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UNITED STATES ý
ANNUAL REPORT PURSUANT TO SECTION 13
OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December
31, 2009 ¨
TRANSITION REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from
to Commission file number: 0-19041 AMERICAN
BIOGENETIC SCIENCES, INC. Registrant's
Telephone Number, Including Area Code: (212) 400-7198 Securities
Registered Pursuant to Section 12(g) of The Act: Common Stock, $0.001 Indicate by check
mark whether the registrant (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 ¨ On December 31,
2009, the aggregate market value of the 65,000 common stock held by non-affiliates of the
registrant was approximately $657,499 based on the asked price of the Registrants common
stock on December 31, 2009. On December 31, 2009, the Registrant had 217,747,909
shares of common stock outstanding. Indicate by check
mark whether the registrant is a large accelerated filer, an accelerated filer, a
non-accelerated filer (as
defined in Rule 12b-2 of the Exchange Act) or a smaller
reporting company . Indicate by check mark whether the registrant is a shell
company (as defined in Rule 12b-2 of the Exchange Act). Yes x No ¨ Page PART I ITEM
1. ITEM
2. ITEM
3. ITEM
4. ITEM
5. ITEM
7. ITEM
8. ITEM
9. ITEM
9A.
PART III ITEM 10. ITEM 11. ITEM 12. ITEM 13. ITEM 14. ITEM 15. Cautionary Statement regarding Forward-Looking
Statements This Annual Report on Form 10-K
includes forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. The Registrant has based these forward-looking statements on its current
expectations and projections about future events. These forward-looking statements are
subject to known and unknown risks, uncertainties and assumptions about the Registrant
that may cause its actual results, levels of activity, performance or achievements to be
materially different from any future results, levels of activity, performance or
achievements expressed or implied by such forward-looking statements. In some cases, you
can identify forward-looking statements by terminology such as "may,"
"will," "should," "could," "would,"
"expect," "plan," "anticipate," "believe,"
"estimate," "continue," or the negative of such terms or other similar
expressions. Factors that might cause or contribute to such a discrepancy include, but are
not limited to, those described in this Annual Report on Form 10-K and in the Registrant's
other Securities and Exchange Commission filings. PART I ITEM 1. DESCRIPTION OF BUSINESS Back to
Table of Contents Introduction American
Biogenetic Sciences, Inc., a Delaware corporation, is sometimes referred to herein as
"we", "us", "our", "Company" and the
"Registrant". The Registrant was formed in 1983 for the purpose of
researching, developing and marketing cardiovascular and neurobiology products for
commercial development and distributing vaccines. The Registrant's products were designed
for in vitro and in vivo diagnostic procedures and therapeutic drugs, and its products had
been identified for use in the treatment of epilepsy, migraine and mania,
neurodegenerative diseases, coronary artery diseases and cancer. The Registrant
commenced selling its products during the last quarter of 1997 but did not generate any
sufficient revenues from operations to fund its operating expenses. On September 19, 2002, the Registrant filed a petition
under the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the Eastern District of
New York. On November 4, 2005, the Bankruptcy Court approved an order authorizing a change
in control and provided that the Company, subsequent to the bankruptcy proceeding, is free
and clear of all liens, claims and other obligations. Change in Control following Bankruptcy The material terms of the transaction
confirmed by the Bankruptcy Court authorized Park Avenue Group to appoint new members to
the Registrant's board of directors and management, and to change the Registrant's
articles of incorporation with respect to the capital stock of the Company. On November 8,
2005, Park Avenue Group appointed Richard Rubin to the board of directors of the Registrant, which then
appointed Mr. Rubin to be chief executive officer and chief financial officer of the
Registrant At present, Mr. Rubin is the Company's sole officer and director
("Management"). On November 29, 2005, the Registrant's
board of directors approved an amendment to the Registrant's articles of incorporation to
increase the number of authorized shares of capital stock to 910,000,000 shares,
consisting of 900,000,000 shares of common stock, par value $0.0001, and 10,000,000 shares
of preferred stock, par value $0.0001. Business
Objectives of the Registrant As
a result of the bankruptcy proceeding, the Registrant has no present operations.
Management determined to direct its efforts and limited resources to pursue and effect a
business combination. Current
trends Management believes that as
a result of the relative uncertainty in the United States equity markets over the past
years, many privately-held companies have been closed off from the public market and
traditional IPOs. During the past few years, many privately-held as well as public
companies attempted to divest non-core assets and divisions and valuations of these assets
and divisions have often decreased significantly. Therefore, Management believes that
there are substantial business opportunities to effect attractive acquisitions. As a
public entity with its shares of common stock registered under the Exchange Act and
publicly trading, Management believes to be well positioned to identify target
acquisitions and to effect a business combination in order to take advantage of these
current trends. Effecting a business combination Prospective purchasers of
the Registrant's common stock will invest in the Company without an opportunity to
evaluate the specific merits or risks of any one or more business combinations. A business
combination may involve the acquisition of, or merger with, a company which needs to raise
substantial additional capital by means of being a publicly traded company, while avoiding
what it may deem to be the adverse consequences of undertaking an initial public offering
itself. These include time delays, significant expense, loss of voting control and
compliance with various Federal and state securities laws. A potential business
combination may involve a company which may be financially unstable or in its early stages
of development or growth. The
Registrant has not identified a target business or target industry The Registrant's effort in
identifying a prospective target business will not be limited to a particular industry and
the Company may ultimately acquire a business in any industry Management deems
appropriate. To date, the Registrant has not selected any target business or industry on
which to concentrate its search for a business combination. While the Registrant intends
to focus on target businesses in the United States, we are not limited to those entities
and may consummate a business combination with a target business outside of the United
States. Accordingly, there is no basis for investors in the Registrant's common stock to
evaluate the possible merits or risks of the target business or the particular industry in
which we may ultimately operate. To the extent we effect a business combination with a
financially unstable company or an entity in its early stage of development or growth,
including entities without established records of sales or earnings, we may be affected by
numerous risks inherent in the business and operations of financially unstable and early
stage or potential emerging growth companies. In addition, to the extent that we effect a
business combination with an entity in an industry characterized by a high level of risk,
we may be affected by the currently unascertainable risks of that industry. An extremely
high level of risk frequently characterizes many industries which experience rapid growth.
In addition, although the Company's Management will endeavor to evaluate the risks
inherent in a particular industry or target business, we cannot assure you that we will
properly ascertain or assess all significant risk factors. Sources
of target businesses The Registrant anticipates
that target business candidates will be brought to our attention from various sources,
including broker-dealers, investment bankers, venture capitalists, bankers and other
members of the financial community who may present solicited or unsolicited proposals.
While we do not presently anticipate engaging the services of professional firms that
specialize in business acquisitions on any formal basis, we may engage these firms in the
future, in which event we may pay a finder's fee or other compensation. In no event,
however, will we pay Management any finder's fee or other compensation for services
rendered to us prior to or in connection with the consummation of a business combination. Selection
of a target business and structuring of a business combination Management has voting
control of 69.80% and
will have virtually unrestricted flexibility in identifying and selecting a prospective
target business. In evaluating a prospective target business, our Management will
consider, among other factors, the following: - financial condition and
results of operation of the target company; These criteria are not
intended to be exhaustive. Any evaluation relating to the merits of a particular business
combination will be based, to the extent relevant, on the above factors as well as other
considerations deemed relevant by our Management in effecting a business combination
consistent with our business objective. In evaluating a prospective target business, we
will conduct a due diligence review which may encompass, among other things, meetings with
incumbent management and inspection of facilities, as well as review of financial and
other information which will be made available to us. The time and costs required
to select and evaluate a target business and to structure and complete the business
combination cannot presently be ascertained with any degree of certainty. Any costs
incurred with respect to the identification and evaluation of a prospective target
business with which a business combination is not ultimately completed will result in a
loss to us. Probable
lack of business diversification We may seek to effect
business combinations with more than one target business, it is probable that we will have
the ability to effect only a single business combination. Accordingly, the prospects for
our success may be entirely dependent upon the future performance of a single business.
Unlike other entities which may have the resources to complete several business
combinations with entities operating in multiple industries or multiple areas of a single
industry, it is probable that we will not have the resources to diversify our operations
or benefit from the possible spreading of risks or offsetting of losses. By consummating a
business combination with only a single entity, our lack of diversification may: - subject us to numerous
economic, competitive and regulatory developments, any or all of which may have a
substantial adverse impact upon the particular industry in which we may operate subsequent
to a business combination; and Limited
ability to evaluate the target business' management Although we intend to
closely scrutinize the management of a prospective target business when evaluating the
desirability of effecting a business combination, we cannot assure you that our assessment
of the target business' management will prove to be correct. In addition, we cannot assure
you that the future management will have the necessary skills, qualifications or abilities
to manage a public company intending to embark on a program of business development.
