0001012895-01-500137.txt : 20011019 0001012895-01-500137.hdr.sgml : 20011019 ACCESSION NUMBER: 0001012895-01-500137 CONFORMED SUBMISSION TYPE: 10KSB PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20010630 FILED AS OF DATE: 20011012 FILER: COMPANY DATA: COMPANY CONFORMED NAME: IMMUNOTECHNOLOGY CORP CENTRAL INDEX KEY: 0000789097 STANDARD INDUSTRIAL CLASSIFICATION: BLANK CHECKS [6770] IRS NUMBER: 841016435 STATE OF INCORPORATION: DE FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 10KSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-24641 FILM NUMBER: 1757751 BUSINESS ADDRESS: STREET 1: 1661 LAKEVIEW CIRCLE CITY: OGDEN STATE: UT ZIP: 84403 BUSINESS PHONE: 8013993632 FORMER COMPANY: FORMER CONFORMED NAME: IMMUNOTECHNOLOGY LABORATORIES INC DATE OF NAME CHANGE: 19900503 FORMER COMPANY: FORMER CONFORMED NAME: LJC CORP DATE OF NAME CHANGE: 19891025 10KSB 1 f01jun10k.txt IMMUNO 01JUN10KSB 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-KSB (Mark One) [x] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended June 30, 2001 ------------- [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED] For the transition period from ________ to __________ Commission File Number 0-24641 ------- IMMUNOTECHNOLOGY CORPORATION ---------------------------- (Exact name of registrant as specified in charter) Delaware 84-1016435 ------------------------------ ------------------------- State or other jurisdiction of (I.R.S. Employer I.D. No.) incorporation or organization 1661 Lakeview Circle, Ogden, Utah 84403 ------------------------------------------- ---------- (Address of principal executive offices) (Zip Code) Issuer's telephone number, including area code (801) 399-3632 --------------- Securities registered pursuant to section 12(b) of the Act: Title of each class Name of each exchange on which registered None N/A ------------------ ----------------------------------------- Securities registered pursuant to section 12(g) of the Act: Common Stock, par value $0.00001 -------------------------------- (Title of class) Check whether the Issuer (1) filed all reports required to be filed by section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. (1) Yes [X] No [ ] (2) Yes [X] No [ ] Check if disclosure of delinquent filers in response to Item 405 of Regulation S-B is not contained in this form, and no disclosure will be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-KSB or any amendment to this Form 10-KSB. [X] State issuer's revenues for its most recent fiscal year: $-0- 2 State the aggregate market value of the voting stock held by nonaffiliates computed by reference to the price at which the stock was sold, or the average bid and asked prices of such stock, as of a specified date within the past 60 days: Based on the average bid and asked prices of the common stock at September 21, 2001 of $.155 per share, the market value of shares held by nonaffiliates would be $201,102. As of September 21, 2001, the Company had 8,050,731 shares of common stock issued and outstanding. DOCUMENTS INCORPORATED BY REFERENCE List hereunder the following documents if incorporated by reference and the part of the form 10-KSB (e.g., part I, part II, etc.) into which the document is incorporated: (1) Any annual report to security holders; (2) Any proxy or other information statement; and (3) Any prospectus filed pursuant to rule 424(b) or (c) under the Securities Act of 1933: NONE 3 PART I. ITEM 1. DESCRIPTION OF BUSINESS Business in General ------------------- (a) Initial Business Activities --------------------------- The Company was incorporated on November 30, 1989, in the state of Delaware. The Company's predecessor was LJC Corporation, a Utah corporation, organized on November 8, 1984 ("LJC"). On October 7, 1989, LJC acquired ImmunoTechnology Laboratories, Inc., a Colorado corporation ("ITL"), by means of a stock-for-stock exchange with the shareholder of ITL. As a result of this transaction, ITL became a wholly owned subsidiary of LJC. On October 10, 1989, LJC changed its name to ImmunoTechnology Laboratories, Inc. ("ITL-UT"). At a special meeting of the shareholders of ITL-UT, the shareholders approved a proposal to redomicile ITL-UT in the state of Delaware, by forming a Delaware corporation and merging ITL-UT into the Delaware corporation, and changing the its name to ImmunoTechnology Corporation. The merger was effective on December 21, 1989. As a result of the merger, ITL-UT no longer exists. ITL was formed for the purpose of engaging in the business of operating a medical test related laboratory. The Company's only business has been the operation of ITL, whose operations were discontinued in 1992. (b) Current Business Activities ---------------------------- Since discontinuing the operations of ITL, the Company has been seeking potential business acquisition or opportunities to enter in an effort to commence