<PAGE>

                                  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 December 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 000-26856

                                QUADRATECH, INC.
                                ----------------
                 (Name of small business issuer in its charter)

            Nevada                                      95-4396848
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
 incorporation or organization)

            13226 Nelson
     City of Industry, California                         91746
(Address of principal executive offices)                (Zip Code)

Issuer's telephone number (626) 336-1300

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

                                      None

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

                               $0.001 Common Stock
                                (Title of class)

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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. [] Yes [X] 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]

As of December 31, 2001, 36,513,301 shares of the Registrant's Common Stock,
$0.001 par value, were outstanding. The aggregate market value of the Common
Stock held by non-affiliates of the registrant (i.e. excluding shares held by
executive officers, directors, and control persons as defined in Rule 405) on
that date was $82,760.51 computed at the closing price on that date.

The registrant's revenue for the December 31, 2001 fiscal year was $3,147,101.

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                                TABLE OF CONTENTS

                                                                            Page
Item 1. Description of Business................................................4

Item 2. Description of Property................................................6

Item 3. Legal Proceedings......................................................7

Item 4. Submission of Matter to Vote of Security Holders.......................8

Item 5. Market for Common Company Equity and Related Stockholder Matter........8

Item 6. Management's Discussion and Analysis or Plan of Operation..............8

Item 7. Financial Statements..................................................10

Item 8. Directors, Executive Officers, Promoters and Control Persons;
        Compliance with Section 16(a) of the Exchange Act.....................10

Item 9. Executive Compensation................................................11

Item 10. Security Ownership of Certain Beneficial Owners and Management.......12

Item 11. Exhibits and Reports.................................................12

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Item 1. Description of Business
-------------------------------

Introduction.

        Quadratech, Inc. (the "Company") was incorporated on February 4, 1984
under the laws of the State of Utah. On March 19, 1990, the Company changed its
domicile from the State of Utah to the State of Nevada. Until August 1993, the
Company had no operations. In 1993, the Company entered into an agreement and
plan of reorganization with the shareholders of (OSA) Oil Scavenger Absorbent, a
California Corporation ("OSA, Inc."). The shareholders of OSA, Inc. received
5,500,000 shares, representing 60% of the then outstanding shares, in exchange
for all of their issued and outstanding shares of stock in OSA, Inc.

        OSA, Inc. was incorporated in 1992 to act as a distribution company for
oil absorbent products. Its shareholders were Maria Comfort, Ed V. Lunenschloss,
William Snyder, Michael Montgomery, and John Sullivan. With dissatisfaction of
products then on the market, the Company developed its oil absorbent product.

Business of the Company.

        The Company's business units are divided into two (2) areas, the
development and manufacturer of environmental absorbents and the supply of
third-party logistics (3PL).

         The development of environmental absorbent products consists of
identifying and evaluating potential products and if the evaluation proves
favorable, obtaining all of the requisite components required to complete
manufacture of the product, including financing and any government approvals.

         3PL services is the information gathering, order coordination, order
processing, supply of transportation equipment and completion of supply, via
physical delivery of durable and non- durable goods. The Company has two 3PL
wholly owned subsidiaries, Accu Chem Conversion, Inc. [ACC] and MAG Transport,
Inc. [MAG]. ACC and MAG perform 3PL services in eleven (11) western state area,
with physical Locations in City of Industry and Calipatria California, and
Ogden, Utah. The two 3PL subsidiaries operate approximately 30 tractors and 65
trailers that hauls hazardous and non-hazardous commodities including wax,
sugar, caustics and acids.

The Industry.

         The manufacture of a product used for the clean-up of hazardous spills
of oil and oil-based petrochemicals was the initial market sought by the
Company. An oil absorbent material is used to absorb the spilled oil. The oil
can be removed from the absorbent material and returned or recycled in
accordance with all applicable Federal, State and local laws.

         Total Cradle-to-Grave remediation of the product by removing hazardous
waste from the customers operations, then recycling or disposing of the used
absorbent and waste products into government approved products or services,
provides a significant advantage to our customers. The hazardous material
disposal industry is growing very rapidly, sparked by increased governmental
regulations concerning disposal of these types of materials. Quadratech is
currently emphasizing the value of their products and services to those
commercial and governmental agencies which are concentrating their attentions on
environmentally safe products which are non-toxic, therefore justify our total
redemption capability.

         As of the date hereof, the Company has focused attention on providing
absorbent products for four separate markets: oil and acid absorbents,
agricultural applications and pet litter. Each product line has its own market.
The oil and acid absorbent material is sold in the hazardous material market;
the agricultural market applies to several applications, i.e. egg washing,
animal bedding material, and effluent management; the pet litter is a grocery
and catalog item which has the unique capability of being flushed down the
toilets while providing odor removal and significant absorbent qualities.

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I. Products.

         A. Oil Absorbent Materials and Alternative-Energy Products. The Company
         obtained by assignment from Ed V. Lunenschloss U.S. Patent No.5,248,391
         issued on September 28, 1993 for its oil absorbent material and
         currently has the rights/an unrestricted license as an oil-spill
         cleanup agent, in accordance with Title 23, Division 3, Chapter 10, of
         the California Code of Regulations. The Company believes that there are
         other licensed competitors whose products may be used on a restricted
         basis, i.e., their products, unlike the Company's cannot be deployed or
         used in free form in open waterways. Further, such absorbent products
         are classified as a renewable energy source.

         B. Floor sweeps. The company's floor sweep products absorb and retrieve
         spilled oil and waste water from airplanes (jet fuel), gasoline
         stations (gas and diesel), machine shops, barge floors, repair shops
         and caustic acids, such as battery electrolytes, chromium acid and
         sulfuric acid.

         C. Pet Litter. Flush it (TM) Pet Litter, made from recycled paper,
         primarily for the feline market, is more absorbent than clay, silica,
         and diatomaceous earth. It can be flushed down the toilet, and it helps
         in cleaning sludge build-up, with its oil and grease absorbency. It is
         deemed by the Company to be environmentally friendly, biodegradable,
         with excellent odor control and minimum tracking. Stable Mate, made
         from recycled paper, is a biodegradable, odor controllable absorbent
         utilized primarily for horse bedding or other animal uses. The
         Company's initial testing of the product indicates that it has no
         adverse health impact on animals. The Company had commenced marketing
         this product directly to horse owners and to entities who board, either
         permanently or temporarily (horse racing tracks) and/or transfer
         animals and to distributors.

         D. Acid Absorbent. A battery acid floor sweep-absorbent also made from
         recycled paper, is capable of neutralizing acids such as battery
         electrolytes, chromium acid, and sulphuric acid

II. Services:

         A. ACCU CHEM Conversion, Inc. (ACC) was incorporated in January 1994
         under the laws of California. The Company acquired 83% of ACC in
         October 1999 in a tax-free re-organization plan approved by a majority
         of the Company's Shareholders. The remaining portion of ACC was
         acquired in December 2000 for $10,000 in cash authorized by a Board of
         Directors resolution. This $10,000 was funded through the normal flow
         of inbound Accounts Receivable.

         The Company acquired the Stock of MAG Transport, Inc. (MAG) on May 5th
         2000. MAG, based in Ogden, Utah, provides 3PL services in 11 western
         states. MAG operates 20 tractors and 30 trailers hauling food grade
         bulk commodities and dust control agents for several manufacturers.

         ACC and MAG perform third party logistics support for food, chemical
         and textile manufacturers located throughout the United States. ACC's
         third party support services include: operation of two (2) railroad
         terminals in Southern California, the transportation of both hazardous
         and non-hazardous materials in a fleet of company owned and operated
         tractors and trailers, and a Just-In-Time purchase/supply agreement
         with a leading aerospace company.