Furthermore, the future role of our directors, if any, in the target business cannot
presently be stated with any certainty. While it is possible that our sole director will
remain associated in some capacity with us following a business combination, it is
unlikely that he will devote their full efforts to our affairs subsequent to a business
combination. Moreover, we cannot assure you that our director will have significant
experience or knowledge relating to the operations of the particular target business. Following a business
combination, we may seek to recruit additional managers to supplement the incumbent
management of the target business. We cannot assure you that we will have the ability to
recruit additional managers, or that additional managers will have the requisite skills,
knowledge or experience necessary to enhance the incumbent management. Competition In identifying, evaluating
and selecting a target business, we expect to encounter intense competition from other
entities having a business objective similar to ours. Many of these entities are well
established and have extensive experience identifying and effecting business combinations
directly or through affiliates. Many of these competitors possess greater technical, human
and other resources than the Registrant and our financial resources will be relatively
limited when contrasted with those of many of these competitors. While we believe there
are numerous potential target businesses that may be interested in effecting a business
combination with a current, reporting public company, Management believes that we may have
only very limited ability to compete in acquiring certain sizable target businesses
because of our limited available financial resources. This inherent competitive limitation
gives others an advantage in pursuing the acquisition of a target business. Further, any
of these obligations may place us at a competitive disadvantage in successfully
negotiating a business combination. Our management believes, however, that our status as a
public entity and potential access to the United States public equity markets may give us
a competitive advantage over privately-held entities having a similar business objective
as us in acquiring a target business with significant growth potential on favorable terms.
If we succeed in effecting a
business combination, there will be, in all likelihood, intense competition from
competitors of the target business. In particular, certain industries which experience
rapid growth frequently attract an increasingly larger number of competitors, including
competitors with increasingly greater financial, marketing, technical and other resources
than the initial competitors in the industry. The degree of competition characterizing the
industry of any prospective target business cannot presently be ascertained. We cannot
assure you that, subsequent to a business combination, we will have the resources to
compete effectively, especially to the extent that the target business is in a high-growth
industry. Employees Richard Rubin, is our chief
executive officer and chief financial officer. Mr. Rubin is not obligated to contribute
any specific number of hours per week and intend to devote only as much time as he deems
necessary to the Company's affairs. The amount of time he will devote in any time period
will vary based on the availability of suitable target businesses to investigate. We do
not intend to have any full time employees prior to the consummation of a business
combination. Conflicts of Interest The Company's Management is not required
to commit its full time to the Company's affairs. As a result, pursuing new business
opportunities may require a greater period of time than if Management would devote his
full time to the Company's affairs. Management is not precluded from serving as officer or
director of any other entity that is engaged in business activities similar to those of
the Registrant. In the future, Management may become associated or affiliated with
entities engaged in business activities similar to those we intend to conduct. In such
event, Management may have conflicts of interest in determining to which entity a
particular business opportunity should be presented. In the event that the Company's
Management has multiple business affiliations, it may have legal obligations to present
certain business opportunities to multiple entities. In the event that a conflict of
interest shall arise, Management will consider factors such as reporting status,
availability of audited financial statements, current capitalization and the laws of the
jurisdictions of the target entities. If several business opportunities or operating
entities approach Management with respect to a business combination, Management will
consider the foregoing factors as well as the preferences of the incumbent management of
the operating company. However, Management will act in what it believes will be in the
best interests of the shareholders of the Registrant. The Registrant shall not enter into
a transaction with a target business that is affiliated with Management. Periodic Reporting and Audited Financial Statements We have registered our securities under the Securities Exchange Act of
1934 and have reporting obligations, including the requirement that we file annual and
quarterly reports with the SEC. In accordance with the requirements of the Exchange Act,
our annual reports will contain financial statements audited and reported on by our
independent public accountants. We will not acquire a target business if audited financial statements
cannot be obtained for the target business. Our Management believes that the requirement
of having available audited financial statements for the target business will limit the
pool of potential target businesses available for acquisition. ITEM 1A. RISK FACTORS RELATED TO OUR
BUSINESS The Company, since emergence from
bankruptcy, has very limited operations and resources. Since the Company emerged from bankruptcy, its
operations have been limited to seeking a potential business combinations and has no
revenues from operations. Our investors will have no basis upon which to evaluate the
Company's ability to achieve the Company's business objective, which is to effect a merger
or business combination with an operating business. The Company will not generate any
revenues until, at the earliest, after the consummation of a business combination. Since the Company has not currently selected
a particular target industry or target business with which to complete a business
combination, the Company is unable to currently ascertain the merits or risks of the
business' operations. Since the Company has not yet identified a particular
industry or prospective target business, there is no basis for investors to evaluate the
possible merits or risks of the particular industry in which the Company may ultimately
operate or the target business which the Company may ultimately acquire. To the extent the
Company completes a business combination with a financially unstable company or an entity
in its development stage, the Company may be affected by numerous risks inherent in the
business operations of those entities. Although the Company's Management will endeavor to
evaluate the risks inherent in a particular industry or target business, the Company
cannot assure you that it will properly ascertain or assess all of the significant risk
factors. There can be no assurance that any prospective business
combination will benefit shareholders or prove to be more favorable to shareholders than
any other investment that may be made by shareholders and investors. Unspecified and
unascertainable risks. There is no basis for shareholders to
evaluate the possible merits or risks of potential business combination or the particular
industry in which the Company may ultimately operate. To the extent that the Company
effects a business combination with a financially unstable operating company or an entity
that is in its early stage of development or growth, including entities without
established records of revenues or income, the Company will become subject to numerous
risks inherent in the business and operations of that financially unstable company. In
addition, to the extent that the Company effects a business combination with an entity in
an industry characterized by a high degree of risk, the Company will become subject to the
currently unascertainable risks of that industry. An extremely high level of risk
frequently characterizes certain industries that experience rapid growth. Although
Management will endeavor to evaluate the risks inherent in a particular business or
industry, there can be no assurance that Management will properly ascertain or assess all
such risks or that subsequent events may not alter the risks that the Company perceived at
the time of the consummation of a business combination. The Company may issue shares of the
Company's common stock and preferred stock to complete a business combination, which would
reduce the equity interest of the Company's stockholders and likely cause a change in
control of the Company's ownership. The Company's certificate of incorporation authorizes
the issuance of up to 900,000,000 shares of common stock, par value $0.0001 per share, and
10,000,000 shares of preferred stock, par value $0.0001 per share. The Company currently
has 682,252,091 authorized but unissued shares of the Company's common stock available for
issuance and all of the 10,000,000 shares of preferred stock available for issuance.
