SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                   Form 10-KSB

(Mark one)
[X] Annual Report Under Section 13 or 15(d) of The Securities Exchange Act
    of 1934

    For the fiscal year ended January 31, 2005

[ ] Transition Report Under Section 13 or 15(d) of The Securities Exchange Act
    of 1934

    For the transition period from ______________ to _____________

--------------------------------------------------------------------------------

                         Commission File Number: 0-30197


                       KIK Technology International, Inc.
        (Exact name of small business issuer as specified in its charter)

      California                                               91-2021602
(State of incorporation)                                (IRS Employer ID Number)

                  590 Airport Road, Oceanside, California 92054
                    (Address of principal executive offices)

                                 (760) 967-2777
                           (Issuer's telephone number)

--------------------------------------------------------------------------------

      Securities registered under Section 12 (b) of the Exchange Act: None

            Securities registered under Section 12(g) of the Exchange Act:
                          Common Stock $.001 par value

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

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

The issuer's revenues for the fiscal year ended January 31, 2005 was $2,462,977.

The aggregate market value of the voting common equity held by non-affiliates as
of May  13,  2005  was  approximately  $154,438  based  upon  25,171,865  shares
outstanding of which 7,721,865 are held by  non_affiliates  and a share price of
$0.02. No non_voting common equity is outstanding.

As of May 13,  2005,  there were  25,171,865  shares of Common  Stock issued and
outstanding.

Transitional Small Business Disclosure Format : Yes [ ] No [X]
<PAGE>
                       KIK TECHNOLOGY INTERNATIONAL, INC.

                                INDEX TO CONTENTS

                                                                     Page Number
                                                                     -----------
PART I

Item 1   Description of Business                                           3
Item 2   Description of Property                                           6
Item 3   Legal Proceedings                                                 7
Item 4   Submission of Matters to a Vote of Security Holders               7

PART II

Item 5   Market for Company's Equity and Related Stockholder Matters       7
Item 6   Management's Discussion and Analysis or Plan of Operation         9
Item 7   Financial Statements                                             12
Item 8   Changes in and Disagreements with Accountants
          on Accounting and Financial Disclosures                         12
Item 8A  Controls and Procedures                                          12

PART III

Item 9   Directors, Executive Officers, Promoters and Control Persons;
          Compliance with Section 16(a) of the Exchange Act               12
Item 10  Executive Compensation                                           13
Item 11  Security Ownership of Certain Beneficial Owners and Management
          and Related Stockholder Matters                                 13
Item 12  Certain Relationships and Related Transactions                   14
Item 13  Exhibits and Reports on 8-K                                      14
Item 14  Principal Accountant Fees and Services                           14

SIGNATURES                                                                15

                                       2
<PAGE>
                  CAUTION REGARDING FORWARD-LOOKING INFORMATION

Certain  statements  contained  in  this  annual  filing,   including,   without
limitation, statements containing the words "believes", "anticipates", "expects"
and  words  of  similar  import,  constitute  forward-looking  statements.  Such
forward-looking  statements  involve known and unknown risks,  uncertainties and
other factors that may cause the actual results,  performance or achievements of
the Company,  or industry  results,  to be materially  different from any future
results,   performance   or   achievements   expressed   or   implied   by  such
forward-looking statements.

Such factors include, among others, the following:  international,  national and
local general economic and market conditions:  demographic  changes; the ability
of the Company to sustain,  manage or  forecast  its growth;  the ability of the
Company to successfully make and integrate acquisitions;  raw material costs and
availability;  new product  development and  introduction;  existing  government
regulations  and  changes  in,  or  the  failure  to  comply  with,   government
regulations;  adverse publicity;  competition; the loss of significant customers
or suppliers;  fluctuations  and  difficulty in forecasting  operating  results;
changes in business strategy or development  plans;  business  disruptions;  the
ability  to attract  and  retain  qualified  personnel;  the  ability to protect
technology; and other factors referenced in this and previous filings.

Given  these  uncertainties,  readers  of this Form  10-KSB  and  investors  are
cautioned not to place undue reliance on such  forward-looking  statements.  The
Company  disclaims  any  obligation  to update any such  factors or to  publicly
announce the result of any  revisions to any of the  forward-looking  statements
contained herein to reflect future events or developments.

                                     PART I

ITEM 1 - DESCRIPTION OF BUSINESS

BUSINESS DEVELOPMENT

KIK Technology  International,  Inc. (KTII) was incorporated on February 1, 2000
under   the  laws  of  the   State   of   California   as   Russian-Imports.com.
Russian-Imports.com  was  initially  founded to develop an  internet  e-commerce
website which would sell handmade  lacquer  boxes,  Matroshka  dolls and crystal
imported  from Russia.  This  business plan was  unsuccessful  and  subsequently
terminated.

On September 4, 2001,  KTII  (formerly  Russian-Imports.com)  issued  16,700,000
shares of restricted,  unregistered common stock to KIK Tire Technologies,  Inc.
(a  publicly-owned  Canadian  corporation)  (KTTI)  for 100.0% of the issued and
outstanding stock of KIK Technology,  Inc. (a wholly-owned  subsidiary of KTTI).
By  virtue of this  transaction,  KIK  Technology,  Inc.  became a  wholly-owned
subsidiary of KTII and KTTI became an  approximate  73.6%  shareholder  in KTII.
Concurrent  with this  transaction,  Russian-Imports.com  changed it's corporate
name to KIK Technologies International, Inc.

KIK  Technology,  Inc (KTI) was  incorporated in June 1988 under the laws of the
State of California.  KTI manufactures and markets an extensive and high quality
line of off-highway micro-cellular polyurethane tires for the healthcare,  light
industrial,  lawn and garden and  recreational  industries.  KTI operates from a
sole manufacturing plant and marketing offices located in Oceanside, CA.

The  acquisition of KIK  Technology,  Inc.  (KTI), on September 4, 2001, by KTII
effected  a change  in  control  of KTII  and was  accounted  for as a  "reverse
acquisition"  whereby KTI is the  accounting  acquiror for  financial  statement
purposes. For accounting purposes, the acquisition was treated as an acquisition
of the  Company  by  KIK  and  as a  recapitalization  of  KIK.  The  historical
shareholders'  equity  of  KIK,  prior  to the  transaction,  was  retroactively
restated for the equivalent  number of shares exchanged in the transaction after
giving effect to any difference in the par value of the Company and KIK's common
stock, with an offset to additional paid-in capital.

Accordingly, the historical consolidated financial statements of the Company are
those of KTI from it's inception and those of the consolidated entity subsequent
to the September 4, 2001 transaction date. The Company follows the accrual basis
of accounting in accordance with accounting principles generally accepted in the
United States of America and has adopted a year-end of January 31.

The Company operates through it's wholly-owned subsidiary, KIK Technology,  Inc.
(KTI). KTI operates from its  manufacturing  plant and marketing offices located
at  Oceanside,  California  and  manufactures  and markets an extensive and high
quality  line  of  off-highway   micro-cellular   polyurethane   tires  for  the
healthcare, light industrial, lawn and garden and recreational industries.

                                       3
<PAGE>
The current KIK production processes, formulations, manufacturing equipment, and
line of some 150  products  are the  result  of over ten years of  research  and
development,  funded by over $5 million of invested  capital,  and  protected by
trade secrets and licensing agreements.

In its formative  years,  KIK,  through it's research and  development  efforts,
developed new and tougher varieties of urethane  formulations for it's products;
obtained tooling for new products;  and added extensive production capacity. The
Company introduced initiated various marketing programs as capital was available
resulting in the following revenues:

         Year ended January 31, 2005 - approximately $2.4 million
         Year ended January 31, 2004 - approximately $3.6 million
         Year ended January 31, 2003 - approximately $3.2 million
         Year ended January 31, 2002 - approximately $2.6 million
         Year ended January 31, 2001 - approximately $3.7 million

Revenues  are  generated  through  direct  sales to the medical  market  segment
(primarily  wheelchair  tires) and  through a network of third  party  marketing
distributors.  KIK continues to develop the  implementation  of other  marketing
strategies,  directly and through carefully  selected new strategic  partners as
the necessary funds are available. The manufacturing  infrastructure  sufficient
to meet projected demand through the next few years is in place.

The Company has relied  upon  Section  4(2) of the  Securities  Act of 1933,  as
amended (the "Act") and Rule 506 of Regulation D promulgated  thereunder  ("Rule
506") for it's issuances of its unregistered securities.  In each instance, such
reliance  was based  upon the fact that (I) the  issuance  of the shares did not
involve  a public  offering,  (ii)  there  were no more  than  thirty-five  (35)
investors (excluding "accredited investors"), (iii) each investor who was not an
accredited  investor  either alone or with his purchaser  representative(s)  has
such  knowledge  and  experience  in financial  and business  matters that he is
capable of evaluating the merits and risks of the prospective investment, or the
issuer  reasonably  believes  immediately  prior to  making  any sale  that such
purchaser comes within this description,  (iv) the offers and sales were made in
compliance  with Rules 501 and 502, (v) the securities  were subject to Rule 144
limitations on resale and (vi) each of the parties was a sophisticated purchaser
and had full  access to the  information  on the  Company  necessary  to make an
informed  investment  decision by virtue of the due  diligence  conducted by the
purchaser or  available  to the  purchaser  prior to the  transaction  (the "506
Exemption").

BUSINESS STRATEGY

KIK is a  manufacturer  of  micro-cellular  polyurethane  (MCP)  tires  with the
technology  and equipment to take  advantage of the growing market for flat-free
tires. It has developed what it considers is an excellent  reputation within the
industry.

It is the objective of the Company to become a major force  throughout the world
as a MCP tire producer. The Company believes the tire industry is looking for an
alternative to pneumatic  tires and that the KIK tires provide a viable,  "value
added"  alternative.  The  Company's  initial focus is to determine the needs of
existing and potential customers and supplying a superior product at competitive
prices.

The  Company   will  also   continue  to  pursue  and   evaluate   new  business
diversification opportunities available to it using its technology.

PRODUCT

KIK  manufactures  polyurethane  tires  by  blending  hydrocarbon-based  quality
isocyanate  intermediates  with  glycol-based  polyols and other chemicals.  The
resulting  compound makes a light but tough tire which the Company believes will
set an evolutionary trend in the tire industry.

KIK tires are environmentally friendly,  puncture and leak proof and maintenance
free.  They ride like a  pneumatic  tire but last much longer due to their tough
polymer construction.

The  Company  also  manufactures   non-tire  urethane  products,   for  non-tire
customers.

THE COMPANY'S EQUIPMENT AND PRODUCTION LINE CAPABILITIES

KIK owns  all the  equipment  necessary  to turn raw  material  to the  finished
product - including tires and completed wheel assemblies.

                                       4
<PAGE>
The Company's  technology and equipment  enable it to produce a large variety of
tires and other  products.  Although the Company is licensed  for three  variant
features of MCP tire  technologies,  it has  developed  its own unique  chemical
formulations  and  manufacturing  processes.  The Company's  production  process
requires the dispensing of catalyzed liquid chemicals into a spinning mold. This
centrifugal  casting of mixed,  activated  polyurethane base stock raw materials
results in a tough molded  polymer with smooth,  solid outer skin and a lighter,
uniformly  dense  porous  foam  core.  KIK tires can be  designed  and molded to
virtually any tread  specification and are available in a variety of colors. The
spin casting results in perfectly  balanced tires. The Company has the equipment
to produce,  depending on the size of the tire,  1,500,000  to  2,000,000  tires
annually.

The  Company  has a machine  shop and  maintains  its own  testing  and  quality
assurance  equipment and program.  Completed tires must meet specific  protocols
such as weight and pressure.  Whenever possible,  the Company purchases bulk raw
materials in volumes to produce  significant  cost savings in the  manufacturing
process.

The Company is  constantly  looking into  developing  new products and modifying
existing  products for its production  lines, and is evaluating  improvements to
its technology designed to lower production costs and improve competitiveness in
its markets.

PROPRIETARY TECHNOLOGY

The Company  operates under perpetual  licensing  agreements with patent holders
that cover various aspects of tire and equipment designs,  chemical formulations
and manufacturing processes.

MARKETING AND SALES DISTRIBUTION

The Company has grouped the  worldwide  market for  off-highway  tires into four
major market segments,  each possessing  identifiable  business  characteristics
requiring separate sales strategies.

HEALTHCARE:  The  Company's  immediate  focus  is  penetration  of the  existing
wheelchair and power scooter  pneumatic tire business,  with emphasis at the OEM
level.  This has been the  "prototype"  industry  around  which the  Company has
developed  and  perfected its MCP tire  technology.  Through trade shows,  trade
magazine advertising,  distributors and direct sales contacts, an excellent base
has been established to facilitate future growth in this sector.

