to operate the business. Results of Operations. (a) Revenues. The Company had revenues totaling $75,452 for three months ended August 31, 2005 as compared to $80,480 for the three months ended August 31, 2004, a decrease of $5,028 or approximately 6%. For the three months ended August 31, 2005, cost of revenues totaled $40,343 compared to $37,889 in the same period of the prior year, an increase of $2,454 or approximately 6%. Overall, gross profit totaled $35,109 for the three months ended August 31, 2005 compared to $42,591 for the three months ended August 31, 2004, a decrease of $7,482 or approximately 18%. The Company's revenues primarily consisted of sales and recycling. Revenue from sales of refurbished and/or working equipment collected totaled $22,288 for the three months ended August 31, 2005 as compared with the same period in the prior year of $27,179, a decrease of $4,891 or approximately 18%. Revenue from recycling totaled $53,164 for the three months ended August 31, 2005 as compared to $53,301 for the three months ended August 31, 2004, a nominal change. Revenue from sales decreased compared to the prior year as a result of slower sales demand for refurbished equipment collected. Revenue from recycling had a nominal change compared to the prior year primarily due to lack of marketing and more focus on developing a more efficient infrastructure for recycling operations. The Company believes that revenues from sales will begin to increase starting in the third quarter of the fiscal year. Although revenue from recycling nominally changed compared to the prior year, the Company believes with a refocused marketing strategy and better- developed infrastructure for recycling that revenues should increase to levels similar to the prior year in the next twelve months. (b) Selling, General and Administrative Expenses. Total selling, general and administrative expenses for the three months ended August 31, 2005 were $85,457 as compared to $41,274 for the three months ended August 31, 2004, an increase of $44,183 or approximately 107%. The overall increase in selling, general and administrative expense compared to prior year was primarily due to an increase in staffing by four personnel during the year. (c) Net Loss. The Company's net loss totals $55,138 for the three months ended August 31, 2005, as compared to a net loss of $3,055 for the three months ended August 31, 2004, an increased net loss of $52,083. This increased loss was due to the factors discussed above. Factors That May Affect Operating Results. The operating results of the Company can vary significantly depending upon a number of factors, many of which are outside its control. General factors that may affect the Company's operating results include: - Market acceptance of and changes in demand for its services; - A small number of customers account for, and may in future periods account for, substantial portions of the Company's revenue, and revenue could decline because of delays of customer orders or the failure to retain customers; - Gain or loss of clients or strategic relationships; - Announcement or introduction of new services by the Company or by its competitors; - Price competition; - The ability to upgrade and develop systems and infrastructure to accommodate growth; - The ability to introduce and market products and services in accordance with market demand; - Changes in governmental regulation; and - Reduction in or delay of capital spending by clients due to the effects of terrorism, war and political instability. The Company believes that its planned growth and profitability will depend in large part on the ability to promote its services, gain clients and expand its relationship with current clients. Accordingly, the Company intends to invest in marketing, strategic partnerships, and development of its customer base. If the Company is not successful in promoting its services and expanding its customer base, this may have a material adverse effect on its financial condition and its ability to continue to operate its business. The Company is also subject to the following specific factors that may affect its operating results: (a) Competition. The market for collection and recycling of electronic waste is competitive and the Company expects competition to continue to increase. In addition, the companies with whom the Company has relationships could develop products or services, which compete with the Company's products or services. Also, some competitors in the Company's market have longer operating histories, significantly greater financial, technical, marketing and other resources, and greater brand recognition than the Company does. The Company also expects to face additional competition as other established and emerging companies enter the market for collection and recycling of electronic waste. To be competitive, the Company believes that it must, among other things, invest resources in developing new products, improving its current products and maintaining customer satisfaction. Such investment will increase the Company's expenses and affect its profitability. In addition, if it fails to make this investment, the Company may not be able to compete successfully with its competitors, which could have a material adverse