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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549-1004
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended March 31, 2008
 or
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from                 to               .
 Commission file number: 0-29266
 CVF TECHNOLOGIES CORPORATION
 (Exact name of registrant as specified in its charter)
 Nevada(State or other jurisdiction of 
Incorporation or organization)
    
    87-0429335(I.R.S. Employer
Identification No.)
 8604 Main Street, Suite 1
Williamsville, NY
14221  (Address of principal executive offices)
(Zip Code)
 (716) 565-4711  (Registrants telephone number, including area code)
 þ o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer o
    
    Smaller reporting company þ(Do not check if a smaller reporting company)
 o þ




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TABLE OF CONTENTS  PART I  FINANCIAL INFORMATIONItem 1. Financial StatementsItem 2. MANAGEMENTS DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONItem 3. Quantitative and Qualitative Disclosures About Market Risk.Item 4. Controls and procedures.Item 4T.PART II  OTHER INFORMATIONItem 1. Legal ProceedingsItem 2. Unregistered Sales of Equity Securities and Use of Proceeds.Item 5. Other Information.Item 6. ExhibitsSIGNATURESEXHIBIT INDEXEX-11EX-31.1EX-31.2EX-32    Table of Contents  
  
  CVF TECHNOLOGIES CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
 (Expressed in U.S. Currency)March 31,
    
    
    December 31,2008
    
    
    2007(unaudited)
    
    
    (audited)ASSETSCURRENT ASSETS:Cash and cash equivalents
    
    $
    482,072
    
    
    $
    735,115Trade receivables
    
    
    26,561
    
    
    
    112,452Inventory
    
    
    114,969
    
    
    
    120,223Prepaid expenses and other
    
    
    21,899
    
    
    
    20,399TOTAL CURRENT ASSETS
    
    
    645,501
    
    
    
    988,189Property and equipment, net of accumulated depreciation
    
    
    14,240
    
    
    
    13,614Loans receivable
    
    
    142,251
    
    
    
    142,251Market value  Biorem (see Note 4)
    
    
    2,128,510
    
    
    
    Holdings available for sale, at market
    
    
    1,042
    
    
    
    1,451Security Deposit, long-term
    
    
    1,619
    
    
    
    1,677Note receivable
    
    
    461,454
    
    
    
    477,843TOTAL ASSETS
    
    $
    3,394,617
    
    
    $
    1,625,025LIABILITIES AND STOCKHOLDERS (DEFICIT) EQUITYCURRENT LIABILITIES:Accounts payables and accrued liabilities
    
    $
    888,932
    
    
    $
    901,960IRS Audit Settlement
    
    
    970,404
    
    
    
    953,872TOTAL CURRENT LIABILITIES
    
    
    1,859,336
    
    
    
    1,855,832LONG-TERM LIABILITIES:Deferred income taxes
    
    
    99,021
    
    
    
    102,693Minority interest
    
    
    874,216
    
    
    
    905,265Pension obligation
    
    
    645,788
    
    
    
    677,001TOTAL LONG-TERM LIABILITIES
    
    
    1,619,025
    
    
    
    1,684,959Redeemable Series A preferred stock, $0.001 par value,
redeemable at $18.25 per share, authorized 500,000 shares,
issued and outstanding 1,592 shares
    
    
    29,054
    
    
    
    29,0543,507,415
    
    
    
    3,569,845STOCKHOLDERS (DEFICIT) EQUITY:Common stock, $0.001 par value, authorized 50,000,000 shares,
14,949,866 issued and in treasury 1,664,361
    
    
    16,614
    
    
    
    16,614Additional paid in capital
    
    
    30,033,521
    
    
    
    29,973,593Treasury stock
    
    
    (3,208,392
    )
    
    
    (3,208,392
    )Accumulated other comprehensive loss
    
    
    (242,582
    )
    
    
    (319,917
    )Deferred market value  Biorem
    
    
    2,660,638
    
    
    
    Accumulated deficit
    
    
    (29,372,597
    )
    
