-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Kk/VWYfF6ANgPotglPQKSkexyjsMW2S9GPdZ+KGvZdT9B8mJYY8/qMSzJvUsdNIt Fs16Dn8OItud9Rd7/44nUA== 0001010549-01-500129.txt : 20010601 0001010549-01-500129.hdr.sgml : 20010601 ACCESSION NUMBER: 0001010549-01-500129 CONFORMED SUBMISSION TYPE: 10KSB PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19991231 FILED AS OF DATE: 20010530 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PROHEALTH MEDICAL TECHNOLOGIES INC CENTRAL INDEX KEY: 0000744452 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER PROCESSING & DATA PREPARATION [7374] IRS NUMBER: 592262718 STATE OF INCORPORATION: NV FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10KSB SEC ACT: SEC FILE NUMBER: 002-90539 FILM NUMBER: 1651093 BUSINESS ADDRESS: STREET 1: 211 WEST WALL CITY: MIDLAND STATE: TX ZIP: 79701 BUSINESS PHONE: 9156821761 MAIL ADDRESS: STREET 1: 211 WEST WALL CITY: MIDLAND STATE: TX ZIP: 79701 FORMER COMPANY: FORMER CONFORMED NAME: DCC ACQUISITION CORP DATE OF NAME CHANGE: 19990211 FORMER COMPANY: FORMER CONFORMED NAME: DATALINK CAPITAL CORP/TX/ DATE OF NAME CHANGE: 19980306 FORMER COMPANY: FORMER CONFORMED NAME: DATALINK SYSTEMS INC DATE OF NAME CHANGE: 19980306 10KSB 1 prohealthdec319910ksb.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 Form 10-KSB - -------------------------------------------------------------------------------- (Mark one) XX ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE - ---------- ACT OF 1934 For the annual period ended December 31, 1999 TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES - ---------- EXCHANGE ACT OF 1934 For the transition period from ___________ to ____________ - -------------------------------------------------------------------------------- Commission File Number: 2-90519 ------- ProHealth Medical Technologies, Inc. (Exact name of small business issuer as specified in its charter) Nevada 59-2262718 - -------------------------- -------------------------- (State of incorporation) (IRS Employer ID Number) 211 West Wall Street, Midland, TX 70701-4556 -------------------------------------------- (Address of principal executive offices) (915) 682-1761 -------------- (Issuer's telephone number) DCC Acquisition Corporation, 1201 Chester Industrial Parkway Avon, Ohio 44011-1081 ------------------------------------------------------------ (Former name, former address and former fiscal year, if changed since last report) - -------------------------------------------------------------------------------- Securities registered under Section 12 (b) of the Exchange Act: None Securities registered under Section 12(g) of the Exchange Act: Common Stock $0.0001 par value Check whether the issuer has (1) filed all reports required to be files by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period the Company was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No X --- --- Check if there is no disclosure of delinquent filers in response to Item 405 of Regulation S-B contained in this form, and no disclosure will be contained, to the best of Company'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. [ ] The issuer's revenues for the fiscal year ended December 31, 1999 were $0. As of May 25, 2001, the aggregate market value of the Company's common Stock held by non-affiliates was: $-0- As of May 25, 2001, there were 145,640 shares of Common Stock issued and outstanding. Transitional Small Business Disclosure Format : Yes No X --- --- 1 TABLE OF CONTENTS Page Number ----------- Part I Item 1 - Description of Business 3 Item 2 - Description of Property 4 Item 3 - Legal Proceedings 4 Item 4 - Submission of Matters to a Vote of Security Holders 4 Part II Item 5 - Market for Company's Common Stock and Related Stockholders Matters 5 Item 6 - Management's Discussion and Analysis or Plan of Operation 6 Item 7 - Index to Financial Statements F-1 Item 8 - Changes in and Disagreements with Accountants on Accounting and Financial Disclosures 6 Part III Item 9 - Officers and Directors 6 Item 10 - Executive Compensation 7 Item 11 - Security Ownership of Certain Beneficial Owners And Management 7 Item 12 - Certain Relationships and Related Transactions 8 Item 13 - Exhibits and Reports on 8-K 9 Signatures 10 2 Caution Regarding Forward-Looking Information --------------------------------------------- This annual report contains certain forward-looking statements and information relating to the Company that are based on the beliefs of the Company or management as well as assumptions made by and information currently available to the Company or management. When used in this document, the words "anticipate", "believe", "estimate", "expect" and "intend" and similar expressions, as they relate to the Company or its management, are intended to identify forward-looking statements. Such statements reflect the current view of the Company regarding future events and are subject to certain risks, uncertainties and assumptions, including the risks and uncertainties noted. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described herein as anticipated, believed, estimated, expected or intended. In each instance, forward-looking information should be considered in light of the accompanying meaningful cautionary statements herein. PART I Item 1 - Description of Business General - ------- Datalink Systems, Inc. (Datalink) filed a registration under The Securities Act of 1933 on Form S-1 with the Securities and Exchange Commission with respect to a public offering of its securities. The offering became effective on July 29, 1985 and completed October 29, 1985 and raised an aggregate of $300,000 from the sale of 3,000,000 shares of common stock at $.10 per share. The Company was engaged in the business of providing electronic information processing services to the medical/health care industry. This venture was not successful and management attempted to redirect the focus of the company through merger with a viable private entity. Several Letters of Intent were signed but later abandoned by all parties. The corporate name was changed in April 29, 1987 to Datalink Capital Corporation and the capital restated to 100,000,000 shares of $.0001 par value common stock. The corporate charter was revoked on November 4, 1988 by the State of Florida for failure to file required documents and pay associated fees. A change in control of the majority stockholder resulted in a change in control of the Company and the company's charter was reestablished on December 5, 1990. The new management was unable to complete a merger with a private entity or recapitalize the company and the company remained dormant. On April 26, 1991 the corporate name was changed to Midland Capital Resources, Inc. The corporate charter was revoked again on October 9, 1992 by the State of Florida for failure to file required documents and pay associated fees. On July 30, 1997, the charter was reinstated by the State of Florida and on September 24, 1997 the name was changed to Datalink Capital Corporation. On May 1, 1997 a stock purchase agreement was entered into between the then majority stockholder and Glenn A. Little. In March 1998, this agreement was renegotiated and effective control of the company was obtained by Mr. Little by the purchase of 37.4% of the outstanding shares. Effective December 29, 1998 the Company changed its state of incorporation from Florida to Nevada, pursuant to a change-of-state-if-incorporation merger. In the merger transaction, the Company's name was changed from "DataLink Capital Corporation" to "DCC Acquisition Corporation". On June 8, 1999, in a Current Report on Form 8-K, the Company announced its acquisition of all of the issued and outstanding common shares of New Cinema Partners Inc. (NCP) in consideration of and in exchange for common stock of the Company issued from treasury (Acquisition Transaction), which transaction constituted a change in control of the Company. 3 On August 15, 1999, the Company filed a Current Report on Form 8-K reporting that the June 8, 1999 Form 8-K announcement of the Acquisition Transaction and the filing of the June 8, 1999 Form 8-K Current Report in respect thereof was premature. The Acquisition Transaction had not been, and will not be, consummated. The Board of Directors of the Company did not approve, authorize or ratify the Acquisition Transaction. Due to mis-communication between representatives of NCP and its shareholders and the agent for the Company, NCP and its shareholders were of the view that all requisite approvals and authorizations in respect of the Acquisition Transaction had been obtained and all other conditions precedent to the completion of the Acquisition Transaction satisfied and, accordingly, the June 8, 1999 Current Report on Form 8-K was filed in accordance with applicable law. The Company continued its efforts to locate and combine with an existing, privately-held company that is profitable or, in management's view, has growth potential, irrespective of the industry in which it is engaged. On November 17, 1999, in the Quarterly Report on Form 10-QSB for the quarter ended September 30, 1999, the Company announced that on November 1, 1999, the Company experienced a change in control and acquired a majority of the shares of stock of two corporations, ProHealth Laboratories, Inc (ProHealth) and STL Group, Inc. (STL) in exchange for shares of the Company's common stock. Although discussed in the November 17, 1999 Form 10-QSB filing, the Company never filed any required Current Report on Form 8-K which contained more detailed information about the terms of the acquisitions of ProHealth and STL and their business and financial information. On January 11, 2001, the Company filed a Current Report on Form 8-K announcing that the two Agreements and Plans of Reorganization (Agreements) disclosed and discussed in the November 17, 1999 Form 10-QSB filing never closed and prematurely announced as such. In anticipation of the closing of these transaction and in accordance with the Agreements, the Company convened a Board of Directors Meeting on October 22, 1999 and changed the name from DCC Acquisition Corp to ProHealth Medical Technologies, Inc. and approved and enacted a 1:10 reverse split of its Common Stock, $0.0001 par value, with fractional shares rounded up to the nearest whole share. All share and per share amounts in this filing reflect the effect of the reverse split as of the first day of the first period presented. As a result of each of the private entity's inability to fulfill its obligations under each Agreement with the Company, the closing of the acquisitions has never taken place as planned and announced. In January 2001, Glenn A. Little and Matthew Blair, the former officers and directors of the Company, reached an agreement with the parties to the Agreements to recognize the failure of the merger and agreed to return as Management of the Company. All books and records were returned to the former management of the Company and the various companies and parties to the Agreements mutually released and discharged each other with regard to the failed transaction. Pursuant to the rescission agreement, any and all shares which may have been issued pursuant to the Agreements were rescinded and returned to the Company's treasury, and the Company appointed Glenn A. Little as President and Director and Matthew Blair as Secretary and Director. It is the intention of the current management to bring its SEC reporting to date in order that the Company might be potentially attractive to a private business that might be interested in becoming a publicly-held company, without the expense and time delay involved in distributing its securities to the public. Proposed Business - ----------------- The Company intends to locate and combine with an existing, privately-held company which is profitable or, in management's view, has growth potential, irrespective of the industry in which it is engaged. However, the Company does not intend to combine with a private company which may be deemed to be an investment company subject to the Investment Company Act of 1940. A combination may be structured as a merger, consolidation, exchange of the Company's common stock for stock or assets or any other form which will result in the combined enterprise's becoming a publicly-held corporation. 