Although the Company currently has no commitments to issue any securities, the Company
will, in all likelihood, issue a substantial number of additional shares of its common
stock or preferred stock, or a combination of common and preferred stock, in connection
with a business combination. To the extent that additional shares of common and/or
preferred stock are issued, the Company's shareholders would experience dilution of their
respective ownership interests in the Company. The issuance of additional shares of common
stock and/or convertible preferred stock may adversely affect the market price of the
Company's common stock, in the event that an active trading market commences, of which
there can be no assurance. The issuance of additional shares of the Company's common stock
or any number of shares of the Company's preferred stock: - may significantly reduce the equity interest of
current stockholders; Similarly, if the Company issues debt securities, it
could result in: It is likely that the Company's current
officer and director will resign upon consummation of a business combination and the
Company will have only limited ability to evaluate the management of the target business. The Company's ability to successfully effect a business
combination will be dependent upon the efforts of the Company's Management. The future
role of the Company's key personnel in the target business, however, cannot presently be
ascertained. Although it is possible that Management will remain associated in some
capacity with the target business following a business combination, it is likely that the
management of the target business at the time of the business combination will remain in
place. Although the Company intends to closely scrutinize the management of a prospective
target business in connection with evaluating the desirability of effecting a business
combination, the Company cannot assure you that the Company's assessment of management
will prove to be correct. Dependence on key personnel The Company is dependent upon the
continued services of its officer and director. To the extent that his services become
unavailable, the Company will be required to obtain other qualified personnel and there
can be no assurance that it will be able to recruit and hire qualified persons at
acceptable terms. The Company's officer and director may
allocate his time to other businesses thereby causing conflicts of interest in his
determination as to how much time to devote to the Company's affairs. This could have a
negative impact on the Company's ability to consummate a business combination. The Company's officer and director is not required to
commit his full time to the Company's affairs, which may result in a conflict of interest
in allocating his time between the Company's plan of operations and other businesses. The
Company does not intend to have any full time employees prior to the consummation of a
business combination. Management of the Company is engaged in several other business
endeavors and is not obligated to contribute any specific number of his hours per week to
the Company's affairs. If Management's other business affairs require him to devote more
substantial amounts of time to such affairs, it could limit his ability to devote time to
the Company's affairs and could have a negative impact on the Company's ability to
consummate a business combination. The Company's officer and director is now,
and may in the future become, affiliated with entities engaged in business activities
similar to those intended to be conducted by the Company and, accordingly, may have
conflicts of interest in determining which entity a particular business opportunity should
be presented to. The Company's officer and director is now, and may in
the future become, affiliated with entities, including other companies engaged in business
activities similar to those intended to be conducted by this Company. Additionally, the
Company's officer and director may become aware of business opportunities which may be
appropriate for presentation to this Company as well as the other entities with which he
is or may be affiliated. Additionally, due to the existing affiliations of the Company's
officer and director with other entities, he may have a fiduciary obligation to present
potential business opportunities to those entities in addition to presenting them to us
which could cause additional conflicts of interest. Accordingly, Management may have
conflicts of interest in determining to which entity a particular business opportunity
should be presented. It is probable that the Company will only be
able to enter into one business combination, which will cause us to be solely dependent on
such single business and a limited number of products, processes or services. It is probable that the Company will enter into a
business combination with a single operating business. Accordingly, the prospects for the
Company's success may be: - solely dependent upon the performance of a single
operating business; or In this case, the Company will not be able to diversify
the Company's operations or benefit from the possible spreading of risks or offsetting of
losses, unlike other entities which may have the resources to complete several business
combinations in different industries or different areas of a single industry. The Company has limited resources and there
is significant competition for business combination opportunities. Therefore, the Company
may not be able to enter into or consummate an attractive business combination. The Company expects to encounter intense competition
from other entities having a business objective similar to the Company's, including
venture capital funds, leveraged buyout funds and operating businesses competing for
acquisitions. Many of these entities are well established and have extensive experience in
identifying and effecting business combinations directly or through affiliates. Many of
these competitors possess far greater technical, human and other resources than does the
Company and the Company's financial resources are very limited when contrasted with those
of many of these competitors. While the Company believes that there are numerous potential
target businesses that it could acquire, the Company's ability to compete in acquiring
certain sizable target businesses will be limited by the Company's limited financial
resources and the fact that the Company will use its common stock to acquire an operating
business. This inherent competitive limitation gives others an advantage in pursuing the
acquisition of far more target businesses than the Company. The Company may be unable to obtain
additional financing, if required, to complete a business combination or to fund the
operations and growth of the target business, which could compel the Company to
restructure a potential business transaction or abandon a particular business combination. The Company has not yet identified any prospective
target business. If we require funds because of the size of the business combination, we
will be required to seek additional financing. We cannot assure you that such financing
would be available on acceptable terms, if at all. To the extent that additional financing
proves to be unavailable when needed to consummate a particular business combination, we
would be compelled to restructure the transaction or abandon that particular business
combination and seek an alternative target business candidate. In addition, if we
consummate a business combination, we may require additional financing to fund the
operations or growth of the target business. The failure to secure additional financing
could have a material adverse effect on the continued development or growth of the target
business. None of the Company's officers, directors or stockholders is required to provide
any financing to us in connection with or after a business combination. Additional financing
requirements associated with compliance with reporting requirements under the Exchange
Act. The Company has no revenues and is
dependent upon the willingness of the Company's Management to fund the costs associated
with the reporting obligations under the Exchange Act, other administrative costs
associated with the Company's corporate existence and expenses related to the Company's
business objective. The Company may not generate any revenues until the consummation of a
business combination. The Company anticipates that it will have available sufficient
financial resources to continue to pay accounting and other professional fees and other
miscellaneous expenses that may be required until the Company commence business operations
in connection with a business combination. In the event that the Company's available
financial resources from its Management prove to be insufficient for the purpose of
achieving its business objective through a business combination, the company will be
required to seek additional financing. The Company's failure to secure additional
financing could have a material adverse affect on the Company's ability to pursue a
business combination. The Company does not have any arrangements with any bank or
financial institution to secure additional financing and there can be no assurance that
any such arrangement would be available on terms acceptable and in the Company's best
interests. The Company does not have any written agreement with Management to provide
funds for the Company's operating expenses. The Company's officer and director owns 69.80% of issued shares or common
stock, a controlling interest in the Company, and thus may influence certain actions
requiring stockholder vote. It is unlikely that there will be an annual meeting of
stockholders to elect new directors prior to the consummation of a business combination,
in which case all of the current director will continue in office at least until the
consummation of the business combination. If there is an annual meeting, as a consequence
of the controlling interest of the Company's management has broad discretion regarding
proposals submitted to a vote by shareholders. Accordingly, the Company's existing
director will continue to exert substantial control at least until the consummation of a
business combination. Broad discretion of Management Any person who invests in the Company's common stock
will do so without an opportunity to evaluate the specific merits or risks of any
prospective business combination. As a result, investors will be entirely dependent on the
broad discretion and judgment of Management in connection with the selection of a
prospective business combination. There can be no assurance that determinations made by
the Company's Management will permit us to achieve the Company's business objectives. Reporting
requirements may delay or preclude a business combination Pursuant to
the requirements of Section 13 of the Exchange Act, the Company is required to provide
certain information about significant acquisitions and other material events. The Company
will continue to be required to file quarterly reports on Form 10-Q and annual reports on
Form 10-K, which annual report must contain the Company's audited financial statements. As
a reporting company under the Exchange Act, following any business combination, we will be
required to file a report on Form 8-K, which report contains audited financial statements
of the acquired entity. These audited financial statements must be filed with the SEC
within 5 days following the the transaction. While obtaining audited financial statements
is typically the responsibility of the acquired company, it is possible that a potential
target company may be a non-reporting company with unaudited financial statements. The
time and costs that may be incurred by some potential target companies to prepare such
audited financial statements may significantly delay or may even preclude consummation of
an otherwise desirable business combination. Acquisition prospects that do not have or are
unable to obtain the required audited statements may not be appropriate for acquisition
because we are subject to the reporting requirements of the Exchange Act. The Company's shares of common stock are
quoted on the Pinksheets, which limits the liquidity and price of the Company's common
stock. The Company's shares of common stock are traded on the
Pinksheets. Quotation of the Company's securities on the Pinksheets limits the liquidity
and price of the Company's common stock more than if the Company's shares of common stock
were listed on The NASDAQ Stock Market or a national exchange. There
is currently no active trading market in the Company's common stock. There can be no
assurance that there will be an active trading market for the Company's common stock
following a business combination. In the event that an active trading market commences,
there can be no assurance as to the market price of the Company's shares of common stock,
whether any trading market will provide liquidity to investors, or whether any trading
market will be sustained. If the Company is deemed to be an investment
company, the Company may be required to institute burdensome compliance requirements and
the Company's activities may be restricted, which may make it difficult for the Company to
enter into a business combination. If we are deemed to be an investment company under the
Investment Company Act of 1940, our activities may be restricted, including: - restrictions on the nature of the Company's
investments; and In addition, we may have imposed upon us burdensome
requirements, including: The Company does not believe that its anticipated
activities will subject it to the Investment Company Act of 1940. The Company may be deemed to have no
"Independent Directors", actions taken and expenses incurred by our officer and
director on behalf of the Company will generally not be subject to "Independent
Review". Our sole officer and director owns 69.80% of our issued shares of
common stock and has accrued compensation for services rendered prior to or in connection
with a business combination. He also may be reimbursement for out-of-pocket expenses
incurred by him in connection with activities on the Company's behalf such as identifying
potential target businesses and performing due diligence on suitable business
combinations. There is no limit on the amount of these out-of-pocket expenses and there
will be no review of the reasonableness of the expenses by anyone other than our board of
directors, which consists of one person. Our sole director will not be deemed
"independent," he will generally not have the benefit of independent directors
examining the propriety of expenses incurred on our behalf and the sums subject to
reimbursement. Although the Company believes that all actions taken by our director on the
Company's behalf will be in the Company's best interests, the Company cannot assure our
shareholders or investors that this will actually be the case. If actions are taken, or
expenses are incurred that are actually not in the Company's best interests, it could have
a material adverse effect on our business and plan of operations and adversely effect the
price of our stock held by the public stockholders. State blue sky
registration; potential limitations on resale of the Company's common stock The holders of the Company's
shares of common stock registered under the Exchange Act and those persons who desire to
purchase them in any trading market that may develop in the future, should be aware that
there may be state blue-sky law restrictions upon the ability of investors to resell the
Company's securities. Accordingly, investors should consider the secondary market for the
Registrant's securities to be a limited one. It is the
intention of the Registrant's Management following the consummation of a business
combination to seek coverage and publication of information regarding the Registrant in an
accepted publication manual which permits a manual exemption. The manual exemption permits
a security to be distributed in a particular state without being registered if the
Registrant issuing the security has a listing for that security in a securities manual
recognized by the state. However, it is not enough for the security to be listed in a
recognized manual. The listing entry must contain (1) the names of issuers, officers, and
directors, (2) an issuer's balance sheet, and (3) a profit and loss statement for either
the fiscal year preceding the balance sheet or for the most recent fiscal year of
operations. Furthermore, the manual exemption is a nonissuer exemption restricted to
secondary trading transactions, making it unavailable for issuers selling newly issued
securities. Most of the accepted manuals
are those published by Standard and Poor's, Moody's Investor Service, Fitch's Investment
Service, and Best's Insurance Reports, and many states expressly recognize these manuals.
