10KSB 1 doc1.txt SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-KSB ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2003 Commission File Number 0-17750 FEMINIQUE CORPORATION (Exact Name of Registrant as Specified in its Charter) DELAWARE 13-3186327 (State or Other Jurisdiction (I.R.S. Employer of Incorporation) Identification Number) 140 BROADWAY, 46TH FLOOR NEW YORK, NEW YORK 10005 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT: None SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT: COMMON STOCK $.001 PAR VALUE Check whether the issuer (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 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 pursuant to Item 405 of Regulation S-B is contained herein, and will not 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 Issuer's revenues for its most recent fiscal year: $21,904 The aggregate market value of voting stock held by non-affiliates of the registrant as of December 4, 2003 was $22,773 (based on the last reported sale price of $.0001 per share on December 4, 2003). The number of shares of the registrant's common stock outstanding as of December 4, 2003 was 25,005,733. Transitional Small Business Disclosure Format: Yes [ ] No [X] -------------------------------------------------------------- FEMINIQUE CORPORATION 2003 FORM 10-KSB ANNUAL REPORT TABLE OF CONTENTS PART I ITEM 1. DESCRIPTION OF BUSINESS RISK FACTORS ITEM 2. DESCRIPTION OF PROPERTY ITEM 3. LEGAL PROCEEDINGS ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS PART II ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION ITEM 7. FINANCIAL STATEMENTS ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE ITEM 8A. CONTROLS AND PROCEDURES PART III ITEM 9. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT ITEM 10. EXECUTIVE COMPENSATION ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K THIS REPORT CONTAINS FORWARD-LOOKING STATEMENTS THAT INVOLVE RISKS AND UNCERTAINTIES. SUCH STATEMENTS ARE BASED ON CURRENT EXPECTATIONS, ASSUMPTIONS, ESTIMATES AND PROJECTIONS ABOUT THE COMPANY AND ITS INDUSTRY. THESE FORWARD-LOOKING STATEMENTS INVOLVE RISKS AND UNCERTAINTIES. FORWARD-LOOKING STATEMENTS ARE SUBJECT TO KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS THAT MAY CAUSE ACTUAL RESULTS, LEVELS OF ACTIVITY, PERFORMANCE, ACHIEVEMENTS AND PROSPECTS TO BE MATERIALLY DIFFERENT FROM THOSE EXPRESSED OR IMPLIED BY SUCH FORWARD-LOOKING STATEMENTS. THE COMPANY UNDERTAKES NO OBLIGATION TO UPDATE PUBLICALLY ANY FORWARD-LOOKING STATEMENTS FOR ANY REASON EVEN IF NEW INFORMATION BECOMES AVAILABLE OR OTHER EVENTS OCCUR IN THE FUTURE. PART I ITEM 1. DESCRIPTION OF BUSINESS OVERVIEW In June 1999, Biopharmaceutics, Inc. (the "Company"), pursuant to a meeting of the Board of Directors, adopted a resolution and filed a Certificate of Amendment to the Certificate of Incorporation and changed the name of the Company to Feminique Corporation. Biopharmaceutics, Inc. was originally incorporated in Nevada on August 15, 1983 under the name of Health Care Facilities Corporation. On March 28, 1988, the shareholders changed the Company's name to Biopharmaceutics, Inc. and the state of incorporation from Nevada to Delaware. The Company's executive office is located at 140 Broadway, 46th Floor, New York, NY 10005. Its telephone number is (212) 655-9262. On December 11, 1998, the Company completed the sale of its wholly-owned subsidiary, Caribbean Medical Testing Center, Inc. ("CMT"), which was in the business of multi-phase specialty medical testing and laboratory services throughout Puerto Rico. Under the terms of the sale, common stock of CMT was sold for $4,700,000, payable as follows: $600,000 to be held in escrow for specified outstanding taxes, $2,600,000 in cash and the waiver of the Company's guaranty of a $1,500,000 note held by the purchaser. In addition and as part of its settlement with other creditors, the Company settled an outstanding indebtedness to Dondo Associates, Inc. ("Dondo") by assigning $2,600,000 of the cash proceeds from the CMT sale to Dondo in exchange for the cancellation of the Company's outstanding promissory note (incurred by the Company as a result of the acquisition of CMT) to Dondo totaling $4,117,715 inclusive of interest. A fee of $50,000 was paid to a Director of the Company by Dondo for services rendered on its behalf in said transaction. The results of operations of CMT have been classified as discontinued operations and all prior periods have been restated. In connection with the Company's restructuring plan, the manufacturing operations of its generic pharmaceutical products subsidiary were discontinued effective September 30, 1998. The Company liquidated the entire manufacturing operation in 1999. The operations of this division for the three years ended September 30, 1999 have been reported as discontinued operations in the consolidated statement of operations. The Company's business operations, in fiscal years 2003 and 2002, were principally conducted through one wholly-owned subsidiary: Quality Health Products, Inc. ("QHP"), a company organized to market the line of Feminine Hygiene Products acquired in March 1996 from SSL Americas Inc., formerly known as London International Group, Inc. ("LIG"). The Company ceased business in August 2000. Since the Company's Board of Directors effectuated a restructuring of management and adopted a plan to restructure operations in 1998, it was determined that the feminine hygiene Branded products operation was to constitute the Company's core business. Subsequently, the Company became a distributor of consumer feminine hygiene and family planning products which are sold nationwide to major chain stores, distributors and wholesalers. In March 1996, the Company through QHP, acquired certain feminine hygiene Branded products from London International Group, Inc. now known as SSL Americas Inc. The brands acquired are sold under the names Vaginex (R), Koromex (R), Koroflex (R) and Feminique (R) and have been established on average more than thirty years with Koromex (R) being established since 1933. Sales of these Brands were being made to food and drug chains, drug wholesalers, domestic and overseas distributors, clinics and domestic government agencies. The Company sales are conducted by one independent Sales Representative Organization, which calls on the key accounts that carry the lines. The Company expects its sales representative to expand sales on the lines by expanding the customer base and by receiving greater support from the Company in promoting the products. The Company and QHP on August 3, 2000 filed a Chapter 11 Petition in the United States Bankruptcy Court for the Eastern District of New York. By orders dated July 28, 2003 and January 29, 2003 respectively, the Company and QHP had their plan's confirmed by Bankruptcy Judge Melanie L. Cyganowski. As part of the plan, QHP, on July 12, 2002 executed an Asset Purchase Agreement which was approved by the Bankruptcy Court on September 9, 2002. Substantially all the assets and rights to all the assets used in connection with its feminine hygiene business were sold to Clay Park Labs Inc. ("Clay Park"). Under the Asset Purchase Agreement, Clay Park committed itself to pay a guaranteed purchase price of $350,000 over five years, with a maximum purchase price of $1,500,000 over five years. Pursuant to the terms of various stipulations entered into between the Official Committee of Unsecured Creditors of QHP and Clay Park during the Chapter 11 proceeding, the