         MAG's third-party logistics support include the operations of a fleet
         of specialized sugar trailers that pick-up, transport and deliver bulk
         sugar For a leading sugar manufacturer in the Northwestern United
         States.

         ACC employ's twenty-four (24) full-time personnel and maintains its
         Corporate Headquarters in El Monte, California. MAG employ's 12 full
         time Personnel at its terminal in Ogden, Utah.

Marketing and Sales.

         In 2001 the Company halted the marketing of its products principally
through both sales representatives and direct marketing in the United States.
This was done to allow time for all company resources to be concentrated on the
integration of MAG's operations into The Company's existing 3PL services. The
Company maintained all its contacts with all marketing, sales and manufacturing
sources waiting during 2001, so that these resources could be developed in the
future when the opportunity for marketing and sales is better suited.

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         During the time period January 1, 2001 through December 31, 2001,
absorbent manufacturing operations remained suspended while an ongoing market
analysis was undertaken to determine that an adequate manufacturing cost
structure existed for the available competitive market for absorbent products.
Adequate inventory of finished product is available to conduct testing and
provide samples to potential markets.

The Competition, Other Products.

I.  Products

         The Company competes on a national basis with a large number of
environmental service firms. These range in size from small local companies to
large national firms, many of which have considerably greater resources than the
Company. While the service capabilities of these competitors overlap with
several of the service areas provided by the Company, few compete in all areas
of the Company's markets. Factors influencing the Company's competitiveness are
price, reputation for quality, the availability and skills of engineering and
construction personnel, financial strength, knowledge or markets, site
conditions and estimating abilities. Although the environmental business is
highly competitive, particularly for competitively bid projects, the Company
believes its experience and skill make it well positioned to compete
effectively.

         The Company encounters substantial competition from companies in the
polypropylene absorbent materials field. Major polypropylene competitors include
large chemical equipment manufactures substantially larger than the Company,
with substantially greater financial capabilities. The natural non-toxic
absorbent materials field is relatively new and rapidly growing, and the nature
of the competition is not yet defined.

II.  Services

         The Company's 3PL subsidiaries compete with numerous small, medium and
large third-party logistics companies throughout the United States. QUDT ranked
one-hundred 110th (110th) in total revenue among tank truck carriers in the
United States in 2001. MAG's revenue in combination with ACC's will increase the
size of The Company.

         ACC benefits from the strategic location of two (2) rail terminals,
both in California with the potential for expansion in other strategic Locations
as the market demands. MAG benefits from the strategic location of its assets
at/ or near the point of manufacture of the products it hauls.

Proprietary Information.

         The Company holds a patent for the Oil Absorbent Material and has
future plans to pursue additional patents for floor sweep, pet litter and acid
absorbent products.

Employees.

         As of December 31, 2001 the Company had thirty-six (36) full-time
employees All through its two (2) subsidiaries, ACC and MAG. The reduction of
employees when comparing 2001 to 2000 is the result of a reduction of sales and
routes for the MAG subsidiary of The Company.

Item 2. Description of Property.
--------------------------------

         The Company's office is located at 11401 Valley Blvd. Suite 200A, El
Monte, California, 91731. The Company leases/rents four (4) other locations:

         1. 300 N. Baldwin Park Blvd, City of Industry, CA 91731

         2. 13226 E. Nelson Avenue, City of Industry, CA 91746

         3. 600 S. Brown Avenue, Calipatria, CA 92233

         4. 188 W. 14th St. Ogden, Utah 84402

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Item 3. Legal Proceedings.
--------------------------

         On May 15, 1998, the Securities and Exchange Commission ("the
Commission") filed a Complaint against the Company. In connection therewith, the
Company entered a general appearance, waived service upon it of a Summons and of
the Complaint of the Commission and admitted the jurisdiction of the Court over
it and over the subject matter of this action. The Company admitted that
pursuant to Section 13(a) of the Securities Exchange Act of 1934 ("Exchange
Act") [15 U.S.C. Section 78m(a)] and Rules 12b-25, 13a-13 [17 C.F.R. Sections
240.12b-25, 240.13a-1 and 240.13a-13] promulgated thereunder, it was required to
file, and it has filed: (a) to file with the Commission its Annual Reports on
Form 10-K [17 C.F.R. Section 249.310]: (1) for its fiscal year ended December
31, 1996, which was due on or before March 31, 1997; and (2) for its fiscal year
ended December 31, 1997, which was due on or before March 31, 1998; (b) to file
with the Commission its Quarterly Reports on Form 10-Q [17 C.F.R. Section
249.308a]: (1) for its fiscal quarter ended March 31, 1997, which was due on or
before May 15, 1997; (2) for its fiscal quarter ended June 30, 1997, which was
due on or before August 14, 1997; and (3) for its fiscal quarter ended September
30, 1997, which was due on or before November 14, 1997; (c) to file with the
Commission its Notifications of Late Filing on Form 12b-25 [17 C.F.R. Section
249.322]: (1) for its Annual Reports on Form 10-K; (i) for its fiscal year ended
December 31, 1996, which was due before April 1, 1997; and (ii) for its fiscal
year ended December 31, 1997, which was due on or before April 1, 1998; and (2)
for its Quarterly Reports on Form 10-Q: (i) for its fiscal quarter ended March
31, 1997, which was due on or before May 16, 1997; (ii) for its fiscal quarter
ended June 30, 1997, which was due on or before August 15, 1997; and (iii) for
its fiscal quarter ended September 30, 1997, which was due on or before November
17, 1997; The Company, without trial, argument or adjudication of any issue of
fact or law, waived entry of findings of fact and conclusions of law pursuant to
Rule 52 of the Federal Rules of Civil Procedure, except as set forth herein and
in the Final Judgment of Permanent Injunction as to the Company (the "Final
Judgment") to be entered in the action. The Company waived any right it may have
had to appeal from the Final Judgment to be entered in the action. The Company
waived service upon it of the Final Judgment and agreed that the entry of the
Final Judgment by the Court and filing with the Clerk in the United States
District Court for the District of Columbia will constitute notice to the
Company of the terms and conditions of such Final Judgment. The Company entered
the Consent voluntarily and represented that no offer, promise or threat of any
kind whatsoever had been made by the Commission or any of its members, officers,
employees, agents or representatives in connection with or in consideration
therefore. The Company agreed that the Consent shall be incorporated by
reference into the Final Judgment, a copy of which was to be entered by the
Court in this action. The Company consented, before the taking of any testimony
and without trial, argument or adjudication of any issue of fact or law therein
to the entry, without further notice, of the Final Judgment: (a) restraining and
enjoining the Company and its officers, agents, servants and employees and
attorneys, and those persons in active concert or participation with them, who
receive actual notice of the Final Judgment by personal service or otherwise,
and each of them, from failing or causing the failure to file timely and in
proper form with the Commission at its headquarters office, accurate and
complete information and reports as are required to be filed with the Commission
pursuant to Section 13(a) of the Exchange Act and Rules 12b-25, 13a-1 and
13a-13, promulgated thereunder, including, among others, Annual Reports,
Quarterly Reports and Notifications of Late Filing; (b) ordering the Company to
require any outgoing chief executive officer or president of the Company to
deliver or cause to be delivered a copy of the Final Judgment and of the Consent
to any incoming chief executive officer or president of the Company to deliver
or cause to be delivered a copy of the Final Judgment and of the consent to any
incoming chief executive officer or president of the Company; and (c) ordering
the Company to file with the Commission at its headquarters office in
Washington, D.C.: (1) a complete and accurate Annual Report on Form 10-K for its
fiscal year ended December 31, 1996 by May 29, 1998; (2) complete and accurate
Quarterly Reports on form 10-Q for its fiscal quarters ended March 31, June 30
and September 30, 1997 by June 15, 1998; (3) a complete and accurate Annual
Report of Form 10-K for its fiscal year ended December 31, 1997 by June 30,
1998; and (4) such other periodic reports which may become due prior to the
entry of the Final Judgment.

