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                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   Form 10-KSB

[X] ANNUAL REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF
    1934
                     For the fiscal year ended May 31, 2001

[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT
    OF 1934
                For the transition period from________to________
                         Commission file number 0-17978

                              EDD HELMS GROUP, INC.
                 (Name of small business issuer in its charter)

             Florida                                     59-2605868
     (State or other jurisdiction                     (I.R.S. Employer
         of incorporation)                         identification number)

   17850 N.E. 5th Avenue, Miami, Florida                  33162-1008
  (Address of principal executive offices)                (Zip Code)

                    Issuer's telephone number (800) 322-0530

Securities registered pursuant to Section 12(b) of the Exchange Act:

                                               Name of each exchange on which
         Title of each class                             registered
                  None                                      None

Securities registered pursuant to Section 12(g) of the Exchange Act:

                          COMMON STOCK, $.01 Par Value
                                (Title of class)

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

Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B is not contained in this form, and no disclosure will be
contained, to the best of registrant'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. [X]

The issuer's revenues for its most recent fiscal year were $20,270,475.

The aggregate market value of the voting stock held by non-affiliates computed
by reference to the average bid and asked prices as of September 12, 2001, was
$652,866.60 (2,176,222 shares at an average bid price of $.30 per share).

There were 12,581,175 shares outstanding of the issuer's common stock, $.01 par
value, as of September 12, 2001.
================================================================================
<PAGE>

                        EDD HELMS GROUP, INC. AND SUBSIDIARIES
                                   FORM 10-KSB
                                TABLE OF CONTENTS

PART I                                                              PAGE
--------                                                            ----
  Item 1.      DESCRIPTION OF BUSINESS                                2
  Item 2.      DESCRIPTION OF PROPERTY                                6
  Item 3.      LEGAL PROCEEDINGS                                      6
  Item 4.      SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS    6

PART II
--------
  Item 5.      MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER
                 MATTERS                                              6
  Item 6.      MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF
                 OPERATION                                            6
  Item 7.      FINANCIAL STATEMENTS                                   9
  Item 8.      CHANGE IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
                 ACCOUNTING AND FINANCIAL DISCLOSURE                 23

PART III
--------
  Item 9.      DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND
                 CONTROL PERSONS; COMPLIANCE WITH SECTION 16(A)
                 OF THE EXCHANGE ACT                                 23
  Item 10.     EXECUTIVE COMPENSATION                                24
  Item 11.     SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
                 MANAGEMENT                                          24
  Item 12.     CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS        25
  Item 13.     EXHIBITS AND REPORTS ON FORM 8-K                      25

                                        1
<PAGE>

FORWARD-LOOKING INFORMATION

This Form 10-KSB contains certain forward-looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995. For this purpose, any
statements contained in this Form 10-KSB that are not statements of historical
fact may be deemed forward-looking statements. Without limiting the foregoing,
words such as "may," "will," "expect," "believe," "anticipate," "estimate" or
"continue" or comparable terminology are intended to identify forward-looking
statements. These statements by their nature involve substantial risks and
uncertainties, and actual results may differ materially depending on a variety
of factors, many of which are not within our control. These factors include, but
are not limited to:

 o Economic conditions generally and in the industries in which our customers
   participate

 o Competition within our industry, including:

      o Competition from much larger competitors
      o Price increases or supply limitations for components purchased by us and
        delays, reductions, or cancellations of orders previously placed with
        and by us or
      o Cancellations of orders previously placed with and by us

                                     PART I

ITEM 1.  DESCRIPTION OF BUSINESS

INTRODUCTION

We are in the business of providing:

 o     Electrical and data communications services, including: o Cellular
       antenna installations o Facilities services o Plant maintenance

 o Air conditioning and refrigeration (provided by our wholly-owned subsidiary),
   including:
        o Process piping

 o Public facsimile (FAXMAIL) services

Our corporate offices and operations facilities are located at 17850 NE 5th Ave,
Miami, Florida 33162. Our mobile fleet services customers in Miami-Dade, Broward
and southern Palm Beach counties operate from this location.

RECENT HISTORY

We are a Florida corporation, organized in 1985. We were incorporated under the
name of Hotelecopy, Inc.

March 30, 1999 - Edd Helms, Incorporated acquired the stock, assets, business
operations and goodwill of L.C.T. Communications Corp., a Florida corporation,
from L.C.T. and its shareholders, Lorraine and Charles O'Toole for a purchase
price of $100,000, $30,426 of which was paid in shares of Edd Helms,
Incorporated. L.C.T. was a data/communication cabling installation, testing, and
repair service business servicing Dade, Broward, and Palm Beach counties. As
part of the acquisition, Edd Helms, Incorporated entered into a Non-Competition
Agreement with Charles and Lorraine O'Toole. They agreed that from March 30,
1999, through March 31, 2001, they would not compete in the field of business of
L.C.T. Charles and Lorraine also each entered into an Employment Agreement with
Edd Helms Electrical Contacting, Inc. simultaneously with the closing of the
acquisition, in which Charles and Lorraine were each bound by a one-year
restrictive covenant and a confidentiality clause. We no longer employ either
O'Toole.

August 2, 1999 - Hotelecopy merged with Edd Helms, Incorporated, a Florida
corporation, with Hotelecopy surviving and through the articles of merger
amending its name to "Edd Helms Group, Inc." (this merger will be referred to as
the "Merger" throughout this annual report). Our predecessor, Edd Helms,
Incorporated, was a privately owned corporation that was incorporated in the
State of Florida in 1975. Each director of Hotelecopy and Edd Helms,
Incorporated recommended to their respective shareholders that the companies
merge. The reasons to merge were so that the shareholders of Hotelecopy could
benefit from the expected increase in revenue to be gained through the merger,
while the shareholders of Edd Helms, Incorporated would benefit by merging their
business operations into those of a company with publicly traded shares.

July 30, 1999 - The shareholders of Edd Helms, Incorporated approved the Merger.
The shareholders of Hotelecopy also approved the Merger on July 30, 1999.
Pursuant to the Plan and Agreement of Merger the shareholders of Edd Helms,
Incorporated received 10,740,677 shares of Edd Helms Group, with each of the
4,930 issued and outstanding shares of the predecessor Edd Helms, Incorporated
being converted into 2,178,6363 shares of Edd Helms Group. Mr. Edd Helms, Jr.,
our Chairman of the Board, President and Chief Executive Officer held 44% of the
issued and outstanding shares of Hotelecopy and 89% of the issued and
outstanding shares of Edd Helms, Incorporated prior to the Merger, and after the
Merger he owns approximately 82.15% of Edd Helms Group. Edd Helms, Incorporated
had two wholly-owned subsidiaries:

(i)  Edd Helms Air Conditioning, Inc., and

(ii) Edd Helms Electrical Contracting, Inc., a Florida corporation which was
incorporated on April 7, 1980, and which was merged with and into Edd Helms,
Incorporated in May of 1999, prior to the Merger.

We presently have two wholly-owned subsidiaries:

1. Hoteleticket, Inc., a Florida corporation, was incorporated on March 7, 1988.
Hoteleticket is a licensed travel agency which has been inactive since 1993, but
we keep in compliance with relevant regulatory authorities, including our
Airline Reporting Company registration.

2. Edd Helms Air Conditioning, Inc., a Florida corporation which was
incorporated on April 7, 1980, and which as a result of the Merger became a
wholly-owned subsidiary of the Company.

                                     2

<PAGE>

PRINCIPAL SERVICES AND MARKETS

I.     Electrical and Data Communications Services

Our primary line of business is the provision of electrical and data
communications services to commercial businesses, factories, hotels, banks,
convention facilities, and residences throughout Miami-Dade, Broward, and
southern Palm Beach counties. Our services include preventive maintenance,
emergency repairs, and replacements of electrical control systems, wiring, data
cabling, switches, and panels. We also service the on-going needs of homeowners
and businesses, and we replace electrical and wiring systems and associated
parts specifically in connection with retrofitting or remodeling residences and
commercial buildings. We have approximately 12,000 customers. We maintain a web
site at www.eddhelms.com and have registered this domain along with
www.eddhelms.com.

We also provide temporary electrical and wiring services to convention and trade
show exhibitors. To facilitate the trade show servicing component of our
business, we maintain a mobile inventory of specialty show equipment. Typically,
we provide electrical and exhibit set-up services to hotels and convention
facilities where their exhibitors purchase their required electrical needs
directly from us. We have trained employees with significant trade show
experience and own our own inventory that we believe to be properly equipped to
handle most trade show events. We have long-term contracts with several large
trade show groups with which we have enjoyed long-term relationships.

Although we are not dependent on new construction projects alone, we do compete
in this market and perform several new construction projects each year. This
work is generally bid or negotiated directly with the owners or general
contractors. Over the years, we have been successful in negotiating many design
build projects and will continue to pursue work in this arena.

II.      Air Conditioning and Refrigeration

In 1994, we acquired the assets of a major mechanical contractor in South
Florida. This wholly-owned subsidiary operates as Edd Helms Air Conditioning,
Inc. Since the acquisition we have worked to transform this business into a
streamlined service and retrofit organization. Although we do compete in the new
construction market, we are not dependent on the new construction market alone.
Like electrical and data communications services, we place most of our air
conditioning and refrigeration efforts in the service, retrofit, and design
build markets.

The strength of our electrical and air conditioning services business rests in
our workforce and management team. We internally train our workforce to be
professional, customer-service oriented technicians, with intensive training in
customer communication, sales and problem solving skills. Each of our employees
undergoes a background reference check, including driving and criminal records.
We also provide on-going training and education to our employees. Our
electricians typically have a master electrician or journeyman license. Our air
conditioning technicians also hold masters or journeyman licenses. The data
communication employees possess certifications from BICSI as certified
installers or as RCDD(Registered Communications Distribution Designers). In
order for our employees to maintain their electrician licenses, each employee
must complete a minimum of 14 hours of continuing education every two years that
is required by the State of Florida. We endeavor to provide competitive
compensation and benefits, such as 401(k) plans to our technicians with the goal
of obtaining and retaining the best possible employees.