INDUSTRIAL:  KIK markets light, off-highway industrial and utility tires through
its  strategic  alliance with ARNCO,  A Los Angeles based  producer of pneumatic
tire sealants and foam-fill compounds. ARNCO, a world leader in their field, has
a North  American  distribution  network in place  providing  an  immediate  and
natural sales outlet for KIK's "Carefree"  branded products.  KIK private-labels
tires for ARNCO under the "Carefree Tire" registered trademark, and for selected
high volume customers.

RECREATIONAL: Although the Company has products for recreational devices such as
golf carts and skate boards,  this market is dominated by bicycles.  Previously,
KIK has  discussed  the  manufacture  of bicycle  tires outside of North America
through selected  strategic (joint venture)  partners in countries such as China
active in export  markets,  and where  users are reliant on the bicycle as basic
transportation.  During Fiscal 2004, the Company has become aware of the Chinese
manufacture of products of comparable  quality,  which directly compete with the
Company's  products.  At this time, the expansion of  manufacturing  outside the
Oceanside, California plant is uncertain.

LAWN & GARDEN:  KIK will  attack  the  international  lawn and garden OEM market
directly and through  established  distributors.  Most of Carefree  Tire's North
American downstream tire distribution network services this industry parallel to
the  industrial  market.  Initial  results  indicate that users embrace this new
technology enthusiastically for such applications as wheelbarrows,  powered lawn
mowers,  snow blowers,  and farm carts,  etc.  OEMs are also being  aggressively
pursued in the United States, Canada and Europe.

ADVERTISING & PROMOTION

As the Company has  available  capital,  the Company is  developing a variety of
collateral   materials  to  support  sales  efforts.   These  materials  include
informational and instructional  video tapes , brochures,  product catalogs with
data sheets,  flyers,  sample presentations etc. The Company also advertises and
markets its products on its website - www.kiktire.com.

COMPETITION

Currently  the  Company  knows  of  three  tire  manufacturers  that  utilize  a
manufacturing process similar to its own (Green Tire, U.K., Alshin Tire, U.S.A.,
Amerityre Corporation,  U.S.A.). The Company has also heard of a manufacturer in

                                       5
<PAGE>
India and one in China. To the best of the Company's  knowledge,  only a limited
number of their tires have been  marketed in the United  States.  The  Company's
main  competition  comes from firms that  manufacture and market tires and tubes
made from  rubber.  Several  of these  competitors  are  large  well-established
companies with considerably  greater financial,  marketing,  sales and technical
resources than those available to the Company.

During Fiscal 2004,  the Company has become aware of the Chinese  manufacture of
products of  comparable  quality,  which  directly  compete  with the  Company's
products.  At this time, the expansion of  manufacturing  outside the Oceanside,
California  plant is  uncertain.  Further,  many of the  Company's  present  and
potential competitors have capabilities that may allow such competitors to offer
its  products  at prices  which may compete  with the  Company's  products.  The
Company's  products  could  be  made  uneconomical  by the  introduction  of new
products  or  marketing  or  pricing  actions  by one or more  of the  Company's
competitors, including foreign competition.

However, the Company believes that once the superior  characteristics of the MCP
tires have been properly  communicated to the consumers,  an increasingly  large
percentage of consumers will switch to the Company's tires.

SOURCES AND AVAILABILITY OF RAW MATERIALS

In prior years, the Company's  principal raw materials are purchased from a sole
supplier was also a major customer for the Company's  products.  In the event of
any  disruption  in the  availability  of raw  materials  or a  market  for  the
Company's  products  purchased  by this key  supplier,  the  Company  could have
experienced a negative  economic  impact.  The Company is developing  additional
sources of supply of it's key raw materials  comparable prices and management is
seeking other avenues of  distribution  of the Company's  products to consumers.
Management  is of the opinion that no  interruption  of either raw  materials or
product demand will occur.

RESEARCH AND DEVELOPMENT

The  Company  constantly  seeks to improve  its MCP  technology  and develop new
products.  However,  the Company does not anticipate that it will be required to
commit  any  substantial  funds for  existing  development  projects  or for new
research and development.

REGULATION AND ENVIRONMENTAL COMPLIANCE

The Company is subject to general local, state and federal regulations governing
environmental  concerns.  Management  believes  the  Company has always been and
continues to be in compliance with all such laws.

EMPLOYEES

As of May 13,  2004,  the  Company has  approximately  17  full-time  employees,
including  2  management/clerical   personnel.   None  of  these  employees  are
represented  by a labor union.  The Company  considers  its  relations  with its
employees  to be  excellent.  The Company may employ  additional  personnel,  as
necessary, to accommodate future expansion.

ITEM 2 - DESCRIPTION OF PROPERTY

The Company maintains its executive offices at 590 Airport Road,  Oceanside,  CA
92054. Its telephone number is (760) 967-2777.

The  Company  leases   approximately   13,480  square  feet  of  space  under  a
non-cancellable  lease,  expiring  in May 2005,  from an  unrelated  third-party
landlord.  The lease requires monthly payments as follows:  $8,307 for the first
12 months; $8,639 for the next 12 months and $8,984 for the next 12 months. Rent
expense  incurred under this lease was  approximately  $106,428 and $102,340 for
each of the years ended January 31, 2005 and 2004, respectively.

Future amounts due under this lease agreement for facilities are as follows:

                                             Year ending
                                             January 31,         Amount
                                             -----------         ------
                                               2006             $142,364
                                                                ========

                                       6
<PAGE>
ITEM 3 - LEGAL PROCEEDINGS

The Company may become  involved in various claims and legal actions  arising in
the ordinary  course of  business.  In the opinion of  management,  the ultimate
disposition  of these  matters will not have a material  adverse  impact  either
individually  or  in  the  aggregate  on  consolidated  results  of  operations,
financial position or cash flows of the Company.  As of the date of this filing,
the Company is not involved in any legal proceeding.

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

The Company has not conducted any meetings of shareholders  during the preceding
quarter or periods subsequent thereto.

                                     PART II

ITEM 5 - MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

As of May 13,  2004,  there were  25,171,865  shares of $0.001 par value  common
stock (the "Common Stock") of the Company outstanding and owned by approximately
62 shareholders of record,  exclusive of shareholders holding their certificates
in street name.

Our Certificate of Incorporation  authorizes the issuance of 100,000,000  shares
of $0.001 par value common stock.  Our  Certificate  of  Incorporation  does not
allow for the  issuance of any class of  preferred  stock.  Holders of shares of
common  stock are entitled to one vote for each share on all matters to be voted
on by the  stockholders.  Holders of common stock have cumulative voting rights.
Holders of shares of common stock are entitled to share ratably in dividends, if
any,  as may be  declared,  from time to time by the Board of  Directors  in its
discretion,   from  funds  legally  available  therefor.   In  the  event  of  a
liquidation, dissolution, or winding up of the company, the holders of shares of
common stock are entitled to share pro rata all assets  remaining  after payment
in full of all liabilities.  Holders of common stock have no preemptive or other
subscription rights, and there are no conversion rights or redemption or sinking
fund provisions with respect to such shares.

During 2001,  the Company filed a request for clearance of quotations on the OTC
Bulletin Board under SEC Rule 15c2-11,  Subsection  (a)(5) with NASD  Regulation
Inc. A  Clearance  Letter was issued to the  Company  and was issued the trading
symbol "KKTI".

The ask/high and bid/low  information for each calendar  quarter since September
4, 2001,  noting that the  over-the-counter  quotations  provided herein reflect
inter-dealer prices, without retail markup,  mark-down or commission and may not
represent actual transactions.
                                                                High        Low
                                                                ----        ---
Fiscal Year ended January 31, 2004
  First quarter 2004 (February 1, 2003 - April 30, 2003)        $0.06      $0.04
  Second quarter 2004 (May 1, 2003 - July 31, 2003)             $0.06      $0.04
  Third quarter 2004 (August 1, 2003 - October 31, 2003)        $0.07      $0.04
  Fourth quarter 2004 (November 1, 2003 - January 31, 2004)     $0.05      $0.02

Fiscal Year ended January 31, 2005
  First quarter 2005 (February 1, 2004 - April 30, 2004)        $0.05      $0.03
  Second quarter 2005 (May 1, 2004 - July 31, 2004)             $0.11      $0.04
  Third quarter 2005 (August 1, 2004 - October 31, 2004)        $0.08      $0.03
  Fourth quarter 2005 (November 1, 2004 - January 31, 2005)     $0.05      $0.02

DIVIDENDS

The Company has never paid or declared  any  dividends  on its common  stock and
does not anticipate paying cash dividends in the foreseeable future.

RECENT SALES OF UNREGISTERED SECURITIES

Effective at the end of each Fiscal  quarter  during the year ended  January 31,
2003, the Company and the holders of the two convertible  notes,  James Hullihan
and Vector II, LLC agreed for the  payment of accrued  interest  in  restricted,
unregistered  common stock.  The Company  issued an aggregate  101,964 shares of
restricted,  unregistered  common  stock in payment of accrued  interest.  These
transactions were valued at an aggregate  approximately  $6,977. The convertible
note  terms  allow  for  the  payment  of  accrued   interest  with  restricted,

                                       7
<PAGE>
unregistered  common stock using an average value of 50% of the daily average of
the market  price of the common  stock for the 30 calendar  days  preceding  the
interest due date. In two instances,  the closing stock price, as discounted was
at or in excess of the closing price on the  settlement  date. In two instances,
the closing stock price on the  settlement  date was in excess of the prescribed
calculation.  The  differential  between  the  discounted  "fair  value" and the
settlement  price resulted in a charge to operations of  approximately  $906 for
compensation  expense  related  to common  stock  issuances  at less than  "fair
value".

Effective  February 1, 2003 and May 1, 2003,  the Company and the holders of the
two convertible notes, James Hullihan and Vector II, LLC, agreed for the payment
of accrued interest in restricted, unregistered common stock. The Company issued
an aggregate 206,987 shares of restricted,  unregistered common stock in payment
of  accrued   interest.   These   transactions   were  valued  at  an  aggregate
approximately  $3,782.  The  convertible  note  terms  allow for the  payment of
accrued  interest with  restricted,  unregistered  common stock using an average
value of 50% of the daily  average of the market  price of the common  stock for
the 30 calendar days  preceding the interest due date.  In both  instances,  the
closing  stock  price on the  settlement  date was in excess  of the  prescribed
calculation.  The  differential  between  the  discounted  "fair  value" and the
settlement  price resulted in a charge to operations of  approximately  $945 for
compensation  expense  related  to common  stock  issuances  at less than  "fair
value".

In February 2003, the Company issued 150,000 restricted,  unregistered shares of
common stock to David Gaal in payment of a contract for marketing services. This
transaction was valued at approximately  $3,000, which was equal to or in excess
of the  discounted  closing  price of the  Company's  common stock on the NASDAQ
Electronic  Bulletin  Board  on the  date of each  respective  transaction.  The
Company relied upon Section 4(2) of The Securities Act of 1933, as amended,  for
an exemption from registration on these shares..

In April 2003,  the Company  issued 22,500  restricted,  unregistered  shares of
common  stock to Camden  Securities  in  settlement  of a January 31, 2003 trade
account  payable  in the  amount  of  approximately  $552.  The  value  of  this
transaction  was equal to or in excess of the  discounted  closing  price of the
Company's  common stock on the NASDAQ  Electronic  Bulletin Board on the date of
each  respective  transaction.  The  Company  relied  upon  Section  4(2) of The
Securities Act of 1933, as amended,  for an exemption from registration on these
shares.

In May 2003,  the Company  issued  575,664  restricted,  unregistered  shares of
common stock in payment of trade accounts payable to Mintmire & Associates,  the
Company's  primary legal counsel,  in the amount of approximately  $72,849.  The
value of this  transaction  was equal to or in excess of the discounted  closing
price of the Company's common stock on the NASDAQ  Electronic  Bulletin Board on
the date of each respective transaction. The Company relied upon Section 4(2) of
The Securities Act of 1933, as amended,  for an exemption from  registration  on
these shares.

On July 22, 2004, the Company issued 150,000 restricted,  unregistered shares of
common  stock  to The  Compeller  Group,  LTD.  in  payment  of a  contract  for
professional  services.  This  transaction was valued at  approximately  $6,000,
which was equal to or in excess of the discounted closing price of the Company's
common  stock  on the  NASDAQ  Electronic  Bulletin  Board  on the  date of each
respective  transaction.  The Company relied upon Section 4(2) of The Securities
Act of 1933, as amended, for an exemption from registration on these shares.