business operations. The Company does not propose to restrict its search for a business opportunity to any particular industry or geographical area and may, therefore, engage in essentially any business in any industry. The Company has unrestricted discretion in seeking and participating in a business opportunity, subject to the availability of such opportunities, economic conditions, and other factors. The selection of a business opportunity in which to participate is complex and risky. Additionally, as the Company has only limited resources, it may be difficult to find good opportunities. There can be no assurance that the Company will be able to identify and acquire any business opportunity which will ultimately prove to be beneficial to the Company and its shareholders. The Company will select any potential business opportunity based on management's business judgment. The activities of the Company are subject to several significant risks which arise primarily as a result of the fact that the Company has no specific business and may acquire or participate in a business opportunity based on the decision of management which potentially could act without the consent, vote, or approval of the Company's shareholders. The risks faced by the Company are further increased as a result of its lack of resources and its inability to provide a prospective business opportunity with significant capital. 4 Competition ----------- Until such time as the Company completes an acquisition, the Company will be unable to evaluate the type and extent of its likely competition. The Company is aware that there are several other public companies with only nominal assets that are also searching for operating businesses and other business opportunities as potential acquisition or merger candidates. The Company is in direct competition with these other public companies in its search for business opportunities. Employees --------- As of the date hereof, the Company does not have any employees and has no plans for retaining employees until such time as the Company's business warrants the expense, or until the Company successfully acquires or merges with an operating business. The Company may find it necessary to periodically hire part-time clerical help on an as-needed basis. Facilities ---------- The Company is currently using as its principal place of business the personal residence of its President and Director located in Ogden, Utah. Although the Company has no written agreement and pays no rent for the use of this facility. ITEM 2. DESCRIPTION OF PROPERTIES See "Facilities" under Item 1. above. ITEM 3. LEGAL PROCEEDINGS None. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS No matters were submitted to a vote of shareholders of the Company during the fourth quarter of the fiscal year ended June 30, 2001. 5 PART II ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS The table on the following page sets forth, for the respective periods indicated, the prices for the Company's common stock in the over-the-counter market as reported by the NASD's OTC Bulletin Board. The bid prices represent inter-dealer quotations, without adjustments for retail mark-ups, mark-downs or commissions and may not necessarily represent actual transactions. High Bid Low Bid -------- ------- Fiscal Year Ended June 30, 1999 ------------------------------- First Quarter $ 0.50 $ 0.25 Second Quarter $ 0.50 $ 0.25 Third Quarter $ 0.50 $ 0.0325 Fourth Quarter $ 0.50 $ 0.0325 Fiscal Year Ended June 30, 2000 ------------------------------- First Quarter $ 0.25 $ 0.25 Second Quarter $ 0.25 $ 0.25 Third Quarter $ 0.375 $ 0.25 Fourth Quarter $ 0.5625 $ 0.375 Fiscal Year Ended June 30, 2001 ------------------------------- First Quarter $ 0.5625 $ 0.2969 Second Quarter $ 0.3438 $ 0.2812 Third Quarter $ 0.4062 $ 0.2812 Fourth Quarter $ 0.4062 $ 0.28 At September 21, 2001, the Company's Common Stock was quoted on the OTC Bulletin Board at a bid and asked price of $0.11 and $0.19, respectively. Since its inception, the Company has not paid any dividends on its Common Stock, and the Company does not anticipate that it will pay dividends in the foreseeable future. At June 30, 2001, the Company had approximately 48 shareholders of record based on information provided by the Company's transfer agent. 