A large part of our services is provided by means of our mobile service
vehicles. These service vehicles and the licensed technicians that operate them
respond to the customers needs in their homes, factories, and businesses. These
services are available 24 hours a day and 365 days per year.

Our employees provide electrical and air conditioning services using a fleet of
approximately 60 service trucks, vans and support vehicles which are either
owned or leased by us. Most of these service vehicles are equipped with a
computer tracking system that allows us to monitor the location of the service
vehicle at all times as well as the time of arrival and departure of the vehicle
and technicians at each job. The tracking system is integrated with our in-house
server. Each vehicle has a module that communicates between a commercial service
provider and our server. The service provider licenses software to us and
utilizes signal antennas located throughout South Florida to communicate with
antennas and modules in our service vehicles. All warehouse and delivery
personnel also have two-way radios in their vehicles that permit communication
with our dispatch department. Our administrative and management personnel also
have hand-held two-way radios.

We maintain a high profile advertising campaign in the yellow pages and radio
spots that are run throughout the year. This advertising campaign continues to
renew our customer base. We use both general advertising and a direct sales
force to market our services. The name "Edd Helms" has garnered goodwill since
its first use in 1975. We exploit the goodwill by placing an "Edd Helms"
trademarked logo and identifying marks on our service trucks, marketing
materials, advertisements, and the uniform t-shirts that all of our field
technicians wear.

We charge our customers a range of fees depending on the service required. We
typically are paid on a COD (cash) basis for residential customers who pay by
cash, check, or credit card, once a job is completed. Commercial customers pay
for our services in the same fashion unless and until we approve a credit
application. On large contracts, we sign a written contract and billings are
produced every 30 days and are due and payable net within 10 days. These
contracts generally have approximately ten percent retention until complete, and
at such time, all charges become due and payable. We provide a one-year warranty
covering our electrical services and air conditioning work.

During our fiscal year ended May 31, 2001, revenues from the electrical services
component of our business constituted approximately 70.8% of our total revenues
and revenues from the air conditioning services component of our business
constituted approximately 27.6% of our total revenues.

III.     Public facsimile (FAXMAIL) services

An additional component of our business is the operation of a public facsimile
network through which the public is able to send and receive faxes at rates
competitive with overnight mail from both self-service and attended locations
throughout the United States (this component of our business is referred to as
the "FaxMail" business for the remainder of this annual report.) Before the
Merger, Hotelecopy operated the FaxMail business. As of June 1, 2001, we
operated 76 self-service "FaxMailers" and 6 attended fax machines in hotels.

We operate credit card operated self-service facsimile terminals marketed as the
FaxMailer. The self-service FaxMailer allows the public to send a fax, receive a
fax, or to access any of the companies FaxMail services. We contract directly
with third parties at 76 locations to provide self-service FaxMailers under a
Membership Agreement. We operate self-service FaxMailers in most all of United
Airlines private membership airport clubrooms nationwide. We also operate our
Faxmailers within airports, colleges, universities, train stations, and hotels
in various locations nationwide.

                                        3
<PAGE>

We have developed proprietary computer software for the FaxMailers. This
software has been continuously refined and upgraded since 1986. Our computer
system integrates computer-based fax systems, traditional fax systems, voice
prompting, point-of-sale transaction processing and credit card processing with
traditional data processing systems. From our FaxMail operations center in
Miami, Florida, we remotely monitor and manage all of our public fax terminals
across the United States. In fact, we are capable of managing additional public
terminal locations anywhere in the world.

The customer, using a major credit card, pays FaxMailer usage fees directly to
us. We electronically collect self-service FaxMail usage receipts on a daily
basis and pay the self-service Member location a commission based on those usage
revenues.

During our fiscal year ended May 31, 2001, our FaxMail business constituted 1.6%
of our total revenues. Our revenues from attended Member locations have
declined. We attribute this decline primarily to maturation of the public fax
marketplace, and the expiration and non-renewal of certain attended Member
location agreements. We now focus our sales efforts on self-service FaxMail
locations.

Where we own the self-service FaxMailer terminal, we earn a higher percentage of
the FaxMailer usage fees as compared to when it is an attended location.

COMPETITION

I.   Electrical and Air Conditioning Services Industry

In the electrical and air conditioning services industry, we compete mainly with
small owner-operated companies that typically operate in a single market. Some
of these smaller competitors have less overhead costs than we and, as a result,
offer lower service rates. Often times the small competitors have long
established relationships with homeowners for a variety of home electrical
repairs, which makes that market difficult for us to penetrate. There are also a
number of public companies, such as EmCor, Blue Dot, IES and Service Experts,
which focus on providing residential or commercial services in some of the same
service lines provided by us. Some of these competitors, and potential
competitors, have greater financial resources than we do to finance acquisition
and development opportunities, and may be able to pay higher prices for the same
opportunities to develop and support service operations.

The market for our electrical and air conditioning services is competitive. We
believe that the principal competitive factors of this line of business are:

 (a) timeliness, reliability and quality of services provided;
 (b) range of services offered;
 (c) market share visibility strengthened by advertising; and
 (d) price

Our ability to employ, train and retain highly motivated service technicians to
provide a quality service is key to our success in being competitive. In order
to recruit qualified individuals, we offer attractive compensation and health
and saving benefits that are more comprehensive than those typically offered
within the industry, including a 401(k) plan.

II. FaxMail

Our FaxMail business competes with alternative methods of document transmission,
principally overnight mail services such as Federal Express, United Parcel
Service and Express Mail by the United States Postal Service, internet fax
services and electronic main (eMail). Additionally, any business can purchase a
facsimile machine and provide fax service to the public independent of us and
barriers to entry into the fax provision business are not high.

In general, the market for public fax and information services is highly
competitive. We believe that the principal competitive factors in this market
include product features, ease of operation, product reliability, initial
investment costs, and price and customer support services. We believe that our
continued operations will, in large part, be dependent on our ability to respond
to competitive pressures and technological changes. We foresee the burgeoning
use of eMail and eFax services will be detrimental to our FaxMail business.

We compete with both large established concerns and smaller companies that are
developing and offering, or which may develop and offer, competing products and
services as well as eMail. Many of these competitors have financial resources
far greater than ours. The intense competition in the market has adversely
affected us.

                                        4
<PAGE>

SUPPLIERS

I. Electrical and Air Conditioning Services

We obtain supplies for our electrical and air conditioning services from
approximately 100 suppliers. Suppliers of materials are plentiful and we are not
dependent on any one company.

II.  FaxMail

Our equipment used at our FaxMailer locations consists principally of products
sold by AT&T and Ricoh. Our self-service units integrate certain designed
components, which are manufactured by others and are readily available from any
one of many suppliers. We believe that our present suppliers can adequately meet
our needs for the near future.

CYCLICALITY OF THE INDUSTRY

I.   Electrical and Air Conditioning Services

We generate increased revenues in the summer months when the dependency on air
conditioning is greater than in the winter months. The electrical services
business is not cyclical.

II.    FaxMail

Our FaxMail revenues are derived primarily from business travelers.
Consequently, during periods of lessened business travel, such as holiday
seasons, these revenues decline.

ECONOMIC DEPENDENCE

I.  Electrical and Air Conditioning Services

We believe that there is always a demand for electrical and air conditioning
services. With the emergence of the broadband industry with fast computers, the
reliability of the electrical power and the network computer wiring has become
more critical than ever. The required reliability of many of these electrical
systems exceeds a requirement of 99.999%. Uninterruptible Power Supplies (UPS)
and standby emergency generators are required in greater numbers than ever
before. Aside from the initial installation of power and network cabling,
ongoing maintenance programs are imperative. Indoor air quality with proper
temperature and humidity control is also required. Many of the computer networks
now require transmission of information at gigabit speed which requires
upgrading of slower network cables. Fiber optics is now replacing copper wire in
many of these installations.

The electrical, data communications and air conditioning construction services
industry has a higher overall growth rate than the overall construction
industry. This is due in part to the increase in complexity of electrical and
mechanical systems in many projects. This results from the increased use of
computers and more advanced data and voice communications and environmental
control systems. As a result, buildings are now consuming more electricity per
square foot than in the past and more extensive air conditioning and electrical
distribution systems are now required.

Voice and data communication systems now require more reliable power supplies
and improved low voltage and fiber optic cabling. The need for increased
environmental controls within a building, such as the increased need for air
conditioning control to maintain computer systems at optimal temperatures, and
the increased demand for environmental control in individual spaces, are
creating expanded opportunities for the electrical, mechanical, and data
communications facilities service business.

Electrical and mechanical construction services involve the design, installation
and start up of several systems. These include:
     1) the generation and distribution of electrical power including conduits,
        power cables, transformers, electrical panels, switch gear, controls,
        generators, and uninterruptible power supplies
     2) lighting fixtures and controls
     3) voice and data communications, including fiber optic and copper cabling
     4) fire alarm, security, and process control
     5) heating, ventilation, air conditioning, refrigeration and increased
        requirements of all of these systems in clean-room applications

We perform our services pursuant to contracts with owners, corporations,
government organizations, construction managers, developers, general contractors
and individual tenants in multi-tenant facilities.

We also install and maintain antennas, cables, splitters, grounding, and power
for the cellular and wireless industries. This work is generally performed on
free standing towers up to three-hundred (300) feet high and on roof tops of
existing high rise buildings. We own and operate several different pieces of
test equipment to certify the quality of these critical wireless installations.
Our qualifications and financial resources have allowed us to win several
contracts in the wireless industry with expectations of increased opportunities
based on our past performance.

II.    FaxMail

Each member location contracts with us for FaxMail services. The majority of our
attended location agreements are for single locations. We have an annually
renewable agreement with Alaska Airlines, to offer self-service FaxMailers in
all of their private membership airport clubrooms nationwide. Although we are
not dependent upon a single customer, the loss of any individual master contract
could have a material adverse effect on continuing operations.