                                       8
<PAGE>
ITEM 6 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS

OVERVIEW

During  Fiscal 2005 and 2004,  the Company  achieved  revenues of  approximately
$2,463,000  and  $3,639,000 as compared to  approximately  $3,155,000 for Fiscal
2003. These revenues were derived primarily from the sale of tire products.  Net
loss for the years ended January 31, 2005 and 2004 was approximately  $(435,000)
and $199,000) as compared to a net loss of approximately  ($12,700) for the year
ended  January 31, 2003.  The net losses for Fiscal 2005 and 2004 each include a
$120,000  charge  for  administrative  services  to the  Company  from  KIK Tire
Technologies Inc., the Company's  publicly-owned  Canadian majority shareholder.
The net loss per share of common stock  outstanding for Fiscal 2004 and 2003 was
approximately $(0.02) and $(0.01) per share.

RESULTS OF OPERATIONS

The following  discussion and analysis of our financial condition and results of
operations  should  be read  in  conjunction  with  the  consolidated  financial
statements and notes.

YEAR ENDED JANUARY 31, 2005 AS COMPARED TO JANUARY 31, 2004

The Company  posted net sales of  approximately  $2,463,000  for the fiscal year
ended January 31, 2005 as compared to net sales of approximately  $3,639,000 for
the fiscal year ended January 31, 2004.  This decrease  reflects a change in the
Company's  product demand and  distribution  and the negative  impact of foreign
competition.

The Company's cost of sales decreased by approximately $676,000 to approximately
$2,441,000  for the year ended  January 31,  2005 as  compared to  approximately
$3,117,000 for the year ended January 31, 2004. This decrease profiles favorably
to the decrease in sales volume  during  Fiscal 2005 and  increases in prices in
raw  materials  during the year.  The  Company  has  experienced  certain  price
increases  in key raw  materials  which  have not been  passed  through in their
entirety due to competitive pressures from comparable products produced in Asian
markets.  All other costs related to production  were  relatively  stable during
Fiscal 2005. The Company  continued to experience a  deterioration  in the gross
profit margin to approximately 8.94% (approximately $220,000) for Fiscal 2005 as
compared to approximately 14.39%  (approximately  $522,000) for Fiscal 2004. The
deterioration  of the gross profit margin was  attributable to economic  pricing
pressures  caused by foreign  competition and increases in domestic raw material
costs.  Management is aware of this situation and is evaluating various remedies
to restore the gross profit percentages experienced in prior years.

General and  administrative  expenses declined from  approximately  $718,000 for
Fiscal 2004 to  approximately  $654,000  in Fiscal  2004.  At the KIK  operating
subsidiary level, all general and administrative costs were virtually consistent
(approximately  $527,000 for Fiscal 2005 versus  $575,000 for Fiscal 2004).  The
difference  reflects various overhead  expenses at the corporate  administrative
level which are subject to random  fluctuation  based upon business and overhead
activities,  including a new administrative support charge of $120,000 which was
assessed by KIK Tire Technologies  Inc., the Company's  publicly-owned  Canadian
majority shareholder in both Fiscal 2005 and 2004, respectively.

Overall,  the Company  experienced a net loss of  approximately  $(435,000)  and
$(199,000) for Fiscal 2005 and 2004,  respectively and recognized a net loss per
weighted-average   share  outstanding  of  approximately  $(0.02)  and  $(0.01),
respectively.

YEAR ENDED JANUARY 31, 2004 COMPARED TO THE YEAR ENDED JANUARY 31, 2003

The Company  posted net sales of  approximately  $3,639,000  for the fiscal year
ended January 31, 2004 as compared to net sales of approximately  $3,156,000 for
the fiscal year ended  January 31, 2003.  This  increase  reflects  sales of the
Company's  tire products to both key  customers and other third party  customers
during the year as management  made an effort to expand it's sales volume in all
markets using the Company's products

The Company's cost of sales increased by approximately $517,000 to approximately
$3,117,000  for the year ended  January 31,  2004 as  compared to  approximately
$2,600,000 for the year ended January 31, 2003. This increase profiles favorably
to the increase in sales volume  during  Fiscal 2004 and  increases in prices in
raw  materials  during  the year.  Virtually  all of the  increase  is  directly
attributable  to the costs of raw  materials  and  direct  labor  needed for the
increase in unit volume.  All other costs related to production  were relatively
stable  during  Fiscal 2004.  The Company  experienced  a gross profit margin of
approximately  13.26%  (approximately  $522,000)  for Fiscal 2004 as compared to
approximately 17.71% (approximately $556,000) for Fiscal 2002. The deterioration
of the gross profit margin was attributable to economic pricing pressures caused
by foreign competition and increases in domestic raw material costs.  Management
is aware of this  situation  and is evaluating  various  remedies to restore the
gross profit percentages  experienced in prior years.

                                        9
<PAGE>
General and administrative  expenses  increased from approximately  $578,000 for
Fiscal 2003 to  approximately  $718,000  in Fiscal  2004.  At the KIK  operating
subsidiary level, all general and administrative costs were virtually consistent
(approximately  $575,000 for Fiscal 2004 versus  $525,000 for Fiscal 2003).  The
difference  reflects various overhead  expenses at the corporate  administrative
level which are subject to random  fluctuation  based upon business and overhead
activities,  including a new administrative support charge of $120,000 which was
assessed by KIK Tire Technologies  Inc., the Company's  publicly-owned  Canadian
majority shareholder.

LIQUIDITY AND CAPITAL RESOURCES

The Company had cash and cash equivalents of  approximately  $60,000 and $81,000
and  $27,000 at January  31,  2005,  2004 and 2003,  respectively.  The  Company
maintained  business liquidity and capital resources during the year adequate to
fund all capital and operating expense requirements. During both Fiscal 2005 and
2004,  operations were  principally  funded from internally  generated funds. In
prior years,  operating capital needs were  supplemented  through line of credit
borrowings and capital raised through a private  placement of debt and/or equity
securities.

For the years ended January 31, 2005,  2004 and 2003,  the  Company's  operating
activities generated positive net cash flows of approximately $500, $118,000 and
$18,000,  respectively.  Net cash provided by operating  activities  consists of
cash  received  from sales of  products  to  customers,  less  purchases  of raw
materials,  payment of payroll and payment of other general operating  expenses,
including interest.

Cash used in investing activities was approximately  $(10,000) and $(60,000) for
the years ended  January 31,  2005 and 2004,  respectively.  The Fiscal 2005 and
2003 cash utilizations were due to the acquisition of equipment.

The Company  experienced  cash used in  financing  activities  of  approximately
$(11,000)  and $(3,800) in Fiscal 2005 and 2004,  respectively.  The Fiscal 2005
and 2004 usage  included the payment of principal on a long-term  capital  lease
payable of approximately  $(4,100) and $(3,800),  respectively and the repayment
on long-term notes payable to investors of approximately $(7,000).

The Company  believes that sufficient cash will be generated  internally to fund
its operations for the next twelve months.

RESTRUCTURED CONVERTIBLE NOTE

On February 16, 2004,  the Company  restructured  the $50,000  convertible  note
payable to Vector II, LLC. Under the  restructured  terms,  the Company paid all
accrued  interest  and made a $3,000  principal  reduction  on March  16,  2004.
Thereafter,  the  Company is  obligated  to pay $2,000 per month,  plus  accrued
interest,  for the next six months and $1,000 per month,  plus accrued interest,
thereafter until all outstanding amounts are paid in full. The restructured note
bears interest at 10.0% per annum.

The restructured  note is convertible  into shares of  unregistered,  restricted
common  stock at the sole  discretion  of the  Company  provided  that the daily
average  (calculated  from the last sale price daily) of the market price of the
Company's  common stock for any 30 calendar day period  equals or exceeds  $1.00
per share, with the conversion being calculated at a 50% discount of such 30 day
average.

The Noteholder also has the election, with the Company's consent, to receive the
monthly  interest  payments  in  restricted,  unregistered  common  stock of the
Company at the daily average  (calculated from the last sale price daily) of the
market price of the Company's  common stock for the 30 calendar day period prior
to the interest due date, with the number of shares to be issued calculated at a
50% discount of such 30 day average.

Through January 31, 2005, the Company has paid approximately $7,000 in principal
and $7,600 in cumulative accrued interest.

CRITICAL ACCOUNTING POLICIES

Financial  Reporting  Release  No.  60,  of the U. S.  Securities  and  Exchange
Commission,   requires  all  companies  to  include  a  discussion  of  critical
accounting policies or methods used in the preparation of financial  statements.
Note B to the Company's  Consolidated Financial Statements includes a summary of
the significant  accounting  policies and methods used in the preparation of the
Company's Consolidated Financial Statements. The following is a brief discussion
of the more significant accounting policies and methods used by the Company.

                                       10
<PAGE>
REVENUE RECOGNITION

Our  revenue  recognition  policy is  significant  because  our revenue is a key
component of our results of operations.  The Company recognizes revenue from the
sale of tires and  accessories.  Revenue  is  recognized  upon  shipment  to, or
receipt by  customers,  depending  upon  contractual  terms and when there is no
significant  uncertainty  regarding  the  consideration  to be received  and the
associated  costs to be  incurred.  Additionally,  we  provide  a  reduction  of
recorded revenue for billing adjustments and billing corrections.

ACCOUNTS RECEIVABLE

The Company  continuously  monitors  collections and payments from its customers
and  maintains an allowance  for  estimated  uncollectible  accounts  based upon
historical  experience and specific customer  collections  issues that have been
identified.   Depending   upon   management's   assessment   of   a   customer's
creditworthiness and order size, certain shipments are made on "COD" terms using
common carriers.

Since accounts  receivable  are  concentrated  in a relatively few customers,  a
significant  change in the  liquidity or financial  position of any one of these
customers  could have a material  adverse  impact on the  collectibility  of the
Company's  accounts  receivable and future  operating  results.  In the event of
complete  non-performance by any customer or customers,  the maximum exposure to
the Company would be the recorded amount of trade accounts  receivable  shown on
the balance sheet at the date of non-performance.

INVENTORIES

Inventories  are  valued  at the  lower of cost or  market.  Cost is  determined
principally on the average cost method.  The Company regularly reviews inventory
quantities  on hand and  records,  when  necessary,  a provision  for excess and
obsolete  inventory  based  primarily  on the  Company's  estimated  forecast of
product demand and production  requirements  for the next twelve months.  Demand
for the Company's products can fluctuate  significantly.  A significant increase
in the demand for the Company's  products could result in a short-term  increase
in the cost of inventory purchases while a significant  decrease in demand could
result in an increase in the amount of excess  inventory  quantities on hand. In
addition, the Company's industry is characterized by rapid technological change,
frequent  new product  development  and rapid  product  obsolescence  that could
result in an increase in the amount of obsolete  inventory  quantities  on hand.
Additionally,  the Company's  estimate of future  product demand may prove to be
inaccurate,  in which case the Company may have  understated  or overstated  the
provision required for excess and obsolete  inventory.  Therefore,  although the
Company  makes every  effort to ensure the  accuracy of its  forecasts of future
product demand, any significant unanticipated changes in demand or technological
developments  could have a significant  impact on the Company's  inventory value
and reported operating results.

STOCK-BASED COMPENSATION

Statement of Financial  Accounting Standards No. 123, Accounting for Stock Based
Compensation,  defines a fair-value  based method of accounting for  stock-based
employee  compensation  plans and  transactions  in which an entity  issues  its
equity  instruments  to  acquire  goods and  services  from  non-employees,  and
encourages  but does not  require  companies  to  record  compensation  cost for
stock-based employee compensation plans at fair value.

For periods  prior to  November  1, 2002,  the Company has chosen to account for
employee stock-based compensation using the intrinsic value method prescribed in
Accounting  Principles  Board Opinion No. 25 (APB No. 25),  Accounting for Stock
Issued  to  Employees,  and  related  interpretations.   Accordingly,   employee
compensation  cost for stock options and warrants is measured as the excess,  if
any, of the market  price of the  Company's  stock at the date of the grant over
the amount an employee must pay to acquire the stock. This treatment was allowed
under Statement of Financial Accounting Standards No. 123, "Accounting for Stock
Based Compensation" (SFAS 123).