Official Committee, on behalf of the unsecured creditors of QHP will receive 15% of all payments made by Clay Park in excess of the guaranteed amount of $350,000, which payments will be distributed to unsecured creditors by the disbursing agent under the Plan of Reorganization of QHP. On December 13, 2002, QHP filed its Amended Plan of Reorganization dated December 3, 2002 ("Plan"). Under the provisions of the Plan, SSL Americas, the secured creditor of QHP received an assignment of all of the payments due QHP under the terms of the Asset Purchase Agreement, which was deemed in full discharge and satisfaction of its claim and waived all claims against QHP. All unsecured creditors of QHP, which were Class 3 creditors under the Plan, received on account of the allowed amount of their claims a pro-rata distribution from QHP's cash on hand on the Consummation Date (as defined in the Plan), and will receive a pro-rata distribution from the disbursing agent from payments being made by Clay Park under the Asset Purchase Agreement. Pursuant to the Plan, all unsecured creditors of QHP received a first distribution of 22.17595% of their respective claim. As of this date, no further distributions have been made by the disbursing agent to any unsecured creditors of QHP. Pursuant to Feminique's plan - Class 2 claimants, which represented the general unsecured creditors of Feminique, were to receive on account of each allowed claim, a pro-rata distribution of 23,344,085 shares of Feminique Common stock. In addition, in exchange for $7,077 contributed by Matterhorn Holdings, Inc. ("Matterhorn"), Matterhorn was to receive 28,311,830 shares of Common Stock representing a purchase price of $.00025 per share. Without the assets of QHP, the Company has had no operating business since August 3, 2000. The Company pursuant to a licensing Agreement with Clay Park Labs Inc. dated May 5, 2000 received royalty payments through the quarter ended December 31, 2002. The licensing agreement was assigned to SSL Americas, the secured creditor of QHP. GOING CONCERN The Company has incurred recurring operating losses and does not have any revenue generating activities. These conditions raise substantial doubt about the Company's ability to continue as a going concern. If at any time the Company determines that it does not have sufficient cash in order to execute the Bankruptcy Plans, then the Company intends to endeavor to obtain additional equity or other funding, if it is able to do so. However, there can be no assurance that the Company will be able to raise additional funding necessary to operate. See "RISK FACTORS" and "Management's Discussion and Analysis of Financial Condition and Plan of Operation - Liquidity and Capital Resources". THE MARKET The Company is no longer in the feminine hygiene industry and therefore that market is not applicable to the Company. Management is pursuing other business models at this time. One model that has emerged is the purchase and recovery of distressed consumer debt receivables. The Company would purchase charged-off consumer debt at deep discount and outsource recovery to carefully selected recovery partners. A newly installed management team has several years of experience in purchase and recovery of consumer debt, corporate finance and raising capital. Through the acquisition of General Outsourcing Services, the Company gets the servicing capability of a licensed collections agency equipped with state-of-the-art telecommunication system, payment system and proprietary debt management and collection software. The Company's approach to buying distressed debt is based on risk-adjusted value. The Company would attempt to identify value objects within portfolios available for purchase. The Company would differentiate itself from the rest of the field based on the following: - Invaluable knowledge of quantitative and qualitative variables - Complete knowledge of the history of debt under consideration for purchase - Better understanding of portfolio's characteristics than the originator/seller of the debt - How the debt is originated - telemarketing, direct mail solicitation, face to face in the office, home or casual event. Individuals who make the effort to complete forms in person or at home are more likely to be debt conscientious than individuals who respond to a telemarketers questions. Review in more detail as to why the individual took on the debt - was it to buy something of need or a spontaneous purchase. THE COMPETITION The Company does not have competition at this time as the Company has had no operating business since on or about August 3, 2000. LEGAL UNCERTAINTIES The Company is not aware of any significant legal uncertainties at this time. EMPLOYEES Other than Max Khan, the President and CEO and Steven Lowe, Secretary, the Company has no employees and does not anticipate hiring any employees in the near future. RISK FACTORS IN ADDITION TO OTHER INFORMATION IN THIS REPORT, YOU SHOULD CONSIDER THE FOLLOWING RISK FACTORS CAREFULLY. THESE RISKS MAY IMPAIR THE COMPANY'S OPERATING RESULTS AND BUSINESS PROSPECTS AS WELL AS THE MARKET PRICE OF THE COMPANY'S COMMON STOCK. RISKS RELATED TO THE COMPANY'S FINANCIAL CONDITION AND BUSINESS MODEL THE COMPANY'S LIQUIDITY IS LIMITED AND IT MAY NOT BE ABLE TO OBTAIN SUFFICIENT FUNDS TO FUND ITS BUSINESS. The Company's cash is currently very limited and may not be sufficient to fund future operations. These factors may make the timing, amount, terms and conditions of additional financing unattractive for the Company. If the Company is unable to raise additional capital, any future operations could be impeded. If the Company obtains additional funding, the issuance of additional capital stock may be dilutive to the Company's stockholders. THE COMPANY HAS RECEIVED A GOING CONERN OPINION FROM ITS AUDITORS The Company's consolidated financial statements have been prepared on the assumption that the Company will continue as a going concern. The Company's independent auditors have issued a reported dated December 5, 2003 that includes an explanatory paragraph stating the Company's lack of revenue generating activities and substantial operating deficits, among other things, raise substantial doubt about the Company's ability to continue as a going concern. THE COMPANY CURRENTLY HAS NO OPERATIONS The Company has had no operations since August 3, 2000 when it filed for protection under Chapter 11 of the US Bankruptcy Code. IT MAY BE DIFFICULT TO CONSUMMATE A MERGER OR ACQUISITION WITH A PRIVATE ENTITY The Company expects its purpose will include locating and consummating a merger or acquisition with a private entity. The Company anticipates the selection of a business opportunity in which to participate will be complex and extremely risky. The Company has, and will continue to have, little or no capital with which to provide the owners of business opportunities with any significant cash or other assets. However, management believes the Company will be able to offer owners of acquisition candidates the opportunity to acquire a controlling ownership interest in a publicly registered company without incurring the cost and time required to conduct an initial public offering. Such an acquisition candidate will, however, incur significant legal and accounting costs in connection with an acquisition of the Company, including the costs of preparing current and periodic reports, various agreements and other documents. THE COMPANY MAY NOT BE ABLE TO RAISE ADDITIONAL