GOVERNMENT REGULATION

I.  Electrical and Air Conditioning Services

Aspects of our electrical and air conditioning services operations are subject
to various federal, state and local laws and regulations including:
 (a) permitting and licensing  requirements  applicable to service
     technicians in their respective trades;
 (b) building and electrical codes and zoning ordinances; and
 (c) laws and regulations relating to worker safety and protection

We believe we have all required permits and licenses to conduct our operations
and comply with applicable statutory requirements relating to our operations.

In connection with the air conditioning services component of our business, we
have a registration stating that we dispose of Freon used in air conditioning
equipment in accordance with the standards required by the EPA.

II.   FaxMail

There is no price regulation for FaxMail services. We cannot foresee whether
charges for fax and other electronic business services provided by us will be
regulated in the future.

EMPLOYEES

As of May 31, 2001, we had 183 employees. Approximately 118 of these employees
are electrical technicians and another 26 are air conditioning technicians. We
have 39 employees who fill administrative, sales and management roles. We
believe that our relations with our employees are good. We are signatory to
various collective bargaining agreements with local unions representing
approximately 75% of the our employees. None of these collective
bargaining agreements are nationwide or regional in scope.

We are a member of the National Electrical Contractors Association who
represents us in bargaining with the International Brotherhood of Electrical
Workers. Our air conditioning subsidiary is a member of the Mechanical
Contractors Association who represents us in bargaining with the United
Association.

                                        5
<PAGE>

EXECUTIVE OFFICERS OF THE COMPANY

See the information contained in Part III, Item 9, which is describes our
executive officers in detail.

ITEM 2. DESCRIPTION OF PROPERTY

We lease approximately 27,000 square feet for the warehousing, distribution and
executive offices for our electrical and air conditioning services business at a
total annual cost of approximately $193,000 including sales tax. We also lease
2,000 square feet for the headquarters of our FaxMail business at a total annual
cost of $26,400. All leased property is owned by a partnership of which Carol
Helms and W. Edd Helms, Jr., are the sole owners. Carol and W. Edd Helms are
officers and directors and related to some of our other officers and directors.
We believe that these facilities are in good condition and are sufficient to
accommodate our needs. We believe the rent to be reasonable and competitive in
price with rent for similar facilities in the area.


ITEM 3.  LEGAL PROCEEDINGS

On July 26, 2000, a former employee, filed suit for breach of his employment
agreement. The same former employee filed a charge of discrimination with the
Equal Employment Opportunity Commission against the Company, alleging that he
was discriminated against, in violation of the Americans With Disabilities Act
of 1990, as amended. The Commission has issued a determination that there was
probable cause that the employee's rights may have been violated. The Commission
recommended that we have conciliation. We did not pursue conciliation and have
elected to defend our position in the court.

On August 8, 2001, the former employee filed an amended complaint to include
alleged violations under the Americans with Disabilities Act and the Florida
Civil Rights Act. The former employee is seeking compensatory damages, interest
and attorneys' fees and costs, as well as a declaratory judgment as to the
restrictive covenant contained within the employment agreement. We denied the
allegations set forth in the complaint. On September 10, 2001, the case was
removed from the Circuit Court of the Eleventh Judicial District to the United
States District Court, Southern District of Florida. Discovery in this action
has not yet commenced.

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

No matter was submitted to a vote of security holders through the solicitation
of proxies or otherwise during the fourth quarter of the fiscal year ending May
31, 2001.

                                     PART II
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

There is currently no established public trading market for our common stock. In
order to obtain bid quotations for our common stock, it is necessary to contact
certain broker/dealers, if any, which make a market in our common stock. We are
not aware of any such broker/dealers. Our original NASDAQ trading symbol was
FAXM. We changed this trading symbol to EDDH effective January 7, 2000.

The following tables set forth, for the periods indicated, the range of high and
low closing bid and ask prices for our common stock from June 1, 2000, through
May 31, 2001. These quotations represent prices between dealers, do not include
retail markups, markdowns, or commissions, and do not represent actual
transactions. In both fiscal years 2001 and 2000, there was no reported trading
in our common stock. Consequently, we are not able to state with any certainty
the range of bid and ask quotations for fiscal 2001 or 2000. The following
information was obtained from the Company's records.

                                                   Year Ended        Year Ended
                                                   May 31, 2001     May 31, 2000
                                                   High    Low      High     Low
                                                   -----------      ------------

          First Quarter                            $.08   $.08       No Trading
          Second Quarter                           $.08   $.07       No Trading
          Third Quarter                            $.15   $.07       No Trading
          Fourth Quarter                           $.15   $.30       No Trading

On May 31, 2001, there were approximately 445 holders of record of our common
stock. This number does not include any adjustment for stockholders owning the
stock in "Street" name.

We have not paid dividends since our inception and do not anticipate paying any
dividends in the near future. We intend to retain earnings, to provide funds for
general corporate purposes and the expansion of our business.

ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

HIGHLIGHTS

Revenues increased         $8,284,681

Cost of revenues increased $7,022,854

Pre-tax income increased   $  848,471

OPERATING SEGMENTS

Our business consists of electrical, air conditioning and faxmail services
segments.

                                        6
<PAGE>

RESULTS OF OPERATIONS

The following are discussions for May 31, 2001, compared to May 31, 2000:

REVENUES

Our revenues increased approximately 70% to $20,270,475 for the year ended May
31, 2001 as compared to $11,985,794 for the fiscal year ended May 31, 2000. The
increase in our revenue is attributed to the growth in the electrical and air
conditioning business as well as the growth of the data communications division.
We believe this growth to be a result of our visible advertising and the
additional services that we are now selling with the Data Communications
division.

COST OF REVENUES

Our cost of revenues increased approximately 80% for the fiscal year ended May
31, 2001, to $15,773,098 as compared to $8,750,244 for the fiscal year ended May
31, 2000. We believe that the increase in costs can be attributed to increased
direct job cost as the result of increased sales derived from the electrical,
data communications, and air conditioning divisions. Wages for the direct cost
of field employees increased. Additionally, a portion of our overhead expenses
increased as a result of increased sales.

SELLING, GENERAL, AND ADMINISTRATIVE EXPENSES

These expenses increased 14% for the fiscal year ended May 31, 2001, to
$3,600,376 as compared to $3,161,633 for the fiscal year ended May 31, 2000.
This was primarily the result of increased advertising and additional sales
expenses attributed to the data communications and air conditioning divisions.
Additionally, administrative personnel were added to our staffing as a result of
the increased sales. Salaries were generally increased across-the-board in line
with the employees' tenure and cost of living increases.

INCOME NOT ARISING FROM CONTINUING OPERATIONS

During the current year we sold a telephone number from the FaxMail business for
approximately $50,000 cash, plus restricted securities of the purchasing
company, which were valued at approximately $71,500 at the time of the sale. At
the end of the fiscal year these securities were believed to have no significant
value.

EFFECTS OF INFLATION

We believe that our revenues and results of operations have not been
significantly affected by inflation during the last two years ended May 31,
2001.

LIQUIDITY AND CAPITAL RESOURCES

Our primary sources of liquidity is cash flow from operations, proceeds from
notes payable, borrowings under a secured line of credit for up to $750,000 and
two other bank loans. As of May 31, 2001, the cash flow from our operations was
$1,642,194, as compared to $102,773 for the end of the prior fiscal year. As of
May 31, 2001, we had received $257,518 in proceeds from notes payable and
borrowed $75,000 under our secured line of credit. We made principal payments on
notes payable and long-term debt of $317,688 and $476,814 in payments under the
line of credit in fiscal year ended May 31, 2001. As of May 31, 2000, we had
received $281,666 in proceeds from notes payable and received $491,814 borrowed
under the line of credit. As of May 31, 2000, we made principal payments for
$254,117 on notes payable and long-term debt and paid $90,000 towards the line
of credit.

We had a working capital surplus of approximately $1,695,627 and a ratio of
current assets to current liabilities of approximately 1.62:1 as of May 31,
2001. This compares with the May 31, 2000 working capital surplus of $766,702,
and a ratio of 1.38:1 current assets to current liabilities.

For the year ended May 31, 2001, our liquidity increased by $928,041 as cash
increased to $1,289,957 compared to $361,916 for the year ended May 31, 2000.
This increase in cash is attributable principally to increased profits from
operations.

                                        7
<PAGE>

ITEM 7. FINANCIAL STATEMENTS

Our consolidated financial statements in response to this item are as follows:

                                C O N T E N T S

                                                    Page
                                                   -----
INDEPENDENT AUDITOR'S REPORT                        10

CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Balance Sheets                         11

Consolidated Statements of Income                   12

Consolidated Statements of Cash Flows               13

Consolidated Statements of Stockholders' Equity     14

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS          15 to 22



                                        9

<PAGE>

Dohan and Company                                 7700 North Kendall Drive, #200
Certified Public Accountants                          Miami, Florida  33156-7564
A Professional Association                            Telephone:  (305) 274-1366
                                                      Facsimile:  (305) 274-1368

                          INDEPENDENT AUDITOR'S REPORT

Board of Directors
Edd Helms Group, Inc. and Subsidiaries
Miami, Florida

We have audited the accompanying consolidated balance sheets of Edd Helms Group,
Inc. and Subsidiaries as of May 31, 2001 and 2000, and the related consolidated
statements of income and comprehensive income, cash flows and stockholders'
equity for the years then ended. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of Edd Helms Group,
Inc. and Subsidiaries at May 31, 2001 and 2000, and the results of their
operations and their cash flows for the years then ended, in conformity with
generally accepted accounting principles.


