Omnimmune (OMMH) 10-Q 2010 Q1 Quarterly report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q 

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the quarterly period ended March 31, 2010

OR

o	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: 333-145507

OMNIMMUNE HOLDINGS, INC.

(Exact name of registrant as specified in its charter)

Delaware	26-3128407
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

4600 Post Oak Place, Suite 352, Houston, Texas	77027
(Address of principal executive offices)	(Zip Code)

(713) 622-8400

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section13 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 o

Indicate by check mark whether the Registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit and post such files).    Yes  ¨    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer o Accelerated filer o Non-accelerated filer o Smaller reporting company x

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

As of May 13, 2010 there were 8,914,921  shares of the issuer’s common stock outstanding.

OMNIMMUNE HOLDINGS, INC. and Subsidiaries

Quarterly Report on Form 10-Q

TABLE OF CONTENTS

		Page
PART I - FINANCIAL INFORMATION
Item 1.	Financial Statements	4
	Consolidated Balance Sheets as of March 31, 2010 and December 31, 2009	4
	Consolidated Statements of Operations for the three months ended March 31, 2010 and March 31,2009	5
	Consolidated Statements of changes in Stockholders’ Deficiency as of March 31, 2010	6
	Consolidated Statements of Cash Flows for the three months ended March 31, 2010 and March 31, 2009	19
	Notes to Consolidated Financial Statements	21
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	40
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	45
Item 4.	Controls and Procedures	45
PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	46
Item 1A.	Risk Factors	46
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	49
Item 3.	Defaults Upon Senior Securities	49
Item 4.	Submission of Matters to a Vote of Security Holders	49
Item 5.	Other Information	49
Item 6.	Exhibits	49

EXPLANATORY NOTE

Unless otherwise indicated or the context otherwise requires, all references below in this Current Report to “we,” “us,” “our” and the “Company” are to Omnimmune Holdings, Inc., a Delaware corporation.  Omnimmune Holdings, Inc. was originally incorporated on February 22, 2007, in the State of Nevada under the name Roughneck Supplies, Inc., and upon a merger with and into Omnimmune Holdings, Inc. effective August 6, 2008, the Company changed its domicile to Delaware.  Further, on August 7, 2008, Omnimmune Corp., a Texas corporation, merged with and into the Company’s wholly owned subsidiary and Delaware Corporation, Omnimmune Acquisition Corp., after which Omnimmune Acquisition Corp. changed its name to Omnimmune Corp. (the “Merger”).  Prior to the Merger, the Company was a shell company and Omnimmune Corp. was considered the acquirer for accounting purposes in the transaction.  As a result the historical financial statements included in this report are those of Omnimmune Corp., the Texas Corporation.  Unless otherwise indicated, all financial and business information contained in this Current Report relates exclusively to the business and financial affairs of Omnimmune Holdings, Inc. and its subsidiaries.

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

OMNIMMUNE HOLDINGS, INC.

(A DEVELOPMENT STAGE ENTERPRISE)

CONSOLIDATED BALANCE SHEETS

	March 31,			December 31,
	2010			2009
Assets	(Unaudited)
Current assets
Cash and cash equivalents	$	590		$	5,627
Prepaid Insurance		16,021			25,805
Total current assets	$	16,611		$	31,432
Liabilities and stockholders' deficiency
Current liabilities
Accounts payable and accrued liabilities	$	835,231		$	906,893
Accounts payable and accrued liabilities-related party		1,288,032			1,156,038
Line of credit		253,378			253,059
Accrued interest, net		261,430			327,078
Accrued interest- related party		485,870			483,836
Cash advance		290,400			310,400
Notes payable, net		987,046			987,046
Total current liabilities		4,401,387			4,424,350
Long term portion of notes payable		20,290			29,374
Long term portion of notes payable - due to related parties		1,004,745			1,003,563
Total liabilities		5,426,422			5,457,287
Commitments and contingencies		-			-
Stockholders' deficiency
Common stock, $0.0001 par value; 50,000,000 shares authorized;
8,914,921 shares issued and outstanding
at March 31, 2010 and December 31, 2009		890			890
Additional paid-in capital		16,688,729			15,671,385
Common stock subscribed		1,137			1,137
Deficit Accumulated during the Development Stage		(22,100,567	)		(21,099,267	)
Total stockholder's deficiency		(5,409,811	)		(5,425,855	)
	$	16,611		$	31,432

See notes to consolidated financial statements.

4

OMNIMMUNE HOLDINGS, INC.