CAPITAL There is no assurance that the Company will be able to raise capital on a debt or equity basis, or obtain other means of financing. THE COMPANY'S STOCK PRICE HAS DECLINED SIGNIFICANTLY AND MAY NOT REBOUND The trading price of the common stock has declined significantly since August 2000. The market for the common stock is essentially non-existent and there can be no assurance that the Company's stock price will rebound. PENNY STOCK REGULATIONS AND REQUIREMENTS FOR LOW PRICED STOCK The SEC adopted regulations which generally define a "penny stock" to be any non-Nasdaq equity security that has a market price of less than $5.00 per share, subject to certain exceptions. Based upon the price of the Company's common stock as currently traded on the pink sheets, the Company's common stock is subject to Rule 15g-9 under the Exchange Act which imposes additional sales practice requirements on broker-dealers which sell securities to persons other than established customers and "accredited investors". For transactions covered by this rule, a broker-dealer must make a special suitability determination for the purchaser and have received a purchaser's written consent to the transaction prior to sale. Consequently, this rule may have a negative effect on the ability of stockholders to sell common shares of the Company in the secondary market. ITEM 2. DESCRIPTION OF PROPERTY The Company's principal executive officers are located at 140 Broadway, 46th Floor, New York, New York. The Company does not own any property and pays no rent for the use of this mailing address. The office is provided by the President of the Company. ITEM 3. LEGAL PROCEEDINGS Except for the proceedings under the Chapter 11 of the Bankruptcy Code, the Company is not a party to any pending legal proceedings nor is any of the Company's property the subject of any pending legal proceedings. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS Not applicable. PART II ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS MARKET PRICE OF COMMON STOCK Feminique Corporations' Common Stock is quoted on the pink sheets under the symbol Femqq.pk. While it appears there is no market for the Common Stock, the Company has set forth in the table below the high and low closing bid prices per share of Common Stock as reported for each quarter within the last two fiscal years. The last reported bid price on the pink sheets for the Common Stock was $.0001 on December 4, 2003. The pink sheets are the over the counter bulletin board exchange (OTC).
HIGH LOW Oct 1, 2000 - Dec 31, 2000 $ 0.006 $ 0.001 Jan 1, 2001 - Sept 30, 2003 the stock was not traded
HOLDERS As of December 4, 2003, there were 843 holders of record on common stock (Femqq) and approximately 4,500 holders in street name. DIVIDEND POLICY The Company has never declared or paid any cash dividends on its capital stock. The Company currently intends to retain future earnings, if any, to finance its business and does not expect to pay any cash dividends for the foreseeable future. RECENT SALES OF UNREGISTERED SECURITIES There were no recent sales of common stock for the years ended September 30, 2003 and 2002. REGISTRATION OF SECURITIES The Company appears to be a blank check company, as defined by Rule 419 of Regulation C, promulgated under the Securities Act. Generally, a blank check company is a development stage company that has no specific business plan or purpose, or is seeking to merge with or acquire an unidentified target, and is issuing "penny stock". So long as the Company continues to be a blank check Company, any registration statement filed by the Company will need to comply with Rule 419. ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION THE FOLLOWING DISCUSSION SHOULD BE READ IN CONJUNCTION WITH THE COMPANY'S FINANCIAL STATEMENTS AND NOTES TO THOSE STATEMENTS AND OTHER FINANCIAL INFORMATION APPEARING ELSEWHERE IN THIS REPORT. OVERVIEW The Company as of August 3, 2000 filed a chapter 11 Petition in the United States Bankruptcy Court for the Eastern District of New York. The order was confirmed July 28, 2003. The Company since August 3, 2000 was not engaged in any business. The Company had financed its operating requirements for 1999 and prior primarily by the issuance of short and long-term debt and notes. RESULTS OF OPERATIONS 2003 COMPARED TO 2002 Royalty revenue was $21,904 compared to $138,363 for the prior fiscal year. This decreased as the Company received its last royalty payment in the quarter ended December 31, 2002, pursuant to a licensing agreement with Clay Park Labs Inc. dated May 5, 2000. The Company sold its remaining intangible asset in the fiscal year ended 2002 for $2,040,384, which had a basis of $1,700,076. The sales price represented long-term debt and other debt owed to the purchaser, and certain unsecured debt to other parties. The United States Bankruptcy Court approved this transaction. The Company had $50,000 of miscellaneous income in the 2002 fiscal year, which was a reimbursement of expenses that was recorded in the current fiscal year as selling, general and administrative expenses. There were negligible other selling, general and administrative expenses for both years due to the cessation of the manufacturing operations. OUTLOOK Without an operating subsidiary, the Company has had no operating business since on or about August 3, 2000. The Company intends to explore other business opportunities. There can be no assurance that the Company will be able to find any suitable business opportunity. Suitable business opportunities may include those presented to the Company by persons or firms desiring to seek the perceived advantages of a corporation registered under the Exchange Act. The Company will not restrict its search to any specific business, industry, or geographical location and the Company may participate in a business venture of virtually any kind of nature. The Company has, and will continue to have, little or no capital with which to provide the owners of business opportunities with any significant cash or other assets. However, management believes the Company will be able to offer owners of acquisition candidates the opportunity to acquire a controlling ownership interest in a publicly registered company without incurring the cost and time required to conduct an initial public offering. Any such acquisition candidate will, however, incur significant legal and accounting costs in connection with an acquisition of the Company, including the costs of preparing current reports on Form 8-K and periodic reports on Form 10-Q or 10-QSB and Form 10-K and 10-KSB, various agreements and other documents. PLAN OF OPERATIONS The Company plans on carrying out its reorganization under the Bankruptcy Court order. The Company plans on borrowing from investors so it can satisfy its cash requirements. The Company has no plans to conduct any research and development, to purchase any equipment or to change its number of employees. RECENT ACCOUNT PRONOUNCEMENTS The Company continues to assess the effects of recently issued accounting standards. The impact of all recently adopted and issued accounting standards has been disclosed in the Notes to the Audited Consolidated Financial Statements. CRITICAL ACCOUNTING ESTIMATES The Company is a shell company and, as such, the Company does not employ critical accounting estimates. Should the Company resume operations it will employ critical accounting estimates and will make any disclosures that are necessary and appropriate.