4 Pending negotiation and consummation of a combination, the Company anticipates that it will have, aside from carrying on its search for a combination partner, no business activities, and, thus, will have no source of revenue. Should the Company incur any significant liabilities prior to a combination with a private company, it may not be able to satisfy such liabilities as are incurred. If the Company's management pursues one or more combination opportunities beyond the preliminary negotiations stage and those negotiations are subsequently terminated, it is foreseeable that such efforts will exhaust the Company's ability to continue to seek such combination opportunities before any successful combination can be consummated. In that event, the Company's common stock will become worthless and holders of the Company's common stock will receive a nominal distribution, if any, upon the Company's liquidation and dissolution. Combination Suitability Standards - --------------------------------- In its pursuit for a combination partner, the Company's management intends to consider only combination candidates which are profitable or, in management's view, have growth potential. The Company's management does not intend to pursue any combination proposal beyond the preliminary negotiation stage with any combination candidate which does not furnish the Company with audited financial statements for at least its most recent fiscal year and unaudited financial statements for interim periods subsequent to the date of such audited financial statements, or is in a position to provide such financial statements in a timely manner. The Company will, if necessary funds are available, engage attorneys and/or accountants in its efforts to investigate a combination candidate and to consummate a business combination. The Company may require payment of fees by such combination candidate to fund the investigation of such candidate. In the event such a combination candidate is engaged in a high technology business, the Company may also obtain reports from independent organizations of recognized standing covering the technology being developed and/or used by the candidate. The Company's limited financial resources may make the acquisition of such reports difficult or even impossible to obtain and, thus, there can be no assurance that the Company will have sufficient funds to obtain such reports when considering combination proposals or candidates. To the extent the Company is unable to obtain the advice or reports from experts, the risks of any combined enterprise's being unsuccessful will be enhanced. Furthermore, to the knowledge of the Company's officers and directors, neither the candidate nor any of its directors, executive officers, principal shareholders or general partners: (1) will not have been convicted of securities fraud, mail fraud, tax fraud, embezzlement, bribery, or a similar criminal offense involving misappropriation or theft of funds, or be the subject of a pending investigation or indictment involving any of those offenses; (2) will not have been subject to a temporary or permanent injunction or restraining order arising from unlawful transactions in securities, whether as issuer, underwriter, broker, dealer, or investment advisor, may be the subject of any pending investigation or a defendant in a pending lawsuit arising from or based upon allegations of unlawful transactions in securities; or (3) will not have been a defendant in a civil action which resulted in a final judgement against it or him awarding damages or rescission based upon unlawful practices or sales of securities. The Company's officers and directors will make these determinations by asking pertinent questions of the management of prospective combination candidates. Such persons will also ask pertinent questions of others who may be involved in the combination proceedings. However, the officers and directors of the Company will not generally take other steps to verify independently information obtained in this manner which is favorable. Unless something comes to their attention which puts them on notice of a possible disqualification which is being concealed from them, such persons will rely on information received from the management of the prospective combination candidate and from others who may be involved in the combination proceedings. 5 Governmental Regulation - ----------------------- It is impossible to predict the government regulation, if any, to which the Company may be subject. The use of assets and/or conduct of businesses that the Company may operate within could subject it to environmental, public health and safety, land use, trade, or other governmental regulations and state or local taxation. Management will endeavor to ascertain and monitor the effects of such, if any, government regulation on the business of the Company. In certain circumstances, however, it may not be possible to predict with any degree of accuracy the impact of government regulation. The inability to ascertain the effect of government regulation on a particular business activity will make the acquisition of an interest in such business a higher risk. Competition - ----------- The Company may be involved in intense competition with other business entities, many of which could have a competitive edge over the Company by virtue of their stronger financial resources and prior experience in business. There is no assurance that the Company will be successful in a competitive business environment. Employees - --------- The Company currently has no employees. The sole executive officer, who is not compensated for his time contributed to the Company, devotes only such time to the affairs of the Company, which is minimal at this time. Item 2 - Description of Properties The Company has no properties and has no requirement for property or offices at this time. The Company's records require nominal space and are maintained in the offices of it's President at 211 West Wall Street, Midland, Texas 79701 at no charge. Item 3 - Legal Proceedings The Company is not a party to any material pending legal proceedings, and to the best of its knowledge, no such proceedings by or against the Company have been threatened. Item 4 - Submission of Matters to a Vote of Security Holders No matter was submitted to a vote of security holders in the fiscal years ended December 31, 1999 or 1998, respectively. PART II Item 5 - Market for Common Equity and Related Stockholder Matters Market Information - ------------------ The Company's common stock is not listed for trading on any electronic board or other exchange. As of May 25, 2000, there were approximately 400 holders on record of the Company's common stock holding a total of 145,640 shares. Dividend Policy The Company has never paid any dividends on its common stock and does not have any current plan to pay any dividends in the foreseeable future. 