6 ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION Cautionary Statement Regarding Forward-looking Statements --------------------------------------------------------- This report may contain "forward-looking" statements. Examples of forward- looking statements include, but are not limited to: (a) projections of revenues, capital expenditures, growth, prospects, dividends, capital structure and other financial matters; (b) statements of plans and objectives of the Company or its management or Board of Directors; (c) statements of future economic performance; (d) statements of assumptions underlying other statements and statements about the Company and its business relating to the future; and (e) any statements using the words "anticipate," "expect," "may," "project," "intend" or similar expressions. Results of Operations --------------------- The Company is considered a development stage company with no assets or capital and with no operations or income since approximately 1992. The Company's costs and expenses associated with the preparation and filing of this filing and other operations of the Company have been paid for by shareholders of the Company, specifically Mark A. Scharmann and David Knudson (see Item 11. Security Ownership of Certain Beneficial Owners and Management). It is anticipated that the Company will require only nominal capital to maintain the corporate viability and necessary funds will most likely be provided by the Company's existing shareholders or its officers and directors in the immediate future until the completion of a proposed acquisition. In the opinion of management, inflation has not and will not have a material effect on the operations of the Company until such time as the Company successfully completes an acquisition or merger. At that time, management will evaluate the possible effects of inflation on the Company as it relates to its business and operations following a successful acquisition or merger. Plan of Operation ----------------- Because the Company lacks funds, it may be necessary for the officers and directors to either advance funds to the Company or to accrue expenses until such time as a successful business consolidation can be made (see Item 12. Certain Relationships and Related Transactions). Management intends to hold expenses to a minimum and to obtain services on a contingency basis when possible. The Company's directors may receive compensation for services provided to the Company until such time as an acquisition or merger can be accomplished. However, if the Company engages outside advisors or consultants, it may be necessary for the Company to attempt to raise additional funds. The Company has not made any arrangements or definitive agreements to use outside advisors or consultants or to raise any capital. In the event the Company does need to raise capital most likely the only method available to the Company would be the private sale of its securities. It is unlikely that it could make a public sale of securities or be able to borrow any significant sum from either a commercial or private lender. There can be no assurance that the Company will be able to obtain additional funding when and if needed, or that such funding, if available, can be obtained on terms acceptable to the Company. 7 The Company does not intend to use any employees, with the possible exception of part-time clerical assistance on an as-needed basis. Outside advisors or consultants will be used only if they can be obtained for minimal cost or on a deferred payment basis. Management is confident that it will be able to operate in this manner and to continue its search for business opportunities during the next twelve months. ITEM 7. FINANCIAL STATEMENTS The financial statements of the Company are set forth immediately following the signature page to this form 10-KSB. ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE The Company has had no disagreements with its certified public accountants with respect to accounting practices or procedures or financial disclosure. See ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K. PART III ITEM 9. DIRECTORS AND EXECUTIVE OFFICERS, PROMOTERS, AND CONTROL PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT The following table sets forth as of June 30, 2001, the name, age, and position of each executive officer and director and the term of office of each director of the Company. Name Age Position Director or Officer Since ---- --- -------- ------------------------- Mark A. Scharmann 43 President and Director February 1997 David Knudson 41 Secretary/Treasurer and Director February 1997 Dan O. Price 47 Director May 2001 The term of office of each director is one year and until his successor is elected at the Company's annual shareholders' meeting and is qualified, subject to removal by the shareholders. The term of office for each officer is for one year and until a successor is elected at the annual meeting of the board of directors and is qualified, subject to removal by the board of directors. Biographical Information ------------------------ Set forth below is certain biographical information with respect to each of the Company's officers and directors. Mark Scharmann is the principal shareholder of Troika Capital Investments, a business consulting company founded in 1981. He has rendered business consulting services to numerous private and public companies since then. He graduated from Weber State