         As of March 1, 2002 the Company had filed with the SEC, 0quarters of
Form 10QSB Reports due for 2000, plus 0 8-K filings for unscheduled events in
2000.

Item 4. Submission of Matter to Vote of Security Holders.
---------------------------------------------------------

        None.

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Item 5. Market for Common Company Equity and Related Stockholder Matter.
------------------------------------------------------------------------

         As of December 31, 2000 The Company had 36,513,301 shares of record of
its common stock. The Company has not paid cash dividends on its common stock.
The Company anticipates that for the foreseeable future any earnings will be
retained for use in its business, and no cash dividends will be paid on the
common stock. Declaration of common stock dividends will remain within the
discretion of the Company's Board of Directors and will depend upon the
Company's growth, profitability, financial condition and other relevant factors.

        The Company common stock is traded on the bulletin board system under
the symbol "QUDT." The table below reflects the high and low bid and ask
quotations for each of the Company's fiscal quarters for the two fiscal years
covered by this report. The prices reflect inter-dealer prices, without retail
mark-up, mark-down or commission and do not necessarily represent actual
transactions.

         As of December 31, 2001, the company had issued and outstanding
36,513,301 shares of Common Stock. 25,897,828 of said share of stock have
restrictive legends imposed thereon and stop transfer order have been issued to
the Company's transfer agent.

                                              2001

                                              HIGH                LOW
                                              ----                ---
1st Quarter                                   $ .045              $.02
2nd Quarter                                   $ .005              $.001
3rd Quarter                                   $ .02               $.005
4th Quarter                                   $ .015              $.005

                                              2000

                                              HIGH                LOW
                                              ----                ---
1st Quarter                                   $ .16               $.10
2nd Quarter                                   $ .08               $.0625
3rd Quarter                                   $ .10               $.0475
4th Quarter                                   $ .06               $.03

Dividends.

         The payment of dividends is within the discretion of the Board of
Directors of the Company. The Company currently intends to retain all earnings,
if any, in the foreseeable future for use in the development of the Company's
business. The Company has not paid dividends since inception. It is not
anticipated that any dividends will be paid in the foreseeable future and there
can be no assurance that dividends can or will ever be paid. The payment of
dividends is contingent upon future earnings, if any, the Company's financial
condition and capitol requirements, general business conditions and other
factors.

Item 6. Management's Discussion and Analysis or Plan of Operation.
------------------------------------------------------------------

        Comparison of Years ended December 31, 2001 and December 31, 2000.

Results of Operation.

         In 2001, the Company suspended its focus on marketing efforts for the
potential selling of its oil absorbent products to commercial and government
accounts as its priority. This was done since previous efforts had resulted in
minimal successful sales.

         Total revenue for the Company in 2001 was $3,147,101 a decrease in
sales of $1,273,151 over 2000 sales of $4,420,282 mainly due to; 1) the
voluntary abandoning of non-profitable line hauls for the MAG subsidiary and 2)
the combination of loss of sales for the transportation of molasses and liquid
sugar for MAG.

         Division sales were as follows: The OSA division of the Company
generated $0 in sales for 2001, the ACC division generated $3,147,101, and the
MAG Division had "0" reportable sales due to its classification as a
discontinued Operation. (See Note 3)


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         OSA's expenses have been greatly reduced due to the temporary cessation
of manufacturing operations while product lines are evaluated and presented to
municipalities, private spill-response contractors, Department of Energy
facilities, medical supply distributors, national automotive supply chains and
internet pet supply companies. During this evaluation process, OSA's expenses
for administrative, general and sales costs will remain at a minimum for the
foreseeable future.

         ACC's and MAG's expenses for terminal/trucking, administrative and
general expenses are within normal guidelines as established by industry
standards. During FY 2001, portions of the administrative departments of MAG and
ACC were combined, to take advantage of redundant job classifications and to
reduce G&A costs.

         In June, 2000 the MAG Subsidiary applied for an SBA loan to refinance
all its existing Fleet liabilities, to improve cash flow. This loan closed in
the first quarter of 2001. The new note with American Investment Financial (AIF)
was $1.163 million dollars, and paid off all MAG's Capital Leases and Notes for
the fleet that MAG operated. The payments on this one note, when compared to the
summation of payments of all the Capital Leases and Notes for the same equipment
was an improvement in cash flow for MAG of approximately $35,000 per month
($53,000 pre AIF note versus $18,000 on the new note amortized over 7 years).
MAG also had its insurance expense reduced $7,000 per month by the addition of
MAG's equipment to The Company's existing insurance vendor for the ACC
subsidiary. The total cash savings for MAG, when applying the new note payments,
insurance changes and administrative reductions was approximately $45,000 per
month. With these cost reductions in place, management believed that MAG could
produce adequate profits to sustain its own operation, service its own current
and old debts, and return borrowed monies, (inter-company loans) to The
Company's other subsidiary, ACC. The following chart represents the cash
infusion into MAG by the ACC subsidiary of The Company.

2000                  $147,027.93
2001                  $251,160.76
2002                  $ 67,723.18
                      -----------
Total                 $465,911.87
                      ===========

         As the year 2001 progressed, the discovery of additional and previously
undisclosed debt (liabilities) due from MAG were uncovered by management. These
liabilities are currently the subject of litigation with the previous owners of
MAG. The total amounts of these debts, in combination with lower gross sales and
the voluntary cessation by management of certain unprofitable routes of MAG,
resulted in continued inadequate cash flow from MAG to service all its debt
(liabilities). As ACC continued to infuse cash into MAG to give MAG the
opportunity to stand alone on its sales and profits, management studied the long
term effect of this continual borrowing throughout 2001, and came to the
conclusion in late 2001, that MAG could never sustain itself as a stand-alone
entity. The MAG subsidiary of The Company was permanently closed February 16,
2002.

         After the 9/11 terrorist attacks, The Company was contacted and has
been working with the Department of Homeland Security and the TSA to insure that
its facilities meet the guidelines established by Homeland Security for the
secure transportation, handling and storage of hazardous materials at its
facilites. Through December 31, 2001, no funds have been expended, however
significant funds are projected to be expended in years 2002, 2003 and 2004 to
meet the requirements set forth by Homeland Security and the TSA.

         The Company believes that internally generated funds will be sufficient
to maintain the existing business base in all divisions of the Company through
2001. The Company may 1) consider further issuance of stock to cancel
indebtedness or to fund any future merger/acquisition, or 2) the re-purchase of
common stock in accordance with all applicable SEC laws.

         The liquidity of the Company and its available capital resources have
remained unchanged as compared to 2000

         The Company believes that internally generated funds and the sale and
issuance of stock for cash, or in cancellation of indebtedness, will provide
minimum capitol resources to finance operations, fund capital expenditures and
planned research activities. The Company's need for funds has been reduced
predicated upon the significant reduction in property rental, maintenance and
G&A expenses as well as the reduction of marketing costs for absorbent products.