 (A DEVELOPMENT STAGE ENTERPRISE)

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

							Cumulative from
	For the Three			For the Three			Inception
	Months Ended			Months Ended			(January 12, 2005)
	March 31,			March 31,			to March 31,
	2010			2009			2010
Revenue	$	-		$	-		$	-
Operating expenses:
Selling, general and administrative expenses		263,611			321,741			14,302,680
Impairment of license agreement		-			-			1,701,936
Total operating expenses		263,611			321,741			16,004,616
Operating loss		(263,611	)		(321,741	)		(16,004,616	)
Other expense:
Interest (income) expense, net		231,934			56,688			12,007,345
Cancellation of shares previously issued for license agreement		-			-			(842,514	)
(Gain) loss on restructuring of debt		505,755			-			(5,068,880	)
Total other (income) expense		( 737,689	)		(56,688	)		( 6,095,951	)
Loss before  taxes		( 1,001,300	)		(378,429	)		( 22,100,567	)
Provision for taxes		-			-			-
Net loss	$	( 1,001,300	)	$	(378,429	)	$	( 22,100,567	)
Net loss per share - basic	$	(0.11	)	$	(0.04	)
Weighted average shares outstanding - basic		8,914,926			8,814,926

See notes to consolidated financial statements.

5

OMNIMMUNE HOLDINGS, INC.

(A DEVELOPMENT STAGE ENTERPRISE)

CONSOLIDATED STATEMENTS OF

CHANGES IN STOCKHOLDERS' DEFICIENCY

	Preferred Stock						Common Stock
	Shares		Value		Additional Paid-in Capital		Shares		Value		Additional Paid-in Capital		Common Stock Subscribed		Accumulated Deficit During the Development Stage			Total Stockholders Equity
Balance at January 15, 1997 (date of inception)		-	$	-	$	-		-	$	-	$	-	$	-	$	-		$	-
Contribution of assets and liabilities by founder		11,229		112		49,888		1,055,507		106		43,466		-		-			93,572
Beneficial conversion feature of note payable for the year ended December 31, 1997		-		-		-		-		-		327,700		-		-			327,700
Loss for the year ended December 31, 1997		-		-		-		-		-		-		-		(1,366,300	)		(1,366,300	)
Balance as of December 31, 1997		11,229	$	112	$	49,888		1,055,507	$	106	$	371,166	$	-	$	(1,366,300	)	$	(945,028	)
Beneficial conversion feature of note payable for the year ended December 31, 1998		-		-		-		-		-		43,000		-		-			43,000
Loss for the year ended December 31, 1998		-		-		-		-		-		-		-		(328,534	)		(328,534	)
Balance as of December 31, 1998		11,229	$	112	$	49,888		1,055,507	$	106	$	414,166	$	-	$	(1,694,834	)	$	(1,230,562	)

6

 OMNIMMUNE HOLDINGS, INC.

(A DEVELOPMENT STAGE ENTERPRISE)

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIENCY

(Continued)

	Preferred Stock						Common Stock
	Shares		Value		Additional Paid-in Capital		Shares		Value		Additional Paid-in Capital		Common Stock Subscribed		Accumulated Deficit During the Development Stage		Total Stockholders Equity
Issuance of 55,553 shares of common stock for technology license at $1.10 per share		-		-		-		55,553		5		61,837		-		-		61,842
Issuance of 5,614 shares of convertible preferred stock at $4.45 per share to investors		5,614		56		24,944		-		-		-		-		-		25,000
Issuance of 5,614 shares of convertible preferred stock at $4.45 per share to investors		5,614		56		24,944		-		-		-		-		-		25,000
Issuance of 5,614 shares of convertible preferred stock at $4.45 per share to investors		5,614		56		24,944		-		-		-		-		-		25,000
Issuance of 5,614 shares of convertible preferred stock at $4.45 per share to investors		5,614		56		24,944		-		-		-		-		-		25,000
Beneficial conversion feature of note payable for the year ended December 31, 1999		-		-		-		-		-		12,000		-		-		12,000

7

OMNIMMUNE HOLDINGS, INC.

