To: CAYMAN who wrote (6416 ) 2/15/2003 8:33:52 AM From: CAYMAN Respond to of 6467 Duro Enzyme and Thermo Tech Duro Enzyme Products Inc. files Form 10QSB, Quarterly Report of Financial Condition Feb 14 2003 ITEM 1. LEGAL PROCEEDINGS The Company was named in a legal suit filed on November 20, 2001. The suit has been filed against it, its officers and directors, and others, by Thermo Tech(TM) Technologies Inc. and subsidiaries (collectively "Thermo Tech"). There are a total of 75 defendants named in the suit. The Company intends to deny the substance of Thermo Tech's allegations. The Company has filed an appearance with the Supreme Court of British Columbia and will develop its formal technical legal response in conjunction with its legal counsel. Thermo Tech alleges that the Company and its officers and directors have appropriated, or in the alternative attempted to appropriate, corporate opportunities from the Plaintiffs through the unauthorized use of confidential information and trade secrets owned by the Plaintiffs. As a result of the alleged unlawful actions of the Company and its officers and directors, Plaintiffs claim that they have suffered loss, damage and expense. In the prayer for relief, Plaintiffs seek the following relief from the court: - An injunction against the Company from unlawfully marketing and using the Thermo Tech Process (defined in the Statement of Claim as a process that incorporates the use of thermophilic, aerobic microorganisms which produce enzymes in a multiple stage fermentation process to create high protein animal feed from organic waste); - Damages for unlawfully marketing and using the Thermo Tech Process; - Damages for interference with the Plaintiffs' contractual relations; - Damages for appropriation of the Plaintiffs' corporate opportunities; - Punitive damages; - Exemplary damages; and - Special costs, or in the alternative, increased costs. The Company believes that Thermo Tech's allegations against it have no basis in fact, and are without merit, as the Company does not use any of Thermo Tech's processes. As Thermo Tech states in its press release of November 20, 2001, announcing the lawsuit: "[T]he lawsuit contains only allegations, not proven facts, and each of these allegations will have to be proven by [Thermo Tech] at a trial between the parties." The Company intends to vigorously defend this lawsuit and to assert all appropriate counterclaims. Due to the complexities of the lawsuit and the contractual and other relationships between the parties to the lawsuit, the Company cannot predict what the outcome of the lawsuit may be or reasonably estimate the financial effect associated with it. The Company was named in a lawsuit on April 23, 2002. The suit was filed against it and its subsidiary Duro Enzyme Solutions Inc by a former officer and director of the company. The lawsuit is for alleged unpaid monies, in the amount of $28,555. The company feels that this allegation is without merit and will defend this action accordingly. ITEM 5. OTHER INFORMATION On December 24, 2002, the company's Board of Directors accepted the resignation of Ralph Petruzzo as a Director of Duro Enzyme Products Inc. and Duro Enzyme Solutions Inc. HAWKINS ACCOUNTING Certified Public Accountant 17412 Monterey Road, Ste. 200 Morgan Hill, CA 95037 (408) 776 - 9455 Fax: FAX: (408) 776 - 8979 CONSENT OF THE INDEPENDENT ACCOUNTANT As the independent accountant for Duro Enzyme Products, Inc., I hereby consent to the incorporation by reference in this Form 10-QSB statement of my report, relating to the reviewed financial statements dated February 13, 2003 for the period ended December 31, 2002. R. Richard Hawkins II -- February 13, 2003pinksheets.com