                                        9



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Item 7. Financial Statements.
-----------------------------

        The Financial Statements are set forth as an Exhibit hereto.

         a) Exhibit A

Item 8. Directors, Executive Officers, Promoters and Control Persons; Compliance
--------------------------------------------------------------------------------
        with Section 16(a) of the Exchange Act.
        ---------------------------------------

At December 31, 2001, the officers and directors of the Company were:

Name and address                   Age           Position
----------------                   ---           --------

Craig G. Robitaille                 43       Chief Executive
21391 Dockside Circle                        Officer and President
Huntington Beach, Ca  92646

Ted D. Kimbrough                    66       Director & Chairman of the Board
1933 Durango Avenue
Los Angeles, CA  90034

William Snyder                      78       Director
509 South Hindry
Inglewood, CA  90301

Christopher Wiles                   47       Director
23535 Windom Street
West Hills, CA  91304

Michael J. Oliva                    58       Director
10552 Beardsley Circle
Villa Park, CA  92861

Lloyd D. Smithson                   63       Director & Chief Financial Officer*
1170 Oakengate Road
San Dimas, CA  91773

Steve Secord
9606 Ann St
Santa Fe Springs, CA 90670          55       Director

         The directors of the Company are elected to serve until the next annual
Shareholders' meeting or until their successors are duly elected and qualified.

Background of Current Officers and Directors.

         BILL SNYDER is the founder and CEO of Caprice Engineering Company,
which he established in 1972. Mr. Snyder started it as a supplier to the U.S.
Government of miscellaneous aircraft spare parts. During his tenure, (since
1972) the firm increased its yearly sales from $100,000 to $3,000,000. His
experience ranges from sales and inventory control through manufacturing and
quality control, with emphasis on the day to day administration of a
Government-controlled business. From 1968 to 1972, Mr. Snyder was sales manager
of Sparkadyne Corporation, a military spare parts manufacturing company. From
1950 to 1967, Mr. Snyder was Purchasing Supervisor at Rockwell Aviation, a
supplier of aircraft and space equipment to the U.S. Government.

         CHRISTOPHER WILES received a Bachelor of Science degree in Accounting
from San Francisco State University, California in 1978. From 1983 to 1988 he
was National Sales Manager Teraco, Inc., a company engaged in the manufacture of
promotional goods and from 1982 until 1993 was Vice President-Sales for Ocean
Manufacturing Corporation, a company engaged in the manufacture of promotional
products. From 1993 to the present Mr. Wiles has been engaged in the business of
marketing promotional products under the name of CW Marketing & Promotional
Services. Mr. Wiles joined the Board on December 27, 1996.

                                        10



<PAGE>

         TED D. KIMBROUGH received his Bachelor of Science in Education from
Northern Illinois State University, his Master of Science in Education from
California State University, Los Angeles, did Post graduate studies at
Pepperdine University, University of California at Los Angles and University of
Southern California and an Honorary Juris Doctorate from the University of West
Los Angeles. Mr. Kimbrough is the President and Owner of Multi-Kim & Associates,
Inc. and the former Superintendent of Schools for the Sacramento Unified School
District (1996-1997), Chicago Unified School District (1990-1993); Compton
Unified School District (1982-1990). Previously, he had been employed by the Los
Angeles Unified School District.

         CRAIG GLEN ROBITAILLE received his Bachelor of Science in Environmental
and Occupational Health from Cal State University, Northridge, California. From
1981 through 1993, Mr. Robitaille was an executive with various southern
California businesses involving quality control and facility and plant
management. In 1993, he founded ACCU CHEM Conversion, Incorporated, a chemical
handling and transportation company, with special emphasis on handling hazardous
materials.

         MICHAEL J. OLIVA attended Pepperdine College in Los Angeles, CA through
1966. In 1971 purchased half ownership of a local trucking company in Los
Angeles; later in that same year began warehousing as a compliment to the local
trucking program. In 1979 purchased a second local trucking company and in 1982
merged them to become Ernst Air Speed Trucking. In 1991 the company moved to
Montebello, CA, becoming Ernst Trucking and Warehousing, a division of Tobic,
Inc.

         LLOYD D. SMITHSON served as a Branch Operations Officer with Bank of
America after which he took a position with a public accounting firm
specializing in operational and tax accounting for the transportation and
distribution industry. During these same six years he attended Cal State, Los
Angeles. For the next eighteen years Mr. Smithson owned and operated his tax
accounting and consulting firm. He later became the CFO and General Manager for
Admiral Transportation. During this 10-year tenure he became one of the three
founders of ACCU CHEM Conversion, Inc. in the City of Industry and has
functioned as CFO. (see note 2 below)

         STEVE SECORD graduated from the Rochester Institute of Technology with
a BA in Accounting. He passed the CPA exam in New York in 1970. From 1968-1976,
Mr. Secord Worked for the Big 8 Accounting firm of Ernst % Ernst in the
auditing, consulting and Tax departments. He rose to the level of a Manager in
the Consulting Department prior to departing in 1976. After that, he was
employed by; Rando Machine Corporation, Tomy Toys, WTC Air Freight, Daylight
Transport and Seino America with positions ranging From Controller to CFO until
1993, when he purchased and became the sole owner of Almac Systems Transport in
California, where he remains President and CEO.

Item 9. Executive Compensation.
-------------------------------

        The following table sets forth the cash compensation which was paid by
the Company for services rendered to the Company. During fiscal years ended 2000
and 2001 the following payments were made:

<TABLE>
<CAPTION>

                                                                          Remuneration
                                                                 -------------------------------
Name                                Position                        2001                2000
------------------------------------------------------------------------------------------------
<S>                                 <C>                           <C>                 <C>

Lloyd D. Smithson                   Controller/CFO               $ 27,225.86 (1)(2)   $70,000.06

Craig G. Robitaille                 President and Chief          $ 93,600.00 (1)      $93,600.00
                                    Executive Officer

All Executive officers as a group                                $120,825.86         $163,600.06
</TABLE>

         No compensation is payable to Directors of the Company in connection
with attendance at Board Meetings, except as to such Directors who also serve as
Officers of the Company in capacities other than Directors and/or Officers. At
this time no other compensation has been scheduled for any other member of the
Board of Directors or Officers of the Corporation.

                                        11



<PAGE>

         Future compensation of Officers will be determined by the Board of
Directors based upon the financial condition and performance of the Company, the
financial requirements of the Company, and upon individual performance of each
Officer. The Board of Directors intents to ensure that the salaries paid to the
Company's Officers and employees are reasonable and prudent and are based upon
both the financial condition and performance of the Company and upon the
performance of the individual Officers.

(1)      Both officers are under employment contracts that run through February,
         2011 with two (2) five (5) year options.

(2)      Mr. Smithson was released from his employment in May of 2001 by a
         unanimous vote of the Board of Directors for failure to carry out
         orders given to him by the Board. Mr. Smithson was also voted off the
         Board of Directors of The Company at the same time.

Item 10. Security Ownership of Certain Beneficial Owners and Management.
------------------------------------------------------------------------

         The following table sets forth as at December 31, 2001, certain
information as to the common stock of the Company owned of record and/or
beneficially by each person who is known to the Company to own more than five
(5%) percent of the outstanding common stock, and by all officers and directors
of the Company.

Name and Address                    Amount Beneficially
of Owner                            and/or Owned Record               Approx. %
-------------------------------------------------------------------------------

Ted D. Kimbrough                          $1,000,000                     1.1%
1933 Durango Avenue
Los Angeles, California 90034

Craig Glen Robitaille                      5,200,000                    14.2%
21391 Dockside Circle
Huntington Street, CA 92646

William Snyder                             3,100,000                     8.5%
409 South Hindry
Inglewood, California 90301

Christopher Wiles                            410,000                     1.1%
23535 Windom Street
West Hills, California 91304

Michael J. Oliva                           5,251,200                    14.4%
10552 Beardsley Circle
Villa Park, CA  92861

Lloyd D. Smithson                          5,000,000                    13.7%
1170 Oakengate Road
San Dimas, CA  91773

Francis Rigney, MD                         3,100,000                     8.5%
2605 California Street
San Francisco, CA  94115-2617

Item 11. Exhibits and Reports
------------------------------

         Completed Financial Statements filed as part of this report, prepared
by the firm of Spector & Wong LLP, Certified Public Accountant for the fiscal
year ended December 31, 2001, with the related consolidated statements of
operations, accumulated deficit and cash flows included.