University, Ogden, Utah, in 1997, with a Bachelors of Integrated Studies emphasizing Business, Psychology and Health Promotion. Mr. Scharmann is also the President and a Director of Pacific Alliance Corporation (OTBCC:PALC). David Knudson has worked as a business consultant since 1985. From 1992 to 1995 he was employed as a computer information systems consultant at Weber State University, and an adjunct professor in the Information Systems & Technologies department from 1994 to 1996. He earned his BS Degree in Finance at Weber State College, Ogden, Utah, in 1984 and a BS Degree in Information Systems & Technologies at Weber State University in 1995. Mr. Knudson is also Secretary/Treasurer and Director of Nightingale, Inc., Secretary/Treasurer and Director of Pacific Alliance Corporation (OTCBB:PALC), and a Director of PPI Capital Group, Inc. (OTCBB:PPIM). 8 Dan O. Price has been a director of the Company since May 2001. From 1993 to 1998, Mr. Price served as vice president for corporate development of Troika Capital, Inc., Ogden, Utah, a financial consulting company. From October 1998 to October 2000, Mr. Price worked as an evaluator at Learning Technics, Kirkland, WA and Salt Lake City, UT. Since February 2001, Mr. Price has been working as an Enrollment Counselor for the University of Phoenix in Salt Lake City. Mr. Price is also Vice President and Director of Pacific Alliance Corporation (OTCBB:PALC), and a Director of PPI Capital Group, Inc. (OTCBB:PPIM). The term of office of each director is one year and until his successor is elected and qualified at the Company's annual meeting, subject to removal by the Shareholders. The term of office for each Officer is one year and until a successor is elected at the annual meeting of the Board of Directors and is qualified, subject to removal by the Board of Directors. The Company will reimburse Directors for their expenses associated with attending Directors' meetings. However, Directors have not, nor is it anticipated they will, receive any additional compensation for attending Directors' meetings. COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT ------------------------------------------------- The Company believes that under the SEC's rules for reporting of securities transactions by directors and executive officers, all required reports have been timely filed. ITEM 10. EXECUTIVE COMPENSATION The following tables set forth certain summary information concerning the compensation paid or accrued for each of the Company's last three completed fiscal years to the Company's chief executive officer and each of its other executive officers that received compensation in excess of $100,000 during such period (as determined at June 30, 2001, the end of the Company's last completed fiscal year):
Summary Compensation Table Long Term Compensation ---------------------- Annual Compensation Awards Payouts Other Restricted Name and Annual Stock Options LTIP All other Principal Position Year Salary Bonus($) Compensation Awards /SARs Payout Compensation ------------------ ---- ------ -------- ------------ ------ ------- ------ ------------ Mark Scharmann, 2001 $ -0- -0- -0- -0- -0- -0- -0- President 3/01 until present John A. Wise, Pres. 2001 $ -0- -0- -0- -0- -0- -0- -0- and Chairman 2000 -0- -0- -0- -0- -0- -0- -0- until 3/01 1999 -0- -0- -0- -0- -0- -0- -0-
Employment Agreements and Benefits: None. Compensation of Directors: None. Termination of Employment and Change of Control Arrangement: None. Options/SAR Grants in Last Fiscal Year: None. Bonuses and Deferred Compensation: None. Compensation Pursuant to Plans: None. Pension Table: Not Applicable. Other Compensation: None 9 ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT The following table sets forth as of September 21, 2001, the name and the number of shares of the Company's Common Stock, par value $0.00001 per share, held of record or beneficially by each person who held of record, or was known by the Company to own beneficially, more than 5% of the Company's 8,050,731 shares of Common Stock issued and outstanding, and the name and shareholdings of each director and of all officers and directors as a group. Title of Name and Address Amount and Nature of Percent Class Of Beneficial Owner Beneficial Ownership of Class -------- ------------------- --------------------- -------- Common Mark A. Scharmann 4,651,684 57.78 1661 Lakeview Circle Ogden, UT 84403 Common David Knudson 2,131,615 26.48 1661 Lakeview Circle Ogden, Utah 84403 Officers and Directors ---------------------- Common Mark A. Scharmann, President and Director -------See Above------- Common David Knudson, Secretary/ Treasurer and Director -------See Above------- Common Dan O. Price, Director - - All Officers, Directors, and Nominees as a Group (3 Persons) 6,783,299 84.26 =========== ===== -------------------------------- (1) Represents 4,514,834 shares held directly by Mr. Scharmann, 86,850 shares beneficially held of record by Troika Capital Investment, of which Mr. Scharmann is the principal owner and shareholder, and 50,000 shares held in Mr. Scharmann's IRA. ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS Mark A. Scharmann, an officer and director of the Company advanced money to the Company during the year ended June 30, 1999. The advances bear interest at a rate of 10% per annum and have no maturity date. At March 31, 1999, the Company converted its advances from the officer, notes payable to minority shareholders and related accrued interest totaling $116,448 into 3,726,331 shares of common stock or $0.03125 per share. On April 2, 1999, the Company loaned Mr. Scharmann $10,000. The advance is evidenced by a demand note and bears interest at the rate of 10% per annum. At June 30, 1999, the advance to the officer had been reduced to $3,696, which balance was paid in August 1999. 10 On June 21, 2000, the Company's board of directors approved the issuance of 1,115,673 shares of the Company's common stock to David Knudson, the Secretary/Treasurer of the Company, in exchange for the conversion of $34,864.78 in principal and accrued interest pursuant to the terms of a Promissory Note between the Company and Mr. Knudson. Prior to the conversion of the Promissory Note, the Company had 4,884,327 shares of its common stock issued and outstanding. After giving effect to the issuance of the conversion shares to Mr. Knudson, the Company had 6,000,000 shares of common stock issued and outstanding. The shares issued to Mr. Knudson constitute restricted securities issued pursuant to section 4(2) of the Securities Act of 1933, as amended. David Knudson, an officer and director of the Company, through his consulting firm Twelve O Eight, has provided bookkeeping and other services to the Company, for which it has been paid fees totaling $15,924 and $16,027 during the years ended June 30, 2001 and 2000, respectively. On August 22, 2001, our board of directors approved the issuance of an aggregate of 2,050,731 shares of our common stock to Mark A. Scharmann, our President and David Knudson, our Secretary/Treasurer. Mr. Scharmann was issued 1,036,789 shares in exchange for the conversion of $32,399.67 in principle and accrued interest under a demand note. Mr. Knudson was issued 1,013,942 shares in exchange for the conversion of $31,685.79 in principle and accrued interest under a demand note. Prior to the conversion of the demand note we had 6,000,000 shares of its common stock issued and outstanding. After giving effect to the issuance of the conversion shares to Messrs. Scharmann and Knudson, we have 8,050,731 shares of common stock issued and outstanding. The shares issued in the foregoing transaction constitute restricted securities issued pursuant to section 4(2) of the Securities Act of 1933, as amended. ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K (a)(1)FINANCIAL STATEMENTS. The following financial statements are included in this report: Title of Document Page ----------------- ---- Independent Auditors' Report of Rose, Snyder & Jacobs 12 Balance Sheet as of June 30, 2001 13 Statements of Operations for the years ended June 30, 2001 and 2000 and from inception of the development stage, July 1, 1992 through June 30, 2001 14 Statements of Stockholders' Equity for the years ended June 30, 2001 and 2000 15 Statements of Cash Flows for the years ended June 30, 2001 and 2000 and from inception of the development stage, July 1, 1992 through June 30, 2001 16 Notes to Financial Statements 17 (a)(2)FINANCIAL STATEMENT SCHEDULES. The following financial statement schedules are included as part of this report: None. (a)(3)EXHIBITS. The following exhibits are included as part of this report: None. (b) Reports on Form 8-K. No reports on Form 8-K were filed during the quarter ended June 30, 2001. 11 SIGNATURES Pursuant to the requirements of 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 dates indicated: IMMUNOTECHNOLOGY CORPORATION Date: October 11, 2001 By /S/ Mark A. Scharmann, President and Director Date: October 11, 2001 By /S/ David Knudson Secretary/Treasurer and Director Date: October 11, 2001 By /S/Dan O. Price, Director 12 INDEPENDENT AUDITORS' REPORT To the Stockholders of ImmunoTechnology Corporation We have audited the accompanying balance sheet of ImmunoTechnology Corporation (a Delaware Corporation in the Development Stage), as of June 30, 2001, and the related statements of operations, stockholders' deficit, and cash flows for the years ended June 30, 2001 and 2000 and the period from inception of the development stage (July 1, 1992) through June 30, 2001. These financial statements are the responsibility of the Corporation's management. Our responsibility is to express an opinion on these 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 