    
    (28,406,718
    )TOTAL STOCKHOLDERS (DEFICIT) EQUITY
    
    
    (112,798
    )
    
    
    (1,944,820
    )TOTAL LIABILITIES AND STOCKHOLDERS (DEFICIT) EQUITY
    
    $
    3,394,617
    
    
    $
    1,625,025




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CVF TECHNOLOGIES CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF OPERATIONS
 (UNAUDITED)
 (Expressed in U.S. Currency)Three months ended March 31,2008
    
    
    2007SALES
    
    $
    112,087
    
    
    $
    681,679Royalty Income
    
    
    17,426
    
    
    
    Cost of sales
    
    
    89,382
    
    
    
    537,176GROSS MARGIN
    
    
    40,131
    
    
    
    144,503EXPENSES:Selling, general and administrative
    
    
    518,671
    
    
    
    537,084TOTAL EXPENSES
    
    
    518,671
    
    
    
    537,084(Loss) from continuing operations before under noted items
    
    
    (478,540
    )
    
    
    (392,581
    )OTHER (EXPENSES) INCOMEInterest (expense) income, net
    
    
    (14,017
    )
    
    
    6,306(Loss) from equity investees
    
    
    (34,456
    )
    
    
    (75,674
    )Gain on sale of shares
    
    
    99,330
    
    
    
    Other income, net
    
    
    4,725
    
    
    
    12,239(Decrease) in market value  Biorem
    
    
    (542,560
    )
    
    
    TOTAL OTHER (EXPENSE)
    
    
    (486,978
    )
    
    
    (57,129
    )(Loss) before income taxes and minority interest
    
    
    (965,518
    )
    
    
    (449,710
    )Income taxes
    
    
    
    
    
    
    770(Loss) before minority interest
    
    
    (965,518
    )
    
    
    (450,480
    )Minority interest in loss
    
    
    
    
    
    
    12,572NET (LOSS)
    
    $
    (965,518
    )
    
    $
    (437,908
    )BASIC (LOSS) PER SHARE
    
    $
    (0.08
    )
    
    $
    (0.03
    )DILUTED (LOSS) PER SHARE
    
    $
    (0.08
    )
    
    $
    (0.03
    )WEIGHTED SHARES USED IN COMPUTATION  BASIC
    
    
    12,637,735
    
    
    
    12,637,735WEIGHTED SHARES USED IN COMPUTATION  DILUTED
    
    
    12,637,735
    
    
    
    12,637,735




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CVF
TECHNOLOGIES CORPORATION AND SUBSIDIARIES
 CONSOLIDATED
STATEMENT OF CASH FLOWS
 (UNAUDITED)
 (Expressed in U.S. Currency)Three Months Ended March 31,2008
    
    
    2007CASH FLOW FROM OPERATING ACTIVITIES:Net (loss) from continuing operations
    
    $
    (965,518
    )
    
    $
    (437,908
    )Adjustments to reconcile net loss
from operating activities:Depreciation and amortization
    
    
    1,273
    
    
    
    1,028Minority interest in losses of subsidiaries
    
    
    
    
    
    
    (12,572
    )Pension expense
    
    
    (31,213
    )
    
    
    (9,221
    )Deferred income tax
    
    
    (3,672
    )
    
    
    (284
    )Loss from equity investees
    
    
    34,456
    
    
    
    75,674Decrease in market value  Biorem
    
    
    542,560
    
    
    
    Equity based compensation
    
    
    61,104
    
    
    
    52,816Changes in non-cash working capital itemsDecrease (Increase) in trade receivables
    
    
    85,891
    
    
    
    (93,830
    )(Increase) in inventory
    
    
    5,254
    
    
    
    (51,044
    )Decrease (Increase) in prepaid expenses and other
    
    
    (1,500
    )
    
    
    8,920Increase (Decrease) in trade payables and accrued liabilities
    
    
    (168
    )
    
    
    (97,498
    )693,985
    
    
    
    (126,011
    )CASH (USED IN) OPERATING ACTIVITIES
    
    
    (271,533
    )
    