                                        12



<PAGE>

                                   SIGNATURES

         Pursuant to the requirements of Section 12 of the Securities Exchange
Act of 1934, the Company has duly caused this registration statement to be
signed on its behalf by the undersigned, thereunto duly authorized.

                                            QUADRATECH INC.

Date: June 18, 2004

                                            By: /s/ Craig G. Robitaille
                                                ---------------------------
                                                Craig G. Robitaille
                                                President

                                        13



<PAGE>

                          INDEPENDENT AUDITOR'S REPORT
                          ----------------------------

To the Board of Directors and stockholders
of Quadratech, Inc. and Subsidiaries

We have audited the accompanying consolidated balance sheet of Quadratech, Inc.
and subsidiaries as of December 31, 2001, and the related consolidated statement
of operations, changes in stockholders' deficit, and cash flows for the year
then ended. These consolidated financial statements are the responsibility of
the Company's management. Our responsibility is to express an opinion on these
consolidated financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the consolidated
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the consolidated financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe that our
audit 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 Quadratech, Inc. and
subsidiaries as of December 31, 2001, and the results of their operations and
their cash flows for the year then ended in conformity with accounting
principles generally accepted in the United States of America.

The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in Note 16 to
the financial statements, the Company's operating losses in prior years and
deficit in stockholders' equity raise substantial doubt about its ability to
continue as a going concern. Management's plans regarding those matters are also
described in Note 16. These financial statements do not include any adjustments
that might result from the outcome of this uncertainty.

Spector and Wong, LLP
Pasadena, California
June 11, 2004

                                      F-1



<PAGE>

QUADRATECH, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEET
DECEMBER 31, 2001
--------------------------------------------------------------------------------

ASSETS
Current Assets
  Accounts receivable, net of allowance for doubtful
     accounts of $29,185                                            $   267,296
  Prepaid expenses                                                        9,200
  Due from related party                                                 70,312
  Net current assets of discontinued operations                          72,061
                                                                    ------------
           Total current assets                                         418,869

Property and equipment, net of accumulated
   depreciation $2,808,519                                              725,876

Other Assets
  Deposits and other assets                                              28,428
  Patents, net of accmulated amortization of $7,012                       8,533
                                                                    ------------
                                                                         36,961
                                                                    ------------

           TOTAL ASSETS                                             $ 1,181,706
                                                                    ============

LIABILITIES AND STOCKHOLDERS' DEFICIT
Current Liabilities
  Cash overdraft                                                    $    65,526
  Accounts payable                                                      184,798
  Accrued expenses                                                      497,138
  Line of credit                                                         85,000
  Notes payable, current portion                                        863,052
  Current liabilities of discontinued operations                        156,829
                                                                    ------------
                                                                      1,852,343
Long-term debt                                                        1,099,942
                                                                    ------------

          Total liabilities                                           2,952,285
                                                                    ------------

Stockholders' Deficit
  Common stock, $.001 par value; 50,000,000 shares
   authorized; 36,513,301 issued and outstanding                         36,513
  Common stock to be issued                                                 187
  Additional paid-in capital                                          3,454,237
  Accumulated deficit                                                (5,261,516)
                                                                    ------------
                                                                     (1,770,579)
                                                                    ------------

    TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT                     $ 1,181,706
                                                                    ============

See Notes to Consolidated Financial Statements

                                      F-2



<PAGE>

QUADRATECH, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF OPERATIONS
FOR YEAR ENDED DECEMBER 31, 2001
--------------------------------------------------------------------------------

  Sales                                                            $  3,147,101

  Cost of sales                                                       1,571,000
                                                                   -------------

    Gross Profit                                                      1,576,101
                                                                   -------------

Operating expenses:
  Selling, general and administrative                                 1,553,271
  Amortization of intangible assets                                       1,036
                                                                   -------------
    Total operating expenses                                          1,554,307

    Operating income                                                     21,794
                                                                   -------------

Other income (expenses):
  Other income, net                                                      26,063
  Recovery of bad debt                                                  132,995
  Interest expense                                                      (65,550)
                                                                   -------------
    Total other income (expenses)                                        93,508

Net income from continuing operations before taxes                      115,302

Provision for taxes                                                      17,677
                                                                   -------------

Net income from continuing operations                                    97,625

(Loss) from discontinued operations, net of income tax
  of $100                                                              (684,887)
                                                                   -------------

Net (loss)                                                         $   (587,262)
                                                                   =============

Per share of common stock:
  Net income from continuing operations                            $       0.00
  Net (loss) from discontinued operations                                 (0.02)
                                                                   -------------
  Net (loss) per share - Basic and Diluted                         $      (0.02)
                                                                   =============

Weighted Average Number of Shares                                    36,513,301

See Notes to Consolidated Financial Statements

                                      F-3



<PAGE>
<TABLE>

QUADRATECH, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY

FOR YEAR ENDED DECEMBER 31, 2001
------------------------------------------------------------------------------------------------------------

                                                                     Common
                                                                   Stock and
                                                                   Additional
                                                     Shares of      Paid-in      Accumulated
                                                   Common Stock     Capital        Deficit        Total
------------------------------------------------------------------------------------------------------------
<S>                                                    <C>         <C>            <C>          <C>
Balance at December 31, 2000                           36,513,301  $ 3,490,937    $ (4,674,254)$ (1,183,317)

Net loss                                                        0            0        (587,262)    (587,262)
                                                  ----------------------------------------------------------

BALANCE AT DECEMBER 31, 2001                           36,513,301   $3,490,937    $ (5,261,516) $(1,770,579)
                                                  ==========================================================

</TABLE>

See Notes to Consolidated Financial Statements

                                                          F-4



<PAGE>
<TABLE>

QUADRATECH, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF CASH FLOWS
FOR YEAR ENDED DECEMBER 31, 2001
---------------------------------------------------------------------------------------------

<S>                                                                              <C>
Cash Flow From Operating Activities:
  Net income from continuing operations                                          $    97,625
  Adjustments to reconcile net income to net cash provided by operations:
   Depreciation and amortization                                                     389,273
   Provision for bad debt                                                              6,190
   Misc noncash adjustment                                                            (4,120)
   (Increase) decrease in:
     Accounts receivable, net                                                         56,884
     Prepaid expenses                                                                 (9,200)
     Inventories                                                                      68,684
     Deposits and other assets                                                            79
   Increase in:
     Accounts payable and other liabilities                                           80,679
                                                                                 ------------
        Net cash provided by operating activities of continuing operations           686,094
        Net cash (used for) operating activities of discontinued operations         (673,389)
                                                                                 ------------
        NET CASH PROVIDED BY OPERATING ACTIVITIES                                     12,705

Cash Flow From Investing Activities:
  Due from related party                                                             (70,312)
  Investment in subsidiary                                                            (8,783)
  Purchase of property and equipment - continuing operations                         (19,084)
  Purchase of property and equipment - discontinued operations                        (2,595)
                                                                                 ------------
       NET CASH (USED FOR) INVESTING ACTIVITIES                                     (100,774)

Cash Flow From Financing Activities:
  Cash overdraft                                                                      34,917
  Net proceeds from note payable                                                   1,052,502
  Repayments on capital lease obligations                                           (999,350)
                                                                                 ------------
      NET CASH PROVIDED BY FINANCING ACTIVITIES                                       88,069

Net increase in cash                                                                      --

Cash at beginning of year                                                                 --
                                                                                 ------------

CASH AT END OF YEAR                                                              $        --
                                                                                 ============

Supplemental Disclosures of Cash Flow Information:
      Interest paid                                                              $   193,126
      Taxes paid                                                                 $    35,924

</TABLE>

See Notes to Consolidated Financial Statements

                                                F-5



<PAGE>

QUADRATECH, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE 1 - NATURE OF BUSINESS

Quadratech, Inc. (the "Company") was formed under the laws of Nevada on February
4, 1994. The Company and its wholly owned subsidiary, Oil Scavenger Absorbent,
Inc. ("OSA", a California corporation), were established to offer significant
solutions for certain environmental problems from the development and
manufacturing of a range of environmentally safe bio-degradable products.