ITEM 7. FINANCIAL STATEMENTS FEMINIQUE CORPORATION AND SUBSIDIARIES INDEX TO CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED SEPTEMBER 30, 2003 AND 2002 PAGE(S) ------- INDEPENDENT AUDITORS' REPORT 10-11 FINANCIAL STATEMENTS: Consolidated Balance Sheet as of September 30, 2003 12-13 Consolidated Statements of Income (Operations) for the Years Ended September 30, 2003 and 2002 14 Consolidated Statements of Stockholders' Deficit for the Years Ended September 30, 2003 and 2002 15 Consolidated Statements of Cash Flows for the Years Ended September 30, 2003 and 2002 16 Notes to Consolidated Financial Statements 17-23
BAGELL, JOSEPHS & COMPANY, L.L.C. Certified Public Accountants High Ridge Commons Suites 400-403 200 Haddonfield Berlin Road Gibbsboro, New Jersey 08026 (856) 346-2828 Fax (856) 346-2882 INDEPENDENT AUDITORS' REPORT To the Board of Directors and Stockholders of: Feminique Corporation and Subsidiaries New York, New York We have audited the accompanying consolidated balance sheets of Feminique Corporation and Subsidiaries as of September 30, 2003 and 2002 and the related consolidated statements of income, stockholders' deficit and cash flows for the years then ended. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We conducted our audits 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 financial statements and schedule. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall consolidated financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the consolidated financial statements, the Company has incurred substantial operating losses from continuing operations and had a consolidated deficit at September 30, 2003 of $1,353,314. Additionally, the company and its operating subsidiary in August 2000 filed for reorganization under Chapter 11 of the United States Bankruptcy Code. The order confirming the plan of reorganization was accepted July 28, 2003 (See Note 10). These conditions raise substantial doubt about the Company's ability to continue as a going concern. Management's plans in addressing these matters are more fully discussed in Note 2. The consolidated financial statements do not include any adjustments that might result from the outcome of these uncertainties. MEMBER OF: AICPA INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS NEW JERSEY SOCIETY OF CERTIFIED PUBLIC ACCOUNTANTS PENNSYLVANIA INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS NEW YORK STATE SOCIETY OF CERTIFIED PUBLIC ACCOUNTANTS 10 In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Feminique Corporation and Subsidiaries as of September 30, 2003 and 2002, and the results of their consolidated operations, changes in consolidated stockholders deficit and their consolidated cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America. BAGELL, JOSEPHS & COMPANY, L.L.C. BAGELL, JOSEPHS & COMPANY, L.L.C. Certified Public Accountants Gibbsboro, New Jersey December 5, 2003 11
FEMINIQUE CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEET SEPTEMBER 30, 2003 ASSETS CURRENT ASSETS Cash $ 21,284 Prepaid expenses and other current assets 5,316 ---------- TOTAL CURRENT ASSETS 26,600 ---------- TOTAL ASSETS 26,600 ==========
The accompanying notes are an integral part of the consolidated financial statements. 12
FEMINIQUE CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEET, CONTINUED SEPTEMBER 30, 2003 LIABILITIES AND STOCKHOLDERS' DEFICIT CURRENT LIABILITIES Accounts payable - Trade $ 578,376 Accrued expenses 89,538 Notes payable 137,000 Convertible debentures payable 575,000 ------------- TOTAL CURRENT LIABILITIES 1,379,914 ------------- COMMITMENTS AND CONTINGENCIES STOCKHOLDERS' DEFICIT Common stock, par value $.001 per share; Authorized 50,000,000 shares, issued and outstanding 25,005,733 shares 25,005 Additional paid-in capital 35,012,966 Accumulated deficit (35,446,673) Less: treasury stock, at cost (103,432 shares) (944,612) ------------- TOTAL STOCKHOLDERS' DEFICIT (1,353,314) ------------- TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT $ 26,600 =============
The accompanying notes are an integral part of the consolidated financial statements. 13
FEMINIQUE CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (OPERATIONS) FOR THE YEARS ENDED SEPTEMBER 30, 2003 AND 2002 2003 2002 ------------ ----------- REVENUES Royalties $ 21,904 $ 138,363 Sale of asset - 2,040,384 ------------ ----------- 21,904 2,178,747 COSTS AND EXPENSES Basis of assets sold - 1,700,076 Selling, general and administrative 50,000 45 ------------ ----------- TOTAL COSTS AND EXPENSES 50,000 1,700,121 ------------ ----------- NET INCOME (LOSS) BEFORE OTHER INCOME (28,096) 478,626 OTHER INCOME Interest income 4,388 2,823 Miscellaneous Income - 50,000 ------------ ----------- TOTAL OTHER INCOME 4,388 52,823 ------------ ----------- INCOME FROM CONTINUING OPERATIONS BEFORE PROVISION FOR STATE INCOME TAXES (23,708) 531,449 Provision for state income taxes - ------------ ----------- NET INCOME(LOSS) $ (23,708) $ 531,449 ============ =========== BASIC AND DILUTED INCOME PER COMMON SHARE $ - $ 0.020 ============ =========== AVERAGE WEIGHTED OUTSTANDING SHARES OF COMMON STOCK 25,005,733 25,005,733 ============ ===========
The accompanying notes are an integral part of the consolidated financial statements. 14
FEMINIQUE CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT FOR THE YEARS ENDED SEPTEMBER 30, 2003 AND 2002 COMMON STOCK ADDITIONAL ---------- ------- PAID-IN ACCUMULATED TREASURY SHARES AMOUNT CAPITAL DEFICIT STOCK TOTAL ---------- ------- ----------- ------------- ---------- ------------ BALANCE, SEPTEMBER 30, 2001 25,005,733 25,005 35,012,966 (35,954,414) (944,612) (1,861,055) Net income for the year ended 'September 30, 2002 - - - 531,449 - 531,449 ---------- ------- ----------- ------------- ---------- ------------ BALANCE, SEPTEMBER 30, 2002 25,005,733 $25,005 $35,012,966 $(35,422,965) $(944,612) $(1,329,606) ========== ======= =========== ============= ========== ============ Net (loss) for the year ended 'September 30, 2003 - - - (23,708) - (23,708) ---------- ------- ----------- ------------- ---------- ------------ BALANCE, SEPTEMBER 30, 2003 25,005,733 $25,005 $35,012,966 $(35,446,673) $(944,612) $(1,353,314) ========== ======= =========== ============= ========== ============
The accompanying notes are an integral part of the consolidated financial statements. 15