    
    (563,919
    )CASH FLOWS (USED IN) FROM INVESTING ACTIVITIES:Sale of Biorem equity
    
    
    99,330
    
    
    
    CASH PROVIDED BY INVESTING ACTIVITIES
    
    
    99,330
    
    
    
    EFFECT OF EXCHANGE RATE CHANGES ON CASH AND
CASH EQUIVALENTS
    
    
    (80,840
    )
    
    
    (5,497
    )NET (DECREASE) IN CASH AND CASH EQUIVALENTS
    
    
    (253,043
    )
    
    
    (569,416
    )CASH AND CASH EQUIVALENTS  beginning of period
    
    
    735,115
    
    
    
    2,332,690CASH AND CASH EQUIVALENTS  end of period
    
    $
    482,072
    
    
    $
    1,763,274




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CVF
TECHNOLOGIES CORPORATION AND SUBSIDIARIES
 STATEMENT
OF COMPREHENSIVE INCOME
 (UNAUDITED)
 (Expressed in U.S. Currency)Three months ended March 31,2008
    
    
    2007Net (loss)
    
    $
    (965,518
    )
    
    $
    (437,908
    )Other comprehensive income, net of tax:Foreign currency translation adjustments
    
    
    77,009
    
    
    
    30,464Unrealized holding gains:Unrealized holding (losses) gain arising during period (see note below)
    
    
    326
    
    
    
    (1,775
    )Total other comprehensive income
    
    
    77,335
    
    
    
    28,689Comprehensive (loss) during period
    
    $
    (888,183
    )
    
    $
    (409,219
    )
 
 Note:
    
    Unrealized holding (losses) gain are net of tax of $217 and ($1,185) for the
three months ended March 31, 2008 and 2007, respectively.




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CVF TECHNOLOGIES CORPORATION AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 THREE MONTHS ENDED MARCH 31, 2008 AND 2007  (UNAUDITED)
  1.
    
    BASIS OF PRESENTATIONThe accompanying financial statements are unaudited, but reflect all adjustments
which, in the opinion of management, are necessary for a fair presentation of financial
position and the results of operations for the interim periods presented. All such
adjustments are of a normal and recurring nature. The results of operations for any
interim period are not necessarily indicative of the results attainable for a full fiscal
year.The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that affect the
amounts reported in the financial statements and accompanying notes. Actual results could
differ from those estimates.Certain of the comparative figures have been reclassified to conform with the
presentation adopted in the current period. The Canadian dollar is the functional currency
used by the Company, whereas the reporting currency is the U.S. dollar.2.
    
    ACCOUNTING POLICIESStock Based Compensation PlansThe Company adopted SFAS No. 123R, Share Based Payments. SFAS No. 123R requires
companies to expense the value of employee stock options and similar awards and applies to
all outstanding and vested stock-based awards.In computing the impact, the fair value of each option is estimated on the date of
grant based on the Black-Scholes options-pricing model utilizing certain assumptions for a
risk free interest rate; volatility; and expected remaining lives of the awards. The
assumptions used in calculating the fair value of share-based payment awards represent
managements best estimates, but these estimates involve inherent uncertainties and the
application of management judgment. As a result, if factors change and the Company uses
different assumptions, the Companys stock-based compensation expense could be materially
different in the future. In addition, the Company is required to estimate the expected
forfeiture rate




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and only recognize expense for those shares expected to vest. In estimating the Companys
forfeiture rate, the Company analyzed its historical forfeiture rate, the remaining lives
of unvested options, and the amount of vested options as a percentage of total options
outstanding. If the Companys actual forfeiture rate is materially different from its
estimate, or if the Company reevaluates the forfeiture rate in the future, the stock-based
compensation expense could be significantly different from what we have recorded in the
current period. The impact of applying SFAS No. 123R approximated $61,104 and $53,209 in
additional compensation expense during the three months ended March 31, 2008 and 2007. The
shares issued vest from April 2007 through November 2009. Such amount is included in
general and administrative expenses on the statement of operations.3.
    