In 1999, the Company acquired all of the outstanding common stock of Accu Chem
Conversion, Inc. ("AccuChem"). AccuChem performs quality analysis and finalizes
inspections on requested flight - sensitive materials for BNA, leases and
operates rail unloading spots for hazardous materials, and provides rail and
trucking of in-bond shipments.

In 2000, the Company acquired all of the outstanding stock of MAG
Transportation, Inc. ("MAG", a Utah corporation). MAG is a third-party logistics
company, operating in the 11 western Untied States. MAG owns/leases over 20
tractors and 40 trailers, transporting bulk food grade commodities and dust
control agents for manufactures, distributors and processors.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

PRINCIPAL OF CONSOLIDATION The accompanying consolidated financial statements
include the accounts of the Company and its wholly-owned subsidiaries, OSA, Accu
Chem Conversion, Inc. and Mag Transport, Inc., after elimination of all material
intercompany accounts and transactions.

USE OF ESTIMATES The preparation of the accompanying financial statements in
conformity with accounting principles generally accepted in the United States
requires management to make certain estimates and assumptions that directly
affect the results of reported assets, liabilities, revenue, and expenses.
Actual results may differ from these estimates.

REVENUE RECOGNITION Operating revenue and related costs are recognized upon
delivery provided that pervasive evidence of an arrangement exists, the contract
price is fixed and determinable, and collectibility of the resulting receivables
is probable.

ALLOWANCE FOR DOUBTFUL ACCOUNTS The Company provides an allowance for doubtful
accounts equal to the estimated losses that will be incurred in the collection
of receivables. These estimated losses are based on historical experience in
addition to a review of current year status.

In 2001, the Company has collected a written-off account of $132,995. Recovery
of bad debt is included in other income.

CASH AND CASH EQUIVALENTS For purposes of the statements of cash flows, the
Company considers all highly liquid debt instruments with an original maturity
of three months or less to be cash equivalents.

FAIR VALUE OF FINANCIAL INSTRUMENTS The carrying amounts of the financial
instruments have been estimated by management to approximate fair value.

                                      F-6



<PAGE>

QUADRATECH, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

PROPERTY AND EQUIPMENT Property and equipment are valued at cost. Maintenance
and repair costs are charged to expenses as incurred. Depreciation is computed
by the straight-line method over the following estimated useful lives of the
assets: 5 to 7 years for fleet equipment, 5 to 10 years for plant and terminal
equipment, and 3 to 7 years for furniture and office equipment. Leasehold
improvements are amortized by the straight-line method over the shorter of the
estimated useful lives of the assets or the term of the lease.

INTANGIBLE ASSETS Patents, marks and copyrights are capitalized and amortized
over fifteen years using the straight-line method.

INCOME TAXES Income tax expense is based on pretax financial accounting income.
Deferred tax assets and liabilities are recognized for the expected tax
consequences of temporary differences between the tax bases of assets and
liabilities and their reported amounts.

ADVERTISING COSTS All advertising costs are expensed as incurred. Advertising
expense for the year ended December 31, 2001 was $811.

DERIVATIVES In June 1998, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards (SFAS) No. 133, "Accounting for
Derivative Instruments and Hedging Activities", as amended by SFAS No. 138,
which was issued in June 2000. SFAS No. 133 establishes accounting and reporting
standards for derivative instruments. The Company currently does not use
derivative financial products for hedging or speculative purposes and as a
result, does not anticipate any impact on the Company's financial statements.

INCOME (LOSS) PER COMMON SHARE Basic net income (loss) per share is computed
using the weighted average number of common shares outstanding during the
period. Diluted net income per share is computed using the weighted average
number of common shares and dilutive potential common shares outstanding during
the period. Diluted net loss per share is computed using the weighted-average
number of common shares and excludes dilutive potential common shares
outstanding, as their effect is antidilutive. The Company does not have any
dilutive items for year ended December 31, 2001.

RECENT ACCOUNTING PRONOUNCEMENTS: In July 2001, the FASB issued SFAS No. 141,
"Business Combinations" and SFAS No. 142, "Goodwill and Other Intangible
Assets". SFAS No. 141 requires all business combinations initiated after June
30, 2001, to be accounted for using the purchase method. SFAS No. 142 requires
goodwill to be tested for impairment under certain circumstances, and written
off when impaired, rather than being amortized as previous standards required.
SFAS 142 is effective for fiscal years beginning after December 15, 2001. Early
application is permitted for entities with fiscal years beginning after March
15, 2001 provided that the first interim period financial statements have not
been previously issued. The adoption of SFAS No. 141 and No. 142 did not have a
material effect on the Company's operating results or financial condition.

                                      F-7



<PAGE>

QUADRATECH, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

SFAS No. 143,"Accounting for Asset Retirement Obligations," was issued and
addresses financial accounting and reporting for obligations associated with the
retirement of tangible long-lived assets and the associated asset retirement
costs. The statement requires that the fair value of a liability for an asset
retirement obligation be recognized in the period it is incurred if a reasonable
estimate of fair value can be made. The associated retirement costs are
capitalized as a component of the carrying amount of the long-lived asset and
allocated to expense over the useful life of the asset. The statement is
effective for financial statements issued for fiscal years beginning after June
15, 2002. Management believes the adoption of the statement will not have a
material effect on the Company's financial statements.

In August 2001, SFAS No. 144, "Accounting for the Impairment or Disposal of
Long-Lived Assets," was issued and establishes accounting and reporting
standards for the impairment or disposal of long-lived assets. This statement
supercedes SFAS No. 121, "Accounting for the Impairment of Long-Lived Assets and
for Long-Lived Assets to be Disposed." SFAS No. 144 provides one accounting
model to be used for long-lived assets to be disposed of by sale, whether
previously held for use or newly acquired and broadens the presentation of
discontinued operations to include more disposal transactions. The provisions of
SFAS No. 144 are effective for financial statements issued for fiscal years
beginning after December 15, 2001. The Company adopted SFAS No. 144 on December
31, 2001. The net operating results, net assets and net cash flows of Mag
Transport, Inc. have been reported as Discontinued Operations (see Note 3).

NOTE 3- DISCONTINUED OPERATIONS

On December 21, 2001, the Board of Directors approved to scale down and cease
operations of Mag Transport, Inc. (a wholly-owned subsidiary acquired in 2000).
The Company liquidated the property and equipment and used the proceeds to pay
off liabilities and debt.

Pursuant to SFAS No. 144, "Accounting for the Impairment of Disposal of
Long-Lived Assets," the consolidated financial statements of the Company have
been reclassified to reflect the discontinued operations. Accordingly, the
revenues, costs and expenses, assets and liabilities, and cash flows of this
business have been segregated in the consolidated statements of operations,
consolidated balance sheet and consolidated statements of cash flows. The net
operating results, net assets and net cash flows of MAG have been reported as
"Discontinued Operations."