A smaller number of states declare that they "recognize securities manuals" but
do not specify the recognized manuals. The following states do not have any provisions and
therefore do not expressly recognize the manual exemption: Alabama, Georgia, Illinois,
Kentucky, Louisiana, Montana, South Dakota, Tennessee, Vermont and Wisconsin. Dividends
unlikely The Company does not expect
to pay dividends for the foreseeable future because it has no revenues and no cash. The
payment of dividends will be contingent upon the Company's future revenues and earnings,
if any, capital requirements and overall financial conditions. The payment of any future
dividends will be within the discretion of the Company's board of directors as then
constituted. It is the Company's expectation that future management following a business
combination will determine to retain any earnings for use in its business operations and
accordingly, the Company does not anticipate declaring any dividends in the foreseeable
future. Our common
stock is subject to the Penny Stock Rules of the SEC and the trading market in our
common stock is limited, which makes transactions in our common stock cumbersome and may
reduce the value of an investment in our common stock The Company's common stock
is considered a Penny Stock, as defined in the Exchange Act and the rules thereunder,
unless and until the price of the Company's shares of common stock is at least $5.00. The
Company's share price presently is, and prior to any business combination, the share price
is expected to be less than $5.00. Unless the Company's common stock is otherwise excluded
from the definition of Penny Stock, the Penny Stock rules apply. The Penny Stock rules
require a Broker-Dealer prior to a transaction in a Penny Stock not otherwise exempt from
the rules, to deliver a standardized risk disclosure document prepared by the SEC that
provides information about the Penny Stock and the nature and level of risks in the Penny
Stock market. The Broker-Dealer also must provide the customer with current bid and offer
quotations for the Penny Stock, the compensation of the Broker-Dealer and its sales person
in the transaction, and monthly account statements showing the market value of each Penny
Stock held in the customer's account. In addition, the Penny Stock rules require that the
Broker-Dealer, not otherwise exempt from such rules, must make a special written
determination that the Penny Stock is suitable for the purchaser and receive the
purchaser's written agreement prior to the transaction. These disclosure rules have the
effect of reducing the level of trading activity in the secondary market for a stock that
is subject to the Penny Stock rules. So long as the common stock is subject to the Penny
Stock rules, it may become more difficult to sell such securities. Such requirements could
result in reduction in the level of trading activity for the Company's common stock and
could make it more difficult for investors to sell the Company's common stock. General Economic
Risks The Company's current and
future business plans are dependent, in large part, on the state of the general economy.
Adverse changes in economic conditions may adversely affect the Company's plan of
operation and business objective. These conditions and other factors beyond the Company's
control include, but are not limited to regulatory changes. ITEM 2.
DESCRIPTION OF PROPERTIES Back to Table of Contents The Registrant's corporate office
is located at 40 Wall Street, 28th Floor, New York, NY 10005. These facilities consist of approximately 300 square feet of executive
office space. The Registrant believes that the office facilities are sufficient for the
foreseeable future and this arrangement will remain in effect until we will consummate a
business combination. ITEM 3. LEGAL PROCEEDING Back to
Table of Contents ITEM
4. SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS None. PART II ITEM 5.
MARKET FOR REGISTRANT'S COMMON STOCK AND RELATED STOCKHOLDER MATTER Back to
Table of Contents (a) Market Price Information Year Ended
December 31, 2009 Quarter ended December 31, Quarter ended September
30, Quarter ended June 30, Quarter ended March 31, Year Ended
December 31, 2008 Quarter ended December 31, Quarter ended June 30, Quarter ended March 31, Quarter ended December 31, (b) Approximate Number of Holders of Common Stock (c) Dividends (d) Recent Sales of
Unregistered Securities On January 28, 2008, the Registrant issued 1,000,000
shares to a private investor in consideration of $500. (e) Equity Compensation Plans ITEM 6. SELECTED FINANCIAL DATA N/A. ITEM
7. MANAGEMENT'S DISCUSSION AND ANALYSIS AND PLAN OF OPERATION Back to
Table of Contents Overview The Company emerged
from bankruptcy in November 2005. It discontinued its former business operations as a
result of of filing for bankruptcy September 19, 2002. The
Company's current business objective is to seek a business combination with an operating
company. We intend to use the Company's limited personnel and financial resources in
connection with such activities. The Company will utilize its capital stock, debt
or a combination of capital stock and debt, in effecting a business combination. It may be expected that entering into a business combination will involve
the issuance of restricted shares of capital stock. The issuance of additional
shares of our capital stock: - may significantly reduce the equity
interest of our current stockholders; Similarly, if we issued debt securities, it
could result in: Liquidity and Capital
Resources Since emerging from bankruptcy,
the Registrant has neither engaged in any operations nor generated any revenues. While we are dependent upon interim funding provided by Management to pay
professional fees and expenses, we have no written finance agreement with Management to
provide any continued funding. However, we may need to raise additional funds
through a private offering of debt or equity securities if additional administrative funds
are required to consummate a business combination that is presented to us. We have no agreements to issue any debt or equity securities and cannot
predict whether equity or debt financing will become available at terms acceptable to us,
if at all. There are no limitations in the
Company's articles of incorporation on the Company's ability to borrow funds or raise
funds through the issuance of restricted common stock to effect a business combination.
The Company's limited resources and lack of having cash-generating business operations may
make it difficult to borrow funds or raise capital. The Company's inability to borrow
funds or raise funds through the issuance of restricted capital stock required to effect
or facilitate a business combination may have a material adverse effect on the Company's
financial condition and future prospects, including the ability to complete a business
combination. To the extent that debt financing ultimately proves to be available, any
borrowing will subject us to various risks traditionally associated with indebtedness,
including the risks of interest rate fluctuations and insufficiency of any future cash
flow to pay principal and interest, including debt of an acquired business. Off-Balance Sheet
Arrangements As of December 31,
2009, we did not have any off-balance sheet arrangements as defined in
Item 303(a)(4)(ii) of Regulation S-K promulgated under the Securities Exchange Act of
1934. Contractual
Obligations and Commitments As of December 31,
2009 we did not have any contractual obligations. Critical Accounting
Policies Our significant
accounting policies are described in the note to our financial statements included
elsewhere in this annual report. ITEM
8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA Back to
Table of Contents The Registrant's audited financial statements for the
fiscal years ended December 31, 2009 and 2008 are attached to this annual report. Financial Statements for
the Fiscal Year ended December 31, 2009 and 2008 ITEM
9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE Back to Table of Contents None. ITEM 9A. CONTROLS AND PROCEDURES Evaluation of Disclosure Controls and Procedures Evaluation of disclosure controls and procedures. As of December 31, 2009, the
Company's chief executive officer/chief financial officer conducted an evaluation
regarding the effectiveness of the Company's disclosure controls and procedures (as
defined in Rules 13a-15(e) or 15d-15(e) under the Exchange Act. Based upon the
evaluation of these controls and procedures, our chief executive officer/chief financial
officer concluded that our disclosure controls and procedures were effective as of the end
of the fiscal year 2009. Managements Annual Report on Internal Control Over Financial Reporting Management is responsible for establishing and maintaining adequate internal control
over financial reporting and for the assessment of the effectiveness of those internal
controls. As defined by the SEC, internal control over financial reporting is a process
designed by our principal executive officer/principal financial officer, who is also
the sole member of our Board of Directors, to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of the financial statements in
accordance with U.S. generally accepted accounting principles. Because of its inherent limitations, internal control over financial reporting may not
prevent or detect misstatements. Also, projections of any evaluation of effectiveness to
future periods are subject to the risk that controls may become inadequate because of
changes in conditions, or that the degree of compliance with the policies or procedures
may deteriorate. Management has assessed the effectiveness of our internal control over financial
reporting as of December 31, 2009. In making this assessment, management used the criteria
set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO)
in Internal Control-Integrated Framework. Based on our assessment and those criteria, we
have concluded that our internal control over financial reporting was effective as of
December 31, 2009. This annual report does not include an attestation report of the companys
registered public accounting firm regarding internal control over financial reporting.