    SUBSIDIARY SHAREHOLDERS MEETINGIn November 2006, CVF received $860,306 from Gemprint as a shareholder distribution of
capital. In March 2008, Gemprint shareholders approved a shareholder distribution of
capital to be made in April 2008 of $1,328,000. CVFs portion of this distribution is
$1,035,320.4.
    
    SUBSIDIARY BIOREM GOES PUBLICIn 2005, Biorem completed its going public transactions and began trading on the
Toronto Venture Exchange under the symbol BRM. CVFs ownership position in Biorem as of
March 31, 2008 is approximately 2.7 million shares representing 22.8% of the outstanding
shares of Biorem. Since CVF no longer owns more than 50% (effective November 24, 2004), CVF
recorded the results of Biorem on the equity basis of accounting through December 31, 2007.In September 2006, the FASB issued FASB Statement No. 157. This Statement defines fair
value, establishes a framework for measuring fair value in generally accepted accounting
principles (GAAP), and expands disclosures about fair value measurements. CVF adopted this
statement effective the first quarter 2008 for Level 1 assets and liabilities and therefore
reports the market value of Biorem of $2,128,510 on its March 31, 2008 balance sheet. Also
recorded in the income statement was the change in market value from January 1, 2008 to
March 31, 2008 as an unrealized loss of $542,560.5.
    
    EQUITY AND DEBT INVESTMENT IN XYLODYNE CORPORATIONXylodyne was capitalized with cdn $18,000 from two individuals that own 60% of
Xylodyne, while CVF contributed cdn $12,000 to capital for a 40% ownership of Xylodyne.
CVF also loaned Xylodyne another cdn $313,000 in the form of a debenture. Officers of CVF
are two of the four voting board members seats of Xylodyne. The cdn $313,000 debenture is
secured by the assets of Xylodyne only, with no personal guarantees from the majority
owners of Xylodyne.




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CVF evaluated the consolidation of Xylodyne pursuant to paragraph 5 of FIN 46, which
states an entity shall be subject to consolidation if either of the following conditions
exists:
 A.) The total equity investment at risk is not sufficient to permit the entity to finance
its activities without additional subordinated financial support from other parties. The
total equity investment at risk: (1) Includes only equity investments in the entity that
participate significantly in profits and losses, (2) Does not include equity interest that
the entity issued in exchange for subordinated interests in other variable interest
entities, (3) Does not include amounts provided to the equity investor directly or
indirectly by the entity or by other parties, (4) Does not include amounts financed for
equity investor ( for example by loans or guarantees of loans ) directly by the entity or
by other parties involved with the entity, unless that party is a parent, subsidiary or
affiliate of the investor that is required to be included in the same set of consolidated
financial statements as the investor.B.) As a group the holders of the equity investment at risk lack any one of the following
three characteristics of controlling financial interest: (1) The direct or indirect ability
to make decisions about an entitys activities through voting rights or similar rights, (2)
The obligation to absorb the expected losses of the entity if they occur. The investor or
investors do not have that obligation if they are directly or indirectly protected from the
expected losses or are guaranteed a return by the entity itself or by other parties
involved with the entity, (3) The right to receive the expected residual returns of the
entity if they occur. The investors do not have that right if their return is capped by the
entitys governing documents or arrangements with other variable interest holders or with
the entity.CVFs evaluation of including Xylodyne as a variable interest enterprise for
consolidation purposes is based on the following evaluation of both paragraphs 5(a) and
5(b) even though only meeting the conditions in one paragraph alone required the
consolidation of Xylodyne as a variable interest entity:A.) At inception of Xylodyne, CVF believed that the cdn $30,000 capital investment was
insufficient to operate Xylodyne effectively, based on its intended goals and purpose,
hence the need for an additional amount of debt from CVF (ie: the cdn $313,000 debt). As
further support for the initial evaluation is at December 31, 2006, Xylodyne had cdn
$566,000 in assets and had losses of $161,200 in 2006 and $22,200 in 2007. The assets are
largely receivables from US based companies, while Xylodyne is a Canadian based entity.
Traditional banking relationships are difficult to obtain for a start up enterprise with a
business located in one country where as receivables are from companies in another country,
further supporting the need for the additional cdn $313,000 debt. In addition, it is also
possible, but not required, that CVF will extend further credit to Xylodyne as the majority
shareholders may not have additional funds for possible future