audits 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 ImmunoTechnology Corporation (a Development Stage Company) as of June 30, 2001, and the results of its operations and its cash flows for the years ended June 30, 2001 and 2000 and the period from the inception of the development stage (July 1, 1992) through June 30, 2001, in conformity with accounting principles generally accepted in the United States of America. The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company does not generate revenue and has a net capital deficiency that raise substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. Rose, Snyder & Jacobs A Corporation of Certified Public Accountants Encino, California September 27, 2001 13 IMMUNOTECHNOLOGY CORPORATION (A DEVELOPMENT STAGE COMPANY) BALANCE SHEET JUNE 30, 2001 ASSETS CURRENT ASSETS Cash $ - ----------- TOTAL ASSETS $ - =========== LIABILITIES AND STOCKHOLDERS' DEFICIT CURRENT LIABILITIES Bank overdraft $ 2,596 Accrued expenses 37,012 Loan from officers, note 3 55,857 ----------- TOTAL CURRENT LIABILITIES 95,465 ----------- STOCKHOLDERS' DEFICIT Preferred stock, par value $.00001 per share Authorized - 5,000,000 shares Issued - none Common stock, par value $.00001 per share Authorized - 50,000,000 shares Outstanding - 6,000,000 11,628 Paid in capital 274,016 Accumulated deficit prior to the development stage (151,332) Accumulated deficit during the development stage (229,777) ----------- TOTAL STOCKHOLDERS' DEFICIT (95,465) ----------- TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT $ - =========== See independent auditors' report and notes to financial statements. 14 IMMUNOTECHNOLOGY CORPORATION (A DEVELOPMENT STAGE COMPANY) STATEMENTS OF OPERATIONS FOR THE YEARS ENDED JUNE 30, 2001 AND 2000 From inception of the development stage, July 1, 1992 through 2001 2000 June 30, 2001 ------------ ------------ --------------- REVENUE $ - $ - $ - COST OF REVENUE - - - ------------ ------------ --------------- GROSS PROFIT - - - OPERATING EXPENSES Professional fees 48,825 23,124 146,282 Taxes and licenses 50 105 1,637 Bank fees and service charges 565 375 2,659 Meals and entertainment - - 300 Travel 12,347 20,199 58,964 Office expense 530 319 8,300 Interest expense, net 2,685 1,386 11,635 ------------ ------------ --------------- TOTAL OPERATING EXPENSES $ 65,002 $ 45,508 $ 229,777 ------------ ------------ --------------- NET LOSS $ (65,002) $ (45,508) $ (229,777) ============ ============ =============== BASIC AND DILUTED LOSS PER COMMON SHARE $ (.01) $ (.01) ============ ============ WEIGHTED AVERAGE NUMBER OF COMMON SHARES 6,000,000 4,914,893 ============ ============ See independent auditors' report and notes to financial statements. 15 IMMUNOTECHNOLOGY CORPORATION (A DEVELOPMENT STAGE COMPANY) STATEMENTS OF STOCKHOLDERS' DEFICIT FOR THE YEARS ENDED JUNE 30, 2001 AND 2000
Accumulated Common Additional Deficit Prior Accumulated Stock Paid-in to Deficit After Par Value Capital July 1, 1992 July 1, 1992 Total ------------ ------------ ------------ ------------ ------------ Balance at July 1, 1992 $ 11,580 $ 122,752 $ (151,332) $ - $ (17,000) Issuance of common stock upon conversion of debt, note 4 37 116,411 - - 116,448 Activity July 1, 1992 through June 30, 1999 - - - (119,267) (119,267) ------------ ------------ ------------ ------------ ------------ Balance at June 30, 1999 11,617 239,163 (151,332) (119,267) (19,819) Issuance of common stock upon conversion of debt, note 4 11 34,853 - - 34,864 Net loss - - - (45,508) (45,508) ------------ ------------ ------------ ------------ ------------ Balance at June 30, 2000 11,628 274,016 (151,332) (164,775) (30,463) Net loss - - - (65,002) (65,002) ------------ ------------ ------------ ------------ ------------ Balance at June 30, 2001 $ 11,628 $ 274,016 $ (151,332) $ (229,777) $ (95,465) ============ ============ ============ ============ ============
See independent auditors' report and notes to financial statements. 16 IMMUNOTECHNOLOGY CORPORATION (A DEVELOPMENT STAGE COMPANY) STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED JUNE 30, 2001 AND 2000 From Inception of the Development Stage, July 1 1992 through 2001 2000 June 30, 2001 ----------- ----------- ----------- CASH FLOWS FROM OPERATING ACTIVITIES: Net loss $ (65,002) $ (45,508) (229,777) Adjustment to reconcile net loss to net cash used in operating activities Increase (decrease) in accrued expenses 15,479 (1,692) 28,000 ----------- ----------- ----------- NET CASH USED IN OPERATING ACTIVITIES (49,523) (47,200) (201,777) ----------- ----------- ----------- CASH FLOWS FROM INVESTING ACTIVITIES Advance to an officer - - (10,000) Repayment of advance to an officer - 3,696 10,000 ----------- ----------- ----------- NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES - 3,696 - ----------- ----------- ----------- CASH FLOWS FROM FINANCING ACTIVITIES: Bank overdraft 2,596 - 2,596 Advances from officer 46,853 42,587 191,681 Proceeds from notes payable - - 7,500 ----------- ----------- ----------- NET CASH PROVIDED BY FINANCING ACTIVITIES 49,449 42,587 201,777 ----------- ----------- ----------- NET INCREASE (DECREASE) IN CASH (74) (917) - CASH AT BEGINNING OF YEAR 74 991 - ----------- ----------- ----------- CASH AT END OF YEAR $ - $ 74 $ - =========== =========== =========== Supplementary disclosures: Interest paid in cash $ - $ 76 $ 1,736 =========== =========== =========== See independent auditors' report and notes to financial statements. 