Managements report was not subject to attestation by the Companys registered
public accounting firm pursuant to temporary rules of the Securities and Exchange
Commission that permit the Company to provide only Managements report in this annual
report. Changes in Internal Control Over Financial Reporting There were no changes in our internal control over financial reporting or in other
factors identified in connection with the evaluation required by paragraph (d) of Exchange
Act Rules 13a-15 or 15d-15 that occurred during the fourth quarter ended December 31, 2009
that have materially affected, or are reasonably likely to materially affect, our internal
control over financial reporting. ITEM 9B. OTHER INFORMATION Back to
Table of Contents None. PART III ITEM
10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT AND CORPORATE GOVERNANCE Back to
Table of Contents Richard Rubin, 66, is CEO, CFO and Chairman of the
Registrant. During the last five years, Mr. Rubin has been engaged in the business of
providing corporate securities consulting services. In February 2002, Mr. Rubin
became a director of Nettel Holdings, a reporting company and resigned as director in May
2003 upon the consummation of a merger with an operating company. Mr. Rubin served as a
director of Jeantex Group, a reporting company from August 2002 to September 2003 and
resigned upon the consummation of a merger with an operating company. Mr. Rubin presently
serves as CEO, CFO and sole director of Peregrine Industries, Inc., a public company
reporting under the Exchange Act. ITEM 11.
EXECUTIVE COMPENSATION Back to Table of Contents Summary Compensation Table Long
Term Annual
Compensation Compensation
Awards Salary Bonus Year ($) ($) ($) ($) ($) ($) The Company has no employment agreement with Richard
Rubin, its CEO and CFO. ITEM
12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
SHAREHOLDER MATTERS Back to Table of Contents The table below discloses
any person (including any "group") who is known to the Registrant to be the
beneficial owner of more than five (5%) percent of the Registrant's voting securities. As
of December 31, 2009, the Registrant had 217,749,909 shares of common stock issued and
outstanding. Title of
Class Name and
Address of Beneficial Owner Amount
and Nature of Beneficial Owner Percent
of Class(1) Common
Stock ITEM 13. CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE Back to
Table of Contents During
the last two fiscal years, to the knowledge of the Registrant, there was no person who had
or has a direct or indirect material interest in any transaction or proposed transaction
to which the Registrant was or is a party. ITEM 14. PRINCIPAL ACCOUNTING FEES
AND SERVICES Back to Table of Contents Independent Public
Accountants Principal Accounting Fees Audit fees (1) Audit-related fees (2) Tax fees (3) All other fees Section
16(a) Compliance ITEM
15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES Back to Table of Contents (a) The following documents are filed as exhibits to
this report on Form 10-K or incorporated by reference herein. Any document incorporated by
reference is identified by a parenthetical reference to the SEC filing that included such
document. SIGNATURES Pursuant to the
requirements of the Securities Exchange Act of 1934, this report has been signed below by
the following persons on behalf of the registrant and in the capacities and on the date
indicated. Financial
Statements Back to Table of Contents REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM Back to Table of Contents Michael F. Cronin To the Board of Directors and Stockholders I have audited the accompanying balance sheet of American Biogenetic Sciences, Inc. as
of December 31, 2009 and 2008 and the related statements of operations, stockholders
deficiency and cash flows for the years then ended. These financial statements are the
responsibility of the Companys management. My responsibility is to express an
opinion on these financial statements based on my audit. I conducted my audits in accordance with the standards of the Public Company Accounting
Oversight Board (United States). Those standards require that I plan and perform
the audits to obtain reasonable assurance about whether the financial statements are free
of material misstatement. The company is not required to have, nor was I engaged to
perform, an audit of its internal control over financial reporting. My audit included
consideration of internal control over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Company's internal control over
financial reporting. Accordingly, I express no such opinion. 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. I believe that my audits provide a reasonable basis for my opinion In my opinion, the financial statements referred to above present fairly, in all
material respects, the financial position of American Biogenetic Sciences, Inc. as of
December 31, 2009 and 2008 and the results of its operations, changes in
stockholders deficiency and its cash flows for
the years then ended in conformity with accounting principles generally accepted in the
United States of America. April 13, 2010 /s/ Michael F. Cronin NY, FL Financial Statements for the fiscal years 2009
and 2008 ASSETS LIABILITIES
AND STOCKHOLDERS' DEFICIENCY
Common Stock Accumulated Shares Amount Capital Deficit The Company American Biogenetic Sciences, Inc. (the "Company",
We or "ABS") was incorporated in Delaware on September 1, 1983.
Prior to filing for bankruptcy under chapter 7, the Company engaged in the research,
development and production of bio-pharmaceutical products. Bankruptcy Proceedings: On September 19, 2002, the
Registrant filed a voluntary Chapter 7 petition under the U.S. Bankruptcy Code in the U.S.
Bankruptcy Court Eastern District of New York (case no. 02-86689). As a result of the
filing, all of our assets. Properties and liabilities were transferred to a United States
Trustee and we terminated all of our business operations. The Bankruptcy Trustee has
disposed of all substantially of the Companys assets. On November 4, 2005, the
Bankruptcy Court approved an Order confirming the sale of debtor's interest in personal
property to Park Avenue Group, Inc. Basis of Presentation: We adopted "fresh-start"
accounting as of September 20, 2002 in accordance with procedures specified by AICPA
Statement of Position ("SOP") No. 90-7, "Financial Reporting by Entities in
Reorganization under the Bankruptcy Code. The results of the discontinued component have
been reclassified from continuing operations. Significant Accounting Policies Use of Estimates The preparation of financial statements in
conformity with generally accepted accounting principles requires management to make
estimates and assumptions that affect reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial statement and
the reported amounts of revenues and expenses during the reporting period. Actual results
could differ from the estimates. Cash and Cash Equivalents: For financial statement presentation
purposes, the Company considers those short-term, highly liquid investments with original
maturities of three months or less to be cash or cash equivalents. Property and Equipment New property and equipment are recorded
at cost. Property and equipment included in the bankruptcy proceedings and transferred to
the Trustee had been valued at liquidation value. Depreciation is computed using the
straight-line method over the estimated useful lives of the assets, generally 5 years.