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expansion. Based on the conditions elaborated in paragraph 5 (a) and paragraph 9 of FIN
46, CVF believes that it is required to consolidate Xylodyne as a variable interest entity.B.) At inception under the conditions elaborated under paragraph 5(b) of FIN 46, (a)
CVF has two of the four voting board of director seats for making decisions, (b) the cdn
$313,000 debenture is secured by the assets and business of Xylodyne only, hence if
Xylodyne fails and ceases to operate, CVF is not protected against additional losses above
its cdn $12,000 investment as there is no other subordinated creditor, nor does CVF have
any outside guarantees or collateral for the $313,000 cdn debt outstanding, (c) should
Xylodyne perform beyond expectations as a result of CVFs equity ownership, CVF can enjoy
their ratable amount of residual returns. Based on the conditions elaborated in paragraph
5(b), CVF believes that it is required to consolidate Xylodyne as a variable interest
entity.6.
    
    INCOME (LOSS) PER SHAREBasic income per share amounts are computed by dividing net income (loss)
from continuing operations available to common stockholders from
continuing operation, and net income available to common stockholders by
the weighted average number of common shares outstanding during the
period. The net income from continuing operations and net income
available to common stockholders consists of net income from continuing
operations and net income amounts reduced by the dividends on the
Companys Series A preferred stock. Diluted income per share reflects the
per share amount that would have resulted if diluted potential common
stock had been converted to common stock, as prescribed by SFAS 128. The
Company has presented dilutive income per share in those periods where
there was net income and therefore reduced income per share and not
presented dilutive loss per share information when the dilution would
reduce the loss per share.7.
    
    INVENTORYInventory consists of the following:
 March 31, 2008
    
    December 31, 2007Finished goods
    
    $
    114,969
    
    
    $
    120,223




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8.
    
    INVESTMENTSThe following table provides certain summarized unaudited financial information
related to the Companys equity basis holdings:
 Three Months Ended March 31,2008
    
    2007Net Sales
    
    $
    3,162,905
    
    
    $
    1,534,499Gross profit on sales
    
    
    1,445,419
    
    
    
    551,100Net income (loss)
    
    $
    24,350
    
    
    $
    (398,645
    )
 9.
    
    CONCENTRATION OF CREDIT RISKFor the three months ended March 31, 2008, the Companys subsidiary, Xylodyne
Corporation, had a customer which accounted for $nil or 0% of consolidated sales as
compared to $451,459 or 69.8% of the three months ended March 31, 2007 consolidated sales.
No other customer accounted for more than 10% of the Companys sales in the first three
months of either 2008 or 2007. The Companys accounts receivable from this customer at
March 31, 2008 and March 31, 2007 amounted to $47 and $390,328, respectively.10.
    
    DEPENDENCY ON SUPPLIERThe Companys subsidiary, Xylodyne Corporation, had one supplier that accounted for
$nil or 0% of consolidated cost of sales for the three months ended March 31, 2008 as
compared to $385,243 or 73.0% for the three months ended March 31, 2007. The Companys
accounts payable to this supplier at March 31, 2008 and March 31, 2007 amounted to $30,931
and $305,954, respectively.11.
    
    SETTLEMENT WITH THE INTERNAL REVENUE SERVICECVF received a final demand from the Internal Revenue Service dated February 19, 2008
requesting payment of tax totaling $515,000 relating to the tax audit of the years 1997,
2000 and 2001, plus




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accrued interest and penalty for a total demand of $913,336. On March 12, 2008, CVF
responded to this Internal Revenue Service request by submitting a Form 12153 (Request for
Collection Due Process Hearing). As part of this submission CVF is requesting an
Installment Arrangement with the Internal Revenue Service and stating that CVF does not
agree to additional penalties and interest that is included in the $913,336 indicated by
the Internal Revenue Service. CVF plans to challenge the accrued interest charged by the
Internal Revenue Service as CVF believes it has strong grounds to
challenge the interest assessed.12.
    