6 (Remainder of this page left blank intentionally) 7 Item 6 - Management's Discussion and Analysis of Financial Condition, Results of Operations and Plan of Operation Results of Operations - --------------------- Years Ended December 31, 1999 and 1998 - -------------------------------------- The Company had no revenue for the years ended December 31, 1999 and 1998. General and administrative expenses for the years ended December 31, 1999 and 1998 were approximately $3,350 and $1,580, respectively. General and administrative expenses during these years consisted principally of fees associated with the maintenance of the Company's shareholder ledger. The Company realized a net loss of approximately $3,350 and $1,580 for the years ended December 31, 1999 and 1998, respectively. The Company does not expect to generate any meaningful revenue or incur operating expenses unless and until such time that the Company's operating subsidiary begins meaningful operations. Liquidity and Capital Resources - ------------------------------- At December 31, 1999, and for all periods subsequent thereto, the Company had working capital of $-0-. It is the intent of management and significant stockholders to provide sufficient working capital necessary to support and preserve the integrity of the corporate entity. However, there is no legal obligation for either management or significant stockholders to provide additional future funding. Should this pledge fail to provide financing, the Company has not identified any alternative sources. Consequently, there is substantial doubt about the Company's ability to continue as a going concern. The Company's need for capital may change dramatically as a result of any business acquisition or combination transaction. There can be no assurance that the Company will identify any such business, product, technology or company suitable for acquisition in the future. Further, there can be no assurance that the Company would be successful in consummating any acquisition on favorable terms or that it will be able to profitably manage the business, product, technology or company it acquires. Item 7 - Financial Statements The financial statements of the Company appear at the end of this report beginning with the Index to Financial Statements on page F-1. Item 8 - Changes in and Disagreements with Accountants on Accounting and Financial Disclosure On December 15, 1999, the Company filed a Current Report on Form 8-K announcing that S. W. Hatfield, C.P.A., formerly S. W. Hatfield & Associates, had resigned as the Company's independent auditor as a result of the announced acquisitions of ProHealth Laboratories, Inc (ProHealth) and STL Group, Inc. This document announced the appointment of Wrabel & Company to be the successor firm. Although interviews with Wrabel & Company took place, the Company never executed an engagement letter with Wrabel & Company and the disclosure by former management of the engagement of Wrabel & Company by the Company was premature. Wrabel & Company never performed any services of any type for the Company between December 15, 1999 and April 6, 2001. On April 6, 2001, as a result of the change in control of the Company, S. W. Hatfield CPA accepted reappointment as the Company's independent certified public accounting firm to audit the Company's financial statements beginning with the year ending December 31, 1999 and to review the Company's quarterly filings beginning with the quarter ended March 31, 2000. 8 Between the period of December 15, 1999 and April 6, 2001, the Company held no discussions with S. W. Hatfield, CPA on any matter of accounting principals or practices, financial statement disclosure or accounting scope or procedure. Additionally, there were and have been no changes in or disagreements with accountants reporting on the financial statements of the Company for the period between December 31, 1998 and the date of this filing. PART III Item 9 - Directors, Executive Officers, Promoters and Control Persons; Compliance with Section 16(A) of The Securities Exchange Act of 1934 Directors and Officers - ---------------------- The following table sets forth the names, ages, and positions with the Company for the sole director and officer of the Company. Name Age Position Held and Tenure ---- --- ------------------------ Glenn Little 48 President, Director Matthew Blair 43 Secretary, Treasurer Director The directors named above will serve until the next annual meeting of the Company's stockholders or until their successors are duly elected and have qualified. Directors will be elected for one-year terms at the annual stockholders meeting. Officers will hold their positions at the pleasure of the board of directors, absent any employment agreement, of which none currently exists or is contemplated. There is no arrangement or understanding between any of the directors or officers of the Company and any other person pursuant to which any director or officer was or is to be selected as a director or officer, and there is no arrangement, plan or understanding as to whether non-management shareholders will exercise their voting rights to continue to elect the current directors to the Company's board. There are also no arrangements, agreements or understandings between non-management shareholders that may directly or indirectly participate in or influence the management of the Company's affairs. The directors and officers will devote