effect on its revenue and future profitability. (b) Technological and Market Changes. The markets in which the Company competes are characterized by new product and service introductions, evolving industry standards, and the changing needs of customers. There can be no assurance that the Company's existing services will continue to be properly positioned in the market or that it will be able to introduce new or enhanced products into the market on a timely basis, or at all. Currently, the Company is focusing on upgrading and introducing new services. The company intends to begin offering training services beginning in the third quarter of 2005. There can be no assurance that enhancements to existing services or new services will receive customer acceptance. Risks inherent in new service introductions include the uncertainty of price-performance relative to services of competitors and competitors' responses to its new service introductions. (c) Key Personnel. The Company's success is largely dependent on the personal efforts and abilities of its senior management. None of the Company's officers and directors currently has an employment or non-competition agreement with the Company. Therefore, there can be no assurance that these individuals will remain employed by the Company. Should any of these individuals cease to be affiliated with the Company for any reason before qualified replacements could be found, there could be material adverse effects on the Company's business and prospects. The Company's success will also be highly dependent on its ability to attract and retain qualified employees. The Company intends to recruit in fiscal year 2006 employees who are skilled in its industry. The failure to recruit these key personnel could have a material adverse effect on the Company's business. There can be no assurances that the Company will be successful in retaining existing personnel or in attracting and recruiting experienced qualified personnel. The Company believes relations with its employees are satisfactory. Operating Activities. The net cash used in operating activities was $23,051 for the three months ended August 31, 2005 compared to net cash provided in operating activities of $18,852 for the three months ended August 31, 2004, an increase in cash used by $41,903. The change in operating activities is attributable to an overall increase in employee staffing expenses. Investing Activities. The net cash provided by investing activities was $25,593 for the three months ended August 31, 2005 compared to net cash used in investing activities of $9,909 for the three months ended August 31, 2004, an increase of $35,502. The change in investing activities is primarily due to new loans in the current year period. Liquidity and Capital Resources. As of August 31, 2005, the Company had total current assets of $19,185 and total current liabilities of $285,629, resulting in net working capital deficit of $266,541. The Company had cash of $412 on that date. The Company's current cash balance and flow from operations will not be sufficient to maintain its capital requirements for the next twelve months. Accordingly, the Company's implementation of its business plan will depend upon its ability to raise additional funds through bank borrowings and equity or debt financing. The Company estimates that it will need to raise up to $1,000,000 over the next twelve months for such purposes. In August 2005, the Company borrowed $25,000 from an individual. The note bears an interest rate of 7.5% per annum and is due in August 2006. The note has a feature that allows the holder to convert the principle and any accrued interest into freely trading shares of the Company at a rate of $0.001 per share at any time after the Company clears all comments from the Securities and Exchange Commission ("SEC") on its Form 10-SB filing (which will then make the Company eligible for quotation on the Over the Counter Bulletin Board) until the note is satisfied. Whereas the Company has been successful in the past in raising capital, no assurance can be given that these sources of financing will continue to be available to us and/or that demand for our equity/debt instruments will be sufficient to meet its capital needs, or that financing will be available on terms favorable to the Company. If funding is insufficient at any time in the future, the Company may not be able to take advantage of business opportunities or respond to competitive pressures, or may be required to reduce the scope of its planned service development and marketing efforts, any of which could have a negative impact on its business and operating results. In addition, insufficient funding may have a material adverse effect on the Company's financial condition, which could require it to: - Curtail operations significantly; - Sell significant assets; - Seek arrangements with strategic partners or other parties that may require the Company to relinquish significant rights to products, technologies or markets; or - Explore other strategic alternatives including a merger or sale of the Company. To the extent that the Company raises additional capital through the sale of equity or convertible debt securities, the issuance of such securities may result in dilution to existing