-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, AE0UrfuoVl/vkoVNt3iIcxXijt45T97CwPrsdInzlMhbmIGE7K8JHD2pXntzVIO9 E/NdDk1ef8tdD89Yb36GPg== 0001010412-01-500132.txt : 20010815 0001010412-01-500132.hdr.sgml : 20010815 ACCESSION NUMBER: 0001010412-01-500132 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20010630 FILED AS OF DATE: 20010814 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SANGUINE CORP CENTRAL INDEX KEY: 0000926287 STANDARD INDUSTRIAL CLASSIFICATION: IN VITRO & IN VIVO DIAGNOSTIC SUBSTANCES [2835] IRS NUMBER: 954347608 STATE OF INCORPORATION: NV FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-24480 FILM NUMBER: 1710248 BUSINESS ADDRESS: STREET 1: 101 EAST GREEN ST STREET 2: #11 CITY: PASADENA STATE: CA ZIP: 91105 BUSINESS PHONE: 8184050079 MAIL ADDRESS: STREET 1: 101 EAST GREEN ST STREET 2: STE 11 CITY: PASADENA STATE: CA ZIP: 91105 10QSB 1 q601.txt U. S. Securities and Exchange Commission Washington, D. C. 20549 FORM 10-QSB [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2001 [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to -------------- --------------- Commission File No. 0-24480 --------------------------- SANGUINE CORPORATION -------------------- (Name of Small Business Issuer in its Charter) NEVADA 95-4347608 ------ ---------- (State or Other Jurisdiction of (I.R.S. Employer I.D. No.) incorporation or organization) 101 East Green Street, #11 Pasadena, California 91105 --------------------------- (Address of Principal Executive Offices) Issuer's Telephone Number: (626) 405-0079 ------------------------------------------ Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Sections 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. (1) Yes X No (2) Yes X No --- --- --- --- APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS Not applicable. APPLICABLE ONLY TO CORPORATE ISSUERS Indicate the number of shares outstanding of each of the Registrant's classes of common stock, as of the latest practicable date: June 30, 2001 28,838,382 ---------- PART I - FINANCIAL INFORMATION Item 1. Financial Statements. The Financial Statements of the Registrant required to be filed with this 10-QSB Quarterly Report were prepared by management, and commence on the following page, together with Related Notes. In the opinion of management, the Financial Statements fairly present the financial condition of the Registrant. SANGUINE CORPORATION (A Development Stage Company) Index to Financial Statements Page Balance sheet, June 30, 2001 (unaudited) F-1 Statement of operations for the three and six months ended June 30, 2001 and 2000 (unaudited) and for the period from January 18, 1989 (date of inception) to June 30, 2001 (unaudited) F-2 Statement of cash flows for the six months ended June 30, 2001 and 2000 (unaudited) and for the period from January 18, 1989 (date of inception) to June 30, 2001 (unaudited) F-3 Notes to financial statements F-5 SANGUINE CORPORATION (A Development Stage Company) Balance Sheet June 30, 2001 (Unaudited) Assets Current assets: Cash $260,141 Prepaid expense 208,125 Total assets $468,266 Liabilities and Stockholders' Deficit Current liabilities: Related party accounts payable $161,803 Accrued expenses 724,057 Notes payable 1,121,196 Total current liabilities 2,007,056 Stockholders' deficit: Common stock - par value $.001 per share. Authorized 100,000,000 shares; issued and outstanding 28,838,382 shares 28,838 Additional paid-in capital 2,029,589 Deficit accumulated during the development stage (3,597,217) Total stockholders' deficit (1,538,790) Total liabilities and stockholders' deficit $468,266
See accompanying notes to financial statements. SANGUINE CORPORATION (A Development Stage Company) Statement of Operations (Unaudited)
Cumulative Three Months Ended Six Months Ended Amounts June 30, June 30, From 2001 2000 2001 2000 Inception Revenue $ - $ - $ - $ - $ 150,000 Research and development (37,985) (19,500) (102,187) (39,000)(1,061,760) Consulting (86,625) - (105,375) (276,500) (771,895) General and Administrative expenses (107,618) (24,690) (188,315 (109,676)(1,749,572) Loss from operations (232,228) (44,190) (395,677) (416,176)(3,433,227) Other income (expense) Interest income 4,770 - 11,733 - 26,355 Interest expense (30,688) (3,178) (59,046) (25,118) (190,345) Loss before benefit for income taxes (258,146) (47,368) (443,190) (441,294)(3,597,217) Benefit for income taxes - - - - - Net loss $(258,146)$ (47,368)$(443,190)$(441,294$(3,597,217) Loss per share $ (.01)$ - $ (.02)$ (.02) Weighted average number of shares outstanding 28,538,000 24,866,000 28,341,000 23,866,000
See accompanying notes to financial statements. SANGUINE CORPORATION (A Development Stage Company) Statement of Cash Flows (Unaudited)