FEMINIQUE CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED SEPTEMBER 30, 2003 AND 2002 2003 2002 ---------- ------------ CASH FLOWS FROM OPERATING ACTIVITIES: Net income(Loss) $ (23,708) $ 531,449 ADJUSTMENTS TO RECONCILE NET INCOME (LOSS) TO NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES: Gain on asset sales - (340,308) NET CHANGES IN OPERATING LIABILITIES: Accounts payable - Trade (258,691) (30,524) ---------- ------------ NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES (282,399) 160,617 ---------- ------------ NET INCREASE (DECREASE) IN CASH (282,399) 160,617 CASH AND CASH EQUIVALENTS - BEGINNING OF YEAR 303,683 143,066 ---------- ------------ CASH AND CASH EQUIVALENTS - END OF YEAR $ 21,284 $ 303,683 ========== ============ NON CASH ACTIVITY GAIN ON SALE: Sales $ - $ 2,040,384 Basis of Asset - (1,700,076) ---------- ------------ $ - $ 340,308 ========== ============
The accompanying notes are an integral part of the consolidated financial statements 16 FEMINIQUE CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2003 AND 2002 NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES A. THE COMPANY In June 1999, Biopharmaceutics, Inc. (the "Company"), pursuant to a meeting of the Board of Directors, adopted a resolution and filed a Certificate of Amendment to the Certificate of Incorporation and changed the name of the Company to Feminique Corporation. The Company, after its restructuring in 1998 (Note 2) became a distributor of consumer feminine hygiene and family planning products which were sold nationwide in major chain stores, distributors and wholesalers. In December, 1998, The Company sold off its wholly owned subsidiary, Caribbean Medical Testing Center, Inc. ("CMT). CMT was acquired by the Company in June, 1997 and was engaged primarily in the business of multi-phasic specialty medical testing and laboratory services throughout Puerto Rico. The Company also discontinued its manufacturing of generic pharmaceutical products. In August 2000 the Company and its only operating subsidiary Quality Health Products, Inc. filed for reorganization under Chapter 11 of the United States Bankruptcy Code which was confirmed July 28, 2003. B. PRINCIPLES OF CONSOLIDATION The consolidated financial statements include the accounts of the Company and its subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. C. REVENUE RECOGNITION Sales were recognized as products were shipped and royalties where earned. D. DEPRECIATION AND AMORTIZATION The Company in 1999 amortized its intangible asset on the straight-line method over its estimated useful live of twenty years. Beginning in 2000 the Company depreciated its property and equipment on the straight-line method for financial reporting purposes. The Company adopted FASB 142, which recognizes accounting treatment for goodwill and other intangibles (See Note 3). For tax reporting purposes, the Company uses the straight-line or accelerated methods of depreciation. Expenditures for maintenance, repairs, renewals and betterments are reviewed by management and only those expenditures representing improvements to plant and equipment are capitalized. At the time plant and equipment are retired or otherwise disposed of, the cost and accumulated depreciation accounts and the gain or loss on such disposition is reflected in operations. E. DEFERRED INCOME TAXES 17 Deferred income taxes are provided based on the provisions of SFAS No. 109, "Accounting for Income Taxes" ("SFAS 109"), to reflect the tax effect of differenced in the recognition of revenues and expenses between financial reporting and income tax purposes based on the enacted tax laws in effect at September 30, 2003 and 2002. F. EARNINGS (LOSS) PER COMMON SHARE OF COMMON STOCK Historical net income (loss) per common share is computed using the weighted-average number of common shares outstanding. Diluted earnings per share (EPS) includes additional dilution from common stock equivalents, such as stock issuable pursuant to the exercise of stock options and warrants. Common stock equivalents are not included in the computation of diluted earnings per share when the Company reported a loss because to do so would be antidilutive for periods presented. The following is a reconciliation of the computation for basic and diluted EPS:
SEPTEMBER 30, SEPTEMBER 30, 2003 2002 --------------- -------------- Net Income (loss) $ (23,708) $ 531,449 Weighted-average common shares Outstanding (Basic) 25,005,733 25,005,733 Weighted-average common stock Equivalents Stock options - - Warrants - - --------------- -------------- Weighted-average common shares Outstanding (Diluted) 25,005,733 25,005,733 =============== ==============
Earnings per share did not include potential stock issued in conjunction with the convertible debentures since the company is in bankruptcy. NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) G. ESTIMATES The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America required the Company's management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. H. RECLASSIFICATION Certain amounts in the September 30, 2002 financial statement have been reclassified to conform with the September 30, 2003 presentation. The reclassifications did not effect income or loss. 18 I. ADVERTISING COSTS Advertising expenditures relating to the consumer feminine hygiene and family planning products are expensed in the period. The advertising costs, consisting primarily of costs associated with trade show booths are amortized over the periods during which the benefits are expected. J. RECENT ACCOUNT PRONOUNCEMENTS In June 2001, the FASB issued Statement No. 142 "Goodwill and Other Intangible Assets". This Statement addresses financial accounting and reporting for acquired goodwill and other intangible assets and supersedes APB Opinion No. 17, Intangible Assets. It addresses how intangible assets that are acquired individually or with a group of other assets (but not those acquired in a business combination) should be accounted for in financial statements upon their acquisition. This Statement also addresses how goodwill and other intangible assets should be accounted for after they have been initially recognized in the consolidated financial statements. NOTE 2- BASIS OF PREPARATION - GOING CONCERN The Company has incurred net income(loss) from continuing operations of $(23,708) and $531,449 for the years ended September 30, 2003 and 2002, respectively, and has a deficit of $1,353,314 at September 30, 2003. In conjunction with restructuring, the Company in August 2000 filed for reorganization under Chapter 11 of the United States Bankruptcy Code. The order confirming the plan of reorganization was accepted July 28, 2003 (See Note 10). As shown in the accompanying consolidated financial statements the Company has sustained operating losses through September 30, 2003 and has an accumulated deficit of $35,446,673. The Company has filed under Chapter 11 of the United States Bankruptcy Code and had its order confirming reorganization dated July 28, 2003. The Company is a going concern. There is no guarantee that the Company will be able to raise enough capital, generate