their time to the Company's affairs on an as needed basis, which, depending on the circumstances, could amount to as little as two hours per month, or more than forty hours per month, but more than likely will fall within the range of five to ten hours per month. There are no agreements or understandings for any officer or director to resign at the request of another person, and none of the officers or directors are acting on behalf of, or will act at the direction of, any other person. Biographical Information Glenn A. Little, is a graduate of The University of Florida, Gainesville (Bachelor of Science in Business Administration) and the American Graduate School of International Management (Master International Management) and has been the principal of Little and Company Investment Securities (LITCO), a Securities Broker/Dealer with offices in Midland, Texas since 1979. Mr. Little currently serves as an officer of other inactive public corporations having the same business purpose as the Company. Before founding LITCO, Mr. Little was a stockbroker with Howard, Weil, Labouisse Friedrich in New Orleans and Midland and worked for the First National Bank of Commerce in New Orleans, Louisiana. Matthew Blair was formerly a solo practitioner of law in Midland, Texas and is presently a Title IV-D Master in Midland County Texas. Before opening his practice he served in the Legal Department of the Federal Deposit Insurance Corporation (FDIC), Midland, Texas where he gained exposure to corporate structures and debt workouts. His employment before the FDIC appointment was with Texas American Energy and Exxon Corporation. Mr. Blair received a Bachelor of Arts in Government from The University of Texas at Austin (1975) and Juris Doctor from Texas Tech University School of Law (1979). He is licensed in every state court in Texas, United States District Court (Texas) and in The United States Supreme Court. 9 Item 10 - Executive Compensation There was no compensation paid during either of the years ended December 31, 1999 and 1998 None of the Company's current officers or directors receives or has received any salary from Company during the preceding five years. The Company does not anticipate entering into employment agreements with any of its officers or directors in the near future. Directors do not receive compensation for their services as directors and are not reimbursed for expenses incurred in attending board meeting. Item 11 - Security Ownership of Management, Certain Beneficial Owners and Management The following table sets forth as of May 25, 2001, the number and percentage of the 145,640 outstanding shares of common stock that were beneficially owned by (i) each person who is currently a director, (ii) each executive officer, (iii) all current directors and executive officers as a group and (iv) each person who, to the knowledge of the Company is the beneficial owner of more than 5% of the outstanding common stock. Except as otherwise indicated, the persons named in the table have sole voting and dispositive power with respect to all shares beneficially owned, subject to community property laws where applicable. Name and Address Common Shares Percent of Class (1) - ---------------- ------------- -------------------- Glenn A. Little 73,186 50.25% 211 W. Wall Street Midland TX 79701 Matthew Blair 0 0.00% 201 W. Wall Street Midland TX 79701 All officers and directors as a 73,186 .25% Group (2 persons) (1) Based on 145,640 shares outstanding as of May 25, 2001. Item 12 - Certain Relationships and Related Transactions The Company's President, Glenn A. Little, has agreed to provide funds to the Company sufficient to cover Company expenses relating to its SEC periodic reporting and other minor corporate expenses. Except for the transactions described above there are no proposed transactions and no transactions during the past two years to which the Company was a party and in which any officer, director, or principal stockholder, or their affiliates or associates, was also a party. Item 13 - Exhibits and Reports on Form 8-K Copies of the following documents are included as exhibits to this report pursuant to Item 601 of Regulation S-B. 10 Exhibits - -------- 3.1 Articles of Incorporation, as amended (1) 3.2 By-Laws (1) (5) Incorporated herein by this reference to the Company's Current Report on Form 8-K filed with the U. S. Securities and Exchange Commission on December 29, 1998. Form 8-K Filings - ---------------- February 8, 1999 Announcement of a change of State of Incorporation from Florida to Nevada and a change in corporate name from DataLink Capital Corporation to DCC Acquisition Corporation. June 11, 1999 Announcement of the acquisition of all of the issued and outstanding common shares of New Cinema Partners Inc. ("NCP") in consideration of and in exchange for common stock of the Company issued from treasury (the "Acquisition Transaction"), which transaction constituted a change in control of the Company. August 5, 1999 Announcement that the Acquisition Transaction filed on a Current Report on Form 8-K on June 11, 1999and the filing of the Form 8-K Current Report in respect thereof were premature. The Acquisition Transaction has not been, and will not be, consummated. January 10, 2000 Announcement of the resignation of S. W. Hatfield, CPA as the Company's independent certified public accounting firm April 12, 2001 Announcement of the premature announcement of the acquisition of ProHealth Laboratories, Inc. and STL Group, Inc. and the acceptance of reappointment as the Company's independent certified public accounting firm by S. W. Hatfield, CPA. - -------------------------------------------------------------------------------- SIGNATURES In accord with Section 13 or 15(d) of the Securities Act of 1993, as amended, the Company caused this report to be signed on its behalf by the undersigned, thereto duly authorized. ProHealth Medical Technologies, Inc. Dated: May 25, 2001 By: /s/ Glenn A. Little ------------ ------------------------------ Glenn A. Little President, Director and Chief Executive Officer In accordance with the Securities Exchange Act of 1934, as amended, this report has been