                                              /s/Dohan and Company, CPA's
                                              Certified Public Accountants

Miami, Florida
August 10, 2001


Member: Florida Institute of Certified Public Accountants
American Institute of Certified Public Accountants - Private Companies
   and SEC Practice Sections
SC International - Offices in Principal Cities World-Wide


                                       10
<PAGE>

EDD HELMS GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
May 31,                                                      2001        2000
--------------------------------------------------------------------------------
                                     ASSETS
CURRENT ASSETS

Cash and cash equivalents                                $1,289,957 $   361,916
Restricted cash - certificate of deposit                     10,000      10,000
Available-for-sale securities                                 5,424        -
Accounts receivable, less allowance for doubtful
  accounts of $ 59,902 and $78,044                        1,977,508   1,567,164
Due from employees                                           19,219      13,555
Costs and estimated earnings in excess
  of billings on uncompleted contracts                      482,768     311,553
Inventories                                                 606,865     466,050
Prepaid expenses                                             28,871      30,684
--------------------------------------------------------------------------------
  TOTAL CURRENT ASSETS                                    4,420,612   2,760,922
--------------------------------------------------------------------------------
PROPERTY AND EQUIPMENT, NET                                 873,011     822,218
--------------------------------------------------------------------------------
OTHER ASSETS
Excess of cost over net assets of businesses acquired,
  less accumulated amortization of $75,758 and $35,535      176,974     217,197
Deferred income taxes                                       759,492      64,408
Other                                                        12,635      14,128
--------------------------------------------------------------------------------
  TOTAL OTHER ASSETS                                        949,101     295,733
--------------------------------------------------------------------------------
  TOTAL ASSETS                                          $ 6,242,724 $ 3,878,873
================================================================================

                      LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES

Current maturities of long-term debt                    $   217,769 $   203,515
Credit arrangement                                             -        401,814
Current portion of long-term capitalized leases              11,311       3,210
Accounts payable                                          1,179,045     796,621
Accounts payable - related parties                           39,831      39,831
Customer deposits                                             6,729      35,617
Accrued liabilities                                         477,484     285,984
Deferred revenue                                              2,560        -
Billings in excess of costs and estimated
  earnings on uncompleted contracts                         790,256     163,220
Deferred income taxes                                          -         64,408
--------------------------------------------------------------------------------
  TOTAL CURRENT LIABILITIES                               2,724,985   1,994,220
--------------------------------------------------------------------------------
LONG-TERM DEBT                                              168,452     242,876

LONG-TERM PORTION OF CAPITALIZED LEASES                      17,795       2,402
--------------------------------------------------------------------------------
  TOTAL LONG-TERM LIABILITIES                               186,247     245,278
--------------------------------------------------------------------------------
  TOTAL LIABILITIES                                       2,911,232   2,239,498
--------------------------------------------------------------------------------
COMMITMENTS AND CONTINGENCIES (NOTES 10, 12, 13 AND 15)

STOCKHOLDERS' EQUITY
Common stock; $.01 par value, 20,000,000 shares authorized, 12,673,995 and
  12,673,995 shares issued, 12,581,175 and 12,581,608 shares outstanding in 2001
  and 2000 respectively                                     126,740     126,740
Additional paid-in capital                                  186,946     186,946
Retained earnings                                         3,087,769   1,329,579
Treasury stock, 92,820 shares at cost                    (    3,890) (    3,890)
Unrealized losses on securities, less income taxes       (   66,073)       -
--------------------------------------------------------------------------------
  TOTAL STOCKHOLDERS' EQUITY                              3,331,492   1,639,375
--------------------------------------------------------------------------------
  TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY            $ 6,242,724 $ 3,878,873
================================================================================
See accompanying notes.

                                       11
<PAGE>

EDD HELMS GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
For the Years Ended May 31,                                 2001        2000
--------------------------------------------------------------------------------
REVENUES EARNED                                        $ 20,270,475 $11,985,794

COST OF REVENUES EARNED                                  15,773,098   8,750,244
--------------------------------------------------------------------------------
  GROSS PROFIT                                            4,497,377   3,235,550

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES              3,600,376   3,161,633
--------------------------------------------------------------------------------
INCOME FROM OPERATIONS                                      897,001      73,917
--------------------------------------------------------------------------------

OTHER INCOME AND EXPENSES
  Interest income                                            27,525      11,954
  Interest expense                                          (54,091)    (34,001)
  Sale of telephone number                                  121,327         -
  Miscellaneous income (expense)                              6,935      98,356
--------------------------------------------------------------------------------
  TOTAL OTHER INCOME AND EXPENSES                           101,696      76,309
--------------------------------------------------------------------------------

INCOME BEFORE INCOME TAXES                                  998,697     150,226

INCOME TAX PROVISION                                       (313,354)    (46,570)

INCOME TAX BENEFIT FROM UTILIZATION OF NET OPERATING
  LOSS CARRYFORWARD                                       1,072,847      46,570
--------------------------------------------------------------------------------
  NET INCOME                                              1,758,190     150,226

UNREALIZED HOLDING LOSSES ON SECURITIES
  ARISING DURING THE PERIOD, LESS INCOME TAXES             ( 66,073)       -
--------------------------------------------------------------------------------
  COMPREHENSIVE INCOME                                   $1,692,117   $ 150,226
================================================================================
BASIC AND DILUTED NET INCOME PER SHARE                      $  0.14     $  0.01
================================================================================
WEIGHTED AVERAGE SHARES OUTSTANDING                      12,673,995  10,562,491
================================================================================
See accompanying notes.

                                       12
<PAGE>

EDD HELMS GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Years Ended May 31,                                  2001        2000
--------------------------------------------------------------------------------
CASH FLOWS FROM OPERATING ACTIVITIES:
  Net income                                            $ 1,758,190   $ 150,226
  Adjustments to reconcile net income to net cash
    provided by operating activities:
  Depreciation and amortization                             314,923     258,739
  Gain on sale of telephone number                       (  121,327)        -
  Provision for bad debts                                    18,142      26,001
  Merger gains                                                 -     (  157,178)
  Deferred income taxes                                  (  759,492)       -

  Changes in assets (increase) decrease:
  Accounts receivable                                    (  428,486) (  661,096)
  Due from affiliate                                     (     -   )     76,042
  Due from employees                                     (    5,664)       -
  Costs and estimated earnings in excess
    of billings on uncompleted contracts                 (  171,215) (  136,094)
  Inventories                                            (  140,815)     62,441
  Prepaid expenses                                            1,813      31,119
  Other assets                                                1,493     25,632
  Goodwill                                                     -         19,863

  Changes in liabilities increase (decrease):
  Accounts payable                                          382,424     494,329
  Customer deposits                                      (   28,888) (   20,475)
  Accrued liabilities                                       191,500  (   46,331)
  Income taxes payable                                         -     (   36,828)
  Deferred revenue                                            2,560  (    4,595)
  Deferred income taxes                                        -           -
  Billings in excess of costs and estimated
    earnings on uncompleted contracts                       627,036      20,978
--------------------------------------------------------------------------------
NET CASH PROVIDED BY OPERATING ACTIVITIES                 1,642,194     102,773
--------------------------------------------------------------------------------

CASH FLOWS FROM INVESTING ACTIVITIES:
  Purchase of property and equipment                     (  325,493) (  469,075)
--------------------------------------------------------------------------------
NET CASH USED BY INVESTING ACTIVITIES                    (  325,493) (  469,075)
--------------------------------------------------------------------------------

CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from notes payable                               257,518     281,666
  Proceeds from capitalized leases                           38,349       6,586
  Payments of capitalized leases                         (   14,852) (      974)
  Principal payments on long-term debt and notes payable (  317,688) (  254,117)
  Common stock repurchase                                      -     (    3,890)
  Proceeds from line of credit                               75,000     491,814
  Payments on line of credit                              ( 476,814) (   90,000)
  Proceeds from sale of telephone number                      49,827       -
--------------------------------------------------------------------------------
NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES          (  388,660)   431,085
--------------------------------------------------------------------------------

NET INCREASE IN CASH AND CASH EQUIVALENTS                    928,041     64,783

CASH AND CASH EQUIVALENTS - BEGINNING OF YEAR                361,916    297,133
--------------------------------------------------------------------------------
CASH AND CASH EQUIVALENTS - ENDING OF YEAR                $1,289,957 $  361,916
================================================================================

SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING TRANSACTIONS:
  Interest paid                                          $  54,091   $   34,001
  Interest received                                      $  27,525   $   11,553
  Income taxes paid                                      $    -      $   42,845
  Available-for-sale securities received as part of
    proceeds for sale of telephone number                $  71,500   $     -
================================================================================
See accompanying notes.

                                       13
<PAGE>

EDD HELMS GROUP, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
FOR THE YEARS ENDED MAY 31, 2001 AND 2000


                          Additional
          Common Stock     Paid-in   Retained  Treasury  Comprehensive
       Shares     Amount   Capital   Earnings    Stock      Income       Total

--------------------------------------------------------------------------------
May 31, 1999     4,970 $  4,970 $ 88,234 $1,179,353 $  -    $  -     $ 1,272,557

Merger of
Hotelecopy, Inc.
and Edd Helms,
Inc. and
subsidiary  12,669,025  121,770   98,712       -       -       -         220,482

Common stock
purchased from
Employee Stock
Ownership Plan-            -        -          -     (3,890)   -         (3,890)

Net income    -            -        -       150,226    -       -         150,226
--------------------------------------------------------------------------------
May 31,2000 12,673,995  126,740  186,946  1,329,579 ( 3,890)   -       1,639,375

Net income    -            -         -    1,758,190    -       -       1,758,190

Unrealized
holding
losses
arising
during the
period        -            -        -          -       -     (66,073)  ( 66,073)
--------------------------------------------------------------------------------
May 31,2001 12,673,995 $126,740 $186,946 $3,087,769 ($3,890)($66,073) $3,331,492
================================================================================
See accompanying notes.