revenues or execute its reorganization plan to sustain its operations. Management plans to execute its reorganization and seek means of financing through investors and seek a potential merger. NOTE 3- INTANGIBLE ASSETS Intangible assets represented assets acquired from London International US Holdings, Inc., now known as SSL Americas Inc. comprising of trademarks, trade names and a customer base. These assets, which were purchased in 1996 through one of the Company's subsidiaries for $3,600,000 included four branded consumer product line (namely Koromex, Koroflex, Vaginex and Feminique). The obligations bore interest at 9.5% per annum and in the event of default, the entire unpaid balance becomes due and payable on trademarks and trade name purchased. The obligation at September 30, 2003 and 2002 was in default and classified as a current liability. The Company on July 12, 2002 entered into an asset purchase sale with Clay Park Labs, Inc. In this sale the Company sold certain U.S. and foreign patents, trademarks, trademark applications, goodwill, customer lists, supplier lists, and technology. The Company understood that SSL Americas and LRC North America (LRC) held a first and second secured interest in the assets. Therefore, in consideration for the release of such security interest, the Company assigned the rights to the assets to SSL and LRC under the approval of the United States Bankruptcy Court (See Note 10). The Company on May 4, 2000 had executed a license agreement with Clay Park 19 FEMINIQUE CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) SEPTEMBER 30, 2003 AND 2002 NOTE 3- INTANGIBLE ASSETS, CONTINUED assigned that license to Clay Park Labs, Inc. The Company at September 30, 2000 valued its intangible assets at the value of $1,700,076, which was equivalent to the long-term debt it owed to SSL Americas Inc. and certain unsecured debt of $360,000. Therefore, at September 30, 2000 the Company recognized an impairment of $1,223,549 for the year ended as well as the regular amortization of $188,400. The asset was sold on July 12, 2002. The components of intangible assets as of September 30, 2003 and 2002 are as follows:
2003 2002 -------- ------------ Trademarks, tradenames, and customer base acquired from London International $ - $ 3,771,425 Less: accumulated amortization and impairment - (2,071,349) -------- ------------ $ 1,700,076 Asset sold - (1,700,076) -------- ------------ $ - $ - ======== ============
NOTE 4- NOTES PAYABLE FEMINIQUE CORPORATION A. On September 15, 1999, the Company borrowed $100,000 from a shareholder, evidenced by a convertible promissory note bearing interest at 8% per annum with interest payments due on October 31, 1999, March 31, 2000 and June 1, 2000, the maturity date of this note. B. On January 16, 2000, the Company borrowed an additional $37,000, the terms and conditions of which are similar to those of the preceding $100,000 note. Both notes are in default and were listed as obligations in the Company's filing for reorganization on August 2000. The Company's plan in the bankruptcy reorganization as filed in August 2000 stopped the accrual of additional interest on these notes. 20 FEMINIQUE CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) SEPTEMBER 30, 2003 AND 2002 NOTE 5- CONVERTIBLE DEBENTURES PAYABLE The $575,000 of convertible debentures outstanding at September 30, 2003 and 2002 mature by June 2002, with optional redemptions available in May or June 2000 at 105% of par. Interest of the debentures accrues at 10% per annum and is payable in cash or stock, at the Company's option, on a quarterly basis. The debentures can be converted at the holder's option into the Company's common stock in its entirety, or in multiples of $1,000, at conversion prices equal to the greater of $.54 per share of 75% of the closing price per share over the five consecutive trading days immediately prior to the date of exercising the conversion right. At September 30, 2002 and 2001 the Company was not in compliance with its interest payments on the debentures. As a result thereof, the accompanying consolidated financial statements at September 30, 2003 and 2002 reflect the convertible debentures payable as a current liability. NOTE 6- STOCK OPTIONS In 1993, the Company adopted a stock option plan under which selected eligible key employees of the Company are granted the opportunity to purchase shares of the Company's common stock. The plan provides that 750,000 shares of the Company's authorized common stock be reserved for issuance under the plan as either incentive stock options or non-qualified options. Options are granted at prices not less than 100 percent of the fair market value at the date of grant and are exercisable over a period of ten years or a long as that person continues to be employed or serve on the Board of Directors, whichever is shorter. Under the 1993 plan, no options may be granted subsequent to January 5, 2003. At September 30, 2002, the Company believes all options have expired. In March 1997, the Company adopted a qualified stock option plan entitled the 1997 Employee and Consultant Stock Option Plan and a separate 1997 Non-qualified Stock Option Plan (the "Plans"). The plans reserved for future issuance to a total of 6,500,000 shares and 720,000 shares, respectively. The annual meeting stockholders on July 29,1998 voted to cancel the 1997 stock option plans and all outstanding options related thereto. In 1997, the Company adopted the disclosure - only provisions of Statement of Financial Accounting Standard No. 123, "Accounting for Stock-Based Compensation" ("SFAS No. 123"). Accordingly, no compensation cost has been recognized in the accompanying statement of operations for the stock option plans for the years ended September 30, 2003 and 2002. NOTE 7- INCOME TAXES The Company, as of September 30, 2003 and 2002, has available approximately $23,000,000 of net operating loss carry forwards to reduce future Federal and State income taxes. Since, there is no guarantee that the related deferred tax asset will be realized by reduction of taxes payable on taxable income during the carry forward period, a valuation allowance has been computed to offset in its entirety the deferred tax asset attributable to this net operating loss in the amount of approximately $8,970,000. The amount of the valuation allowance is reviewed periodically. NOTE 8- COMMITMENTS AND CONTINGENCIES A. The Company and its subsidiary on May 4, 2000 signed and executed an exclusive license agreement with Clay Park Health Products, Inc. a worldwide license to manufacture, package and distribute its products on an exclusive basis. The Company would receive royalty payments under the terms of that agreement. The agreement was to automatically renew