In December 2002, FASB issued  Statement of Financial  Accounting  Standards No.
148 "Accounting for Stock-Based  Compensation - Transition and Disclosure" (SFAS
148).  This  statement  amends  SFAS 123 and  provides  alternative  methods  of
transition  for a voluntary  change to the fair value based method of accounting
for stock-based employee compensation. This statement also amends the disclosure
requirements  of SFAS 123 to require more prominent and frequent  disclosures in
financial  statements  about  the  effects  of  stock-based  compensation.   The
transition  guidance and annual disclosure  provisions of SFAS 148 are effective
for financial statements issued for fiscal years ending after December 15, 2002.
Effective November 1, 2003, the first day of the reporting quarter including the
effective  date of SFAS 148, the Company's  Board of Directors,  in  conjunction
with public  opinion and SFAS 148,  elected to expense the imputed  compensation
cost  related to any stock  options  granted  during  Fiscal 2003 and for future
periods.  The Company did not issue any stock options during Fiscal 2003 and the
adoption of SFAS 148 did not have a material impact on our results of operations
or  financial  condition.

                                       11
<PAGE>
In December  2004,  the FASB issued SFAS  123(R),  "Share-Based  Payment."  SFAS
123(R)  amends SFAS 123,  "Accounting  for  Stock-Based  Compensation,"  and APB
Opinion 25,  "Accounting  for Stock Issued to Employees."  SFAS 123(R)  requires
that  the  cost  of  share-based  payment  transactions  (including  those  with
employees and  non-employees)  be recognized in the financial  statements.  SFAS
123(R)  applies  to all  share-based  payment  transactions  in which an  entity
acquires  goods or services by issuing (or offering to issue) its shares,  share
options,  or other equity  instruments  (except for those held by an ESOP) or by
incurring  liabilities  (1) in amounts  based (even in part) on the price of the
entity's  shares  or  other  equity  instruments,  or (2) that  require  (or may
require)  settlement  by the  issuance  of an  entity's  shares or other  equity
instruments.  This statement is effective (1) for public companies qualifying as
SEC small  business  issuers,  as of the  first  interim  period or fiscal  year
beginning after December 15, 2005, or (2) for all other public companies,  as of
the first interim  period or fiscal year  beginning  after June 15, 2005, or (3)
for all nonpublic entities, as of the first fiscal year beginning after December
15,  2005.  Management  anticipates  no  significant  impact  to  the  Company's
financial statements upon the adoption of SFAS No. 123(R).

ITEM 7 - FINANCIAL STATEMENTS

The  required  consolidated  financial  statements  begin  on  Page  F-1 of this
document.

ITEM 8 - CHANGES  IN AND  DISAGREEMENTS  WITH  ACCOUNTANTS  ON  ACCOUNTING  AND
         FINANCIAL DISCLOSURE

None

ITEM 8A - CONTROLS AND PROCEDURES

As required by Rule 13a-15 under the Exchange  Act,  within the 90 days prior to
the filing date of this report,  the Company  carried out an  evaluation  of the
effectiveness of the design and operation of the Company's  disclosure  controls
and  procedures.  This evaluation was carried out under the supervision and with
the participation of the Company's management, including the Company's President
and Chief Executive  Officer and the Company's Chief  Financial  Officer.  Based
upon that evaluation,  the Company's  President and Chief Executive  Officer and
the Company's Chief Financial  Officer  concluded that the Company's  disclosure
controls and procedures are effective. There have been no significant 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.

Disclosure  controls and procedures are controls and other  procedures  that are
designed to ensure that information  required to be disclosed in Company reports
filed or submitted under the Exchange Act is recorded, processed, summarized and
reported,  within the time  periods  specified  in the  Securities  and Exchange
Commission's  rules and  forms.  Disclosure  controls  and  procedures  include,
without limitation,  controls and procedures designed to ensure that information
required to be  disclosed  in Company  reports  filed under the  Exchange Act is
accumulated  and  communicated  to  management,  including the  Company's  Chief
Executive  Officer and Chief Financial  Officer as appropriate,  to allow timely
decisions regarding required disclosure.

ITEM 9 - DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
         COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

            Name                  Age             Position
            ----                  ---             --------
        Donald P. Dean            69      Chairman and Director
    William M. Knooihuizen        61      President and Director
        Kuldip C. Baid            57      Chief Financial Officer and Director

DONALD P. DEAN,  P. ENG.  Donald P. Dean  serves as  Secretary,  Chairman of the
Board and Director of KIK  Technology  International,  Inc. He has been with KIK
Technology,  Inc. since 1987.  From 1984 to 1987, he served as President of Jade
Marble Crafts Ltd., a manufacturer of polyester resin-based plastic products and
Twin Top  Industries  Ltd.  Twin Top was a  manufacturer  of  polyurethane  foam
insulated  fiberglass  well-head  shelters and buildings.  During the 1960's Mr.
Dean worked as an engineer,  distribution  supervisor  and plant  manager of the
Toronto Marketing and Chemical  Distribution  Terminal for Shell Canada Limited.
Subsequently,  he was  President of a  subsidiary  of Trimac  Limited  providing
worldwide  transportation  and logistics  planning,  and  management  consulting
services to  government  and  industry.  Mr. Dean is a  registered  professional
engineer.  He  received a B.Sc.  in civil  engineering  from the  University  of

                                       12
<PAGE>
Saskatchewan  in  1960.  Mr.  Dean is  also an  executive  officer  of KIK  Tire
Technologies Inc., the Company's publicly-owned Canadian majority shareholder.

WILLIAM M.  KNOOIHUIZEN,  PE  William M.  Knooihuizen  serves as  President  and
Director of KKTI. He joined KIK Technology, Inc. in May, 1993, and was appointed
President  and CEO of that company in 1996.  He has over 34 years  experience in
urethane processing technology,  where he has held the positions of V.P./General
Manager  for  Dam  Industries,   Inc.,   United  Foam  Corporation  and  Evanite
Permaglass.  He  received  a degree in  Chemical  Engineering  from  Penn  State
University in 1966.

KULDIP C. BAID,  CA Kuldip C. Baid serves as CFO and  Director  of KKTI.  He has
been with KIK  Technology,  Inc.  since 1987.  Mr. Baid is a Canadian  Chartered
Accountant  who from 1981 to 1986 was Manager of Tax with Turbo  Resources  Ltd.
Previous work  experience  includes public  accounting  practice with Deloitte &
Touche; employment as a financial analyst for Oxford Development Group Ltd.; and
Manager of Accounting for Carma Developers Ltd.. Mr. Baid received a B. Commerce
degree from the University of Alberta in 1976 and completed his certification as
a Chartered  Accountant  in 1979.  Mr. Baid is also an executive  officer of KIK
Tire  Technologies   Inc.,  the  Company's   publicly-owned   Canadian  majority
shareholder.

COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934

No Director,  Officer,  Beneficial  Owner of more than ten percent  (10%) of any
class of  securities of the Company  failed to file reports  required by Section
16(a) of the  Exchange  Act during the most recent  fiscal year or prior  fiscal
years.

ITEM 10 - EXECUTIVE COMPENSATION

The  following  summary   compensation  table  sets  forth  the  aggregate  cash
compensation  paid or accrued by the Company to each of the Company's  executive
officers for services  rendered to the Company during the Company's fiscal years
ended 2004,  2003 and 2002 and all plan and  non-plan  compensation  awarded to,
earned by or paid to certain designated executive officers.

<TABLE>
<CAPTION>
                                                                     Long-Term
                                                                   Compensation
                                    Annual Compensation               Awards              Payouts
                                  ------------------------   -------------------------    -------
                                                 Other       Restricted    Securities                    All
                                  Salary/        Annual         Stock      Underlying      LTIP         Other
Name/Title                Year     Bonus      Compensation     Awards     Options/SARs    Payouts    Compensation
----------                ----    -------     ------------     ------     ------------    -------    ------------
<S>                       <C>      <C>            <C>           <C>           <C>           <C>          <C>
Donald P. Dean            2005     $-0-           $-0-          $-0-          $-0-          $-0-         $-0-
Chairman and Secretary    2004     $-0-           $-0-          $-0-          $-0-          $-0-         $-0-
                          2003     $-0-           $-0-          $-0-          $-0-          $-0-         $-0-

William P. Knooihuizen    2005   $143,000       $15,000         $-0-          $-0-          $-0-         $-0-
President                 2004   $143,000       $15,000         $-0-          $-0-          $-0-         $-0-
                          2003   $143,000       $15,000         $-0-          $-0-          $-0-         $-0-

Kuldip C. Baid            2005    $72,000         $-0-          $-0-          $-0-          $-0-         $-0-
Chief Financial Officer   2004    $72,000         $-0-          $-0-          $-0-          $-0-         $-0-
                          2003     $-0-           $-0-          $-0-          $-0-          $-0-         $-0-
</TABLE>

In  May  2000,  KIK  entered  into  an  employment  agreement  with  William  M.
Knooihuizen,  the Company's  current  President  and  Director.  The term of the
agreement is for a period of five (5) years.  For such  services,  KIK agreed to
pay Mr.  Knooihuizen  an annual  salary in the  amount of  $143,000,  to be paid
weekly.

COMPENSATION OF DIRECTORS

The Company has no  standard  arrangements  for  compensating  directors  of the
Company for their attendance at meetings of the Board of Directors.

ITEM 11 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following  table shows,  as of January 31, 2005,  the shares of Common Stock
beneficially owned by all of the persons who served as the directors or officers
of the Company during Fiscal 2005 as well as the principal shareholders (greater

                                       13
<PAGE>
than 5%) of the Company individually and, as to the directors and officers, as a
group. The address of each person or entity,  unless otherwise noted, is c/o KIK
Technology International, Inc., 590 Airport Road, Oceanside, California 92054.

The number of shares  beneficially  owned by each person or entity is determined
under rules of the Securities and Exchange  Commission,  and the  information is
not necessarily  indicative of beneficial ownership for any other purpose. Under
such rules,  beneficial ownership includes any shares as to which the person has
the sole or shared  voting power or  investment  power and also any shares which
the  person  has the right to  acquire  as of a date  within  60 days  after the
relevant date through the exercise of any stock option or other right.

                                                                  % of Class
     Name and address                   Number of Shares      Beneficially Owned
     ----------------                   ----------------      ------------------
KIK Tire Technologies Inc. (1)            16,700,000                66.34%
Donald P. Dean                               250,000                 0.99%
William M. Knooihuizen                       250,000                 0.99%
Kuldip C. Baid                               250,000                 0.99%
All officers and directors                17,450,000                69.32%
 as a group (1)

----------
(1)  Donald  P.  Dean and  Kuldip C.  Baid are  Executive  Officers  of KIK Tire
     Technologies  Inc.,  and as such, may be deemed to have voting control over
     the above listed shares by attribution.

ITEM 12 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

In May 2001, the Company advanced $53,400 to its President, William Knooihuizen,
to hold in trust as a  contingency  fund for the sole use of the  Company in the
event of a  unanticipated  cash  shortfall.  The advance bears  interest at 4.0%
annually and is unsecured.  The original documentation required repayment of the
advance and accrued,  but unpaid,  interest in May 2003. As of January 31, 2005,
with the approval of the Company's Board of Directors,  the Company's  President
continues to maintain these funds as trustee on behalf of the Company.

During each of the years ended  January 31, 2005 and 2004,  the Company  accrued
$120,000  payable to its majority  shareholder,  KIK Tire  Technologies  Inc. (a
publicly-owned Canadian corporation) for administrative services.

ITEM 13 - EXHIBITS AND REPORTS ON FORM 8-K

     EXHIBITS

     31.1 Certification  pursuant to Section 302 of Sarbanes-Oxley Act of 2002 -
          Chief Executive Officer
     31.2 Certification  pursuant to Section 302 of Sarbanes-Oxley Act of 2002 -
          Chief Financial Officer
     32.1 Certification pursuant to Section 906 of Sarbanes-Oxley Act of 2002

   REPORTS ON FORM 8-K

     None

ITEM 14 - PRINCIPAL ACCOUNTANT FEES AND SERVICES

The Company paid or accrued the  following  fees in each of the prior two fiscal
years to it's principal accountant, either S. W. Hatfield, CPA of Dallas, Texas:

                                                   Year ended        Year ended
                                                   January 31,       January 31,
                                                      2005              2004
                                                     -------           -------
       a) Audit fees                                 $18,644           $23,200
       b) Audit-related fees                              --                --
       c) Tax fees                                        --                --
       d) All other fees                                  --                --
                                                     -------           -------

          Totals                                     $18,644           $23,200
                                                     =======           =======

                                       14
<PAGE>
The Company has no formal audit committee. However, as defined in Sarbanes-Oxley
Act of 2002,  the entire  Board of  Directors  is the  Company's  defacto  audit
committee.