                                       14
<PAGE>

EDD HELMS GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MAY 31, 2001 AND 2000

NOTE 1. BUSINESS

Nature of Operations - Edd Helms Group, Inc. was incorporated in the State of
Florida in July 1985, and has three reportable segments. The electrical segment
has provided electrical service, repair, and maintenance of commercial and
residential facilities in the South Florida area, since 1980. The air
conditioning segment derives the majority of its business activity from its
service, repair and maintenance of commercial and residential air conditioning
systems in the South Florida area. The faxmail segment provides a worldwide
facsimile transmission network with facsimile equipment located in various
commercial and public locations throughout the United States and other
countries. The majority of the Company's revenues are derived from their
electrical and air conditioning segments. Hoteleticket is a Florida corporation
formed in 1988 to provide airline and other travel reservation services through
automated ticket printers. Hoteleticket has discontinued its operating
activities, however, it complies with relevant regulatory authorities, and its
only expenses are those that are required in order to comply with those
authorities.

Business Combination - Effective July 30, 1999, the shareholders of Hotelecopy
approved an agreement and plan of merger by and between Hotelecopy, Inc. and Edd
Helms, Incorporated whereby Edd Helms, Incorporated was merged with and into
Hotelecopy, and Hotelecopy's name was changed to Edd Helms Group, Inc. Only July
8, 1999, Edd Helms Group, Inc. filed a proxy statement in connection with an
anticipated solicitation of its shareholders' proxies to approve an agreement
and plan of merger with Edd Helms, Incorporated, (EHI) a Florida corporation,
founded in 1975. The merger was accounted for as a reverse acquisition purchase,
as if EHI had acquired Hotelecopy. Accordingly, the results of operations of
Hotelecopy for the period from August 1, 1999, through May 31, 2000 are included
in the consolidated statement of income for the year ended May 31, 2000.

The shareholders of EHI each received 2,178.6363 shares of Hotelecopy's common
stock in exchange for each outstanding share of EHI's common stock they owned.
The proxy statement also provided for the consideration and vote upon the change
of Hotelecopy's name to Edd Helms Group, Inc. as well as consideration and vote
upon an amendment to Hotelecopy's Articles of Incorporation to increase the
number of authorized shares of its common stock par value $.01 per share, to
20,000,000 shares.

NOTE 2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation - The accompanying consolidated financial statements
include the accounts of Edd Helms Group, Incorporated (EHG) and its wholly-owned
subsidiaries, Edd Helms Air Conditioning, Inc., d/b/a Edd Helms Air Conditioning
(Air Conditioning) and Hoteleticket, Inc. (Hoteleticket). All significant
intercompany accounts and transactions of Edd Helms Group, Inc., and
Subsidiaries (the Company) for the periods presented have been eliminated in
consolidation.


Cash and Cash Equivalents - Cash and cash equivalents consist of time deposits
and all liquid instruments (including overnight repurchase agreements with a
bank) with maturities of three months or less.

Restricted Cash - The Company has a certificate of deposit that collateralizes a
$10,000 irrevocable letter of credit. The letter of credit may be terminated
annually at the Company's option.

Available-for-Sale Securities - Marketable securities consist of common stock
and are stated at market value as determined by the most recently traded price
of each security at the balance sheet date. All marketable securities are
defined as trading securities or available-for-sale securities under the
provisions of Statement of Financial Accounting Standards No. 115 (SFAS 115),
"Accounting for Certain Investments in Debt and Equity Securities".

Management determines the appropriate classification of its investments in
marketable security at the time of purchase and reevaluates such determination
at each balance sheet date. Available-for-sale securities are carried at fair
value, with the unrealized gains and losses, net of tax, reported as a separate
component of stockholders' equity.

Revenue and Cost Recognition - Revenues and direct costs produced by the
Company's hourly based electrical and air conditioning service, repair, and
maintenance activities are recognized as earned or incurred. Contract revenues
and direct costs, where the work is materially completed within sixty days, are
classified as service related revenues, and recognized as earned and incurred.

Revenues from significant construction contracts, not materially completed
within sixty days, are recognized on the percentage-of-completion method,
measured by the percentage of costs incurred to date to estimated total costs
for each contract. This method is used because management considers expended
costs to be the best available measure of progress on the contracts.

These percentage-of-completion contract costs include direct labor, material,
subcontract, equipment rental, and other miscellaneous direct and indirect costs
as allocated. Other operating costs are charged to expense as incurred.
Provisions for estimated losses, if any, on uncompleted contracts are made in
the period in which such losses are determined. Changes in job performance, job
conditions, and estimated profitability, including those arising from contract
penalty provisions and final contract settlements may result in revisions to
costs and income and are recognized in the period in which the revisions are
determined.

                                       15
<PAGE>

NOTE 2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

The asset "Cost and estimated earnings in excess of billings on uncompleted
contracts" represents revenues recognized in excess of amounts billed. The
liability "Billings in excess of costs and estimated earnings on uncompleted
contracts" represents amounts billed in excess of revenues earned. The Company
recognizes its facsimile transmission usage revenue on the date of the
transmission. Membership revenues are recognized ratably over the respective
terms of the members' contracts.

In December 1999, the Securities and Exchange Commission issued Staff Accounting
Bulletin No. 101 ("SAB 101"), "Revenue Recognition in Financial Statements." SAB
101 provides guidance for revenue and recognition under certain circumstances.
SAB 101 became effective for the Company's fiscal year beginning June 1, 2000.
Implementation of SAB 101 did not require the Company to change existing revenue
recognition policies and therefore did not have a material effect on the
Company's financial position or results of operations.

Inventories - Inventories consist principally of electrical and air conditioning
equipment, supplies, components and accessories, and are valued at the lower of
cost or market using the first-in, first-out (FIFO) method to determine cost and
net realizable value to determine market.

Property and Equipment - Property and equipment is recorded at cost.
Expenditures for major betterments and additions are charged to the property
accounts, while replacements, maintenance, and repairs that do not improve or
extend the lives of the respective assets are charged to expense currently.

Depreciation is computed principally using the straight-line method, based on
the estimated useful lives of the assets, which range from five to ten years.

Income Taxes - Income taxes are computed under the provisions of the Financial
Accounting Standards Board Statement No. 109, "Accounting for Income Taxes,"
(SFAS 109). SFAS 109 is an asset and liability approach that requires the
recognition of deferred tax assets and liabilities for the expected future tax
consequences of the differences in events that have been recognized in the
Company's financial statements compared to the tax returns. Current and deferred
taxes are allocated to members of the consolidated group by applying FASB
Statement No. 109 to each member as if it were a separate taxpayer.

Income Tax Credits - Income tax credits will be recognized as a reduction of the
provision for income taxes in the year in which utilized.

Amortization - Goodwill is amortized using the straight-line method. Goodwill
recognized as a result of the merger on July 1999, is being amortized over five
years. Goodwill representing the acquisition of a communications business,
acquired during 1999, is amortized over fifteen years.

Concentrations of Credit Risk and Economic Dependence - The Company provides its
electrical and air conditioning services in the South Florida area.
Consequently, the Company's ability to collect the amounts due from customers
may be affected by economic fluctuations in the service and construction
industries, its geographical location and natural disasters. The Company also
places equipment in airport, hotels, and other public places and extends credit
based on an evaluation of the customer's financial condition, without requiring
collateral. Certain usage is also billed immediately to the sender's credit card
account. Concentrations of credit with respect to trade receivables, consists
primarily of six customers who comprise 41% of accounts receivables. The Company
monitors its exposure for credit losses and maintains allowances for anticipated
losses. Concentrations with respect to sales exist in that revenues from one
customer comprise approximately 37% of revenue for the current fiscal year.

Concentrations of Credit Risk Arising from Cash Deposits in Excess of Insured
Limits - The Company maintains the majority of its cash balances in financial
institutions located in Miami, Florida. The balance in each institution is
insured by the Federal Deposit Insurance Corporation up to $100,000. At May 31,
2001, the Company's uninsured cash balances total $3,632. Additionally, the
Company maintains sweep accounts utilizing nightly repurchase accounts which are
uninsured by the Federal Deposit Insurance Corporation. At May 31, 2001, the
Company's balances in these accounts totaled $1,205,148.

Use of Estimates - The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosures of contingent assets and liabilities at the date of the consolidated
financial statements and the reported amounts of revenues and expenses during
the reporting periods. Actual results could differ from those estimates.

Reclassifications - Certain amounts in the prior year financial statements have
been reclassified for comparative purposes to conform to the current year
presentation.

Advertising - Advertising costs are charged to operations in the year incurred.
Advertising expense for the years ended May 31, 2001 and 2000, amounted to
$484,565 and $453,321, respectively.

Fair Value of Financial Instruments - Cash, receivables, accounts payable, debt,
accrued expenses and other liabilities are carried at amounts which reasonably
approximate their fair value due to the short-term nature of these amounts or
due to variable rates of interest which are consistent with current market
rates.

Basic Net Income Per Common Share - Basic net income per common share is
computed by dividing the net income by the weighted average number of common
shares outstanding during each period. Available stock options at May 31, 2001,
were anti-dilutive and not considered common stock equivalents for purposes of
computing income per common share.

                                       16
<PAGE>

NOTE 2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Comprehensive Income - In June 1997, the FASB Statement No. 130 (SFAS 130)
"Reporting Comprehensive Income". This statement establishes standards for
reporting of comprehensive income and its components (revenues, expenses, gains,
losses) in financial statements and requires that all items required to be
recognized under accounting standards as components of comprehensive income be
reported in a financial statement that is displayed with the same prominence as
other financial statements. Comprehensive loss consists of the unrealized losses
on available-for-sale securities and is on the Statement of Income and
Comprehensive Income.

Segment Reporting and Related Information - In June 1997, the FASB issued
Statement No. 131 (SFAS No. 131), "Disclosures about Segments of an Enterprise
and Related Information", which establishes standards for the way that public
business enterprises report information about operating segments in annual
financial statements. The provisions of this statement were effective for fiscal
years beginning after December 15, 1997, and have been adopted by the Company.

Impairment of Long-Lived Assets - The Company follows FASB Statement No. 121
(SFAS No. 121), "Accounting for the Impairment of Long-Lived Assets and for
Long-Lived Assets to Be Disposed Of". SFAS No. 121 requires that impairment
losses are to be recorded when long-lived assets to be held and used are
reviewed for impairment whenever events or changes in circumstances indicate
that the related carrying amount may not be recoverable. When required,
impairment losses on assets to be held and used are recognized based on the fair
value of the asset. Long-lived assets to be disposed of, if any, are reported at
the lower of carrying amount or fair value less cost to sell.