Cumulative Six Months Ended Amounts June 30, From 2001 2000 Inception Cash flows from operating activities: Net loss $(443,190) $(441,294) $(3,597,217) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation - - 4,609 Non cash expenses 105,375 334,688 972,176 Note Payable issued for services - - 699,200 Changes in operating asset & liabilities: (Decrease) increase in accounts payable and accrued expenses 102,951 106,099 885,861 Net cash provided by (used in) operating activities (234,864) (507) (1,035,371) Cash flows from investing activities - purchase of equipment - - (4,609) Net cash used in investing activities - - (4,609) Cash flows from financing activities: Net (payment on) proceeds from notes payable (36,947) 3,966 201,996 Sales of common stock - - 1,097,375 Contributed capital - - 750 Net cash provided by financing activities (36,947) 3,966 1,300,121 Net increase (decrease) in cash (271,811) 3,459 260,141 Cash, beginning of period 531,952 1,062 - Cash, end of period $260,141 $ 4,521 $260,141
See accompanying notes to financial statements. SANGUINE CORPORATION (A Development Stage Company) Statement of Cash Flows (Unaudited) Continued
Cumulative Six Months Ended Amounts June 30, From 2001 2000 Inception Supplemental disclosure of cash flow information: Interest paid $ 5,802 $2,730 $77,406 Income taxes paid $ - $ - $ -
See accompanying notes to financial statements. SANGUINE CORPORATION (A Development Stage Company) Notes to Financial Statements June 30, 2001 1. Statement Preparation The Company has prepared the accompanying financial statements with interim financial reporting requirements promulgated by the Securities and Exchange Commission. The information furnished reflects all adjustments which are, in the opinion of management, necessary for a fair presentation of financial position and results of operations. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. It is suggested that these condensed financial statements be read in conjunction with the financial statements and notes thereto included in the Company's December 31, 2000 Annual Report on Form 10-KSB. The results of operations for the period ended June 30, 2001 are not necessarily indicative of the operating results for the full year. 2. Earnings Per Share The computation of basic earnings per common share is based on the weighted average number of shares outstanding during the period. The computation of diluted earnings per common share is based on the weighted average number of shares outstanding during the period plus the common stock equivalents which would arise from the exercise of stock options and warrants outstanding using the treasury stock method and the average market price per share during the period. Common stock equivalents are not included in the diluted earnings per share calculation when their effect is antidilutive. Item 2. Management's Discussion and Analysis or Plan of Operation. - -------------------------------------------------------------------- Plan of Operation. - ------------------ Our proposed plan of operation is composed of three "phases," each of which coincides with a specific milestone in the process of developing PHER-O2. Each of these phases will begin subject to available funding. Each phase, and the projected cost of each, is as follows: Phase I (approximately one year): In the first six months, we plan to complete the development of perfluoro-decalin and the synthetic surfactants that make up PHER-O2, manufacture experimental doses and perform preliminary toxicity tests in accordance with FDA and overseas regulations. In the second six months, we intend to continue developing the perfluorocarbon compounds in PHER-O2 in order to produce optimal qualities and to conduct toxicity safety and efficacy trials in accordance with FDA and overseas requirements. During the course of Phase I, we estimate that our increased technical, administrative, sales/marketing and manufacturing requirements will require us to the hire a few additional employees. Estimated cost is $1,500,000, divided as follows: Completing the surfactant formulation and the manufacture of sufficient product for initial testing, $500,000; toxicity and efficacy trials through a sub-contractor, $600,000; and administrative, patent and proprietary right protection and marketing costs, $400,000. Phase II (approximately one year): In the second year, we intend to prepare New Drug Applications for FDA and European approval, conduct trials for cardioplegia, cancer treatment and cardiology treatment in the United States and conduct transfusion trials offshore. During this period, we also plan to submit license applications for transfusion with overseas authorities, begin production of PHER-O2 itself or with our subcontractors and submit a New Drug Application for PHER-O2 in the United States. During the course of Phase II, we estimate that we will need to hire a few additional employees. Estimated cost is $3,500,000, divided as follows: Prepare and file United States and European New Drug Applications, $300,000; conduct human safety and efficacy trials through a subcontractor in the United States and