stockholders. If additional funds are raised through the issuance of debt securities, these securities may have rights, preferences and privileges senior to holders of common stock and the terms of such debt could impose restrictions on the Company's operations. Regardless of whether the Company's cash assets prove to be inadequate to meet its operational needs, the Company may seek to compensate providers of services by issuance of stock in lieu of cash, which may also result in dilution to existing shareholders. Material Commitments for Capital Expenditures The Company does not have any material commitments for capital expenditures. However, the Company has entered into a non-binding offer to purchase the property currently housing our facilities. The acceptance of the offer has been delayed because the property is currently held in probate. If the offer is accepted, we intend to fund the purchase through a 30 year mortgage, the specifics of which will be determined as part of the closing process. Off Balance Sheet Arrangements. The Company does not engage in any off balance sheet arrangements that are reasonably likely to have a current or future effect on our financial condition, revenues, and results of operations, liquidity or capital expenditures. Inflation. The impact of inflation on the Company's costs and the ability to pass on cost increases to its customers over time is dependent upon market conditions. The Company is not aware of any inflationary pressures that have had any significant impact on its operations over the past three months, and the Company does not anticipate that inflationary factors will have a significant impact on future operations. Other. The Company does not provide post-retirement or post-employment benefits requiring charges under Statements of Financial Accounting Standards No. 106 and No. 112. Critical Accounting Policies. The SEC has issued Financial Reporting Release No. 60, "Cautionary Advice Regarding Disclosure About Critical Accounting Policies" ("FRR 60"), suggesting companies provide additional disclosure and commentary on their most critical accounting policies. In FRR 60, the SEC has defined the most critical accounting policies as the ones that are most important to the portrayal of a company's financial condition and operating results, and require management to make its most difficult and subjective judgments, often as a result of the need to make estimates of matters that are inherently uncertain. Based on this definition, the Company's most critical accounting policies include: (a) use of estimates in the preparation of financial statements; (b) revenue recognition; and (c) treatment of property, plant, and equipment. The methods, estimates and judgments the Company uses in applying these most critical accounting policies have a significant impact on the results the Company reports in its financial statements. (a) Use of Estimates in the Preparation of Financial Statements. The preparation of these financial statements requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On an on-going basis, the Company evaluates these estimates, including those related to revenue recognition and concentration of credit risk. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the 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. (b) Revenue Recognition. The financial statements are prepared based on the accrual method of accounting. The Company is paid a rate per pound for removing electronic waste from its customers' facilities. The Company records revenue when recycling services, consisting of such waste removal, are rendered. Sales revenue in connection with the sale of serviceable electronic equipment directly to consumers and/or other recyclers, using existing personnel and facilities, is recognized at the time of sale, with the bulk of collections occurring through credit card transactions at the time of the sale. All sales are prepaid on an "as-is" basis, FOB shipping point, and the Company does not accept returns. Title passes to the customer at the time of sale. (c) Treatment of Property, Plant and Equipment. Property, plant and equipment are stated at cost and depreciated using the straight-line method, based on estimated useful lives of 5 to 7 years for furniture and equipment. Repair and maintenance costs are charged to expense when incurred, while renewals and improvements that extend the useful lives of the equipment are capitalized as additions to the related assets. Forward Looking Statements. This Form 10-QSB contains "forward looking statements" within the meaning of Rule 175 of the Securities Act of 1933, as amended, and Rule 3b-6 of the Securities Act of 1934, as amended. When used in this Form 10-QSB, the words "expects," "anticipates," "believes," "plans," "will" and similar expressions are intended to identify forward-looking statements. These are statements that relate to future periods and include, but are not limited to, statements regarding our adequacy of capital resources, need and ability to obtain additional financing, the features and benefits of our services, our operating losses and negative cash flow, and our critical accounting policies. Forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected. These risks and uncertainties include, but are not limited to, those discussed above, as well as the risks set forth under "Factors That May Affect Operating Results." These forward- looking statements speak only as of the date hereof. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in its expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based. ITEM 3. CONTROLS AND PROCEDURES. Evaluation of Disclosure Controls and Procedures. The Company maintains disclosure controls and procedures (as defined in Rule 13a-15(e) and Rule 15d-15(e) under the Securities Exchange Act of 1934, as amended) that are designed to ensure that information required to be disclosed in our periodic reports filed under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms, and that such information is accumulated and communicated to our management, including our principal executive/financial officer, to allow timely decisions regarding required disclosure. As of the end of the period covered by this report, our management carried out an evaluation, under the supervision and with the participation of our principal executive/financial officer, of our disclosure controls and procedures (as defined in Rule 13a-15(e) and Rule 15d-15(e) of the Exchange Act). Based upon the evaluation, our principal executive/financial officer concluded that our disclosure controls and procedures were effective at a reasonable assurance level to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC's rules and forms. In addition, he concluded that the Company's disclosure controls and procedures were effective at a reasonable assurance level to ensure that information required to be disclosed in the reports that the Company files or submits under the Exchange Act is accumulated and communicated to the Company's management, including its principal executive/financial officer, to allow timely decisions regarding required disclosure. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, will be or have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, and/or by management override of the control. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, and/or the degree of compliance with the policies and procedures may deteriorate. Because of the inherent limitations in a cost-effective internal control system, misstatements due to error or fraud may occur and not be detected. Changes in Disclosure Controls and Procedures. There were no changes in the Company's disclosure controls and procedures, or in factors that could significantly affect those controls and procedures since their most recent evaluation. PART II - OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS. None. ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS None. In addition, there were no purchases of common stock of the Company by the Company or its affiliates during the three months ended August 31, 2005. ITEM 3. DEFAULTS UPON SENIOR SECURITIES. Not Applicable. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. None ITEM 5. OTHER INFORMATION. None. ITEM 6. EXHIBITS. Exhibits included or incorporated by reference herein are set forth in the attached Exhibit Index. SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. RMD Technologies, Inc. Dated: October 25, 2005 By: /s/ Patrick A. Galliher Patrick A. Galliher, President Dated: October 25, 2005 By: /s/ Arthur de Joya Arthur de Joya, Chief Financial Officer (principal financial officer) EXHIBIT INDEX Number Description 3.1 Articles of Incorporation, dated May 17, 2001 (incorporated by reference to Exhibit 3.1 of the Form 10-SB filed on January 7, 2005). 3.2 Certificate of Amendment of Articles of Incorporation, dated June 21, 2004 (incorporated by reference to Exhibit 3.2 of the Form 10-SB filed on January 7, 2005). 3.2 Bylaws, dated June 20, 2001 (incorporated by reference to Exhibit 3.3 of the Form 10-SB filed on January 7, 2005). 10.1 Promissory Note issued by the Company in favor of Steven J. Galliher, dated July 12, 2002 (incorporated by reference to Exhibit 10.1 of the Form 10-SB filed on January 7, 2005). 10.2 Promissory Note issued by the Company in favor of Patrick A. Galliher or Suzanne E. Galliher, dated November 17, 2002 (incorporated by reference to Exhibit 10.2 of the Form 10-SB filed on January 7, 2005). 10.3 Promissory Note issued by the Company in favor of Patrick A. Galliher, dated November 17, 2003 (incorporated by reference to Exhibit 10.3 of the Form 10-SB filed on January 7, 2005). 10.4 Promissory Note issued by the Company in favor of Patrick A. Galliher, dated December 29, 2003 (incorporated by reference to Exhibit 10.4 of the Form 10-SB filed on January 7, 2005). 10.5 Promissory Note issued by the Company in favor of Patrick A. Galliher, dated January 9, 2004 (incorporated by reference to Exhibit 10.5 of the Form 10-SB filed on January 7, 2005). 10.6 Promissory Note issued by the Company in favor of Patrick A. Galliher, dated February 6, 2004 (incorporated by reference to Exhibit 10.6 of the Form 10-SB filed on January 7, 2005). 10.7 Promissory Note issued by the Company in favor of Patrick A. Galliher, dated February 13, 2004 (incorporated by reference to Exhibit 10.7 of the Form 10-SB filed on January 7, 2005). 10.8 Promissory Note issued by the Company in favor of Patrick A. Galliher, dated March 22, 2003 (incorporated by reference to Exhibit 10.8 of the Form 10-SB filed on January 7, 2005). 