In discharging its oversight  responsibility as to the audit process,  the Board
obtained from the independent auditors a formal written statement describing all
relationships  between  the  auditors  and the  Company  that  might bear on the
auditors'  independence as required by Independence Standards Board Standard No.
1,  "Independence  Discussions with Audit  Committees." The Board discussed with
the  auditors  any   relationships   that  may  impact  their   objectivity  and
independence,  including fees for non-audit services, and satisfied itself as to
the  auditors'  independence.  The Board also  discussed  with  management,  the
internal  auditors and the independent  auditors the quality and adequacy of the
Company's  internal controls.  The Board reviewed with the independent  auditors
their management letter on internal controls, if one was issued by the Company's
auditors.

The Board  discussed  and  reviewed  with the  independent  auditors all matters
required to be discussed by auditing standards  generally accepted in the United
States of America,  including those described in Statement on Auditing Standards
No. 61, as amended, "Communication with Audit Committees".

The Board reviewed the audited consolidated  financial statements of the Company
as of and for the year ended January 31, 2005 and 2004,  with management and the
independent  auditors.  Management has the sole ultimate  responsibility for the
preparation of the Company's financial  statements and the independent  auditors
have the responsibility for their examination of those statements.

Based  on the  above-mentioned  review  and  discussions  with  the  independent
auditors and management,  the Board of Directors  approved the Company's audited
consolidated  financial  statements and recommended that they be included in its
Annual  Report on Form 10-KSB for the year ended  January 31,  2005,  for filing
with the Securities and Exchange Commission.

The Company's principal accountant, S. W. Hatfield, CPA did not engage any other
persons or firms  other than the  principal  accountant's  full-time,  permanent
employees.

--------------------------------------------------------------------------------
                                   SIGNATURES

In accordance  with Section 13 or 15(d) of the Securities  Exchange Act of 1934,
the registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.

                                            KIK TECHNOLOGY INTERNATIONAL, INC.

Dated: May 13, 2004                         /s/ Kuldip C. Baid
       ------------                         ------------------------------------
                                                                  Kuldip C. Baid
                                                         Chief Financial Officer
                                                                    and Director

In accordance with the Securities Exchange Act of 1934, as amended,  this report
has been signed below by the  following  persons on behalf of the Company and in
the capacities and on the date as indicated.


Dated: May 13, 2004                      by /s/ Donald P. Dean
       ------------                         ------------------------------------
                                                                  Donald P. Dean
                                                          Chairman and Secretary


Dated: May 13, 2004                         /s/ William M. Knooihuizen
       ------------                         ------------------------------------
                                                          William M. Knooihuizen
                                                          President and Director


Dated: May 13, 2004                         /s/ Kuldip C. Baid
       ------------                         ------------------------------------
                                                                  Kuldip C. Baid
                                            Chief Financial Officer and Director

                                       15
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY

                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS


                                                                            Page
                                                                            ----

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM                      F-2

CONSOLIDATED FINANCIAL STATEMENTS

   Consolidated Balance Sheets
      as of January 31, 2005 and 2004                                        F-3

   Consolidated Statements of Operations and Comprehensive Loss
      for the years ended January 31, 2005 and 2004                          F-4

   Consolidated Statement of Changes in Stockholders' Equity
      for the years ended January 31, 2005 and 2004                          F-5

   Consolidated Statements of Cash Flows
      for the years ended January 31, 2005 and 2004                          F-6

   Notes to Consolidated Financial Statements                                F-7

                                      F-1
<PAGE>
                        LETTERHEAD OF S, W, HATFIELD, CPA

             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


Board of Directors and Stockholders
KIK Technology International, Inc.

We have audited the  accompanying  consolidated  balance sheet of KIK Technology
International,  Inc. and Subsidiary (California  corporations) as of January 31,
2005  and  2004  and the  related  consolidated  statements  of  operations  and
comprehensive  loss, changes in stockholders'  equity and cash flows for each of
the years  ended  January 31, 2004 and 2003,  respectively.  These  consolidated
financial  statements are the  responsibility of the Company's  management.  Our
responsibility  is  to  express  an  opinion  on  these  consolidated  financial
statements based on our audits.

We conducted our audits in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and  perform  the  audit  to  obtain  reasonable  assurance  about  whether  the
consolidated financial statements are free of material misstatement. The Company
is not  required  to  have,  nor were we  engaged  to  perform,  an audit of its
internal control over financial reporting.  Our audits included consideration of
internal  control  over  financial  reporting  as a basis  for  designing  audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the  effectiveness  of the Company's  internal  control
over financial reporting. Accordingly, we express no such opinion. An audit also
includes  examining,  on a test  basis,  evidence  supporting  the  amounts  and
disclosures in the  consolidated  financial  statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall consolidated  financial statement
presentation.  We believe  that our audits  provide a  reasonable  basis for our
opinion.

The consolidated financial statements referred to above, in our opinion, present
fairly, in all material  respects,  the consolidated  financial  position of KIK
Technology  International,  Inc. and  Subsidiary as of January 31, 2005 and 2004
and the results of their consolidated  operations and cash flows for each of the
years  ended  January  31,  2005 and  2005,  respectively,  in  conformity  with
accounting principles generally accepted in the United States of America.


                                                   /s/ S. W. HATFIELD, CPA
Dallas, Texas
April 14, 2005

                                      F-2
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY
                           CONSOLIDATED BALANCE SHEETS
                            January 31, 2005 and 2004
<TABLE>
<CAPTION>
                                                                      January 31            January 31,
                                                                         2005                  2004
                                                                      -----------           -----------
<S>                                                                   <C>                   <C>
                                     ASSETS
CURRENT ASSETS
   Cash on hand and in bank                                           $    59,905           $    80,514
   Accounts receivable
   Trade, net of allowance for doubtful accounts
    of approximately $13,882 and $14,230, respectively                    303,508               372,186
   Other                                                                    9,679                 7,543
   Inventories                                                            253,434               323,063
   Prepaid expenses                                                           384                 2,692
                                                                      -----------           -----------
      TOTAL CURRENT ASSETS                                                626,910               785,998
                                                                      -----------           -----------

PROPERTY AND EQUIPMENT - AT COST                                          646,801               636,780
   Less Accumulated depreciation                                         (517,661)             (479,227)
                                                                      -----------           -----------
      NET PROPERTY AND EQUIPMENT                                          129,140               157,553
                                                                      -----------           -----------
OTHER ASSETS
   Funds held in trust by officer                                          53,400                53,400
   Refundable deposits                                                      4,800                 4,800
                                                                      -----------           -----------
      TOTAL OTHER ASSETS                                                   58,200                67,300
                                                                      -----------           -----------

TOTAL ASSETS                                                          $   814,250           $ 1,001,751
                                                                      ===========           ===========

                      LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
   Notes payable to investors, net of accompanying warrant
    discount of approximately $-0- and $-0-                           $    49,000           $    75,000
   Current maturities of long-term debt                                     4,500                 4,095
   Accounts payable - trade                                               421,805               286,773
   Other accrued expenses                                                  39,762                42,454
   Management fee payable to majority shareholder                         240,000               120,000
   Advances from majority shareholder                                      16,000                16,000
                                                                      -----------           -----------
      TOTAL CURRENT LIABILITIES                                           771,067               544,322
                                                                      -----------           -----------

LONG-TERM DEBT
   Notes payable to investors, net of current maturities                   19,000                    --
   Capital lease payable                                                    5,806                10,336
                                                                      -----------           -----------
      TOTAL LIABILITIES                                                   795,873               554,658
                                                                      -----------           -----------
COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY
   Common stock - $0.001 par value
     100,000,000 shares authorized
     25,171,865 and 25,021,865 shares issued and outstanding               25,172                25,022
   Additional paid-in capital                                           5,152,423             5,146,573
   Accumulated deficit                                                 (5,159,218)           (4,724,502)
                                                                      -----------           -----------
      TOTAL STOCKHOLDERS' EQUITY                                           18,377               447,093
                                                                      -----------           -----------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                            $   814,250           $ 1,001,751
                                                                      ===========           ===========
</TABLE>
              The accompanying notes are an integral part of these
                       consolidated financial statements.

                                      F-3
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY
          CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
                      Years ended January 31, 2005 and 2004
<TABLE>
<CAPTION>
                                                                        Year ended             Year ended
                                                                        January 31,            January 31,
                                                                           2005                   2004
                                                                       ------------           ------------
<S>                                                                    <C>                    <C>
REVENUES - net of returns and allowances                               $  2,462,977           $  3,629,289

COST OF SALES
   Raw materials                                                          1,462,211              2,247,110
   Direct labor and other costs                                             742,730                831,358
   Depreciation                                                              36,006                 38,589
                                                                       ------------           ------------
     TOTAL COST OF SALES                                                  2,440,947              3,117,057
                                                                       ------------           ------------

GROSS PROFIT                                                                220,030                522,232
                                                                       ------------           ------------

OPERATING EXPENSES
   Selling and marketing expenses                                               625                  6,500
   General and administrative expenses
     Salaries and related expenses                                           91,336                 91,772
     Other operating expenses                                               440,262                487,634
   Administrative service fee to majority shareholder                       120,000                120,000
   Depreciation and amortization                                              2,428                 11,500
   Compensation expense related to common
    stock issuances at less than "fair value"                                    --                    945
                                                                       ------------           ------------
     TOTAL OPERATING EXPENSES                                               654,651                718,351
                                                                       ------------           ------------

LOSS FROM OPERATIONS                                                       (432,621)              (196,119)

OTHER INCOME
   Interest expense                                                          (7,875)               (13,823)
   Interest and other income                                                  5,780                 10,805
                                                                       ------------           ------------

LOSS BEFORE PROVISION FOR INCOME TAXES AND EXTRAORDINARY ITEM              (434,716)              (199,137)

PROVISION FOR INCOME TAXES                                                       --                     --
                                                                       ------------           ------------

NET LOSS                                                                   (434,716)              (199,137)

OTHER COMPREHENSIVE INCOME                                                       --                     --
                                                                       ------------           ------------

COMPREHENSIVE LOSS                                                     $   (434,716)          $   (199,137)
                                                                       ============           ============
Net loss per weighted-average share
 of common stock outstanding, calculated
 on Net Loss - basic and fully diluted                                 $      (0.02)          $      (0.01)
                                                                       ============           ============
Weighted-average number of shares
 of common stock outstanding                                             25,101,373             24,840,873
                                                                       ============           ============
</TABLE>
              The accompanying notes are an integral part of these
                       consolidated financial statements.

                                      F-4
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY
            CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
                      Years ended January 31, 2005 and 2004

<TABLE>
<CAPTION>
                                              Common Stock           Additional
                                          --------------------        paid-in        Accumulated
                                          Shares        Amount        capital         deficit            Total
                                          ------        ------        -------         -------            -----
<S>                                   <C>             <C>          <C>             <C>                 <C>
BALANCES AT FEBRUARY 1, 2003           24,086,964      $24,087      $5,066,381      $(4,525,365)        565,103

Issuance of common stock for
 payment of accrued interest              186,737          187           3,595               --           3,782
Compensation expense related
 to issuance of shares at
 less than "fair value"                        --           --             945               --             945
Payment of trade accounts payable         598,164          598          72,802               --          73,400
Payment of consulting fees                150,000          150           2,850               --           3,000

Net loss for the year                          --           --              --         (199,137)       (199,137)
                                       ----------      -------      ----------      -----------       ---------

BALANCES AT JANUARY 31, 2004           25,021,865       25,022       5,146,573       (4,724,502)        447,093

Issuance of common stock for
 Payment of consulting fees               150,000          150           5,850               --           6,000

Net loss for the year                          --           --              --         (434,716)       (434,716)
                                       ----------      -------      ----------      -----------       ---------

BALANCES AT JANUARY 31, 2005           25,171,865      $25,172      $5,152,423      $(5,159,218)      $  18,377
                                       ==========      =======      ==========      ===========       =========
</TABLE>

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

                                      F-5
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                      Years ended January 31, 2005 and 2004