17 IMMUNOTECHNOLOGY CORPORATION (A DEVELOPMENT STAGE COMPANY) NOTES TO FINANCIAL STATEMENTS JUNE 30, 2001 1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Organization and Going Concern ------------------------------ ImmunoTechnology Corporation was incorporated on November 30, 1989 under the laws of the State of Delaware. ImmunoTechnology Corporation operated a medical test laboratory until 1992, when it ceased operations. Presently, the Company has no operations. The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As shown in the financial statements during the year ended June 30, 2001, the Company did not generate any revenue, and has a net capital deficiency. These factors among others may indicate that the Company will be unable to continue as a going concern for a reasonable period of time. For the year ended June 30, 2001, the Company funded its disbursements by loans from officers. The financial statements do not include any adjustments relating to the recoverability of assets and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. The Company is no longer operating, and will attempt to locate a new business (operating company), and offer itself as a merger vehicle for a company that may desire to go public through a merger rather than through its own public stock offering. Cash Flows ---------- Cash consists of balances in a demand account at a bank. Estimates --------- The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results may differ from those estimates. Fair Value of Financial Instruments ----------------------------------- The carrying amount of the Company's advances approximate fair value. 2. INCOME TAXES The Company has loss carryforwards available to offset future taxable income. The loss carryforwards at June 30, 2001 total approximately $335,000 and expire between June 30, 2004 and June 30, 2015. Loss carryforwards are limited in accordance with the rules of change in ownership. A valuation allowance for 100% of deferred tax benefits has been recorded due to the uncertainty of realizing these potential future benefits. See independent auditors' report. 18 IMMUNOTECHNOLOGY CORPORATION (A DEVELOPMENT STAGE COMPANY) NOTES TO FINANCIAL STATEMENTS JUNE 30, 2001 3. RELATED PARTY TRANSACTIONS An officer of the Company advanced money to the Company during the year ending June 30, 1999. All advances bear interest at a rate of 10%. At March 31, 1999, the advances and related accrued interest were converted into shares of common stock (see Note 4). On April 2, 1999, the Company loaned an officer of the Company $10,000. This advance was interest bearing at a rate of 10%. The officer repaid the advance by August 1999. During the year ended June 30, 2000, another officer of the Company advanced $42,587 to the Company. At June 21, 2000, $34,865 of these advances were converted into shares of common stock (see Note 4). The balance of this advance at June 30, 2000 was $9,004. During the year ended June 30, 2001, the two officers above advanced money to the Company a total of $46,853. All advances bear interest at a rate of 10%. An officer of the Company is a principal in a consulting firm to which the Company paid professional fees totaling $15,924 and $16,027 during the years ended June 30, 2001 and 2000, respectively. Additional fees in the amount of $12,174 had not yet been paid at June 30, 2001 and were included in accrued expenses. 4. COMMON STOCK On March 31, 1999, the Company converted its advances from the officer, notes payable to minority shareholders and related accrued interest totaling $116,448 into 3,726,331 shares of common stock at $0.03125 per share. On June 21, 2000, the Company converted its advances from another officer and related accrued interest totaling $34,865 into 1,115,673 shares of common stock or $0.03125 per share. 5. COMMITMENTS AND CONTINGENCIES The Company accrued $17,000 for legal services performed prior to the development stage. Should this balance accrue interest, the liability could increase by approximately $18,000. 6. SUBSEQUENT EVENT In August 2001, the Company converted $64,085 of loans from officers and accrued interest into 2,050,731 shares of common stock. This represents 32 shares for every dollar of indebtedness. See independent auditors' report.