    STOCK BUYBACK PLANAs announced on December 30, 2005, the Companys Board of
Directors approved up to a maximum $500,000 stock buyback program. The
program allows the Company to make up to $500,000 of stock
repurchases. As of May 5, 2008, the Company has purchased 1,182,661
shares under this repurchase program for a total of $461,218.13.
    
    ISSUANCE OF RESTRICTED CVF COMMON SHARESOn April 6, 2006, the Board of Directors of the Company approved the Corporations
Management Incentive Program. In connection with the program, restricted stock was granted
to officers and employees of the Company totaling 1,660,000 restricted common shares. These
shares will vest every 12 months over a three year period beginning April 2007 with vesting
accelerated on a change of control. The value of these shares was recorded at $0.39 per
share which was the closing market price on that date. The expense is being recorded over
the period that the shares vest (36 months). During the first three months of 2008 and
2007, an expense of $55,126 and $53,209 was recorded, respectively.On November 14, 2007, the Board of Directors of the Company approved awarding 652,131
restricted common shares in return for cancellation of all outstanding options and warrants
that had not expired at that time. These shares will vest at the end of each year over a
three year period beginning November 2008 with vesting accelerated on a change of control.
During the first quarter 2008 an expense of $5,978 was recorded for these shares.14.
    
    INTERIM FINANCIAL STATEMENT DISCLOSURESCertain information and footnote disclosures normally included in annual financial
statements presented in accordance with generally accepted accounting principles have been
condensed or omitted from the accompanying unaudited interim financial statements.
Reference is made to the Companys audited financial statements for the year ended December
31, 2007 included in the Companys Annual Report on Form 10-KSB filed with the Securities
and Exchange Commission on April 15, 2008.




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15.
    
    IMPACT OF RECENTLY ISSUED ACCOUNTING STANDARDSThe Company has implemented new accounting standards as follows:FASB 157  Fair Value MeasuresIn September 2006, the FASB issued FASB Statement No. 157. This Statement defines fair
value, establishes a framework for measuring fair value in generally accepted accounting
principles (GAAP), and expands disclosures about fair value measurements. This Statement
applies under other accounting pronouncements that require or permit fair value
measurements, the Board having previously concluded in those accounting pronouncements that
fair value is a relevant measurement attribute. Accordingly, this Statement does not
require any new fair value measurements. However, for some entities, the application of
this Statement will change current practices. This Statement is effective for financial
statements for fiscal years beginning after November 15, 2007. Earlier application is
permitted provided that the reporting entity has not yet issued financial statements for
that fiscal year. This Statement had significant positive and negative impact on the
financial statements of the Company as adopted in the first quarter 2008 (see Note 4.).FASB 159  Fair Value Option for Financial Assets and Financial LiabilitiesIn February 2007, the FASB issued FASB Statement No. 159, The Fair Value Option for
Financial Assets and Financial Liabilities  Including an Amendment of FASB Statement No.
115 (SFAS 159). This Statement provides companies with an option to measure, at specified
election dates, many financial instruments and certain other items at fair value that are
not currently measured at fair value. A company that adopts SFAS 159 will report unrealized
gains and losses on items for which the fair value option has been elected in earnings at
each subsequent reporting date. This Statement also establishes presentation and disclosure
requirements designed to facilitate comparisons between entities that choose different
measurement attributes for similar types of assets and liabilities. This Statement is
effective for fiscal years beginning after November 15, 2007, which for us is the first
quarter of fiscal 2008. This Statement had significant positive and negative impact on the
financial statements of the Company as adopted in the first quarter 2008.FASB 161   Disclosures about Derivative Instruments and Hedging ActivitiesIn March 2008, the FASB issued FASB Statement No. 161, which amends and expands the
disclosure requirements of FASB Statement No. 133 with the intent to provide users of
financial statements with an enhanced understanding of; how and why an entity uses
derivative instruments, how




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the derivative instruments and the related hedged items are accounted for and how the
related hedged items affect an entitys financial position, performance and cash flows.
This Statement is effective for financial statements for fiscal years and interim periods
beginning after November 15, 2008. Management believes this Statement will have no impact
on the financial statements of the Company once adopted.16.
    