<TABLE>
<CAPTION>
                                                               Year ended          Year ended
                                                               January 31,         January 31,
                                                                  2005                2004
                                                                ---------           ---------
<S>                                                             <C>                 <C>
CASH FLOWS FROM OPERATING ACTIVITIES
   Net loss for the year                                        $(434,716)          $(199,137)
   Adjustments to reconcile net loss to net cash
    provided by operating activities
     Depreciation and amortization                                 38,434              50,089
     Amortization of warrant discount on notes payable                 --               4,775
     Provision for doubtful accounts receivable                     4,158              (1,986)
     Expenses paid with common stock                                6,000               6,780
     Compensation expense related to common stock
       issuances at less than "fair value"                             --                 945
   (Increase) Decrease in
     Accounts receivable - trade and other                         62,384                (127)
     Inventory                                                     69,629             (21,652)
     Prepaid expenses and other                                     2,308              (2,256)
   Increase (Decrease) in
     Accounts payable                                             135,032             189,727
     Other accrued expenses                                        (2,692)            (29,566)
     Accrued management fees to parent company                    120,000             120,000
                                                                ---------           ---------
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES                   537             117,592
                                                                ---------           ---------
CASH FLOWS FROM INVESTING ACTIVITIES
   Purchase of property and equipment                             (10,021)            (59,998)
                                                                ---------           ---------
NET CASH USED IN INVESTING ACTIVITIES                             (10,021)            (59,998)
                                                                ---------           ---------
CASH FLOWS FROM FINANCING ACTIVITIES
   Payments on notes payable to investors                          (7,000)                 --
   Payments on long-term capital lease                             (4,125)             (3,772)
                                                                ---------           ---------
NET CASH USED IN FINANCING ACTIVITIES                             (11,125)             (3,772)
                                                                ---------           ---------

INCREASE (DECREASE) IN CASH                                       (20,609)             53,822

Cash at beginning of period                                        80,514              26,692
                                                                ---------           ---------

CASH AT END OF PERIOD                                           $  59,905           $  80,514
                                                                =========           =========
SUPPLEMENTAL DISCLOSURE OF INTEREST AND
INCOME TAXES PAID
   Interest paid for the period                                 $   8,573           $   3,439
                                                                =========           =========
   Income taxes paid for the period                             $      --           $      --
                                                                =========           =========
</TABLE>

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

                                      F-6
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE A - ORGANIZATION AND DESCRIPTION OF BUSINESS

KIK Technology  International,  Inc. (KTII) was incorporated on February 1, 2000
under   the  laws  of  the   State   of   California   as   Russian-Imports.com.
Russian-Imports.com  was  initially  founded to develop an  internet  e-commerce
website which would sell handmade  lacquer  boxes,  Matroshka  dolls and crystal
imported from Russia.  This business plan was  unsuccessful  and,  subsequently,
terminated.  On September 4, 2001,  KTII (formerly  Russian-Imports.com)  issued
16,700,000  shares  of  restricted,   unregistered  common  stock  to  KIK  Tire
Technologies,  Inc. (a publicly-owned Canadian corporation) (KTTI) for 100.0% of
the  issued  and  outstanding  stock of KIK  Technology,  Inc.  (a  wholly-owned
subsidiary of KTTI). By virtue of this transaction,  KIK Technology, Inc. became
a  wholly-owned  subsidiary  of  KTII  and  KTTI  became  an  approximate  73.6%
shareholder  in KTII.  Concurrent  with  this  transaction,  Russian-Imports.com
changed it's corporate name to KIK Technologies International, Inc.

KIK  Technology,  Inc (KTI) was  incorporated in June 1988 under the laws of the
State of California.  KTI manufactures and markets an extensive and high quality
line of off-highway micro-cellular polyurethane tires for the healthcare,  light
industrial,  lawn and garden and  recreational  industries.  KTI operates from a
sole manufacturing plant and marketing offices located in Oceanside, CA.

In prior years, the Company's  principal raw materials are purchased from a sole
supplier was also a major customer for the Company's  products.  In the event of
any  disruption  in the  availability  of raw  materials  or a  market  for  the
Company's  products  purchased  by this key  supplier,  the  Company  could have
experienced a negative  economic  impact.  The Company is developing  additional
sources of supply of it's key raw materials  comparable prices and management is
seeking other avenues of  distribution  of the Company's  products to consumers.
Management  is of the opinion that no  interruption  of either raw  materials or
product demand will occur.

NOTE B - PREPARATION OF FINANCIAL STATEMENTS

The  Company  follows  the  accrual  basis  of  accounting  in  accordance  with
accounting principles generally accepted in the United States of America and has
adopted a year-end of January 31.

The preparation of financial statements in conformity with accounting principles
generally  accepted in the United States of America 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.

Management further acknowledges that it is solely responsible for adopting sound
accounting  practices,   establishing  and  maintaining  a  system  of  internal
accounting  control and preventing and detecting  fraud. The Company's system of
internal  accounting  control is designed to assure,  among other items, that 1)
recorded  transactions  are valid; 2) valid  transactions  are recorded;  and 3)
transactions  are  recorded in the proper  period in a timely  manner to produce
financial  statements which present fairly the financial  condition,  results of
operations  and cash  flows of the  Company  for the  respective  periods  being
presented

For  segment  reporting  purposes,  the Company  operated  in only one  industry
segment during the periods represented in the accompanying  financial statements
and makes all  operating  decisions and  allocates  resources  based on the best
benefit to the Company as a whole.

These  financial  statements  reflect  the books and  records of KIK  Technology
International,  Inc. (formerly  Russian-Imports.com)  (KTII) and KIK Technology,
Inc.  (KTI)  as  of  and  for  the  years  ended  January  31,  2004  and  2003,
respectively.  All significant intercompany transactions have been eliminated in
consolidation. The consolidated entities are referred to as Company.

                                      F-7
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTE C - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

1. Cash and cash equivalents

     For  Statement of Cash Flows  purposes,  the Company  considers all cash on
     hand  and  in  banks,  certificates  of  deposit  and  other  highly-liquid
     investments with maturities of three months or less, when purchased,  to be
     cash and cash equivalents.

     Cash  overdraft  positions may occur from time to time due to the timing of
     making bank deposits and releasing checks, in accordance with the Company's
     cash management policies.

2. Accounts receivable and Revenue Recognition

     In the normal course of business,  the Company extends  unsecured credit to
     virtually  all of its  customers  which are located  throughout  the United
     States  and are  principally  concentrated  in the  midwest  region  of the
     country.  Depending upon management's  assessment of  creditworthiness  and
     order  size,  certain  shipments  are  made on  "COD"  terms  using  common
     carriers.  Because of the credit risk involved,  management has provided an
     allowance for doubtful accounts which reflects its opinion of amounts which
     will   eventually   become   uncollectible.   In  the  event  of   complete
     non-performance, the maximum exposure to the Company is the recorded amount
     of trade  accounts  receivable  shown on the  balance  sheet at the date of
     non-performance.

     The Company  recognizes revenue from the sale of tires and accessories upon
     shipment to, or receipt by customers,  depending upon contractual terms and
     when there is no significant  uncertainty regarding the consideration to be
     received and the associated costs to be incurred. Additionally, the Company
     recognizes   reductions  of  recorded  revenue  for  product  returns  from
     unsatisfied customers and other billing adjustments or corrections,  at the
     point that the  returned  products  are received by the Company or upon the
     completion of negotiations between the Company and it's customer.

3. Inventory

     Inventory consists of raw materials,  principally chemical feedstocks,  and
     finished  goods,  principally  tires and  accessories  manufactured  by the
     Company and other minor  miscellaneous  items  purchased  from  third-party
     vendors for resale as a component of the Company's products.

     Inventory is valued at the lower of cost or market value, using principally
     the average cost method.

4. Property and Equipment

     Property and  equipment are recorded at  historical  cost.  These costs are
     depreciated over the estimated useful lives, generally two (2) to seven (7)
     years, of the individual assets using the straight-line  method.  Gains and
     losses from the  disposition  of property  and  equipment  are  included in
     operations as incurred.

     In accordance  with  Statement of Financial  Accounting  Standards No. 144,
     "Accounting  for the  Impairment  or Disposal of  Long-Lived  Assets",  the
     Company  follows the policy of evaluating  all property and equipment as of
     the end of each reporting quarter.  For each of the years ended January 31,
     2004 and 2003, no charges to operations  were made for  impairments  in the
     future benefit of property and equipment.

                                      F-8
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTE C - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED

5. Income Taxes

     The Company uses the asset and liability  method of  accounting  for income
     taxes.  At January 31, 2004 and 2003,  the  deferred tax asset and deferred
     tax  liability  accounts,  as  recorded  when  material  to  the  financial
     statements,  are entirely the result of  temporary  differences.  Temporary
     differences   represent  differences  in  the  recognition  of  assets  and
     liabilities for tax and financial reporting purposes, primarily accumulated
     depreciation and amortization, allowance for doubtful accounts and vacation
     accruals.

     As of January  31, 2004 and 2003,  the  deferred  tax asset  related to the
     Company's net operating loss carryforward is fully reserved.

6. Advertising costs

     The Company does not conduct any direct  response  advertising  activities.
     For non-direct response advertising, the Company charges the costs of these
     efforts  to  operations  at the  first  time  the  related  advertising  is
     published.

7. Earnings (loss) per share

     Basic  earnings  (loss) per share is computed  by  dividing  the net income
     (loss) available to common shareholders by the  weighted-average  number of
     common shares  outstanding  during the respective  period  presented in our
     accompanying financial statements.

     Fully diluted earnings (loss) per share is computed similar to basic income
     (loss) per share  except that the  denominator  is increased to include the
     number of common  stock  equivalents  (primarily  outstanding  options  and
     warrants).

     Common  stock  equivalents  represent  the  dilutive  effect of the assumed
     exercise of the outstanding stock options and warrants,  using the treasury
     stock method, at either the beginning of the respective period presented or
     the date of  issuance,  whichever  is later,  and only if the common  stock
     equivalents  are  considered  dilutive  based upon the Company's net income
     (loss) position at the calculation date.

      As of January 31, 2004 and 2003,  the  Company's  issued and  outstanding,
     warrants,  options and convertible debt are considered  antidilutive due to
     the Company's net operating loss position.

8. Employee Stock Options

     For periods  prior to November  1, 2002,  the Company  chose to account for
     employee   stock-based   compensation  using  the  intrinsic  value  method
     prescribed  in  Accounting  Principles  Board  Opinion No. 25 (APB No. 25),
     Accounting  for Stock  Issued to  Employees,  and related  interpretations.
     Accordingly,  employee  compensation cost for stock options and warrants is
     measured as the excess,  if any, of the market price of the Company's stock
     at the date of the grant  over the amount an  employee  must pay to acquire
     the  stock.  This  treatment  was  allowed  under  Statement  of  Financial
     Accounting  Standards No. 123,  "Accounting  for Stock Based  Compensation"
     (SFAS 123).


                (Remainder of this page left blank intentionally)

                                      F-9
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTE C - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED

8. Employee Stock Options - continued

     In December 2002, FASB issued Statement of Financial  Accounting  Standards
     No.  148  "Accounting   for  Stock-Based   Compensation  -  Transition  and
     Disclosure"  (SFAS  148).  This  statement  amends  SFAS  123 and  provides
     alternative  methods of transition for a voluntary change to the fair value
     based method of accounting  for  stock-based  employee  compensation.  This
     statement  also amends the disclosure  requirements  of SFAS 123 to require
     more prominent and frequent  disclosures in financial  statements about the
     effects of stock-based  compensation.  The  transition  guidance and annual
     disclosure  provisions of SFAS 148 are  effective for financial  statements
     issued for fiscal years ending after December 15, 2002.  Effective November
     1, 2003,  the first day of the  reporting  quarter  including the effective
     date of SFAS 148, the Company's  Board of Directors,  in  conjunction  with
     public  opinion and SFAS 148,  elected to expense the imputed  compensation
     cost related to any stock options granted during Fiscal 2003 and for future
     periods.  The Company did not issue any stock options during Fiscal 2004 or
     Fiscal 2003 and the adoption of SFAS 148 did not have a material  impact on
     our results of operations or financial condition.

9. New and Pending Accounting Pronouncements

     In December  2003,  the Financial  Accounting  Standards  Board issued FASB
     Interpretation  Number 46-R  "Consolidation of Variable Interest Entities."
     FIN 46-R, which modifies certain  provisions and effective dates of FIN 46,
     sets for the criteria to be used in determining  whether an investment is a
     variable interest entity should be consolidated. These provisions are based
     on the general  premise that if a company  controls  another entity through
     interests other than voting interests,  that company should consolidate the
     controlled  entity.  The Company believes that currently,  it does not have
     any material  arrangements  that meet the definition of a variable interest
     entity which would require consolidation.