signed below by the following persons on behalf of the Company and in the capacities and on the date as indicated. Dated: May 25, 2001 By: /s/ Glenn A. Little ------------ ------------------------------ Glenn A. Little President, Director and Chief Executive Officer Dated: May 25, 2001 By: /s/ Matthew Blair ------------ ------------------------------ Matthew Blair Director 11 PROHEALTH MEDICAL TECHNOLOGIES, INC. (formerly DCC Acquisition Corp.) Financial Statements and Auditor's Report December 31, 1999 and 1998 S. W. HATFIELD, CPA certified public accountants Use our past to assist your future sm ProHealth Medical Technologies, Inc. (formerly DCC Acquisition Corp.) Contents Page ---- Report of Independent Certified Public Accountants F-3 Financial Statements Balance Sheets as of December 31, 1999 and1998 F-4 Statements of Operations for the years ended December 31, 1999 and 1998 F-5 Statement of Changes in Shareholders' Equity for the years ended December 31, 1999 and 1998 F-6 Statements of Cash Flows for the years ended December 31, 1999 and 1998 F-7 Notes to Financial Statements F-8 F-2 S. W. HATFIELD, CPA certified public accountants Member: American Institute of Certified Public Accountants SEC Practice Section Information Technology Section Texas Society of Certified Public Accountants REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS -------------------------------------------------- Board of Directors and Stockholders ProHealth Medical Technologies, Inc. (formerly DCC Acquisition Corp.) We have audited the accompanying balance sheets of ProHealth Medical Technologies, Inc. (a Nevada corporation) as of December 31, 1999 and 1998 and the related statements of operations and comprehensive income, changes in shareholders' equity and cash flows for the each of the two years then ended. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of ProHealth Medical Technologies, Inc. as of December 31, 1999 and 1998 and the related statements of operations and comprehensive income, changes in shareholders' equity and cash flows for the each of the two years then ended, in conformity with generally accepted accounting principles. The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note A to the financial statements, the Company has no viable operations or significant assets and is dependent upon significant shareholders to provide sufficient working capital to maintain the integrity of the corporate entity. These circumstances create substantial doubt about the Company's ability to continue as a going concern and are discussed in Note A. The financial statements do not contain any adjustments that might result from the outcome of these uncertainties. S. W. HATFIELD, CPA Dallas, Texas April 20, 2001 Use our past to assist your future sm (secure mailing address) (overnight delivery/shipping address) P. O. Box 820395 9002 Green Oaks Circle, 2nd Floor Dallas, Texas 75382-0395 Dallas, Texas 75243-7212 214-342-9635 (voice) (fax) 214-342-9601 800-244-0639 SWHCPA@aol.com F-3
ProHealth Medical Technologies, Inc. (formerly DCC Acquisition Corp.) Balance Sheets December 31, 1999 and 1998 1999 1998 --------- --------- ASSETS ------ Current assets Cash on hand and in bank $ -- $ -- --------- --------- Total current assets -- -- --------- --------- Total Assets $ -- $ -- ========= ========= LIABILITIES AND SHAREHOLDERS' EQUITY ------------------------------------ Liabilities Current liabilities Accounts payable - trade $ 963 $ 2,231 Due to shareholder -- 3,000 --------- --------- Total current liabilities 963 5,231 --------- --------- Commitments and contingencies Shareholders' equity (deficit) Common stock - $0.0001 par value 100,000,000 shares authorized 145,640 shares issued and outstanding, respectively 15 15 Additional paid-in capital 805,782 798,160 Accumulated deficit (806,760) (803,406) --------- --------- Total Shareholders' Equity (Deficit) (963) (5,231) --------- --------- Total Liabilities and Shareholders' Equity $ -- $ -- ========= =========
The accompanying notes are an integral part of these financial statements. F-4 ProHealth Medical Technologies, Inc. (formerly DCC Acquisition Corp.) Statements of Operations and Comprehensive Income Years ended December 31, 1999 and 1998 1999 1998 --------- --------- Revenues $ -- $ -- --------- --------- Expenses General and administrative expenses 3,354 1,582 --------- --------- Total operating expenses 3,354 1,582 --------- --------- Income (Loss) from continuing operations before provision for income taxes (3,354) (1,582) Provision for income taxes -- -- --------- --------- Net Income (Loss) (3,354) (1,582) Other Comprehensive Income -- -- --------- --------- Comprehensive Income (Loss) $ (3,354) $ (1,582) ========= ========= Earnings per share of common stock outstanding computed on net loss - basic and fully diluted $ (0.02) $ (0.01) ========= ========= Weighted-average number of shares outstanding - basic and fully diluted 145,640 145,640 ========= ========= The accompanying notes are an integral part of these financial statements. F-5
ProHealth Medical Technologies, Inc. (formerly DCC Acquisition Corp.) Statement of Changes in Shareholders' Equity Years ended December 31, 1999 and 1998 Common Stock Additional ------------ paid-in Accumulated Shares Amount capital deficit Total ---------- ---------- ---------- ---------- ---------- Balances at January 1, 1998 1,456,097 $ 146 $ 798,029 $ (801,824) $ (3,649) Effect of November 1, 1999 1 for 10 reverse stock split, including rounding (1,310,457) (131) 131 -- -- ---------- ---------- ---------- ---------- ---------- Balances at January 1, 1998, as restated 145,640 15 798,160 (801,824) (3,649) Net loss for the year -- -- -- (1,582) (1,582) ---------- ---------- ---------- ---------- ---------- Balances at December 31, 1998 145,640 15 798,160 (803,406) (5,231) Advances from shareholder contributed as additional paid-in capital -- -- 3,000 -- 3,000 Capital contributed to support operations -- -- 4,622 -- 4,622 Net loss for the year -- -- -- (3,354) (3,354) ---------- ---------- ---------- ---------- ---------- Balances at December 31, 1999 145,640 $ 15 $ 805,782 $ (806,760) $ (963) ========== ========== ========== ========== ==========