Following is summarized financial information for the discontinued operations:

For year ended December 31, 2001
------------------------------------------------------------------------------
Sales                                                              $1,198,858
Cost and expenses                                                  (1,731,575)
Other expenses, net                                                  (152,070)
                                                                   -----------

Net (loss) from discontinued operations, net of applicable tax
of $100 (a)                                                        $ (684,887)
                                                                   ===========

(a) No gain or loss on disposal of business was recognized for year ended
December 31, 2001.

                                      F-8



<PAGE>

QUADRATECH, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE 3- DISCONTINUED OPERATIONS (CONTINUED)

At December 31, 2001
------------------------------------------------------------------------------
Current assets:
  Accounts receivable                                                $  65,695
  Other current assets                                                   6,366
                                                                     ----------
     Total current assets                                               72,061
Current liabilities:
  Accounts payable and accrued expenses                               (177,594)
                                                                     ----------
Net liabilities of discontinued operations                           $(105,533)
                                                                     ==========

Net cash used for operating activities of discontinued operations is as follows:

<TABLE>
For year ended December 31, 2001
----------------------------------------------------------------------------------
<S>                                                                      <C>
Net (loss)                                                               $(684,887)
Adjustments to reconcile net (loss) from discontinued
operations to net cash used for operating activities:
  Provision for bad debt                                                    21,898
  Increase in accounts receivable                                          (22,844)
  Increase in other assets                                                    (738)
  Increase in accounts payable and accrued expenses                         13,182
                                                                         ----------
Net cash used in for operating activities of discontinued operations     $(673,389)
                                                                         ==========
</TABLE>

NOTE 4 - PROPERTY AND EQUIPMENT

Property and equipment are summarized as follows as of December 31, 2001:

Fleet Equipment                                              $2,760,263
Furniture and office equipment                                   90,703
Plant and terminal equipment                                    415,021
Leasehold improvements                                          268,408
                                                             -----------
                                                              3,534,395
Accumulated depreciation                                     (2,808,519)
                                                             -----------

   Total property and equipment                              $  725,876
                                                             ===========

NOTE 5 - ACCRUED EXPENSES

Accrued expenses are summarized as follows as of December 31, 2001:

Accrued payroll                                              $ 50,576
Delinquent payroll taxes                                      159,940
Accrued interest                                              121,393
Accrued insurance                                               5,892
Other accrued expenses                                        159,337
                                                             --------

   Total accrued expenses                                    $497,138
                                                             ========

                                      F-9



<PAGE>
<TABLE>

QUADRATECH, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
-------------------------------------------------------------------------------------------

NOTE 6 - NOTES PAYABLE

As of December 31, 2001, notes payable consist of the followings:

<S>                                                                             <C>
 a) Note payable to Francis Rigney, unsecured, interest payable monthly
 at 10% per annum. The note matures in July, 2001.                              $  157,030

 b) Note payable to Annetee Kroes, unsecured, interest at 10% per annum,
 payable in monthly principal payments of $5,000. The note was settled
 on July 22, 2002 in the amount $31,500, payable at $875 per month
 commencing August 1,2002 until paid.                                               31,500

 c) Note payable to related party, unsecured and due on demand. No
 interest was accrued.                                                              50,000

 d) Note payable to related party, unsecured and due on demand. No
 interest was accrued.                                                              50,000

 e) Note payable to prior shareholder of Mag Transport. No interest was
 accrued. The balance was in dispute - see Note 15.                                150,154

 f) Note payable to Bank of America dated February 11, 1999 is payable
 in monthly payments of $5,395 including interest at 9% per annum. The
 note is secured by the fleet assets of Accu Chem Conversion, Inc. and
 is personally guaranteed by three officers and shareholders of the
 Company. Principal and interest are payable through March 1, 2004.                133,977

 g) Note payable to Bank of America dated September 14, 1999 is payable
 in monthly payments of $1,389 plus interest at 1.725% over the bank
 rate (6.475% at 12/31/01). The note is secured by the assets of the
 Company and is personally guaranteed by three officers and
 shareholders. The note matures on September 15,2002.                               12,497

 h) Note payable to Admiral Transportation, dated February 9, 1998, is
 payable in monthly payments of $2,000 including interest at 7% per
 annum. The note is secured by all assets of the Company. On June 20,
 2003, a new note payable of $84,475 was signed to restructure the old
 debt. The new note carries interest at 6% and paid in 72 monthly
 installments of $1,400, commencing August 1, 2003.                                172,283

 i) Note payable to Coast Grain, payable in monthly payments of $2,460
 including interest at 10% per annum. On July 30, 2003, the Company
 obtained a compromise settlement and mutual release related to this
 existing note and the past due rent owed on the El Centro office after
 August 1, 2001.                                                                     9,167

 j) Note payable to HoltraChem, payable in monthly payments of $507
 including interest at 8% per annum. Secured by the fleet equipment. On
 October 1, 2001, the term was modified and is payable in monthly
 payments of $1,250 for first six months and of $2,763 for the remaining
 six months, including interest at 12% per annum.                                   26,601

 k) Note payable to related party, unsecured, and due on demand.
 Interest is accrued at 10% per annum.                                               9,400

 l) Notes payable to related party, unsecured, and due on demand.
 Interest is accrued at 12% per annum.                                              13,373

 m) Note payable to Haycock Petroleum, dated September 4, 2001, is
 payable in weekly payments of $1,944, including interest at 12% per
 annum. Principal and interest are payable through August 28, 2002.                 60,702

 n) Note payable to American Investment Financial, dated March 2, 2001,
 is payable in monthly payments of $20,296, including interest at 2.75%
 over the prime rate. The note is guaranteed by the SBA office (75% of
 note amount) and is secured by the Company's fleet equipment and by
 personal guaranty of the CEO.                                                   1,086,310
                                                                                -----------
Total                                                                            1,962,994
Less: current portion                                                             (863,052)
                                                                                -----------
Long-term debt, net                                                             $1,099,942
                                                                                ===========
</TABLE>

                                      F-10



<PAGE>

QUADRATECH, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE 6 - NOTES PAYABLE (CONTINUED)

Following are matures of long-term debt for each of the next five years:

               At December 31,                 Amount
               ---------------              ---------
               2002                         $  863,052
               2003                            217,273
               2004                            194,530
               2005                            196,537
               2006 and over                   491,602
                                            ----------
                 Total                      $1,962,994
                                            ==========

NOTE 7 - LINE OF CREDIT

The Company has an operating line of credit with a bank in the amount of
$85,000, renewed annually. The line carries an interest rate of 2.35% over the
bank's prime rate (7.10% at December 31, 2001), and requires monthly interest
payments. The outstanding borrowing against on this line as of December 31, 2001
was $85,000.

NOTE 8 - INCOME TAX

The Company files separate federal and state income tax returns with its
subsidiaries.

The provision for income taxes consisted of the following at December 31, 2001:

               Federal                      $  6,166
               State                          11,611
                                            --------
                 Total                      $ 17,777
                                            ========

As of December 31, 2001, the Company has net operating loss carryforwards,
approximately, of $5.3 million and $3.1 million to reduce future federal and
state taxable income, respectively. To the extent not utilized, the
carryforwards will begin to expire through 2021. The Company's ability to
utilize its net operating loss carryforwards is uncertain and thus a valuation
reserve has been provided against the Company's net deferred tax assets.

The deferred net tax assets consist of the following at December 31, 2001:

         Tax benefit on net operating loss carryforward              $2,013,561
         Temporary difference in depreciation and amortization           51,845
         Allowance for doubtful account                                   6,955
         Tax benefit on capital loss carryforward                           901
         Less: valuation allowance                                   (2,073,262)
                                                                     -----------
         Net deferred tax assets                                     $        -
                                                                     ===========

                                      F-11



<PAGE>

QUADRATECH, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE 9 - STOCK OPTIONS

At December 31, 2001, there was no stock option outstanding. All options were
expired in the year.