     In November  2004,  the FASB issued SFAS 151,  "Inventory  Costs." SFAS 151
     amends  the  accounting  for  abnormal  amounts of idle  facility  expense,
     freight,  handling costs, and wasted material (spoilage) under the guidance
     in ARB 43, Chapter 4, "Inventory  Pricing."  Paragraph 5 of ARB 43, Chapter
     4, previously stated that "...under some circumstances,  items such as idle
     facility expense,  excessive spoilage, double freight, and rehandling costs
     may be so abnormal as to require  treatment as current period  charges...."
     This  Statement  requires that those items be recognized as  current-period
     charges  regardless of whether they meet the criterion of "so abnormal." In
     addition,  this  Statement  requires that  allocation  of fixed  production
     overheads to the costs of conversion be based on the normal capacity of the
     production  facilities.  This  statement is effective for  inventory  costs
     incurred during fiscal years beginning after June 15, 2005. Management does
     not expect  adoption of SFAS 151 to have a material impact on the Company's
     financial statements.

     In December  2004,  the FASB issued SFAS 152,  "Accounting  for Real Estate
     Time-Sharing  Transactions."  The FASB issued this Statement as a result of
     the  guidance   provided  in  AICPA   Statement  of  Position  (SOP)  04-2,
     "Accounting for Real Estate Time-Sharing Transactions." SOP 04-2 applies to
     all real  estate  time-sharing  transactions.  Among other  items,  the SOP
     provides  guidance on the  recording of credit  losses and the treatment of
     selling costs, but does not change the revenue recognition guidance in SFAS
     66,  "Accounting  for Sales of Real  Estate," for real estate  time-sharing
     transactions.  SFAS 152  amends  Statement  66 to  reference  the  guidance
     provided in SOP 04-2.  SFAS 152 also amends SFAS 67,  "Accounting for Costs
     and Initial Rental Operations of Real Estate  Projects",  to state that SOP
     04-2 provides the relevant guidance on accounting for incidental operations
     and costs  related to the sale of real  estate  time-sharing  transactions.
     SFAS 152 is  effective  for  years  beginning  after  June 15,  2005,  with
     restatements  of  previously   issued  financial   statements   prohibited.
     Management  does not expect  adoption of SFAS 152 to have a material impact
     on the Company's financial statements.

                                      F-10
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTE C - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED

9. New and Pending Accounting Pronouncements - continued

     In  December  2004,  the FASB issued SFAS 153,  "Exchanges  of  Nonmonetary
     Assets,"  an  amendment  to Opinion  No. 29,  "Accounting  for  Nonmonetary
     Transactions." Statement 153 eliminates certain differences in the guidance
     in Opinion No. 29 as compared to the guidance contained in standards issued
     by the International  Accounting  Standards Board. The amendment to Opinion
     No. 29 eliminates  the fair value  exception for  nonmonetary  exchanges of
     similar  productive  assets and  replaces it with a general  exception  for
     exchanges of nonmonetary assets that do not have commercial substance. Such
     an exchange has commercial substance if the future cash flows of the entity
     are expected to change significantly as a result of the exchange.  SFAS 153
     is effective for nonmonetary asset exchanges occurring in periods beginning
     after June 15, 2005. Earlier application is permitted for nonmonetary asset
     exchanges   occurring  in  periods   beginning  after  December  16,  2004.
     Management  does not expect  adoption of SFAS 153 to have a material impact
     on the Company's financial statements.

     In December 2004, the FASB issued SFAS 123(R),  "Share-Based Payment." SFAS
     123(R) amends SFAS 123, "Accounting for Stock-Based  Compensation," and APB
     Opinion  25,  "Accounting  for Stock  Issued  to  Employees."  SFAS  123(R)
     requires that the cost of share-based payment transactions (including those
     with   employees  and   non-employees)   be  recognized  in  the  financial
     statements.  SFAS 123(R) applies to all share-based payment transactions in
     which an entity  acquires  goods or  services  by issuing  (or  offering to
     issue) its shares,  share options,  or other equity instruments (except for
     those held by an ESOP) or by  incurring  liabilities  (1) in amounts  based
     (even  in  part)  on the  price of the  entity's  shares  or  other  equity
     instruments,  or (2)  that  require  (or  may  require)  settlement  by the
     issuance of an entity's shares or other equity instruments.  This statement
     is effective  (1) for public  companies  qualifying  as SEC small  business
     issuers,  as of the first  interim  period or fiscal year  beginning  after
     December 15, 2005, or (2) for all other public  companies,  as of the first
     interim period or fiscal year beginning after June 15, 2005, or (3) for all
     nonpublic  entities,  as of the first fiscal year beginning  after December
     15, 2005.  Management  anticipates no  significant  impact to the Company's
     financial statements upon the adoption of SFAS No. 123(R).

NOTE D - FAIR VALUE OF FINANCIAL INSTRUMENTS

The carrying amount of cash,  accounts  receivable,  accounts  payable and notes
payable, as applicable,  approximates fair value due to the short term nature of
these items  and/or the current  interest  rates  payable in relation to current
market conditions.

Interest  rate risk is the risk  that the  Company's  earnings  are  subject  to
fluctuations  in interest  rates on either  investments  or on debt and is fully
dependent  upon  the  volatility  of  these  rates.  The  Company  does  not use
derivative instruments to moderate its exposure to interest rate risk, if any.

Financial  risk  is  the  risk  that  the  Company's  earnings  are  subject  to
fluctuations in interest rates or foreign exchange rates and are fully dependent
upon the  volatility  of  these  rates.  The  company  does  not use  derivative
instruments to moderate its exposure to financial risk, if any.

NOTE E - CONCENTRATIONS OF CREDIT RISK

KTII and KTI maintain their  respective cash accounts in financial  institutions
subject  to  insurance   coverage  issued  by  the  Federal  Deposit   Insurance
Corporation  (FDIC).  Under  FDIC  rules,  both  KTII  and KTI are  entitled  to
aggregate  coverage of $100,000 per account  type per separate  legal entity per
financial  institution.  During  the  years  ended  January  31,  2004 and 2003,
respectively,  the  various  entities,  from  time-to-time,  had  deposits  in a
financial  institution  with credit risk  exposures in excess of statutory  FDIC
coverage.  The Company has incurred no losses  during  Fiscal 2005 and 2004 as a
result of any of these unsecured situations.

                                      F-11
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTE F - INVENTORIES

Inventories consist of the following at January 31, 2005 and 2004:

                                            January 31,           January 31
                                               2005                  2004
                                             --------              --------

     Raw materials                           $ 42,408              $114,120
     Finished goods                           211,026               208,943
                                             --------              --------
     Total                                   $253,434              $323,063
                                             ========              ========


NOTE G - PROPERTY AND EQUIPMENT

Property and equipment consists of the following at January 31, 2005 and 2004:

                                     January 31,    January 31,
                                        2005           2004       Estimated life
                                     ---------      ---------     --------------

     Machinery and Equipment         $ 597,901      $ 587,880         7 years
     Office furniture and fixtures      25,441         25,441         5 years
     Leasehold improvements             14,180         14,180         2 years
     Vehicles                            9,279          9,279         5 years
                                     ---------      ---------
                                       646,801        636,780
     Less accumulated depreciation    (517,661)      (479,227)
                                     ---------      ---------

     Net property and equipment      $ 129,140      $ 157,553
                                     =========      =========

Depreciation  expense  for the  years  ended  January  31,  2005  and  2004  was
approximately $38,434 and $40,988, respectively.

NOTE H - FUNDS HELD IN TRUST BY OFFICER

In May 2001, the Company advanced $53,400 to its President to hold in trust as a
contingency fund for the sole use of the Company in the event of a unanticipated
cash  shortfall.  The advance bears  interest at 4.0% annually and is unsecured.
The original  documentation  required repayment of the advance and accrued,  but
unpaid,  interest in May 2003. As of January 31, 2005,  with the approval of the
Company's  Board of  Directors,  the Company's  President  continues to maintain
these funds as trustee on behalf of the Company.

NOTE I - NOTES PAYABLE TO INVESTORS

Pursuant to the terms of a private placement agreement, the Company attempted to
raise up to $600,000  through the  placement of two-year  senior  notes  bearing
interest  at 10%  payable  quarterly.  This  Private  Placement  Memorandum  was
terminated by the Company during the fiscal quarter ended October 31, 2002.

                                      F-12
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTE I - NOTES PAYABLE TO INVESTORS - CONTINUED

In November  2001,  the Company  entered  into an agreement  with an  investment
banker whereby the investment  banker would act as exclusive  dealer-manager  in
this private  placement of  securities  to be issued by the Company  pursuant to
Regulation D of the Securities  Act of 1933, as amended.  As  compensation,  the
investment banker was paid $15,000 for professional fees,  received a commission
equal to 10% of the gross proceeds,  an unaccountable expense allowance equal to
4% of the gross proceeds,  and for every $500,000 raised,  150,000 shares of the
Company's restricted, unregistered common stock. Such shares will be issued upon
completion of the private  placement.  In addition,  the investment  banker will
have the option to nominate one person to the Company's Board of Directors if at
least  $2,000,000 is raised.  As of the  termination  of this Private  Placement
Memorandum, only $75,000 had been successfully raised.

Note  holders can elect,  with the  consent of the  Company,  to accept  Company
common stock in lieu of cash interest payments.  Such payments in stock would be
calculated  at 50% of the daily  average of the market price of the common stock
for the 30-calendar  days preceding the interest due date. After six months from
the date of issue of the notes,  the  Company  can  convert  the notes to common
stock if the daily average  market price of the  Company's  common stock for any
30-calendar days after the initial six-month period equals or exceeds $1.00. The
conversion  of the notes to common stock would also be  calculated at 50% of the
daily average market price for the 30 days prior to the Company giving notice of
its plan to convert.

In  conjunction  with the offering of the notes,  each note holder was given one
warrant for each $1.00 invested.  Each warrant allows the holder to purchase one
share of the Company's  common stock at an initial  exercise  price of $0.60 per
share, and is exercisable for two years. In March 2002, the Company repriced the
outstanding warrants to an exercise price of $0.40 per share.

Pursuant to the private placement,  the Company sold a $50,000  convertible note
on November 12, 2001 and a $25,000  convertible note on December 26, 2001 to two
unrelated  investors.  Warrants to purchase a combined total of 75,000 shares of
the Company's common stock at $0.60 per share were also issued to the investors.
The  warrants  were  valued at $11,789  using the  Black-Scholes  option-pricing
model, and therefore $11,789 of the total debt proceeds of $75,000 was allocated
to the warrants, resulting in a discount on the notes, was amortized to interest
expense over the initial  term of the  underlying  debt.  During the years ended
January 31, 2004, approximately $9,100 of the discount was amortized to interest
expense.  The weighted average assumptions  utilized to value the warrants using
the Black-Scholes option-pricing model were as follows:

Expected life of the option:    The  initial  life of the  corresponding option,
                                generally two (2) years
Expected volatility in
 the Company's stock price:     150.0%,  which was based on  fluctuations of the
                                Company's stock price over the past Fiscal year.
Expected dividends:             Zero (0.00) based on past performance
Anticipated risk free
 interest rate:                 Estimated to be 2.80%.

The  convertible  notes  contained a beneficial  conversion  feature valued at a
combined  total  of  approximately  $63,000.  However,  because  the  conversion
features were fully contingent upon the occurrence of certain future events, the
Company  did not  record a discount  resulting  from the  beneficial  conversion
feature.

The notes  matured  on  November  12,  2003  ($50,000)  and  December  26,  2003
($25,000), respectively.

On February 16, 2004, the Company  restructured  the $50,000  convertible  note.
Under the restructured terms, the Company paid all accrued interest and a $3,000
principal  reduction on March 16, 2004, as of February 16, 2004.  The Company is
obligated to pay $2,000 per month,  plus accrued  interest,  for the period from
March 16,  2004  through  August 16,  2004 and $1,000  per month,  plus  accrued
interest, on the 16th of each month thereafter until all outstanding amounts are
paid in full. The restructured note bears interest at 10.0% per annum.

                                      F-13
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTE I - NOTES PAYABLE TO INVESTORS - CONTINUED

The  $50,000  restructured  note is  convertible  into  shares of  unregistered,
restricted  common stock at the discretion of the Noteholder  with the Company's
consent,  provided that the daily average  (calculated  from the last sale price
daily) of the market price of the Company's common stock for any 30 calendar day
period equals or exceeds $1.00 per share,  with the conversion  being calculated
at a 50% discount of such 30 day average.

The $50,000  Noteholder  also has the  election to receive the monthly  interest
payments in  restricted,  unregistered  common stock of the Company at the daily
average  (calculated  from the last sale price daily) of the market price of the
Company's  common stock for the 30 calendar day period prior to the interest due
date,  with the number of shares to be issued  calculated  at a 50%  discount of
such 30 day average.