every six months through December 31, 2005. On July 12, 2002 the Company assigned its right to the royalty payments to LRC North America and SSL Americas(See Note 10). NOTE 9- COMMON STOCK During the years ended September 30, 2003 and 2002, the Company did not issue any shares of common stock. NOTE 10- BANKRUPTCY EVENTS - ASSET SALE FEMINIQUE CORPORATION Feminique Corporation ("Feminique") filed a Chapter 11 Petition in the United States Bankruptcy Court for the Eastern District of New York on August 3, 2000. On May 14, 2003, Feminique filed its Plan of Reorganization dated May 10, 2002 ("Plan"). Pursuant to the Plan, Class 2 claimants, which represented the general unsecured creditors of Feminique, were to receive on account of each allowed claim, a pro-rata distribution of 23,344,085 shares of Feminique Common Stock. In addition, in exchange for $7,077 contributed by Matterhorn Holdings, Inc. ("Matterhorn"), Matterhorn was to receive 28,311,830 shares of Common Stock representing a purchase price of $.00025 per share. By Order dated July 28, 2003, the Plan was confirmed by Bankruptcy Judge Melanie L. Cyganowski QUALITY HEALTH PRODUCTS, INC. On August 3, 2000, Quality Health Products, Inc. ("QHP") filed a Chapter 11 Petition in the United States Bankruptcy Court for the Eastern District of New York. On July 12, 2002, QHP and Clay Park Labs, Inc. ("Clay Park") executed an Asset Purchase Agreement which was approved by the Bankruptcy Court on September 9, 2002. Under the Asset Purchase Agreement, Clay Park committed itself to pay a guaranteed purchase price of $350,000 over five years, with a maximum purchase price of $1,500,000 over five years. Pursuant to the terms of various stipulations entered into between the Official Committee of Unsecured Creditors of QHP and Clay Park during the Chapter 11 proceeding, the Official Committee, on behalf of the unsecured creditors of QHP will receive 15% of all payments made by Clay Park in excess of the guaranteed amount of $350,000 which payments will be distributed to unsecured creditors by the disbursing agent under the Plan of Reorganization of QHP. On December 13, 2002, QHP filed its Amended Plan of Reorganization dated December 3, 2002 ("Plan"). Under the provisions of the Plan, SSL Americas, the secured creditor of QHP, received an assignment of all of the payments due QHP under the terms of the Asset Purchase Agreement, which was deemed in full discharge and satisfaction of its claim and waived all claims against QHP. All unsecured creditors of QHP, which were Class 3 creditors under the Plan, received on account of the allowed amount of their claims a pro-rata distribution from QHP's cash on hand on the Consummation Date (as defined in the Plan), and will receive a pro-rata distribution from the disbursing agent from payments being made by Clay Park under the Asset Purchase Agreement. By Order dated January 29, 2003, the Plan was confirmed by Bankruptcy Judge Melanie L. Cyganowski. Pursuant to the Plan, all unsecured creditors of QHP received a first distribution of 22.17595% of their respective claim. As of this date, no further distributions have been made by the disbursing agent to any unsecured creditors of QHP. 21 ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None. ITEM 8A. CONTROLS AND PROCEDURES EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES The Company's Chief Executive Officer and Chief Financial Officer, Max Khan, has reviewed and evaluated the effectiveness of the Company's disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e) as of the end of the period covered by this annual report on Form 10-KSB. Based on that evaluation, Max Khan determined that he and the Company's directors and officers, are the only individuals involved in the Company's disclosure process. The Company has no specific procedures in place for processing and assembling information to be disclosed in the Company's periodic reports. The Company's system is designed so that information is retained by the Company and relayed to counsel as it becomes available. The Company currently functions only as a shell corporation as it has no revenues, significant assets or independent operations and plans to establish more reliable disclosure controls and procedures before margining or entering into any other business combination with another company. CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING No significant changes in the Company's internal control over financial reporting have come to management's attention during the Company's previous fiscal quarter that have materially affected, or are likely to materially affect, the Company's internal control over financial reporting. PART III ITEM 9. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT During the fiscal year ended 12/31/03, the Company's officers and directors changed. The Company's Board of Directors and Executive Officers currently consists of three persons. Mr. Max Khan is the President and CEO, Gobind Sahney is the Chairman of the Board and Steven Lowe is the Secretary.
Name Age Position Director Since ------------- --- -------- -------------- Max Khan 37 President & CEO October 9, 2003 Gobind Sahney 41 Chairman of the Board October 9, 2003 Steven Lowe 45 Secretary October 9, 2003
The following list sets forth information as to all directors and executive officers of the Company through its fiscal year ended September 30, 2003 and currently through December 4, 2003.
Name Age Position Held Director Since ---- --- ------------- -------------- Max Khan (1) 37 Pres, CEO, Director October, 2003 Steven Lowe (2) 45 Secretary, Director April, 2003 John Figliolini (3) 38 (3) (3) Jonathan Rosen (4) 37 (4) (4) Leon Golden (1) (5) 42 Acting President, Director October, 2003 Gobind Sahney (1) 41 Director October, 2003 __________________ (1) Max Kahn was elected a director and appointed President and CEO on October 9, 2003, on which date Leon Golden resigned as director. (2) Steven Lowe was appointed secretary and director in April, 2003 at which time Jonathan Rosen has resigned as a director and Acting President. (3) John Figliolini was Secretary and director from the initial filing under Chapter 11 until the Spring of 2003 when he became Acting President of Feminique. At that time, Steven Lowe replaced Mr. Figliolini as Secretary and became Secretary and director. (4) Jonathan Rosen was a former president of the Company prior to its filing under Chapter 11 of the Bankruptcy Code. During the bankruptcy period until April, 2003 he continued as Acting President and Director. He resigned in April, 2003 as an officer and director. (5) Gobind Sahney became a director on October 9, 2003 when he replaced Leon Golden. Mr. Sahney has been elected Chairman by the Board of Directors.