    SEGMENTED INFORMATIONThe Company currently has four reportable segments: identification systems, natural
horticultural, electric vehicles & parts and general corporate. The identification systems
segment consists of one company whose assets were sold in December 2005 for consideration
which included a five year royalty stream. The natural horticultural segment consists of
one company that develops, manufactures and markets natural fertilizers, insecticides and
herbicides. In 2002, as a result of growth in the natural horticultural segment, as a
percentage of consolidated sales, the Company reallocated business units to business
segments to more appropriately group units for chief operating decision purposes and
reporting in accordance with SFAS 131. This change was applied on a retroactive basis.
The electric vehicles & parts segment (which commenced operations in April 2006) consists
of one company that is in the business of developing and distributing electric vehicles.
The Companys general corporate segment includes one company which provides funding and
management advisory services to the holdings. This segments profits include interest
income and gains on sales of its various holdings.The Company evaluates performance and allocates resources based on continuing profit
or loss from operations before income taxes, depreciation and research and development. The
accounting policies of the reportable segments are the same as those described in the
summary of significant accounting policies.There are no intersegment sales, transfers, or profit or loss.Industry Segments for the Three Months Ended March 31, 2008 and 2007
 ElectricIdentification
    
    Natural
    
    Vehicles
    
    CorporateSystems
    
    Horticultural
    
    & Parts
    
    Administration
    
    Total$
    
    $
    
    $
    
    $
    
    $2008Sales
    
    
    
    
    
    
    17,540
    
    
    
    94,547
    
    
    
    
    
    
    
    112,087Income (Loss) from
continuing operations
before other income
    
    
    (9,876
    )
    
    
    (86,784
    )
    
    
    (69,408
    )
    
    
    (329,898
    )
    
    
    (495,966
    )Other income (expense)
    
    
    27,487
    
    
    
    (75,595
    )
    
    
    (5,413
    )
    
    
    (416,031
    )
    
    
    (469,552
    )Income (Loss) from
continuing operations
before income taxes
and minority interest
    
    
    17,611
    
    
    
    (162,379
    )
    
    
    (74,821
    )
    
    
    (745,929)
    
    
    
    (965,518
    )




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ElectricIdentification
    
    Natural
    
    Vehicles
    
    CorporateSystems
    
    Horticultural
    
    & Parts
    
    Administration
    
    Total$
    
    $
    
    $
    
    $
    
    $2007Sales
    
    
    
    
    
    
    19,507
    
    
    
    662,172
    
    
    
    
    
    
    
    681,679(Loss) from
continuing operations
before other income
(expense)
    
    
    (31,312
    )
    
    
    (106,261
    )
    
    
    36,837
    
    
    
    (291,845
    )
    
    
    (392,581
    )Other income (expense)
    
    
    (4,608
    )
    
    
    13,046
    
    
    
    14,674
    
    
    
    (80,241
    )
    
    
    (57,129
    )(Loss) from
continuing operations
before income taxes
    
    
    (35,920
    )
    
    
    (93,215
    )
    
    
    51,511
    
    
    
    (372,086
    )
    
    
    (449,710
    )
 17.
    
    CONTINGENCIESA subsidiary of the Company, Xylodyne, does not have its own product liability
insurance and is in the process of attempting to obtain it to cover the products that it
sells. On January 4, 2008 its main supplier of vehicles, Bad Boy Enterprises, LLC notified
Xylodyne that Xylodyne was covered as a named insured under Bad Boy Enterprises, LLCs own
product liability insurance coverage and Xylodyne has now received a copy of such insurance
certificate. The certificate specifies that Xylodyne will be notified with 30 days notice
if such coverage were to no longer be effective. This policy has an expiration date of
December 15, 2008. If such coverage were to no longer be effective then Xylodyne would then
be uninsured for any potential lawsuits by individuals and/or entities that have purchased
products from Xylodyne. The Company cannot make an estimate of the cost of this potential
risk and therefore cannot account for any loss until an amount becomes determinable.18.
    