Through January 31, 2005, the Company has paid approximately $7,000 in principal
and  $6,667  in  cumulative   accrued  interest  on  the  $50,000   restructured
convertible note.

The  $25,000  convertible  note is in default and no demand for payment has been
made  to  the  Company.  The  Company  continues  to  accrue  interest  on  this
convertible note in accordance with the original terms and conditions.

The aggregate maturities of the notes are as follows:

     Balance as of January 31, 2005                               $ 68,000
     Less current portion                                          (49,000)
                                                                  --------
     Long-term portion                                            $ 19,000
                                                                  ========

NOTE J - CAPITAL LEASE PAYABLE

Capital lease payable is as follows:

<TABLE>
<CAPTION>
                                                                January 31,        January 31,
                                                                   2005               2004
                                                                 --------           --------
<S>                                                              <C>                <C>
$21,080 capital lease payable to a finance corporation
 Interest at 8.60%.  Payable in monthly installments
 of approximately $432, including accrued interest
 Final maturity due in April 2007.  Collateralized by
 equipment                                                       $ 10,306           $ 14,431

     Less current maturities                                       (4,500)            (4,095)
                                                                 --------           --------

     Long-term portion                                           $  5,806           $ 10,336
                                                                 ========           ========
</TABLE>

Future maturities of long-term capital leases payable are

                                             Year ending
                                             January 31,             Amount
                                             -----------             ------
                                                2006                 $ 4,468
                                                2007                   4,872
                                                2008                     966
                                                                     -------

                                                Total                $10,306
                                                                     =======

                                      F-14
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTE K - INCOME TAXES

The  components of income tax (benefit)  expense for the years ended January 31,
2005 and 2004, respectively, are as follows:

                                             January 31,           January 31,
                                                2005                  2004
                                              -------               -------
      Federal:
       Current                                $    --               $    --
       Deferred                                    --                    --
                                              -------               -------
                                                   --                    --
                                              -------               -------
      State:
       Current                                     --                    --
       Deferred                                    --                    --
                                              -------               -------
                                                   --                    --
                                              -------               -------

       Total                                  $    --               $    --
                                              =======               =======

The Company has a net operating loss carryforward of approximately $5,000,000 to
offset future taxable income. Subject to current regulations,  this carryforward
will begin to expire in 2005. The amount and  availability  of the net operating
loss  carryforwards  may be subject  to  limitations  set forth by the  Internal
Revenue Code.  Factors such as the number of shares  ultimately  issued within a
three year  look-back  period;  whether  there is a deemed  more than 50 percent
change in control; the applicable long-term tax exempt bond rate;  continuity of
historical  business;  and  subsequent  income of the Company all enter into the
annual computation of allowable annual utilization of the carryforwards.

The Company's  income tax expense for the years ended January 31, 2005 and 2004,
respectively, are as follows:

                                                     January 31,     January 31,
                                                        2005            2004
                                                      --------        --------

Statutory rate applied to loss before income taxes    $(148,000)      $(68,000)
Increase (decrease) in income taxes resulting from:
 State income taxes                                          --             --
 Other, including reserve for deferred tax asset        148,000         68,000
                                                      ---------       --------

    Income tax expense                                $      --       $     --
                                                      =========       ========

Temporary differences, consisting primarily of net operating loss carryforwards,
statutory  deferrals  of expenses  for  organizational  costs and  accrued,  but
unpaid,  accruals for officer  compensation  and  statutory  differences  in the
depreciable  lives for property and equipment,  between the financial  statement
carrying  amounts and tax bases of assets and liabilities  give rise to deferred
tax assets and liabilities as of January 31, 2005 and 2004, respectively:

                                               January 31,           January 31,
                                                  2005                  2004
                                              -----------           -----------
Deferred tax assets
  Net operating loss carryforwards            $ 1,700,000           $ 1,564,000
  Less valuation allowance                     (1,700,000)           (1,564,000)
                                              -----------           -----------

Net Deferred Tax Asset                        $        --           $        --
                                              ===========           ===========

During the Fiscal  years  ended  January 31,  2005 and 2004,  respectively,  the
valuation  allowance  for  the  deferred  tax  asset  increased  (decreased)  by
approximately $136,000 and $68,000.

                                      F-15
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTE L - COMMON STOCK TRANSACTIONS

Effective  February 1, 2003 and May 1, 2003,  the Company and the holders of the
two convertible  notes agreed for the payment of accrued interest in restricted,
unregistered  common stock.  The Company  issued an aggregate  206,987 shares of
restricted,  unregistered  common  stock in payment of accrued  interest.  These
transactions were valued at an aggregate  approximately  $3,782. The convertible
note  terms  allow  for  the  payment  of  accrued   interest  with  restricted,
unregistered  common stock using an average value of 50% of the daily average of
the market  price of the common  stock for the 30 calendar  days  preceding  the
interest due date. In both instances,  the closing stock price on the settlement
date was in excess of the prescribed  calculation.  The differential between the
discounted  "fair  value"  and the  settlement  price  resulted  in a charge  to
operations of  approximately  $945 for  compensation  expense  related to common
stock issuances at less than "fair value".  The Company relied upon Section 4(2)
of The Securities Act of 1933, as amended, for an exemption from registration on
these shares.

In February 2003, the Company issued 150,000 restricted,  unregistered shares of
common stock in payment of a contract for marketing  services.  This transaction
was  valued  at  approximately  $3,000,  which  was equal to or in excess of the
discounted  closing price of the Company's common stock on the NASDAQ Electronic
Bulletin Board on the date of each  respective  transaction.  The Company relied
upon Section 4(2) of The  Securities  Act of 1933, as amended,  for an exemption
from registration on these shares.

In April 2003,  the Company  issued 22,500  restricted,  unregistered  shares of
common stock in settlement  of a January 31, 2003 trade  account  payable in the
amount of  approximately  $552. The value of this transaction was equal to or in
excess of the  discounted  closing  price of the  Company's  common stock on the
NASDAQ Electronic Bulletin Board on the date of each respective transaction. The
Company relied upon Section 4(2) of The Securities Act of 1933, as amended,  for
an exemption from registration on these shares.

In May 2003,  the Company  issued  575,664  restricted,  unregistered  shares of
common stock in payment of trade accounts payable to the Company's primary legal
counsel in the amount of  approximately  $72,849.  The value of this transaction
was equal to or in  excess  of the  discounted  closing  price of the  Company's
common  stock  on the  NASDAQ  Electronic  Bulletin  Board  on the  date of each
respective  transaction.  The Company relied upon Section 4(2) of The Securities
Act of 1933, as amended, for an exemption from registration on these shares.

In July 2004,  the Company  issued 150,000  restricted,  unregistered  shares of
common  stock  in  payment  of  a  contract  for  professional  services.   This
transaction was valued at approximately  $6,000, which was equal to or in excess
of the  discounted  closing  price of the  Company's  common stock on the NASDAQ
Electronic  Bulletin  Board  on the  date of each  respective  transaction.  The
Company relied upon Section 4(2) of The Securities Act of 1933, as amended,  for
an exemption from registration on these shares.

NOTE M - STOCK WARRANTS

At  January  31,  2004,  the  75,000  warrants  sold  in  conjunction  with  the
convertible notes private placement had expired.

In conjunction  with the reverse  acquisition,  which was concluded in September
2001, The Company granted  2,300,000  warrants to certain  shareholders of KTTI.
These  warrants  have an  exercise  price of  approximately  $0.05 per share and
expired in April 2004.


                (Remainder of this page left blank intentionally)

                                      F-16
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTE M - STOCK WARRANTS - CONTINUED

The  following  table  lists the issued and  outstanding  stock  warrants  as of
January 31, 2005 and 2004, respectively:

                                                   Warrants
                                                    issued        Exercise price
                                                    ------        --------------

Balance at February 1, 2003                        2,375,000
   Granted                                                --
   Exercised                                              --
   Forfeited/Expired                                 (75,000)          $0.40
                                                  ----------

Balance at January 31, 2004                        2,300,000
   Granted                                                --
   Exercised                                              --
   Forfeited/Expired                              (2,300,000)
                                                  ----------

Balance at January 31, 2005                               --
                                                  ==========

Warrants exercisable at January 31, 2005                  --
                                                  ==========

Weighted-average exercise price per warrant              N/A
                                                  ==========

NOTE N - RELATED PARTY TRANSACTIONS

During the years  ended  January 31,  2005 and 2004,  respectively,  the Company
accrued approximately $120,000 in administrative service fees payable to KTTI.

NOTE O - COMMITMENTS AND CONTINGENCIES

LEASED FACILITIES

The Company leases its facilities under a non-cancellable operating lease, which
expires in May 2005. The lease requires monthly payments as follows:  $8,307 for
the first 12  months;  $8,639  for the next 12 months and $8,984 for the next 12
months.  Rent expense incurred under this lease was  approximately  $106,428 and
$102,340 for each of the years ended January 31, 2004 and 2003, respectively.

Future amounts due under this agreement are as follows:

                                                Year ending
                                                January 31,         Amount
                                                -----------         ------

                                                   2006            $142,364
                                                                   ========

Employment Contract

In  May  2000,  KIK  entered  into  an  employment  agreement  with  William  M.
Knooihuizen,  the Company's  current  President  and  Director.  The term of the
agreement is for a period of five (5) years.  For such  services,  KIK agreed to
pay Mr.  Knooihuizen  an annual  salary in the  amount of  $143,000,  to be paid
weekly.

                                      F-17
<PAGE>
                KIK TECHNOLOGY INTERNATIONAL, INC. AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


NOTE P - SIGNIFICANT CUSTOMERS

During the year ended January 31, 2005, the Company had three separate customers
responsible for an aggregate of approximately 71.86% (49.18%,  16.09% and 6.59%,
respectively) of total net revenues. The largest customer was also a significant
vendor  of  raw  materials.   The  largest  key  customer  was  responsible  for
approximately  35.02% of accounts  receivable and 59.37% of accounts  payable at
January 31,  2005.  The second key customer was  responsible  for  approximately
7.42% of accounts  receivable and 0.12% of accounts payable at January 31, 2005.
The third key  customer was  responsible  for  approximately  18.32% of accounts
receivable and approximately 0.52% of accounts payable at January 31, 2005.

During the year ended January 31, 2004,  the Company had two separate  customers
responsible  for  an  aggregate  of  approximately  78.47%  (69.06%  and  9.41%,
respectively) of total sales. The largest customer is also a significant  vendor
of raw materials.  The largest key customer was  responsible  for  approximately
48.95% of  accounts  receivable  and 76.17% of  accounts  payable at January 31,
2004.  The  second key  customer  was  responsible  for  approximately  1.72% of
accounts  receivable  and 0.00% of accounts  payable at January 31, 2004.  There
were no other  customer(s)  responsible  for more than  10.0% of total net sales
during Fiscal 2004.


NOTE Q - SELECTED FINANCIAL DATA (UNAUDITED)

The following is a summary of the quarterly  results of operations for the years
ended January 31, 2005 and 2004, respectively.

<TABLE>
<CAPTION>
                               Quarter ended     Quarter ended     Quarter ended     Quarter ended      Year ended
                                 April 30,          July 31,        October 31,       January 31,       January 31,
                                 ---------          --------        -----------       -----------       -----------
<S>                             <C>               <C>               <C>               <C>               <C>
FISCAL 2005
   Sales                        $   791,111       $   511,720       $   704,469       $   455,677       $ 2,462,977
   Gross profit                     107,642            14,866           119,193           (19,671)          222,030
   Net earnings after
    provision for
    income taxes                    (56,101)         (142,464)          (32,265)         (203,886)         (434,716)
   Basic and fully diluted
    earnings per share                  nil       $     (0.01)              nil       $     (0.01)      $     (0.02)
   Weighted average
    number of shares
    issued and outstanding       25,021,865        25,038,169        25,171,865        25,171,865        25,101,375

FISCAL 2004
   Sales                        $   792,156       $   929,571       $   990,843       $   926,719       $ 3,639,289
   Gross profit                     122,215           137,817           116,462           145,738           522,232
   Net earnings after
    provision for
    income taxes                    (61,636)          (40,059)          (49,959)          (47,483)         (199,137)
   Basic and fully diluted
    earnings per share                  nil               nil               nil               nil       $     (0.01)
   Weighted average
    number of shares
    issued and outstanding       24,311,934        24,990,579        25,021,865        25,021,865        24,840,873
</TABLE>

                                      F-18