Expenditures for renewals and betterments are capitalized. Expenditures for minor items,
repairs and maintenance are charged to operations as incurred. Gain or loss upon sale or
retirement due to obsolescence is reflected in the operating results in the period the
event takes place. Valuation of Long-Lived Assets: We review the recoverability of
our long-lived assets including equipment, goodwill and other intangible assets, when
events or changes in circumstances occur that indicate that the carrying value of the
asset may not be recoverable. The assessment of possible impairment is based on our
ability to recover the carrying value of the asset from the expected future pre-tax cash
flows (undiscounted and without interest charges) of the related operations. If these cash
flows are less than the carrying value of such asset, an impairment loss is recognized for
the difference between estimated fair value and carrying value. Our primary measure of
fair value is based on discounted cash flows. The measurement of impairment requires
management to make estimates of these cash flows related to long-lived assets, as well as
other fair value determinations. Stock Based Compensation: Stock-based awards are accounted for
using the fair value method in accordance with SFAS No. 123R, Accounting for
Stock-Based Compensation, and EITF Issue No. 96-18, Accounting for Equity
Instruments that are Issued to Other Than Employees for Acquiring, or in Conjunction with
Selling Goods or Services. Our primary type of share-based compensation consists of
stock options. We use the Black-Scholes option pricing model in valuing options. The
inputs for the valuation analysis of the options include the market value of the
Companys common stock, the estimated volatility of the Companys common stock,
the exercise price of the warrants and the risk free interest rate. Fair Value of Financial Instruments: Statements of Financial
Accounting Standards No. 107, "Disclosures about Fair Value of Financial
Instruments," requires disclosure of fair value information about financial
instruments. Fair value estimates discussed herein are based upon certain market
assumptions and pertinent information available to management as of April 14, 2010. The
respective carrying value of certain on-balance sheet financial instruments approximated
their fair values. These financial instruments include cash and cash equivalents, accounts
payable and accrued expenses. Fair values were assumed to approximate carrying values for
these financial instruments since they are short-term in nature and their carrying amounts
approximate fair values or they are receivable or payable on demand. Earnings per Common Share: Basic net loss per share is computed
using the weighted average number of common shares outstanding during the period. Diluted
net loss per common share is computed using the weighted average number of common and
dilutive equivalent shares outstanding during the period. Dilutive common equivalent
shares consist of options to purchase common stock (only if those options are exercisable
and at prices below the average share price for the period) and shares issueable upon the
conversion of our Preferred Stock. Due to the net losses reported, dilutive common
equivalent shares were excluded from the computation of diluted loss per share, as
inclusion would be anti-dilutive for the periods presented. There were no common equivalent shares required to be added to the basic
weighted average shares outstanding to arrive at diluted weighted average shares
outstanding in 2009 or 2008. Income Taxes: We must make certain estimates and judgments in
determining income tax expense for financial statement purposes. These estimates and
judgments occur in the calculation of certain tax assets and liabilities, which arise from
differences in the timing of recognition of revenue and expense for tax and financial
statement purposes. Deferred income taxes are recorded in accordance with SFAS No. 109,
Accounting for Income Taxes, or SFAS 109. Under SFAS No. 109, deferred
tax assets and liabilities are determined based on the differences between financial
reporting and the tax basis of assets and liabilities using the tax rates and laws in
effect when the differences are expected to reverse. SFAS 109 provides for the recognition
of deferred tax assets if realization of such assets is more likely than not to occur.
Realization of our net deferred tax assets is dependent upon our generating sufficient
taxable income in future years in appropriate tax jurisdictions to realize benefit from
the reversal of temporary differences and from net operating loss, or NOL, carry forwards.
We have determined it more likely than not that these timing differences will not
materialize and have provided a valuation allowance against substantially all of our net
deferred tax asset. Management will continue to evaluate the realizability of the deferred
tax asset and its related valuation allowance. If our assessment of the deferred tax
assets or the corresponding valuation allowance were to change, we would record the
related adjustment to income during the period in which we make the determination. Our tax
rate may also vary based on our results and the mix of income or loss in domestic and
foreign tax jurisdictions in which we operate. In addition, the calculation of our tax liabilities involves dealing
with uncertainties in the application of complex tax regulations. We recognize liabilities
for anticipated tax audit issues in the U.S. and other tax jurisdictions based on our
estimate of whether, and to the extent to which, additional taxes will be due. If we
ultimately determine that payment of these amounts is unnecessary, we will reverse the
liability and recognize a tax benefit during the period in which we determine that the
liability is no longer necessary. We will record an additional charge in our provision for
taxes in the period in which we determine that the recorded tax liability is less than we
expect the ultimate assessment to be. Uncertain Tax Positions The Financial Accounting Standards Board issued Interpretation No. 48,
Accounting for Uncertainty in Income Taxes an interpretation of FASB
Statement No. 109, Accounting for Income Taxes (FIN No. 48) which was
effective for the Company on January 1, 2007. FIN No. 48 addresses the
determination of whether tax benefits claimed or expected to be claimed on a tax return
should be recorded in the financial statements. Under FIN No. 48, the Company
may recognize the tax benefit from an uncertain tax position only if it is more likely
than not that the tax position will be sustained on examination by the taxing authorities
based on the technical merits of the position. The tax benefits recognized in
the financial statements from such position should be measured based on the largest
benefit that has a greater than fifty percent likelihood of being realized upon ultimate
settlement. FIN No. 48 also provides guidance on derecognition, classification,
interest and penalties, accounting in interim periods and disclosure requirements. Our federal and state income tax returns are open for fiscal years
ending on or after December 31, 2006. We are not under examination by any jurisdiction for
any tax year. At December 31, 2009 we had no material unrecognized tax benefits and
no adjustments to liabilities or operations were required under FIN 48. Recent Accounting Pronouncements In June 2009, the FASB issued SFAS No. 168, The FASB Accounting
Standards CodificationTM and the Hierarchy of Generally Accepted Accounting
Principles (SFAS 168). SFAS 168 establishes the FASB Accounting Standards
CodificationTM (the Codification) as the single source of
authoritative U.S. GAAP recognized by the FASB to be applied by nongovernmental entities.
Rules and interpretive releases of the SEC under authority of federal securities laws are
also sources of authoritative U.S. GAAP for SEC registrants. When effective, the
Codification will supersede all existing non-SEC accounting and reporting standards. All
other non-grandfathered non-SEC accounting literature not included in the Codification
will become non-authoritative. Following SFAS 168, the FASB will not issue new standards
in the form of Statements, FASB Staff Positions, or Emerging Issues Task Force Abstracts.
Instead, the FASB will issue Accounting Standards Updates, which will serve only to: (a)
update the Codification; (b) provide background information about the guidance; and (c)
provide the bases for conclusions on the change(s) in the Codification. SFAS 168 and the
Codification are effective for financial statements issued for interim and annual periods
ending after September 15, 2009. The Company has evaluated this new statement and has
determined that it will not have a significant impact on the determination or reporting of
its financial results. In May 2009, the FASB issued SFAS No. 165, Subsequent Events
("SFAS 165"). SFAS 165 establishes guidance related to accounting for
and disclosure of events that happen after the date of the balance sheet but before the
release of the financial statements. SFAS 165 is effective for reporting periods
ending after June 15, 2009. The Company adopted SFAS 165 on January 1,
2010. SFAS 165 affects disclosures only Management does not anticipate that the
adoption of these standards will have a material impact on the financial statements. AMERICAN BIOGENETIC SCIENCES, INC. 1. Fresh Start Accounting: On September 19, 2002 all of the Companys assets were transferred
to the chapter 7 trustee in settlement of all outstanding corporate obligations. We
adopted "fresh-start" accounting as of September 20, 2002 in accordance with
procedures specified by AICPA Statement of Position ("SOP") No. 90-7,
"Financial Reporting by Entities in Reorganization under the Bankruptcy Code." All results for periods subsequent to September 19, 2002 are referred to
as those of the "Successor Company". The results of operations and cash flows as
presented on the 2002 financial statements reflect the predecessor company. The successor
company had no transactions between September 19 and the end of the reporting period,
December 31, 2002. In accordance with SOP No. 90-7, the reorganized value of the Company
was allocated to the Company's assets based on procedures specified by SFAS No. 141,
"Business Combinations". Each liability existing at the plan sale date, other
than deferred taxes, was stated at the present value of the amounts to be paid at
appropriate market rates. It was determined that the Company's reorganization value
computed immediately before September 20, 2002 was $0. We adopted "fresh-start"
accounting because holders of existing voting shares immediately before filing and
confirmation of the sale received less than 50% of the voting shares of the emerging
entity and its reorganization value is less than its post-petition liabilities and allowed
claims. 2. Bankruptcy Proceedings On September 19, 2002, the Registrant filed a voluntary
Chapter 7 petition under the U.S. Bankruptcy Code in the U.S. Bankruptcy Court Eastern
District of New York (case no. 02-86689). On November 4, 2005, the Bankruptcy Court
approved an Order confirming the sale of debtor's interest in personal property to Park
Avenue Group Inc. The material terms of the transaction confirmed by Bankruptcy Court
authorized Park Avenue Group to appoint new members to the Registrant's board of directors
and authorized the newly-appointed board of directors to amend the Article of
Incorporation with respect to the capital stock of the corporation. The accounts of the former subsidiaries were not
included in the sale and have not been carried forward. Resultant Change in Control: In connection with the
Order confirming the sale of debtor's interest in certain intangible personal property to
Park Avenue Group Inc. approved by the U.S. Bankruptcy Court Eastern District of New York
on November 4, 2006, the Court authorized a change in control pursuant to which Richard
Rubin became our sole director on November 29, 2006, and was appointed CEO by the new
board of directors on November 29, 2006. The Court order further provided that the sale
was free and clear of liens, claims and interests of others and that the sale was free and
clear of any and all other real or personal property interests, including any interests in
ABSs subsidiaries.. 3. Income Taxes: Our net operating loss carryovers available to reduce future income
taxes were reduced or eliminated through our bankruptcy proceedings. We have adopted SFAS
109 which provides for the recognition of a deferred tax asset based upon the value the
loss carry-forwards will have to reduce future income taxes and management's estimate of
the probability of the realization of these tax benefits. We have a current operating loss carry-forward of $25,000 resulting in
deferred tax assets of $8,000. We have determined it more likely than not that these
timing differences will not materialize and have provided a valuation allowance against
substantially all our net deferred tax asset. Utilization of federal and state NOL and tax credit carry forwards may
be subject to a substantial annual limitation due to the ownership change limitations
provided by the Internal Revenue Code of 1986, as amended and similar state provisions.