    SUBSEQUENT EVENTSIn April 2008 a return of capital distribution was made to shareholders of Gemprint as
approved at a special shareholders meeting conducted in March 2008. The total distribution
was $1,328,000, of which $1,035,320 was distributed to CVF.In April 2008, the board of directors of CVF approved the award of an aggregate of
132,109 shares of restricted stock that vest immediately to a service provider to the
company. These restricted shares were awarded in exchange for the cancellation by the
recipient of an aggregate of 82,109 outstanding CVF restricted shares that vested over a 3
year period.19.
    
    GOING CONCERNThese consolidated financial statements have been prepared on a going concern basis,
which presumes that assets will be realized and liabilities discharged in the normal course
of business over the foreseeable future. The consolidated Companys current liabilities
exceed its current




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assets. The Company has incurred losses over the quarter and the past 2 years, which have reduced the Companys cash reserves, and depleted stockholders
equity.These conditions raise substantial doubt about the Companys ability to continue to
fund its investee companies and the ability of some of those companies to continue to
operate as a going concern.The Companys primary need for cash is to maintain its ability to support the
operations and ultimately the carrying values of certain of its individual investee
companies. The Company from time to time may pursue the sale of a portion of its interests
in some of its investee companies as a source of funds, as well as establishing lines of
credit or issuing new stock and reduction of cash flow needs. The Company will continue to
assist its investee companies in their efforts to obtain outside financing in order to fund
the growth and development of their respective businesses and has taken steps to reduce the
operating cash requirements of the parent company and its investees. The Company is also
seeking outside investment for these companies. There is no assurance that these
initiatives will be successful or that certain of its investees will continue to have
adequate cash resources and capital to be able to continue as going concerns.The Companys ability to continue to realize assets and discharge liabilities in the
normal course is uncertain and dependent on these and other initiatives. These financial
statements do not include any of the adjustments to the amounts or classification of assets
and liabilities that might be necessary should the Company be unable to continue its
business in the normal course.




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MANAGEMENTS DISCUSSION AND ANALYSIS OR PLAN OF OPERATION




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
    
    general economic and business conditions;
    
    foreign currency fluctuations, particularly involving the Canadian dollar:
    
    the Companys ability to find additional suitable investments and the ability of those
investments to generate an acceptable return on invested capital; and
    
    the uncertainties and risks involved in investing in early-stage development companies
which can arise because of the lack of a customer base, lack of name recognition and
credibility, the need to locate and retain experienced management and the need to develop and
refine the business and its operations, among other reasons.
    
    the Companys ability to obtain capital to fund its operations and those of its investees.




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
    
    to give reasonable assurance that the information required to be disclosed by us in reports that
we file under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported
within the time periods specified in the Securities and Exchange Commissions rules and forms, and
    
    to ensure that information required to be disclosed in the reports that we file or submit under
the Securities Exchange Act of 1934 is accumulated and communicated to our management, including
our CEO and our CFO, to allow timely decisions regarding required disclosure.




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(11)
    
    Statement re computation of per share earnings(31.1)
    
    Certification of Chief Executive Officer Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.(31.2)
    
    Certification of Chief Financial Officer Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.(32)
    
    Certifications Pursuant to 18 U.S.C. 1350 As Adopted Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002
 
    CVF TECHNOLOGIES CORPORATIONBy:
    /s/ Jeffrey I. DrebenName:
    Jeffrey I. DrebenTitle:
    Chairman of the Board, President
and Chief Executive Officer By:
    /s/ Robert L. MillerName:
    Robert L. MillerTitle:
    Chief Financial Officer




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No.
    
    Description(11)
    
    Statement re computation of per share earnings.(31.1)
    
    Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.(31.2)
    
    Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.(32)
    
    Certifications Pursuant to 18 U.S.C. 1350 As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.