overseas, $2,000,000; set-up pilot facility, or subcontract, to manufacture small quantities of PHER-O2 for use in testing and in connection with the New Drug Applications, $500,000; submit license applications for use of PHER-O2 in transfusions overseas, $200,000; and administrative, patent and proprietary right protection and marketing costs, $500,000. Phase III (approximately one year): In the third year, we plan to complete overseas testing of PHER-O2, begin sales in Europe and other overseas areas that may have approved PHER-O2 by this time and may begin construction of facility for manufacturing, storing, inspecting and shipping PHER-O2. During the course of Phase III, we estimate that we will need to hire additional employees. During the third year, we plan to complete testing of PHER-O2 in the United States and receive all necessary FDA approvals and begin American and Canadian sales for cancer treatment and angioplasty. During this period, we also plan to complete construction of our manufacturing facility, unless we determine to subcontract this process, and continue trials of other PHER-O2 applications, including transplant organ preservation and treatment of carbon monoxide poisoning, sickle cell anemia, stroke and heart attack. The estimated cost for Phase III is $15,000,000, divided as follows: Complete human safety and efficacy clinical trials and obtain United States and overseas agency approval of PHER-O2, $9,000,000; construct manufacturing facility or subcontract with major emulsifying firm, $3,000,000; recruit and train sales force of the United States and foreign markets, $1,500,000; and administrative, patent and proprietary right protection and marketing costs, $1,500,000. These cost estimates are based upon the prior experience of Thomas C. Drees, Ph.D., our President and CEO. Dr. Drees has more than 25 years' experience in the blood industry, with Abbott Labs and others. Our plan of operation for the next 12 months is to: begin Phase I and to complete the synthesis of the PHER-O2 surfactant and its emulsion with perfluoro-decalin; this process in now underway; manufacture experimental doses of PHER-O2; and perform preliminary toxicity tests in accordance with FDA and comparable foreign overseas regulations. Our ability to begin and to carry out our plan depends entirely upon our ability to obtain substantial equity or debt financing. We can not assure you that we will receive this financing. If we do not receive it, we will not be able to proceed with our business plans. For risks that may have an adverse effect on our proposed operations, see the caption "Risk Factors" of our SB-2 Registration Statement, as amended, which was filed with the Securities and Exchange Commission on or about December 6, 2000, and which is incorporated herein by reference. Results of Operations. - ---------------------- During this period, the Company received total revenues of $0 and sustained a net loss of ($258,146), compared with the quarterly period ended June 30, 2000, when the Company received total revenue of $0 and sustained a net loss of ($47,368). For the six months ended June 30, 2001, the Company received total revenue of $0 and sustained a net loss of ($443,190), compared with the six months ended June 30, 2000, when the Company received total revenue of $0 and sustained a net loss of ($441,294). Liquidity. - ---------- As of June 31, 2001, the Company had $260,141 in cash and $208,125 in prepaid expenses, with $2,007,056 in current liabilities. PART II - OTHER INFORMATION Item 1. Legal Proceedings. - ---------------------------- None; not applicable. Item 2. Changes in Securities and Use of Proceeds. - --------------------------------------------------- None; not applicable. Item 3. Defaults Upon Senior Securities. - ------------------------------------------ None; not applicable. Item 4. Submission of Matters to a Vote of Security Holders. - -------------------------------------------------------------- None; not applicable. Item 5. Other Information. - ---------------------------- None; not applicable. Item 6. Exhibits and Reports on Form 8-K. - ------------------------------------------- (a) Exhibits. SB-2 Registration Statement* Form 10-KSB Annual Report for the Year ended December 31, 2000* * Incorporated herein by reference. (b) Reports on Form 8-K. 8-K Current Report dated January 19, 2001.* SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned thereunto duly authorized. SANGUINE CORPORATION Date: 8/13/01 By:/s/Thomas C. Drees -------- ------------------------------------- Thomas C. Drees, CEO, President and Chairman of the Board of Directors Date: 8/13/01 By:/s/Anthony G. Hargreaves -------- ------------------------------------- Anthony G. Hargreaves Vice President, Secretary/Treasurer and Director Date: 8/13/01 By:/s/David E. Nelson -------- ------------------------------------- David E. Nelson CFO and Director -----END PRIVACY-ENHANCED MESSAGE-----