(A DEVELOPMENT STAGE ENTERPRISE)

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIENCY

(Continued)

	Preferred Stock						Common Stock						��
	Shares		Value		Additional Paid-in Capital		Shares		Value		Additional Paid-in Capital			Common Stock Subscribed		Accumulated Deficit During the Development Stage			Total Stockholders Equity
Loss for the year ended December 31, 1999	-		-		-			-		-		-			-		(429,692	)		(429,692	)
Balance as of December 31, 1999		33,685	$	336	$	149,664		1,111,060	$	111	$	488,003		$	-	$	(2,124,526	)	$	(1,486,412	)
Issuance of 5,614 shares of convertible preferred stock at $4.45 per share to investors		5,614		56		24,944		-		-		-			-		-			25,000
Issuance of 11,229 shares of convertible preferred stock at $4.45 per share to investors		11,229		112		49,888		-		-		-			-		-			50,000
Issuance of 5,614 shares of convertible preferred stock at $4.45 per share to investors		5,614		56		24,944		-		-		-			-		-			25,000
Issuance of 2,807 shares of common stock at $2.24 per share to a consultant for services rendered		-		-		-		2,807		-		6,250			-		-			6,250
Beneficial conversion feature of note payable for the year ended December 31, 2000		-		-		-		-		-		30,302			-		-			30,302
Loss for the year ended December 31, 2000		-		-		-		-		-		-			-		(422,306	)		(422,306	)
Balance as of December 31, 2000		56,142	$	560	$	249,440		1,113,867	$	111	$	524,555		$	-	$	(2,546,832	)	$	(1,772,166	)

8

 OMNIMMUNE HOLDINGS, INC.

(A DEVELOPMENT STAGE ENTERPRISE)

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIENCY

 (Continued)

	Preferred Stock						Common Stock
	Shares		Value		Additional Paid-in Capital		Shares		Value		Additional Paid-in Capital		Common Stock Subscribed		Accumulated Deficit During the Development Stage		Total Stockholders Equity
Issuance of 1,055,507 shares of common stock at $2.24 per share in exchange for 2,500,000 shares in InVitro technology		-		-		-		1,055,507		107		59,894		-		-		60,001
Issuance of 2,807 shares of common stock at $2.24 per share to a consultant for services rendered		-		-		-		2,807		-		6,250		-		-		6,250
Issuance of 2,807 shares of common stock at $2.24 per share to a consultant for services rendered		-		-		-		2,807		-		6,250		-		-		6,250
Issuance of 2,807 shares of common stock at $2.24 per share to a consultant for services rendered		-		-		-		2,807		-		6,250		-		-		6,250
Issuance of 2,807 shares of common stock at $2.24 per share to a consultant for services rendered		-		-		-		2,807		-		6,250		-		-		6,250
Issuance of 2,807 shares of common stock at $2.24 per share to a consultant for services rendered		-		-		-		2,807		-		6,250		-		-		6,250
Issuance of 2,807 shares of common stock at $2.24 per share to a consultant for services rendered		-		-		-		2,807		-		6,250		-		-		6,250
Issuance of 2,807 shares of common stock at $2.24 per share to a consultant for services rendered		-		-		-		2,807		-		6,250		-		-		6,250
Issuance of 2,807 shares of common stock at $2.24 per share to a consultant for services rendered		-		-		-		2,807		-		6,250		-		-		6,250

9

 OMNIMMUNE HOLDINGS, INC.

(A DEVELOPMENT STAGE ENTERPRISE)

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIENCY

(Continued)

	Preferred Stock						Common Stock
	Shares		Value		Additional Paid-in Capital		Shares		Value		Additional Paid-in Capital		Common Stock Subscribed		Accumulated Deficit During the Development Stage			Total Stockholders Equity
Issuance of 2,807 shares of common stock at $2.24 per share to a consultant for services rendered		-		-		-		2,807		-		6,250		-		-			6,250
Issuance of 2,807 shares of common stock at $2.24 per share to a consultant for services rendered		-		-		-		2,807		-		6,250		-		-			6,250
Issuance of 2,807 shares of common stock at $2.24 per share to a consultant for services rendered		-		-		-		2,807		-		6,250		-		-			6,250
Issuance of 2,807 shares of common stock at $2.24 per share to a consultant for services rendered		-		-		-		2,807		-		6,250		-		-			6,250
Issuance of 60,665 shares of common stock at $2.24 per share for a technology license		-		-		-		60,665		7		135,060		-		-			135,067
Issuance of 5,614 shares of convertible preferred stock at $4.45 per share to investors		5,614		56		24,944		-		-		-		-		-			25,000
Issuance of 5,614 shares of convertible preferred stock at $4.45 per share to investors		5,614		56		24,944		-		-		-		-		-			25,000
Issuance of 7,018 shares of common stock at $2.24 per share to a consultant for services rendered		-		-		-		7,018		2		15,624		-		-			15,626
Value of 14,036 warrants issued to consultants		-		-		-		-		-		15,500		-		-			15,500
Beneficial conversion feature of note payable for the year ended December 31, 2001		-		-		-		-		-		25,000		-		-			25,000
Loss for the year ended December 31, 2001		-		-		-		-		-		-		-		(959,531	)		(959,531	)
Balance as of December 31, 2001		67,370	$	672	$	299,328		2,270,741	$	227	$	850,633	$	-	$	(3,506,363	)	$	(2,355,503	)

��

10

OMNIMMUNE HOLDINGS, INC.