Stock Based Compensation - In March 2000, the Financial Accounting Standards
Board issued Interpretation No. 44 ("FIN 44"), "Accounting for Certain
Transactions Involving Stock Compensation, an Interpretation of APB Opinion No.
25." FIN 44 clarifies the application of Opinion No. 25 for:
(a) the definition of employee for purposes of applying Opinion No. 25,
(b) the criteria for determining whether a plan qualifies as a noncompensatory
    plan,
(c) the accounting consequence of various modifications to the terms of a
    previously fixed stock option or award and
(d) the accounting for an exchange of stock compensation awards in a business
    combination.

FIN 44 became effective July 1, 2000, but certain conclusions cover specific
events that occur after either December 15, 1998 or January 12, 2000.

The impact of FIN 44 did not have a material effect on the Company's financial
position or results of operations.

Business Combinations and Goodwill - In July 2001, the Financial Accounting
Standards Board issued of Financial Accounting Standards No. 141 (SFAS 141),
"Business Combinations" and of Financial Accounting Standards No. 142 (SFAS
142), "Goodwill and Other Intangible Assets". SFAS 141 requires that all
business combinations be accounted for using the purchase method only and that
certain acquired intangible assets in a business combination be recognized as
assets apart from goodwill.

SFAS 142 requires that ratable amortization of goodwill be replaced with
periodic test of the goodwill impairment and that intangible assets other than
good will and other indefinite lived intangible assets, be amortized over their
useful lives. SFAS 141 is effective for all business combinations initiated
after June 30, 2001 and for all business combinations accounted for by the
purchase method for which the date of acquisition is after June 30, 2001. The
provisions of SFAS 142 will be effective for fiscal years beginning after
December 15, 2001. The impact of SFAS 141 and 142 on the financial statements
has not yet been determined.

In addition, the standard includes provisions for the reclassification of
certain existing recognized intangibles as goodwill, reassessment of the useful
lives of existing recognized intangibles, reclassification of certain
intangibles out of previously reported goodwill and the identification of
reporting units for purposes of assessing potential future impairments of
goodwill. SFAS 142 also requires the Company to complete a transitional goodwill
impairment test six months from the date of adoption.

The Company is currently assessing the impact of this new statement on the
Company's consolidated financial position and results of operations and has not
yet determined the impact of adoption.

NOTE 3.   AVAILABLE-FOR-SALE SECURITIES

Gross unrealized losses on available-for-sale securities at May 31, 2001, were
$66,073. The cost and fair value of available-for-sale securities at May 31,
2001, was $71,500 and $5,424 respectively.

NOTE 4.   ACCOUNTS RECEIVABLE

Accounts receivables consisted of the following:

                                                          2001          2000
                                                      -----------   -----------
  Contracts completed and in progress - billed        $ 1,141,031   $ 1,357,605
  Contracts completed and in progress - unbilled          247,448       200,817
  Retention                                               648,931        86,786
  Allowance for doubtful accounts                    (     59,902)   (   78,044)
                                                      -----------   -----------
                                                      $ 1,977,508   $ 1,567,164
                                                      ===========   ===========

NOTE 5.   COSTS AND ESTIMATED EARNINGS ON UNCOMPLETED CONTRACTS

Costs and estimated earnings on uncompleted contracts are summarized as follows:

                                                          2001          2000
                                                      -----------   -----------
Billings on uncompleted contracts                    $ 11,121,964  $ 2,297,035
                                                      -----------   -----------
Costs incurred on uncompleted contracts              (  8,659,428) (  2,078,915)
Estimated earnings on uncompleted contracts          (  2,155,048) (    366,453)
                                                      -----------   -----------
Total costs and estimated earnings on
  uncompleted contracts                              ( 10,814,476) (  2,445,368)
                                                      -----------   -----------
                                                      $   307,488  ($   148,333)
                                                      ===========   ===========

These amounts are included in the accompanying consolidated balance sheets as
follows:

                                                          2001          2000
                                                      -----------   -----------
Billings in excess of costs and estimated
  earnings on uncompleted contracts                  ($   790,256) ($   163,220)
Costs and estimated earnings in excess
  of billings on uncompleted contracts                    482,768       311,553
                                                      -----------   -----------
                                                     ($   307,488)  $   148,333
                                                      ===========   ===========

NOTE 6.   PROPERTY AND EQUIPMENT

Property and equipment consisted of the following:

                                                          2001          2000
                                                      -----------   -----------
Transportation equipment                              $ 1,414,035   $ 1,233,818
Machinery and equipment                                   547,326       502,963
Facsimile equipment                                       348,905       348,905
Furniture and fixtures                                     75,424        44,289
Computer equipment and software                           415,880       350,305
Leasehold improvements                                     92,178        87,976
                                                      -----------   -----------
                                                        2,893,748     2,568,256
Accumulated depreciation                              ( 2,020,737)  ( 1,746,038)
                                                      -----------    ----------
Property and equipment, less accumulated depreciation $   873,011    $  822,218
                                                      ===========    ==========


Depreciation expense for the years ending May 31, 2001 and 2000, amounted to
$274,699 and $224,013, respectively, and is included in selling, general and
administrative expenses in the consolidated statements of income and retained
earnings.

                                       17
<PAGE>

NOTE 7.   INCOME TAXES

The provisions for income taxes are summarized as follows:

                                                          2001          2000
                                                      -----------    -----------
Current tax, net of utilization of net
  operating loss carryforwards

Federal                                               $     -        $     -
State                                                       -              -
                                                      ----------     ----------
  Total current tax                                         -              -
                                                      ----------     ----------
Deferred tax, net of utilization of net operating
  loss carryforwards

Federal                                               (  624,744)          -
State                                                 (  134,748)          -
                                                      ----------     ----------
  Total deferred tax                                  (  759,492)          -
                                                      ----------     ----------
  Total income taxes                                 $(  759,492)    $     -
                                                      ==========     ==========


The Company files consolidated income tax returns with its two wholly-owned
subsidiaries.

Deferred income taxes and benefits for 2001 and 2000 are provided for certain
income and expenses which are recognized in different periods for tax and
financial reporting purposes. The principal temporary differences that give rise
to the deferred tax asset (liability) and the effect (computed at 37.63% in 2001
and 31% in 2000) that the changes in those temporary differences had on
provision for deferred tax expense are as follows:

                                                          2001          2000
                                                      -----------   -----------
Deferred tax asset
Accrued officers' salaries                            $     2,155   $       405
Allowance for bad debts                                    22,541        24,194
Amortization                                               12,651        11,796
Depreciation                                                 -            2,055
Full absorption cost method                                33,904        22,535
Net operating loss carryforward                         1,563,118     1,192,726
                                                      -----------   -----------
                                                        1,634,369     1,253,711
Valuation allowance                                          -       (1,105,590)
                                                      -----------   -----------
  Total deferred tax asset                              1,634,369       148,121
                                                      -----------   -----------

Deferred tax liability
Income on long-term contracts                        (    810,945)   (  113,600)
Depreciation                                         (     63,932)   (   34,521)
                                                     ----------      ----------
  Total deferred tax liability                       (    874,877)   (  148,121)
                                                     ----------      ----------
  Net deferred tax asset (liability)                   $  759,492   ($    -   )
                                                     ============    ===========

The amounts have been presented in the Company's financial statements as
follows:

                                                          2001          2000
                                                      -----------   -----------
Non-current deferred tax asset                        $  784,474    $    64,408
Current deferred tax liability                       (      -   )  (     64,408)
Non-current deferred tax liability                   (    24,982)  (       -   )
                                                      ----------    -----------
                                                      $  759,492   ($      -   )
                                                     ============  =============

Net operating loss carryforwards at May 31, 2001 were $4,148,813. These loss
carryforwards expire at various dates through the year 2021.

A valuation allowance must be established to reduce deferred income tax benefits
if it is more likely than not that a portion of the deferred income tax benefits
will not be realized. It is Management's opinion that it is likely that the
entire deferred tax benefit will be recognized in future years. Therefore, in
the current year no valuation allowance has been established.

                                       18
<PAGE>

NOTE 8.   AMORTIZATION OF EXCESS ACQUISITION VALUE OVER FAIR MARKET VALUE
            OF ASSETS PURCHASED

During 1999, the Company exchanged 40 shares of its common stock plus $69,574 in
cash in an acquisition of a communications business estimated at approximately
$100,000. The seller was a provider of data, fiber and telecommunications
services, which are utilized by computer network users. In connection with this
acquisition, which was accounted for as a purchase, the Company recognized
goodwill, which is being amortized over fifteen years using the straight-line
method.

In connection with the reverse merger by and between Hotelecopy, Inc., (see Note
1) the Company recognized goodwill, which is being amortized over five years
using the straight-line method.

Amortization expense was $40,224 for 2001 and $34,726 in 2000, and is included
in selling and general administrative expenses in the consolidated statements of
income and retained earnings.

NOTE 9.   EMPLOYEE BENEFIT PLANS

Employee Stock Ownership Plan and Deferred Compensation Profit Sharing Plan

The Company has a qualified employee stock ownership plan (ESOP), and a deferred
compensation profit sharing plan (401K) under Sections 401 and 401K of the
Internal Revenue Code, covering substantially all full-time employees.
Contributions to the plans are at the discretion of the Board of Directors, and
are limited to a specified percentage of eligible compensation for each
participant. No contribution was made to either plan for 2001 or 2000. All
employee benefit plan administrative expenses are paid at the option of the
Company.