NOTE 10 - NET INCOME (LOSS) PER SHARE

The following table sets forth the computation of basic and diluted earnings
(loss) per share for year ended December 31, 2001:

         Numerator:
           Net income from continuing operations                  $   97,625
           Net (loss) from discontinued operations                  (684,887)
                                                                  -----------
           Net (loss)                                             $ (587,262)
                                                                  -----------

         Denominator:
           Weighted average of common shares                       3,651,301
                                                                  -----------

         Per share of common stock:
           Net income from continuing operations                  $     0.00
           Net (loss) from discontinued operations                     (0.02)
                                                                  -----------
           Net (loss) per share-basic and diluted                 $    (0.02)
                                                                  ===========

NOTE 11 - RELATED PARTY TRANSACTIONS

As of December 31, 2001, the Company had a balance of $70,312 due from Accu Chem
Conversions, LLC, of which all three officers of the Company are the members.

NOTE 12 - SEGMENT INFORMATION AND MAJOR CUSTOMERS

SFAS No. 131 "Disclosures about Segments of an Enterprise and Related
Information" requires that a publicly traded company must disclose information
about its operating segments when it presents a complete set of financial
statements. Since the Company has only one operating segment - logistics
support; accordingly, detailed information of the reportable segment is not
presented.

Accu Chem Converions, Inc. had five major customers that accounted for about
$2,578,693 or 80% of the Company's sales for year ended December 31, 2001.

NOTE 13 - GUARANTEES

The Company from time to time enters into certain types of contracts that
contingently require the Company to indemnify parties against third party
claims. These contracts primarily relate to: (i) divestiture agreements, under
which the Company may provide customary indemnifications to purchasers of the
Company's businesses or assets; (ii) certain real estate leases, under which the
Company may be required to indemnify property owners for environmental and other
liabilities, and other claims arising from the Company's use of the applicable
premises; and (iii) certain agreements with the Company's officers, directors
and employees, under which the Company may be required to indemnify such persons
for liabilities arising out of their employment relationship.

                                      F-12



<PAGE>

QUADRATECH, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

The terms of such obligations vary. Generally, a maximum obligation is not
explicitly stated. Because the obligated amounts of these types of agreements
often are not explicitly stated, the overall maximum amount of the obligations
cannot be reasonably estimated. Historically, the Company has not been obligated
to make significant payments for these obligations, and no liabilities have been
recorded for these obligations on its consolidated balance sheet as of December
31, 2001.

NOTE 14 - COMMITMENTS

The Company lease certain facilities and equipment under operating leases. As of
December 31, 2001, future minimum annual operating lease payments are as
follows:

               Year ended December 31,
               -----------------------
               2002                                        $100,768
               2003                                         100,768
               2004                                         100,768
               2005                                         100,768
               2006 and thereafter                           30,276
                                                           --------
                  Total                                    $433,350
                                                           ========

Rent expense for year ended December 31, 2001 was $173,111, net of sublease
income of $18,830.

NOTE 15 - LEGAL PROCEEDINGS

On March 15, 2002, the former owner of Mag Transport, Inc. (MAG) filed a claim
against the company alleging that the Company failed to pay and to deliver
regarding the Company's purchase of Mag Transport, Inc The alleged amount
totaled $216,669 including cash, the Company's common shares and certain
equipment. The Company filed a counter claim alleging that the plaintiff had
misrepresented MAG's financial condition and had failed to disclose numerous
liabilities. The Company believes that they have meritorious defenses against
this action and will continue to vigorously defend it. On May 11, 2004, the
United States District Court for the District of Utah denied, without prejudice,
the Plaintiff's Joint Rule 56 motion for summary judgment and to enforce
settlement agreement, and to dismiss the Company's counterclaim. After the
acquisition, the Company recorded a liability of $158,937 that due to the
Purchase. As of December 31, 2001, the balance reduced to $150,154.

In 2002, A Plus Benefits of SLC, Inc. ("A Plus"), which is a payroll and
employee benefits company, filed a claim against Mag Transport, Inc. and the
Company for a breach of contract for services rendered in 2001. The parties
entered into a settlement agreement in June 2003 providing that MAG and the
Company executed a promissory note in favor of A Plus in the amount of $13,600,
payable without interest in 18 consecutive monthly installments of $760. In
light of the settlement, the lawsuit is currently stayed. The action will be
dismissed upon payment in full of the promissory note. The settlement amount of
$13,600 was accrued in 2001.

The Workers Compensation Fund of Utah ("WCF") conducted an audit of Mag
Transport, Inc., and has asserted a formal claim against the Company for unpaid
premiums in the amount of $24,207.56. WCF sent the matter to a collection
agency. The parties were unable to resolve the dispute, and the collection
agency indicated that WCF will likely to bring a lawsuit, though as of the date
hereof it has not done so. As a result of the WCF claim, the Company has
asserted a claim for approximately $8,100 against the former owners of MAG,
alleging that they wrongfully under reported MAG's payroll to WCF prior to the
acquisition of MAG by the Company. The Company intends to contest the remainder
of WCF's claims where and if an action is brought by WCF. No accrual was made in
2001.

                                      F-13



<PAGE>

QUADRATECH, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE 15 - LEGAL PROCEEDINGS (CONTINUED)

The Company is currently party to various legal proceedings and claims, either
asserted or unasserted, which arise in the ordinary course of business. While
the outcome of these matters cannot be predicted with certainty, management do
not believe that the outcome of any of these claims or any of the above
mentioned legal matters will have a material adverse effect on the Company's
consolidated financial position, results of operations, or cash flows.

NOTE 16 - GOING CONCERN

The Company's consolidated financial statements have been prepared on a going
concern basis, which contemplates the realization of assets and the settlement
of liabilities and commitments in the normal course of business. As shown in the
accompanying consolidated financial statements, the Company incurred significant
losses in prior years, which has caused an accumulated deficit of $5,261,516 as
of December 31, 2001, and as of that date, the Company's current liabilities
exceeded its current assets by $1,433,474 and its total liabilities exceeded its
total assets by $1,777,579.

In December 2001, the Company ceased the operations of Mag Transport, Inc. and
liquidated all assets of MAG. Management is currently involved in active
negotiations to obtain additional financing and actively increasing marketing
efforts to increase revenues. The Company continued existence depends on its
ability to meet its financing requirements and the success of its future
operations. The financial statements do not include any adjustments that might
result from the outcome of this uncertainty.

NOTE 17 - SUBSEQUENT EVENTS

On July 22, 2002, the Company entered into a settlement agreement to settle a
claim by a creditor for a note payable of $50,000 dated May 28, 1999. The
Company agreed to pay the creditor a sum of $31,500 with monthly payments of
$875 commencing August 1, 2002 (see Note 6b). The settlement was considered a
debt restructuring under SFAS no. 15. Accordingly, a gain on debt restructuring
of $5,980 was included as other income for year ended December 31, 2001.

On June 20, 2003, AccuChem restructured a debt of $181,683 plus accrued interest
of $123,731 with Admiral Transportation. Accordingly, a new note of $84,475 was
issued to replace the old debt. The new note is compounded at 6% per annum and
is amortized over 6 years commencing August 1, 2003. The settlement is
considered to be a debt restructuring under SFAS No. 15 (see Note 6h).

On July 30, 2003, the Company and AccuChem entered into a Compromise Settlement
and Mutual Release to settle a dispute with Coast Grain Company for alleged
unpaid rent. AccuChem agreed to pay Coast Grain Company a sum of $47,500 with
monthly payments through 2007 (see Note 6i).

In 2002, Mag Transport, Inc. has liquidated most of its assets. The total
proceeds of $456,700 were transferred to American Investment Financial for
partial debt payment.

                                      F-14