(A DEVELOPMENT STAGE ENTERPRISE)

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIENCY

(Continued)

	Preferred Stock									Common Stock
	Shares			Value			Additional Paid-in Capital			Shares		Value		Additional Paid-in Capital		Common Stock Subscribed	Accumulated Deficit During the Development Stage		Total Stockholders Equity
Issuance of 1,123 shares of convertible preferred stock at $4.45 per share to investors		1,123			11			4,989			-		-		-	-		-		5,000
Conversion of 11,229 shares convertible preferred stock into 44,915 shares of common stock at $2.24 per share		(11,229	)		(112	)		(49,888	)		44,915		4		49,996	-		-		-
Conversion of 5,614 shares convertible preferred stock into 11,229 shares of common stock at $2.22 per share		(5,614	)		(56	)		(24,944	)		11,229		2		24,998	-		-		-
Conversion of 5,614 shares convertible preferred stock into 11,229 shares of common stock at $2.22 per share		(5,614	)		(56	)		(24,944	)		11,229		2		24,998	-		-		-
Conversion of 5,614 shares convertible preferred stock into 11,229 shares of common stock at $2.22 per share		(5,614	)		(56	)		(24,944	)		11,229		1		24,999	-		-		-
Conversion of 16,843 shares convertible preferred stock into 33,686 shares of common stock at $2.24 per share		(16,843	)		(168	)		(74,832	)		33,686		3		74,997	-		-		-

11

OMNIMMUNE HOLDINGS, INC.

(A DEVELOPMENT STAGE ENTERPRISE)

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIENCY

(Continued)

	Preferred Stock									Common Stock
	Shares			Value			Additional Paid-in Capital			Shares		Value		Additional Paid-in Capital		Common Stock Subscribed		Accumulated Deficit During the Development Stage			Total Stockholders Equity
Conversion of 16,843 shares convertible preferred stock into 33,686 shares of common stock at $2.24 per share		(16,843	)		(168	)		(74,832	)		33,686		3		74,997		-		-			-
Conversion of 5,614 shares convertible preferred stock into 11,229 shares of common stock at $2.22 per share		(5,614	)		(168	)		(24,944	)		11,229		1		24,999		-		-			-
Conversion of 1,123 shares convertible preferred stock into 2,246 shares of common stock at $2.24 per share		(1,122	)		(11	)		(4,989	)		2,246		-		5,000		-		-			-
Beneficial conversion feature of note payable for the year ended December 31, 2002		-			-			-			-		-		1,175,356		-		-			1,175,356
Loss for the year ended December 31, 2002		-			-			-			-		-		-		-		(3,061,599	)		(3,061,599	)
Balance as of December 31, 2002		-		$	-		$	-			2,430,190	$	243	$	2,330,973	$	-	$	(6,567,962	)	$	(4,236,746	)

12

OMNIMMUNE HOLDINGS, INC.

(A DEVELOPMENT STAGE ENTERPRISE)

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIENCY

(Continued)