The accompanying notes are an integral part of these financial statements. F-6 ProHealth Medical Technologies, Inc. (formerly DCC Acquisition Corp.) Statements of Cash Flows Years ended December 31, 1999 and 1998 1999 1998 ------- ------- Cash Flows from Operating Activities Net income (loss) for the period $(3,354) $(1,582) Adjustments to reconcile net loss to net cash provided by operating activities Increase (Decrease) in Accounts payable - trade (1,268) (1,418) ------- ------- Net cash used in operating activities (4,622) (3,000) ------- ------- Cash Flows from Investing Activities -- -- ------- ------- Cash Flows from Financing Activities Cash advanced by shareholder 4,622 3,000 ------- ------- Net cash provided by financing activities 4,622 3,000 ------- ------- Increase (Decrease) in Cash -- -- Cash at beginning of period -- -- ------- ------- Cash at end of period $ -- $ -- ======= ======= Supplemental Disclosure of Interest and Income Taxes Paid Interest paid for the year $ -- $ -- ======= ======= Income taxes paid for the year $ -- $ -- ======= ======= The accompanying notes are an integral part of these financial statements. F-7 ProHealth Medical Technologies, Inc. (formerly DCC Acquisition Corp.) Notes to Financial Statements Note A - Organization and Description of Business ProHealth Medical Technologies, Inc. (Company) was originally incorporated on January 26, 1983 under the laws of the State of Florida as Datalink Systems, Inc. for the purpose of marketing electronic information processing systems to the medical and healthcare industries. As of December 31, 1986, the Company had closed this business operation. The Company changed its corporate name to Datalink Capital Corporation in April 1987 and to Midland Capital Resources, Inc. in April 1991. Subsequent thereto, the Company forfeited its corporate charter in the State of Florida due to non-payment of various taxes and fees. In July 1997, the Company's corporate charter was reactivated with the State of Florida and changed its corporate name to Datalink Capital Corporation, effective September 24, 1997. On December 29, 1998, the Company changed its State of Incorporation from Florida to Nevada by means of a merger with and into DCC Acquisition Corporation, a Nevada corporation formed solely for the purpose of effecting the reincorporation. The Articles of Incorporation and Bylaws of the Nevada corporation are the Articles of Incorporation and Bylaws of the surviving corporation. Such Articles of Incorporation did not change the capital structure of the Company and effectively changed the corporate name to DCC Acquisition Corporation. In November 1999, in anticipation of a business combination transaction, the Company experienced a change in control. As a result of the change in control and the anticipated business combination transaction, the Company changed its corporate name to ProHealth Medical Technologies, Inc. Subsequently, the anticipated business combination transaction did not occur. The Company has had no operations, assets or liabilities since 1989. Accordingly, the Company is dependent upon management and/or significant shareholders to provide sufficient working capital to preserve the integrity of the corporate entity at this time. It is the intent of management and significant shareholders to provide sufficient working capital necessary to support and preserve the integrity of the corporate entity. Through December 31, 1999, various Company shareholders have advanced approximately $7,622 through direct payments for operating expenses on behalf of the Company. The Company follows the accrual basis of accounting in accordance with generally accepted accounting principles and has a year-end of December 31. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Note B - Summary of Significant Accounting Policies 1. Cash and cash equivalents ------------------------- For Statement of Cash Flows purposes, the Company considers all cash on hand and in banks, including accounts in book overdraft positions, certificates of deposit and other highly-liquid investments with maturities of three months or less, when purchased, to be cash and cash equivalents. F-8 ProHealth Medical Technologies, Inc. (formerly DCC Acquisition Corp.) Notes to Financial Statements - Continued Note B - Summary of Significant Accounting Policies - Continued 2. Income Taxes ------------ At December 31, 1999, as a result of the November 1999 change in control, the Company has a net operating loss carryforward for income tax purposes of approximately $3,000. If this carryforward is not fully utilized, it will begin to expire in 2019. As of December 31, 1999 and 1998, respectively, the deferred tax asset related to the Company's net operating loss carryforward is fully reserved. 3. Earnings (loss) per share ------------------------- Basic earnings (loss) per share is computed by dividing the net income (loss) by the weighted-average number of shares of common stock and common stock equivalents (primarily outstanding options and warrants). Common stock equivalents represent the dilutive effect of the assumed exercise of the outstanding stock options and warrants, using the treasury stock method. The calculation of fully diluted earnings (loss) per share assumes the dilutive effect of the exercise of outstanding options and warrants at either the beginning of the respective period presented or the date of issuance, whichever is later. As of December 31, 1999 and 1998, respectively, the Company had no warrants and/or options outstanding. Note C - Fair Value of Financial Instruments The carrying amount of cash, accounts receivable, accounts payable and notes payable, as applicable, approximates fair value due to the short term nature of these items and/or the current interest rates payable in relation to current market conditions. Note D - Income Taxes The components of income tax (benefit) expense for the years ended December 31, 1999 and 1998, respectively, are as follows: December 31, December 31, 1999 1999 ------------ ------------ Federal: Current $ - $ - Deferred - - ------- ------- - - ------- ------- State: Current - - Deferred - - ------- ------- - - ------- ------- Total $ - $ - ======= ======= F-9 ProHealth Medical Technologies, Inc. (formerly DCC Acquisition Corp.) Notes to Financial Statements - Continued Note D - Income Taxes - Continued As of December 31, 1999, as a result of the November 1999 change in control, the Company has a net operating loss carryforward of approximately $3,000 to offset future taxable income. Subject to current regulations, this carryforward will begin to expire in 2019. The amount and availability of the net operating loss carryforwards may be subject to limitations set forth by the Internal Revenue Code. Factors such as the number of shares ultimately issued within a three year look-back period; whether there is a deemed more than 50 percent change in control; the applicable long-term tax exempt bond rate; continuity of historical business; and subsequent income of the Company all enter into the annual computation of allowable annual utilization of the carryforwards. The Company's income tax expense for the years ended December 31, 1999 and 1998, respectively, are as follows: December 31, December 31, 1999 1998 ------------ ------------ Statutory rate applied to loss before income taxes $(1,140) $ (537) Increase (decrease) in income taxes resulting from: State income taxes - - Other, including reserve for deferred tax asset 1,140 537 ------- ------- Income tax expense $ - $ - ======= ======= Temporary differences, consisting primarily of statutory deferrals of expenses for organizational costs and statutory differences in the depreciable lives for property and equipment, between the financial statement carrying amounts and tax bases of assets and liabilities give rise to deferred tax assets and liabilities as of December 31, 1999 and 1998, respectively: December 31, December 31, 1999 1998 ------------ ------------ Deferred tax assets Net operating loss carryforwards $ 1,033 $ 1,131 Less valuation allowance (1,033) (1,131) ------- ------- Net Deferred Tax Asset $ - $ - ======= ======= Note E - Common Stock Transactions On October 22, 1999, effective November 1, 1999, the Company's Board of Directors approved and enacted a 1:10 reverse split of its Common Stock, $0.0001 par value, with fractional shares rounded up to the nearest whole share. The accompanying financial statements reflect this action as of the first day of the first period presented. On August 10, 1998, the Company canceled 500,000 shares of its issued and outstanding common stock. All of these shares had been issued illegally in years prior to 1996 by former management, inasmuch as no corporate authorization of the issuances existed and no monetary consideration was received by the Company for the shares. The shares had previously been accounted for as a nonmonetary transaction for services valued at an amount equal to the par value of the shares issued, or approximately $50. F-10
ProHealth Medical Technologies, Inc. (formerly DCC Acquisition Corp.) Notes to Financial Statements - Continued Note E - Common Stock Transactions - Continued Specifically, the cancellations were as follows: a) 275,000 shares issued to a former Director and President of the Company. These shares were found to be illegally issued as (1) there was no action by the Company's Board of Directors authorizing the issuance of such shares; (2) at the time of issuance, the Company's charter in the State of Florida had been revoked by the Secretary of State for failure to make required filings and to pay associated fees; and (3) the transfer agent issued such shares on the oral instructions of a person not possessed with Company authority. b) 25,000 shares issued to a former Director and Corporate Secretary. These shares were found to be illegally issued as (1) there was no action by the Company's Board of Directors authorizing the issuance of such shares; (2) at the time of issuance, the Company's charter in the State of Florida had been revoked by the Secretary of State for failure to make required filings and to pay associated fees; and (3) the transfer agent issued such shares on the oral instructions of a person not possessed with Company authority. c) 200,000 shares issued to individuals in anticipation of fees due for investment banking activities. These shares were found to be illegally issued as (1) there was no action by the Company's Board of Directors authorizing the issuance of such shares; (2) at the time of issuance, the Company's charter in the State of Florida had been revoked by the Secretary of State for failure to make required filings and to pay associated fees; and (3) the transfer agent issued such shares on the oral instructions of a person not possessed with Company authority. The effect of these cancellations has been reflected in the issued and outstanding common stock as of the first day of the first period presented. Note F - Selected Financial Data (Unaudited) The following is a summary of the quarterly results of operations for the years ended December 31, 1999 and 1998, respectively. Quarter ended Quarter ended Quarter ended Quarter ended Year ended March 31 June 30 September 30 December 31 December 31 ------------- ------------- ------------- ------------- ----------- 1999 - ---- Net revenues $ - $ - $ - $ - $ - Gross profit - - - - - Net loss from operations (159) (158) - (3,037) (3,354) Basic and fully diluted earnings per share nil nil nil nil nil Weighted-average number of shares outstanding 145,640 145,640 145,640 145,640 145,640 F-11 ProHealth Medical Technologies, Inc. (formerly DCC Acquisition Corp.) Notes to Financial Statements - Continued Note F - Selected Financial Data (Unaudited) - Continued Quarter ended Quarter ended Quarter ended Quarter ended Year ended March 31 June 30 September 30 December 31 December 31 ------------- ------------- ------------- ------------- ----------- 1998 Net revenues $ - $ - $ - $ - $ - Gross profit - - - - - Net loss from operations - - - (1,582) (1,582) Basic and fully diluted earnings per share nil nil nil nil nil Weighted-average number of shares outstanding 145,640 145,640 145,640 145,640 145,640
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