The annual limitation may result in the expiration of NOL and tax credit carry forwards
before full utilization. 4. Commitments: The Company, prior to its bankruptcy, was a party to numerous claims and
threatened litigation. As a result of the bankruptcy and the subsequent transfer by the
Bankruptcy Trustee of the Companys corporate shell entity free of all liens, claims
and encumbrances pursuant to Section 363(f) of the US Bankruptcy Code, the Company is no
longer party to any litigation. The Company is not a party to any leases and does not have any
commitments 5. Convertible Long-Term Debt: In 2009, we issued a convertible promissory note in the amount of
$76,000 to our President. The note bear interests at 12% per annum until paid or
converted. Interest is payable upon the maturity date (December 31, 2010). The initial
conversion rate is $0.001 per share (subject to standard anti-dilution provisions).
The note formalized a like amount due through the accretion of cash advances and the fair
value of services provided without cost covering several years. The convertible debt securities were issued with a non-detachable
conversion feature. We evaluate and account for such securities in accordance with EITF
Issue Nos. 98-5, 00-19, 00-27, 05-02, 05-04 and 05-08, and SFAS No. 133,
Accounting for Derivative Instruments and Hedging Activities as amended. In accordance SFAS No. 133, we evaluate that the holders
conversion right provision, interest rate adjustment provision, liquidated damages clause,
cash premium option (if applicable), and the redemption option (collectively, the debt
features) contained in the terms governing the Note to determine whether they are or are
not clearly and closely related to the characteristics of the Note. Accordingly, if
the features qualify as embedded derivative instruments at issuance and, furthermore if
they do or do not qualify for any scope exception within SFAS No. 133 (paragraphs
12-32), then they are required by SFAS No. 133 to be accounted for separately from
the debt instrument and recorded as derivative financial instruments. The values ascribed to the note, the conversion feature of the note,
other potential embedded derivative features, and common stock follow the guidance of EITF
Issue No. 00-19, Accounting for Derivative Financial Instruments Indexed to, and
Potentially Settled in, a Companys Own Stock ; SFAS No. 150, Accounting
for Certain Financial Instruments with Characteristics of both Liabilities and Equity
; and EITF Issue No. 00-27, Application of Issue No. 98-5 to Certain Convertible
Instruments . The Company evaluated the embedded conversion feature and determined its
effect based on EITF Issue No. 00-19. In accordance with EITF Issue No. 00-19, a
transaction which includes a potential for net-cash settlement, including liquidated
damages, requires that derivative financial instruments, including warrants and the
embedded conversion feature, be bifurcated, and initially recorded at fair value as an
asset or liability and subsequent changes in fair value be reflected in the statement of
operations. In accordance with the FASB Emerging Issues Task Force
(EITF) Issue No. 98-5 Accounting for Convertible Securities with
Beneficial Conversion Features or Contingently Adjustable Conversion Ratios and EITF
Issue No. 00-27 Application of Issue No. 98-5 to Certain Convertible
Instruments, we determined that the convertible notes did not contains an embedded
beneficial conversion feature. The effective conversion price exceeded the stock price on
the valuation date. 6. Stockholders' Equity: Common Stock On January 29, 2008 we issued 1,000,000 shares to a private investor for
$500 in cash. Preferred Stock On November 29, 2005 and pursuant to authority granted to it by the
bankruptcy court, the Board cancelled and extinguished all issued and outstanding
preferred stock. All related dividends obligations were also extinguished (the elimination
of this preferred stock has been reflected in the 2002 financial statements), and
authorized 10,000,000 new shares of preferred stock, $0.0001 par value that may be issued
in one or more series. The Board of Directors of the Corporation is authorized to fix the
powers, preferences, rights, qualifications, limitations or restrictions of the preferred
stock and any series thereof pursuant to Section 151 of the Delaware General Corporation
Law. Stock Based Compensation On November 29, 2005 and pursuant to authority granted to it by the
bankruptcy court, the Board cancelled and extinguished all issued and outstanding common
stock options and warrants. There are no employee or non-employee options or warrants outstanding or
exercisable. 7. Related Party Transactions not Disclosed Elsewhere: Fair value of services: The principal stockholder provided, without
cost to the Company, his services and office space. The total of these expenses was
$36,000 for 2009 and 2008, respectively, and was reflected in the statement of operations
as general and administrative expenses. Due Related Parties: Amounts due related parties consist of
corporate regulatory compliance expenses paid directly by and cash advances received by
affiliates. These paid items totaled $4,657 for 2009 and $2,040 for 2008.
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
___________________
FORM 10-K
________________________________
(Exact Name Of Registrant
As Specified In Its Charter)
Delaware
11-2655906
(State of Incorporation)
(I.R.S. Employer
Identification No.)
40
Wall Street, 28th Floor, New York, NY
10005
(Address of Principal
Executive Offices)
(ZIP Code)
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K is not contained herein, and will not be contained, to the best of the
registrant's knowledge, in the definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this Form 10-K. ¨
Large accelerated
filer ¨
Accelerated filer ¨
Non-Accelerated
filer ¨
Smaller reporting
company x
Item
Description
3
ITEM 1A.
RISK
FACTORSA RELATED TO OUR BUSINESS
ITEM 1B.
UNRESOLVED STAFF
COMMENTS
11
11
11
12
ITEM 6.
SELECTED FINANCIAL
DATA
12
13
13
13
ITEM 9B.
OTHER
INFORMATION
14
15
15
15
16
16
16
- - growth potential;
- - experience and skill of management and availability of additional personnel;
- - capital requirements;
- - competitive position;
- - stage of development of the products, processes or services;
- - degree of current or potential market acceptance of the products, processes or services;
- - proprietary features and degree of intellectual property or other protection of the
products, processes or services;
- - regulatory environment of the industry; and
- - costs associated with effecting the business combination.
- - result in our dependency upon the development or market acceptance of a single or
limited number of products, processes or services.
- - will likely cause a change in control if a substantial number of the Company's shares of
common stock are issued and most likely also result in the resignation of the Company's
present officer and director; and
- - may adversely affect prevailing market price for the Company's common stock.
- - default and foreclosure on the Company's assets if the Company's operating revenues
after a business combination were insufficient to pay the Company's debt obligations;
- - acceleration of the Company's obligations to repay the indebtedness even if the Company
has made all principal and interest payments when due if the debt security contains
covenants that require the maintenance of certain financial ratios or reserves and any
such covenant is breached without a waiver or renegotiation of that covenant;
- - the Company's immediate payment of all principal and accrued interest, if any, if the
debt security is payable on demand; and
- - the Company's inability to obtain additional financing, if necessary, if the debt
security contains covenants restricting the Company's ability to obtain additional
financing while such security is outstanding.
- - dependent upon the development or market acceptance of a single or limited number of
products, processes or services.
- - restrictions on the issuance of securities, which may make it difficult for us to
complete a business combination.
- - registration as an investment company;
- - adoption of a specific form of corporate structure; and
- - reporting, record keeping, voting, proxy and disclosure requirements and other rules and
regulations.
The Registrant's common stock
is subject to quotation on the NASDAQ BB under the symbol MABAA. The following table shows
the high and low bid prices for the Registrant's common stock during the fiscal years 2009
and 2008 as reported by the National Quotation Bureau Incorporated. These prices reflect
inter-dealer quotations without adjustments for retail markup, markdown or commission, and
do not necessarily represent actual transactions.
High
Low
$
0.003
$
0.001
0.006
0.001
0.006
0.001
0.01
0.001
$
0.01
$
0.001
0.001
0.001
0.001
0.001
0.001
0.001
On December 31, 2009, there were 640 shareholders of record of the Company's common stock.
We currently do not pay cash dividends on the Company's common stock and have no plans to
reinstate a dividend on the Company's common stock.