For approximately one month during the period September 2, 2003 to October 9, 2003 Mr. Leon Golden, a CPA became Acting President and a director of the Company. Mr. Golden is a former director having served in 1999 to just prior to the filing under Chapter 11. Mr. Golden is a CPA practicing accounting on his own behalf since 1986. He resigned as a director on October 9, 2003. GOBIND SAHNEY, age 41, has a background in corporate finance and business management; past experience includes positions in public and private accounting; positions in mortgage banking where he was responsible for commercial real estate loan originations and underwriting; position with a private investment partnership as a Senior Analyst, where he was responsible for the identification, review, and analysis of investments and the investment decision; the founding and development of a successful advisory and research firm, advising companies on organizing and/or reorganizing themselves to attract capital, and/or recruit qualified managers and directors capable of guiding the companies to a higher level of performance and recognition, additional services involved the specific functions of corporate finance and merger and acquisition advisory services for the client entities; the founding and guidance of a successful consumer finance (credit card) marketing organization affiliated with MBNA America Bank. Mr. Sahney is a director of YES, Inc., Herbonics, Inc., International Metal Products (Asia) Pte.Ltd. (Singapore). Mr. Sahney is a lifetime member of the National Eagle Scout Association; member Babson College Board of Trustees; the Babson College Asian Advisory Board; Trustee of the Scripps Whittier Institute for Diabetes/Chairman 2001; the Indus Entrepreneurs San Diego Chapter. Mr. Sahney is the principal owner of General Outsourcing Services LLC, which specializes in the purchase, collection, restructuring, resale and securitization of receivable, portfolios acquired at deep discounts. Mr. Sahney is a graduate of Babson College with dual degrees in Finance and Accounting. Born in 1962, Mr. Sahney lives in San Diego and has 2 children. MAX KHAN, age 41, has been in the financial industry since 1987. He began his career as a financial consultant in New York. Mr. Khan founded Alliance Global Finance Inc. in 1992 with focus on corporate finance and investment banking. Mr. Khan has assisted in raising in excess of $100 million over the last 10 years for U.S. companies from European Institutional Investors. Mr. Khan is also the co-founder of NewTrad Investors Inc., a hedge fund advisory firm specializing in advising Japanese institutions in their diversification into alternative assets. Mr. Khan has a Bachelors Degree in Accounting and Economics from City University of New York and an MBA from Pace University (New York). He is married with 2 children and lives in New York. JONATHAN ROSEN, age 37, was a Director of the Company since 1998 and during the bankruptcy filing, was appointed Acting President and Chief Executive Officer of the Company. He served as Acting President and director during the bankruptcy organization until April, 2003. Since 1985, Mr. Rosen has been a director and officer of various public corporations, many of which he helped finance. Mr. Rosen resigned in April 2003. JOHN FIGLIOLINI, age 38, was a director of the Company since 1998 and served as Secretary during the period of bankruptcy reorganization. Mr. Figliolini is an investment banker and has worked in the securities industry since 1982, raising over $250M in venture capital financing. He is currently the President and owner of Phillip Louis Trading, Inc. a NASD registered broker dealer which makes markets in many small cap stocks, in addition to providing investment banking services. Mr. Figliolini served as Acting President since April 2003 and resigned as an officer and director on September 2, 2003. STEVEN LOWE, age 45, is a practicing attorney in the State of California and is the Secretary and director of the Company since April, 2003. Mr. Lowe is the principal of his own law firm since January 1991 and continues to actively practice law. EXECUTIVE OFFICERS The following individuals were serving as executive officers of the Company on December 4, 2003:
Name Age Position with the Company ------------- --- ------------------------- Max Khan 37 Director, President, CEO, Treasurer Gobind Sahney 41 Chairman of the Board Steven Lowe 45 Secretary
There are no other employees of the Company. SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE Section 16(a) of the Exchange Act requires the Company's directors, executive officers and persons who own more than ten percent of the Company's outstanding Common Stock to file with the SEC and the Company reports on Form 4 and Form 5 reflecting transactions affecting beneficial ownership. The Company does not believe that, during fiscal years ended 2003 and 2002, all persons complied with such filing requirements. ITEM 10. EXECUTIVE COMPENSATION
Long-Term --------- Salary Bonus Compensation Awards: ------ ----- -------------------- Name and Principal Position Year Annual Compensation Securities Underlying Options --------------------------- ------ --------------------- ------------------------------- Max Khan 2002 $ - None None CEO & CFO 2003 $ - None None Steven Lowe 2002 $ - None None Secretary 2003 $ - None None
EMPLOYMENT AND SEPARATION AGREEMENT The Company does not have any employment or separation agreements with any officers or directors. ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS The following table sets forth information at September 30, 2003 concerning ownership of the Company's common shares by each director and executive officer and each person who owns of record, or is known to the Company to own beneficially, more than five percent of the Company's common shares.
Title of Class Name & Address Amt & Nature % of Class -------------- -------------- ------------ ---------- of Beneficial Owner of Beneficial Ownership ------------------- ----------------------- Common Stock John Figliolini 2,279,537 9.5 % (1) Common Stock Jonathan Rosen 2,774,772 6.00 % (2) Common Stock Max Khan -0-(3) -0- Common Stock Steven Lowe -0-(3) -0- Common Stock Ghobind Sahney -0-(3) -0- ____________ (1) John Figliolini is the direct beneficial owner of 1,272,175 shares of Common Stock. Mr. Figliolini also indirectly owns an additional 1,007,362 shares of Common Stock of the Company through 100% ownership of the following privately owned holding Companies: Berkshire International, European Equity Partners, Inc., Sierra Growth and Opportunity, Inc., Histon Financial Services, Medical Technologies, Inc. Suncoast Holdings, Inc ( which is also a consulting firm), and Utopia Capital Management, Inc. In addition, Mr. Figliolini also owns a 50% interest in Dynamic Corporate Holdings, Inc., ("Dynamic") a privately owned holding company which is the registered owner for 5,454,544 shares of common stock of the Company. (2) Jonathan Rosen, a former President of Feminique, owns 50% of Dynamic Corporate Holdings, Inc. (which owns 5,454,544 shares of Feminique) and is also the direct beneficial owner of 47,500 additional shares of common stock of Feminique (approximately 6% of the outstanding shares of Feminique). (3) Management contemplates that directors shall be compensated as directors pursuant to a formal stock option plan to be adopted in the future.
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS John Figliolini, former President and Director and Jonathan Rosen, former President and director were the principals of the Company during the Chapter 11 Bankruptcy proceedings from August 2000 to July 2003. Said individuals and affiliates substantially assisted in formation of the Plan of Reorganization and provided funds to help facilitate its implementation. Mr. Figliolini by his direct holdings and his indirect holdings through affiliates is the principal shareholder of the Company owning or controlling through affiliates, approximately 33,000,000 of a total of 49,994,267 shares outstanding as of December 23, 2003. ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits. The following Exhibits are incorporated herein by reference or are filed with this report as indicated below.
Exhibit Number Description -------- ----------- 31.1 Certification pursuant to Exchange Act Rules 13a-14 and 15d-14 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 32.1 Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. (b) Reports for 8-K. (1) Form 8-K for July 27, 2003 (2) Form 8-K/A for July 27, 2003
SIGNATURES In accordance with Section 13 or 15(d) of the Securities Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. FEMINIQUE CORPORATION /s/ Max Khan ---------------- By: Max Khan Chief Executive Officer, Chief Financial Officer Date: December 7, 2003 In accordance with the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated: /s/ Max Khan ----------------- By: Max Khan Chief Executive Officer, Chief Financial Officer and Director Date: December 7, 2003