Incentive Stock Option Plan

On May 31, 1989, the Company's Board of Directors adopted its 1989 Incentive
Stock Option Plan (ISOP) in order to attract, retain and motivate employees who
contribute materially to the success of the Company. Employees of the Company
and its subsidiaries are covered by the ISOP. Under the terms of the ISOP, the
Company is authorized to grant incentive stock options to purchase up to an
aggregate of 100,000 shares of its common stock. The option price under the ISOP
will be the fair market value of the common stock at the date of grant or if
granted to individuals who own 10% or more of the company's common stock at 110%
of fair market value. No option is exercisable after ten years from the date of
grant (five years for holders of greater than 10% of the stock). The ISOP is
administered by the Compensation Committee for the Company's Board of Directors.
There was no activity during the year ended May 31, 2001 and May 31, 2000. At
May 31, 2001 there are options to purchase 26,500 shares of common stock
pursuant to ISOP grants.

NOTE 10.   RELATED PARTY TRANSACTIONS

Facilities Leases - The Company leases its facilities under a four -year
operating lease expiring December 2002 and one-year operating lease expiring May
31, 2002, from a partnership affiliated through common ownership, at rental
rates that management believes are comparable to those obtainable from other
unrelated parties. The lease provides for monthly payments of $16,911 plus
applicable taxes. Balance of unpaid rent as of May 31, 2001 is $39,831 and is
included in "Accounts payable - related party". Rent expense under these leases
totaled $220,806 and $192,810 for the years ended May 31, 2001 and 2000,
respectively.

Future minimum rental payments required under the above operating leases
subsequent to the year ended May 31 is as follows:

             2001                                       192,690
             2002                                       112,402
                                                    -----------
                                                    $   305,092
                                                    ===========

NOTE 11.   LONG-TERM DEBT

Notes payable consisted of the following:

                                                           2001         2000
                                                      -----------    ----------
Bank notes, payable in monthly installments of $20,001 and $18,509,
respectively, bearing interest at rates varying from none to 9.0%, secured by
transportation equipment, maturing
at various dates through 2004.                        $   329,118    $  364,996

Note payable to bank with interest payable monthly at prime plus 1%, payment of
$1,667 expiring in December 2003, collateralized by computer equipment and
personally guaranteed by
Edd and Carol Helms                                        50,000        71,667

Unsecured note payable to vendor with monthly
installment of $282, bearing interest at a
rate of 8.82% maturing September 2003                       7,103         9,728

                                                      -----------    ----------
                                                          386,221       446,391
Current maturities of long-term debt                 (    217,769)  (   203,515)
                                                      -----------    ----------
Long-term debt                                        $   168,452    $  242,876
                                                      ===========    ==========

Aggregate maturities of notes payable for the years subsequent to the year ended
May 31, are as follows:

             2002                                    $    217,769
             2003                                         139,219
             2004                                          29,233
                                                     ------------
                                                     $    386,221
                                                     ============

                                       19

<PAGE>

NOTE 12.   CREDIT ARRANGEMENT

The Company has a line of credit with a bank for advances up to $750,000,
secured by the Company's accounts receivable. Interest is charged at the bank's
prime interest rate plus one percent (1%) annually. Interest is paid monthly.
The line of credit is available to fund day-to-day working capital needs.

Certain information regarding the credit arrangement as of May 31, 2001 is
summarized as follows:

Maximum amount of borrowing outstanding, at any month end $ 476,814

Minimum amount of borrowing outstanding at any month end $ -

Interest expense related to this credit arrangement amounted to $27,878 and
$9,976 for the years ended May 31, 2001 and 2000, respectively, and are included
in other expenses.

NOTE 13.   CAPITAL LEASE OBLIGATIONS

Capital lease obligations consisted of the following:

                                                           2001         2000
                                                      -----------    -----------
Lease payments, payable in monthly installments of $1,356 and $315,
respectively, inclusive of imputed interest at rates varying from 12.34% to
18.66% maturing in 2004                              $    29,106    $   5,612

Current obligations under capital lease              (    11,311)  (    3,210 )
                                                      -----------    ----------
Long-term obligations under capital lease             $   17,795    $   2,402
                                                      ===========    ==========

Future minimum lease payments under capital lease for the years ended subsequent
to May 31, are as follows:

             2002                                     $   14,881
             2003                                         12,484
             2004                                          8,111
                                                      ----------
                                                          35,476
Amount representing interest                         (     6,370)
                                                      ----------
Present value of future minimum lease payments        $   29,106
                                                      ==========


Interest expense recorded on capital lease obligations amounted to $2,083 and
$288 for the years ended May 31, 2001 and 2000, respectively, and are included
in other income and expenses.

NOTE 14.   ACCRUED LIABILITIES

Accrued liabilities consisted of the following:

                                                           2001          2000
                                                      -----------    -----------
Compensation, related taxes, and benefits             $   397,727    $  191,311
Accounting                                                 67,267        65,854
Other professional fees                                    11,385         8,500
Insurance                                                    -           14,899
Miscellaneous                                               1,105         5,420
                                                      -----------    ----------
                                                      $   477,484    $  285,984
                                                      ===========    ==========


                                       20

<PAGE>

NOTE 15.   COMMITMENTS AND CONTINGENCIES

Operating Leases - The Company also leases various office equipment under
non-cancelable leases expiring at various dates through September 2004. Rent
expense under these operating leases was $35,787 in the current year and is
included in selling, general, and administrative expenses.

In addition, the Company leases several automobiles. The leases have monthly
payments ranging from $279 to $1,392. Lease payments totaled $81,899 and $69,848
for the years ended May 31, 2001 and 2000, respectively.

Future minimum lease payments under all operating leases for years subsequent to
May 31, are as follows:

              2002                                    $   71,857
              2003                                        24,903
              2004                                        17,146
              2005                                        10,798
                                                      ----------
                                                      $  124,704
                                                      ==========

Warranty - In its normal course of business, the Company provides a one-year
warranty covering its work. The Company's policy is to expense costs, if any, in
connection with this warranty in the period such costs are incurred. In the
opinion of management, based upon prior experience, future warranty costs are
not anticipated to be material.

Prepaid Service Agreements - Air Conditioning sells prepaid service agreements,
which are primarily for a period of three years. Unearned revenues related to
these service agreements are reflected on the consolidated balance sheets as
deferred revenues.

Year 2000 - The year 2000 issues as they related to our computer systems have
passed without loss of any company operating systems. Several of the Company's
computers were upgraded in preparation for Year 2000 concerns. None of the Year
2000 computer concerns exists at this time.

Employment Agreement - In April 1999, the Company entered into an employment
agreement with an individual, upon the acquisition of a communications business.
The agreement required the Company to pay this party over a period of two years.
The individual was to receive a percentage of the excess gross profits (as
defined) generated by the individual.

On July 26, 2000, this former employee filed suit for breach of his employment
agreement. The same former employee filed a charge of discrimination with the
Equal Employment Opportunity Commission against the Company, alleging that he
was discriminated against, in violation of the Americans With Disabilities Act
of 1990, as amended. The commission has issued a determination that there was
probable cause that the employee's rights may have been violated. The commission
recommended conciliation discussions with the company and the employee. The
company did not pursue conciliation and has elected to defend its position in
the court.

On August 8, 2001, the former employee filed an amended complaint to include
alleged violations under the Americans with Disabilities Act and the Florida
Civil Rights Act. The former employee is seeking compensatory damages, interest
and attorneys' fees and costs, as well as a declaratory judgment as to the
restrictive covenant contained within the employment agreement. The Company
denies the allegations set forth in the complaint. On September 10, 2001, the
case was removed from the Circuit Court of the Eleventh Judicial District to the
United States District Court, Southern District of Florida. Discovery in this
action has not yet commenced.

NOTE 16.  STOCKHOLDERS' EQUITY

During 2000, the Company acquired treasury stock 92,820 shares of its common
stock from the Employee Stock Ownership Plan (ESOP) for approximately $21,482,
which was accrued in prior years.

                                       21
<PAGE>

NOTE 17.  BACKLOG

The following schedule summarizes the changes in backlog on contracts. Backlog
represents the amount of revenue the Company is contracted to realize from work
to be performed on uncompleted contracts in progress at year-end.

Backlog balance at May 31, 2000                                    $  5,392,939
Expenditures and profit recognition on prior year backlog         (   3,263,435)
New contracts not completed during the current year                  12,163,889
Expenditures and estimated profit recognized on
  uncompleted contracts                                           (   7,931,709)
                                                                   ------------
  Backlog balance at May 31, 2001                                  $  6,361,684
                                                                   ============

NOTE 18.  SEGMENTS AND RELATED INFORMATION


During the current year, the Company adopted FASB Statement No. 131 (SFAS No.
131), "Disclosures about Segments of an Enterprise and Related Information,"
which changes the way the Company reports information about its operating
segments.

The Company's three business segments have separate management teams and
infrastructures that offer different services. They are managed separately
because each business segment provides different unrelated services. The
Company's three business segments are electrical, air conditioning, and Faxmail.
The Company provides electrical service, repair, and maintenance of commercial
and residential facilities through electric. Installation, service, repair and
maintenance of commercial and residential air conditioning systems are done
through air conditioning. The Faxmail segment provides a worldwide facsimile
transmission network with facsimile equipment located in various commercial and
public locations throughout the United States and other countries.

The accounting policies of the segments are the same as those described in the
summary of significant accounting policies. All intersegment sales prices are
market based. The Company evaluates performance based on operating earnings of
the respective business units.

The following segment information includes allocations of certain costs,
including overhead and shared services which are allocated based on revenues,
payroll and other factors. These agreed-upon amounts between the segments may
differ from amounts that would be negotiated in an arms-length transaction.