10.9 Promissory Note issued by the Company in favor of Patrick A. Galliher, dated April 26, 2004 (incorporated by reference to Exhibit 10.9 of the Form 10-SB filed on January 7, 2005). 10.10 Promissory Note issued by the Company in favor of Patrick A. Galliher, dated May 7, 2004 (incorporated by reference to Exhibit 10.10 of the Form 10-SB filed on January 7, 2005). 10.11 Promissory Note issued by the Company in favor of Patrick A. Galliher, dated June 17, 2004 (incorporated by reference to Exhibit 10.11 of the Form 10-SB filed on January 7, 2005). 31.1 Rule 13a-14(a)/15d-14(a) Certification of Patrick A. Galliher (filed herewith). 31.2 Rule 13a-14(a)/15d-14(a) Certification of Arthur de Joya (filed herewith). 32 Section 1350 Certification of Patrick A. Galliher and Arthur de Joya (filed herewith). EX-31.1 2 rmdex311102705.txt EX-31.1 RULE 13a-14(a)/15d-14(a) CERTIFICATION OF PATRICK A. GALLIHER RULE 13a-14(a)/15d-14(a) CERTIFICATION I, Patrick A. Galliher, certify that: 1. I have reviewed this quarterly report on Form 10-QSB of RMD Technologies, Inc.; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the small business issuer as of, and for, the periods presented in this report; 4. The small business issuer's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) [omitted pursuant to extended compliance period] for the small business issuer and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the small business issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) [omitted pursuant to extended compliance period] (c) Evaluated the effectiveness of the small business issuer's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and (d) Disclosed in this report any change in the small business issuer's internal control over financial reporting that occurred during the small business issuer's most recent fiscal quarter (the small business issuer's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the small business issuer's internal control over financial reporting; and 5. The small business issuer's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the small business issuer's auditors and the audit committee of the small business issuer's board of directors (or persons performing the equivalent functions): (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the small business issuer's ability to record, process, summarize and report financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer's internal control over financial reporting. Dated: October 25, 2005 By: /s/ Patrtick A. Galliher Patrick A. Galliher, President EX-31.2 3 rmdex312102705.txt EX-31.2 RULE 13a-14(a)/15d-14(a) CERTIFICATION OF ARTHUR DE JOYA RULE 13a-14(a)/15d-14(a) CERTIFICATION I, Arthur de Joya, certify that: 1. I have reviewed this quarterly report on Form 10-QSB of RMD Technologies, Inc.; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the small business issuer as of, and for, the periods presented in this report; 4. The small business issuer's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) [omitted pursuant to extended compliance period] for the small business issuer and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the small business issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) [omitted pursuant to extended compliance period] (c) Evaluated the effectiveness of the small business issuer's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and (d) Disclosed in this report any change in the small business issuer's internal control over financial reporting that occurred during the small business issuer's most recent fiscal quarter (the small business issuer's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the small business issuer's internal control over financial reporting; and 5. The small business issuer's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the small business issuer's auditors and the audit committee of the small business issuer's board of directors (or persons performing the equivalent functions): (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the small business issuer's ability to record, process, summarize and report financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer's internal control over financial reporting. Dated: October 25, 2005 By: /s/ Arthur de Joya Arthur de Joya Chief Financial Officer (principal financial officer) EX-32 4 rmdex32102705.txt EX-32 SECTION 1350 CERTIFICATION OF PATRICK A. GALLIHER AND ARTHUR DE JOYA SECTION 1350 CERTIFICATION In connection with the quarterly report of RMD Technologies, Inc. ("Company") on Form 10-QSB for the quarter ended August 31, 2005 as filed with the Securities and Exchange Commission ("Report"), the undersigned, in the capacities and on the dates indicated below, hereby certify pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. Section 1350), that to their knowledge: 1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and 2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. Dated: October 25, 2005 By: /s/ Patrtick A. Galliher Patrick A. Galliher, President Dated: October 25, 2005 By: /s/ Arthur de Joya Arthur de Joya Chief Financial Officer (principal financial officer) -----END PRIVACY-ENHANCED MESSAGE-----