We have no equity compensation plans at December 31, 2009.
- - will likely cause a change in control if a substantial number of our shares are issued,
and most likely will also result in the resignation of our present officer and director;
and
- - may adversely affect the prevailing market price for our common stock.
- - default and foreclosure on our assets if our operating revenues after a business
combination were insufficient to pay our debt obligations;
- - acceleration of our obligations to repay the indebtedness even if we have made all
principal and interest payments when due if the debt security contained covenants that
required the maintenance of certain financial ratios or reserves and any such covenants
were breached without a waiver or renegotiation of such covenants;
- - our immediate payment of all principal and accrued interest, if any, if the debt
security was payable on demand; and
- - our inability to obtain additional financing, if necessary, if the debt security
contained covenants restricting our ability to obtain additional financing while such
security was outstanding.
Name
Age
Title
Date Became Executive
Officer
Richard Rubin
67
CEO, CFO and Chairman
11/2005
Other
Restricted
Securities
Annual
Stock
Underlying
All Other
Compensation
Award(s)
Options
Compensation
Name and
Principal Position
Richard Rubin, CEO, CFO and Chairman
2009
24,000
---
---
---
---
---
2008
24,000
---
---
---
---
---
2007
12,000
---
---
---
---
---
(1) Mr. Rubin became CEO, CFO and Chairman of
the Registrant in November 2005. Mr. Rubin has accrued compensation for serving as an
officer and chairman.at the rate of $2,000 per month commencing in July 2006.
Common Stock
Richard Rubin
40 Wall Street, 28th Floor, New York, NY 10005152,000,000 shares
69.80%
Officer and director (1
person)
152,000,000 shares
69.80%
(1) The percentage and ownership is based on
217,747,909 issued and outstanding shares as of December 31, 2009.
The Registrant's Board of Directors has appointed Michael F. Cronin, CPA as independent
public accountant for the fiscal year ended December 31, 2009.
The following table presents the fees for professional audit services rendered by Michael
F. Cronin, CPA for the audit of the Registrant's annual financial statements for the year
ended December 31, 2009 and 2008, and fees billed for other services rendered by Michael
F. Cronin, CPA during this period.
Year Ended
Year Ended
December
31, 2009
December
31, 2008
$
4,000
$
4,000
-
-
-
-
-
-
(1) Audit
fees consist of audit and review services, consents and review of documents filed with the
SEC.
(2)
Audit-related fees consist of assistance and discussion concerning financial accounting
and reporting standards and other accounting issues.
(3) Tax
fees consist of preparation of federal and state tax returns, review of quarterly
estimated tax payments, and consultation concerning tax compliance issues.
Section 16(a) of the Securities and Exchange Act of 1934 requires the Registrant's
directors and executive officers, and persons who own beneficially more than ten percent
(10%) of the Registrant's Common Stock, to file reports of ownership and changes of
ownership with the Securities and Exchange Commission. Copies of all filed reports are
required to be furnished to the Registrant pursuant to Section 16(a). Based solely on the
reports received by the Registrant and on written representations from reporting persons,
the Registrant was informed that its officer and director have filed all reports required
under Section 16(a).
Exhibit No.
Description
31.1
Certification of CEO and CFO
pursuant to Rule 13a-14(a) or 15d-14(a) of the Exchange Act pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
32.1
Certification of CEO and CFO
pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.
/s/ RICHARD RUBIN
Richard Rubin
CEO, CFO and Chairman
Dated: April 14, 2010
Certified Public Accountant
Rochester, New York
American Biogenetic Sciences, Inc.
Michael F. Cronin
Certified Public Accontant
American Biogenetic Sciences, Inc.
Balance Sheets Back to Table of Contents
December 31, 2009
December 31, 2008
Current assets:
Cash
$
0
$
0
Prepaid expenses
0
0
Total current assets
0
0
Total
Assets
$
0
$
0
Current Liabilities:
Accounts payable -
trade
$
500
$
1,500
Accrued expenses
2,280
0
Advances from and
accruals due to related party
14,613
48,956
Total current liabilities
17,613
50,456
Convertible debt
76,000
0
Total liabilities
93,393
50,456
Stockholders' Deficiency:
Common stock, 900,000,000
shares authorized, $0.0001 par value;
217,749,909 shares issued and outstanding at December 31, 2009 and
217,749,909 shares issued and outstanding at December 31, 2008
21,775
21,775
Additional paid-in
capital
24,525
24,525
Accumulated
deficit
(139,693)
(96,756)
Total
Stockholders' Deficiency
(93,393)
(50,456)
Total Liabilities and Stockholders' Deficiency
$
0
$
0
See
Summary of Significant Accounting Policies and Notes to Financial Statements.
American
Biogenetic Sciences, Inc.
Statement of Operations Back to Table of Contents
Fiscal Year Ended
Fiscal Year Ended
December 31, 2009
December 31, 2008
Revenue
$
0
$
0
Costs and Expenses:
General and administrative
40,657
40,063
Interest
2,280
0
Total costs and expenses
42,937
40,063
Net loss
$
(42,937)
$
(40,063)
Basic and diluted net loss
$
(0.00)
$
(0.00)
Weighted average shares outstanding (basic and
diluted)
217,749,909
217,749,909
See Summary of Significant
Accounting Policies and Notes to Financial Statements.
American
Biogenetic Sciences, Inc.
Statement of Cash Flows Back to Table of Contents
Fiscal Year Ended
Fiscal Year Ended
December 31, 2009
December 31, 2008
Cash flows used by operating
activities
$
$
Net loss
(42,937)
(40,063)
Adjustments required to reconcile net loss to cash used in operating activities:
Fair
value of services provided by related parties
36,000
36,000
Expenses paid by related parties
4,011
2,000
Increase (decrease) in accounts payable and accrued expenses
2,280
1,500
Cash flows used in operating
activities
(646)
(563)
Cash flow from investing
activities:
Cash used in investing
activities
0
0
Cash flows from financing activities:
Proceeds of related party
borrowings
646
40
Proceeds from the issuance of
common stock
0
500
Cash
provided by financing activities
646
540
Change in cash
0
(23)
Cash - beginning of period
0
23
Cash - end of period
$
0
$
0
See Summary of
Significant Accounting Policies and Notes to Financial Statements.
American Biogenetic Sciences, Inc.
Statements of Stockholders'
Deficiency Back to Table of Contents
Additional
Paid-In
Subscriptions
receivable
Balance at
December 31, 2007
216,749,909
21,675
24,125
(2,270)
(56,693)
Stock
issued for cash
1,000,000
100
400
2,270
Net
loss
(40,063)
Balance at
December 31, 2008
217,749,909
21,775
24,525
0
(96,756)
Net
loss
(42,937)
Balance at
December 31, 2009
217,749,909
$
21,775
$
24,525
$
0
$
(139,693)
See
Summary of Significant Accounting Policies and Notes to Financial Statements.
Background and Significant Accounting Policies
December 31, 2009 Back to Table of
Contents
NOTES TO FINANCIAL STATEMENTS
December 31, 2009
I, Richard Rubin, certify that:
1. I have reviewed this annual report of American Biogenetic Sciences, Inc.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the issuer as of, and for, the periods presented in this report;
4. The issuer's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as 4efined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the issuer and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the issuer's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the issuer's internal control over financial reporting that occurred during the issuer's most recent fiscal quarter (the issuer's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the issuer's internal control over financial reporting; and
5. The issuer's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the issuer's auditors and the audit committee of the issuer's board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the issuer's ability to record, process, summarize and report financial information; and
(b) Any fraud, whether r not material, that involves management or other employees who have a significant role in the issuer's internal control over financial reporting.
Date: April 14, 2010
/s/ Richard Rubin
CEO, CFO and Chairman
Exhibit 32
CERTIFICATION
PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO SECTION 906
OF THE SARBANES-OXLEY ACT OF 2002
In connection with the annual report of American Biogenetic Sciences, Inc. (the Company) on Form 10-K for the year ended December 31, 2009 (the Report), as filed with the Securities and Exchange Commission on the date hereof, I, Richard Rubin, CEO and CFO of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
1. The
Report fully complies with the requirements of section 13(a) or 15(d) of the Securities
Exchange Act of 1934, as amended; and
2. The information contained in the Report fairly presents, in all material respects, the
financial condition and results of operations of the Company.
/s/ Richard Rubin
CEO, CFO and Chairman
Dated: April 14, 2010
A signed original of this written statement required by Section 906 has been provided to American Biogenetic Sciences, Inc. and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.