                                       Air
Year ended May 31, 2001   Electric Conditioning Faxmail Unallocated   Total
-------------------------------------------------------------------------------
Revenues earned -
  External customers    $14,431,338 $ 5,625,622 $ 213,515 $   -    $ 20,270,745
  Intersegment              268,825      45,778      -        -         314,603
-------------------------------------------------------------------------------
  Total revenues earned $14,700,163 $ 5,671,400 $ 213,515 $   -    $ 20,585,078
===============================================================================
Gross margins             2,858,953   1,550,767    87,657     -       4,497,377
===============================================================================
Operating earnings (loss)   608,146     305,963    84,588     -         998,697
===============================================================================
Depreciation
  and amortization          179,935      93,856    41,132     -         314,923
===============================================================================
Interest expense             38,896      14,456       739     -          54,091
===============================================================================
Total assets             4,966,002    1,384,838    73,180  1,749,130  8,173,150
===============================================================================
Capital expenditures       229,247       13,877       -       82,369    325,493
===============================================================================

                                          Air
Year ended May 31, 2000   Electric Conditioning Faxmail Unallocated    Total
-------------------------------------------------------------------------------
Revenues earned -
  External customers    $ 6,761,813 $5,026,404  $ 197,577      -    $11,985,794
  Intersegment              294,340     14,277       -         -        308,617
-------------------------------------------------------------------------------
  Total revenues earned $ 7,056,153 $5,040,681    197,577      -    $12,294,411
===============================================================================
Gross margins             2,160,284    993,256     82,010      -      3,235,550
===============================================================================
Operating earnings (loss)   516,524  ( 337,171)  ( 29,127)     -        150,226
===============================================================================
Depreciation and
  amortization              130,737    128,002       -         -        258,739
===============================================================================
Interest expense             19,937     14,064       -         -         34,001
===============================================================================
Total assets              2,147,890   1,118,210    53,153   767,621   4,086,874
===============================================================================
Capital expenditures        260,732     172,750      -       58,780     492,262
===============================================================================

                                       22

<PAGE>

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

During the fiscal years covered by this report, we did not have a change in or a
disagreement with our accountants. We initially appointed Dohan and Company,
Certified Public Accountants, as our auditors in 1997.

                                    PART III

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

Our Directors and executive officers are as follows:

Director
Name                 Since         Age     Position
-----                -----         ---     --------
W. Edd Helms, Jr.*   1985           55     Chairman of the Board of
                                           Directors, President and
                                           Chief Executive Officer
L. Wade Helms        1986           44     Executive Vice President and
                                           Director
Joseph M. Komarmy    1984           54     Vice President
Carol Helms          1985           52     Secretary and Director

* Designates Member of the audit and compensation committees of the Board of
  Directors.

W. Edd Helms, Jr., since the Merger, has been our Chairman of the Board of
Directors, President, and Chief Executive Officer. Mr. Helms was the Chairman of
the Board of Directors, President, and Chief Executive Officer of Hotelecopy and
served in these capacities since the inception of Hotelecopy in 1985. Mr. Helms
is also the President of Edd Helms Air Conditioning, Inc. Before the Merger, Mr.
Helms was the President and a Director of Edd Helms, Incorporated. Mr. Helms is
the brother of L. Wade Helms and the husband of Carol Helms.

L. Wade Helms is an Executive Vice President and a Director since the Merger.
From February 1986 until the effective date of the Merger, Mr. Helms served in
the capacity of Executive Vice President and a Director of Hotelecopy. From 1983
to 1986, he was the Chief Financial Officer and Vice President of Edd Helms,
Incorporated and he served as a Director of Edd Helms, Incorporated from 1984
until 1990.

Joseph M. Komarmy is Vice President of the company. Previously, Mr. Komarmy was
Vice President of Edd Helms, Inc. He has been employed with the companies since
1984.

Carol Helms is a Director and Secretary. She was a Director and the Secretary of
Hotelecopy since its inception in 1985. She does not devote full time to our
company affairs and receives no compensation. She was also the Secretary and a
Director of Edd Helms, Incorporated through the date of the Merger.

Directors are elected to hold office until the next Annual Meeting of
Shareholders and until respective successors are elected and qualified. Our
officers are elected by the Board of Directors at the Annual Meeting and hold
office for the term of one year and until their successors are elected and
qualified.

Our by-laws contain provisions that permit indemnification, including legal
fees, of our directors, officers, employees, and agents to the fullest extent
permitted by Florida law.

                                       23

<PAGE>

ITEM 10. EXECUTIVE COMPENSATION

I.  SUMMARY COMPENSATION TABLE

The following table sets forth certain information regarding compensation paid
during each of the last three fiscal years to our executive officers and the
executive officers of Edd Helms, Incorporated. The figures reported for years
2001 and 2000 reflect compensation paid to our officers and the figures reported
for 1999 reflect compensation paid to officers of Edd Helms, Incorporated. The
officers of Hotelecopy were not compensated for their services in the past three
fiscal years. Neither we, Hotelecopy or Edd Helms, Incorporated have issued any
shares to its officers or directors as compensation in the past three years. We
have no employment agreements with any officers or employees.

--------------------------------------------------------------------------------
Annual Compensation                       Long-Term Compensation
----------------------------------------- --------------------------------------
                                          Awards                 Payouts
----------------------------------------- ---------------------- ---------------
   (a)         (b)  (c)    (d)   (e)      (f)         (g)       (h)      (i)
------------- ---- ------ ----- ------ ---------- ----------- ------- ----------
Name and      Year Salary Bonus Other  Restricted Option/SARs LTIP    All Other
Principal                       Annual Stock                  Payouts comp.(inc.
Position                        Comp   Awards                         (cars)
------------- ---- ------ ----- ------ ---------- ----------- ------- ----------

W. Edd Helms, 2001 $255,000                                              $19,800
Jr.           2000 $249,964                                              $19,800
President and 1999 $160,104                                              $19,800
Chief
Executive
Officer
------------- ---- ------ ----- ------ ---------- ----------- ------- ----------

L. Wade Helms 2001 $98,939                                                $9,632
Exec. Vice    2000 $89,764                                                $8,648
President     1999 $77,901                                                $8,648
------------- ---- ------ ----- ------ ---------- ----------- ------- ----------

Joseph M.     2001 $106,736                                              $18,663
 Komarmy      2000 $ 92,410                                              $18,663
Vice President2002 $109,822                                              $18,663
Carol Helms,  2001 $0                                                    $15,110
Secretary     2000 $0
              1999 $0
------------- ---- ------ ----- ------ ---------- ----------- ------- ----------

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth, as of May 31, 2001, information with respect to
(a) any person known to us to be the beneficial owner of five percent or more of
the outstanding shares of our common stock, (b) each of our Directors and our
executive officers, and (c) all of our Directors and executive officers as a
group. For computing the percentage of the shares of our common stock owned by
each person or group listed in this table, any shares not outstanding, which are
subject to options or warrants exercisable within 60 days have been deemed
outstanding. Except as otherwise indicated below, we believe each of the persons
named below to possess sole voting and investment power with respect to the
shares of our common stock beneficially owned by such person.

                     Amt. Of Beneficially
Name                   Owned Common Stock                  Percent
-------------------  --------------------                  -------
W. Edd Helms, Jr.          10,398,331 (1)                    82.17%
L. Wade Helms                  16,326 (2)                      .13%
Joseph M. Komarmy              13,000 (3)                      .10%
Carol Helms                 9,354,183 (4)                    73.92%
ESOP                        1,266,441 (5)                    10.00%
All Officers and Directors 10,414,639 (6)                    82.30% (7)

The address of all three of our officers is: 17850 N.E. 5th Ave, Miami, Florida
33162.

(1) This includes 10,890 shares held by his daughters, 9,277,934 shares held as
a joint tenant with his wife Carol Helms, and 272,330 shares attributed to Mr.
Edd Helms due to his percentage ownership of our ESOP, which holds 1,266,441
shares of our common stock.

(2) This includes 887 shares held as joint tenants with his wife, 2,179 shares
attributed to Mr. Wade Helms due to his percentage ownership of our ESOP and an
option to acquire 12,000 restricted shares of our stock at a purchase price of
$1.10 which option will expire on September 9, 2001.

(3) This represents shares held as joint tenants with his wife.

(4) This includes 10,890 held by her daughters, 9,277,934 shares held as a joint
tenant with her husband Edd Helms, 65,359 shares attributed to Mrs. Helms due to
her percentage ownership of our ESOP, and an option to acquire 1,000 restricted
shares of out stock at a purchase price of $.875 which option will expire on
November 4, 2001. Mrs. Helms disclaims beneficial ownership as to her daughters'
shares.

(5) The ESOP was adopted by Edd Helms, Incorporated on May 15, 1995 and at the
time of merger was funded with roughly 633 shares of the common stock of Edd
Helms, Incorporated. As a result of the merger with Hotelecopy, the ESOP held
1,378,781 of our shares of common stock. Since the merger, the ESOP 112,635
shares have been retired, so that now the ESOP holds 1,266,146 shares.

(6) See notes 1-5 for the details.

(7) For purposes of the percentage calculations, the shares held in common by
Edd and Carol Helms are included in the percentage ownership of each of them.

                                       24
<PAGE>

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

We lease our office and warehouse facilities from a partnership owned by W. Edd
Helms, Jr., and Carol Helms. See the description of property.

We believe that the above transaction is on terms and conditions at least as
favorable to us as those that would have been available from non-affiliated
third parties. Any future transactions between us and our Officers, Directors or
principal shareholders or any affiliates thereof will be made for bona fide
business purposes on terms no less favorable than could be obtained from
unaffiliated third parties, and will be approved by a majority of the board of
directors.

ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K.

     2. Exhibits required to be filed by Item 601 of Regulation S-B.  None.

No Form 8-K was filed during the last quarter of the period covered by this
report.

                                   SIGNATURES

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

                                          /s/ EDD HELMS GROUP, INC.
                                          -------------------------
                                              (Registrant)

                                       By:/s/ W. Edd Helms, Jr.
                                          -------------------------
                                          W. EDD HELMS, JR.
                                          PRESIDENT AND CHIEF EXECUTIVE OFFICER

                                     Date:September 13, 2001

In accordance with the Exchange Act, this report has been signed on the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.

                                       By:/s/ L. Wade Helms
                                          -------------------------
                                          L. WADE HELMS
                                          VICE PRESIDENT

                                     Date:September 13, 2001

                                       By:/s/ Carol Helms
                                          -------------------------
                                          CAROL HELMS
                                          SECRETARY

                                     Date:September 13, 2001

                                       25