	Preferred Stock						Common Stock
	Shares		Value		Additional Paid-in Capital		Shares		Value		Additional Paid-in Capital		Common Stock Subscribed		Accumulated Deficit During the Development Stage			Total Stockholders Equity
Beneficial conversion feature of note payable for the year ended December 31, 2003		-		-		-		-		-		29,401		-		-			29,401
Loss for the year ended December 31, 2003		-		-		-		-		-		-		-		(540,986	)		(540,986	)
Balance as of December 31, 2003		-	$	-	$	-		2,430,190	$	243	$	2,360,374	$	-	$	(7,108,948	)	$	(4,748,331	)
Issuance of 1,404 shares of common stock at $2.24 to a consultant for services rendered		-		-		-		1,404		-		3,125		-		-			3,125
Issuance of 1,404 shares of common stock at $2.24 to a consultant for services rendered		-		-		-		1,404		-		3,125		-		-			3,125
Value of 26,107 warrants issued to consultants		-		-		-		-		-		93,000		-		-			93,000
Beneficial conversion feature of note payable for the year ended December 31, 2004		-		-		-		-		-		17,149		-		-			17,149
Loss for the year ended December 31, 2004		-		-		-		-		-		-		-		(1,252,796	)		(1,252,796	)
Balance as of December 31, 2004		-	$	-	$	-		2,432,998	$	243	$	2,476,773	$	-	$	(8,361,744	)	$	(5,884,728	)
Issuance of 134,746 shares of common stock at $2.24 for a technology license		-		-		-		134,746		13		299,987		-		-			300,000
Issuance of 6,661 shares at $3.74 per share for cash		-		-		-		6,661		1		24,999		-		-			25,000
Beneficial conversion feature of note payable for the year ended December 31, 2005		-		-		-		-		-		72,000		-		-			72,000
Loss for the year ended December 31, 2005		-		-		-		-		-		-		-		(1,141,448	)		(1,141,448	)
Balance as of December 31, 2005		-	$	-	$	-		2,574,405	$	257	$	2,873,759	$	-	$	(9,503,192	)	$	(6,629,176	)

13

OMNIMMUNE HOLDINGS, INC.

(A DEVELOPMENT STAGE ENTERPRISE)

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIENCY

 (Continued)

	Preferred Stock						Common Stock
	Shares		Value		Additional Paid-in Capital		Shares		Value		Additional Paid-in Capital		Common Stock Subscribed		Accumulated Deficit During the Development Stage			Total Stockholders Equity
Issuance of 4,913 shares of common stock pursuant to an antidilution agreement		-		-		-		4,913		-		-		-		-			-
Issuance of 1,235 shares of common stock pursuant to an antidilution agreement		-		-		-		1,235		-		-		-		-			-
Issuance of 1,235 shares of common stock pursuant to an antidilution agreement		-		-		-		1,235		-		-		-		-			-
Issuance of 1,235 shares of common stock pursuant to an antidilution agreement		-		-		-		1,235		-		-		-		-			-
Issuance of 3,706 shares of common stock pursuant to an antidilution agreement		-		-		-		3,705		-		-		-		-			-
Issuance of 3,706 shares of common stock pursuant to an antidilution agreement		-		-		-		3,705		-		-		-		-			-
Issuance of 1,235 shares of common stock pursuant to an antidilution agreement		-		-		-		1,235		-		-		-		-			-
Issuance of 225 pursuant to an antidilution agreement		-		-		-		225		-		-		-		-			-
Beneficial conversion feature of note payable for the year ended		-		-		-		-		-		4,000		-		-			4,000
Loss for the year ended December 31, 2006		-		-		-		-		-		-		-		(1,076,266	)		(1,076,266	)

14

 OMNIMMUNE HOLDINGS, INC.

(A DEVELOPMENT STAGE ENTERPRISE)

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIENCY

 (Continued)

	Preferred Stock						Common Stock
	Shares		Value		Additional Paid-in Capital		Shares		Value		Additional Paid-in Capital			Common Stock Subscribed			Accumulated Deficit During the Development Stage			Total Stockholders Equity
Balance at December 31, 2006		-	$	-	$	-		2,591,893	$	257	$	2,877,759		$	-		$	(10,579,458	)	$	(7,701,442	)
Issuance of 7,018 shares of common stock at $3.74 per share for services rendered		-		-		-		7,017		2		26,249			-			-			26,251
Issuance of 25,989 shares of common stock  for $3.74 per share for licensing agreement		-		-		-		25,988		2		97,204			-			-			97,206
Issuance of 25,989 shares  of common stock for $3.74 per share for licensing agreement		-		-		-		25,990		2		97,204			-			-			97,206
119,053 shares  of common stock to be issued at $0.37 per share for license agreement		-		-		-		-		-		-			445,305			-			445,305
119,053 shares to be issued at $0.37 per share for license agreement		-		-		-		-		-		-			445,305			-			445,305
Beneficial conversion feature of note payable for the year ended December 31, 2007		-		-		-		-		-		6,604,430			-			-			6,604,430
Loss for the year months ended December 31, 2007		-		-		-		-		-		-			-			(2,768,669	)		(2,768,669	)
Balance at December 31, 2007		-	$	-	$	-		2,650,888	$	263	$	9,702,846		$	890,610		$	(13,348,127	)	$	(2,754,408	)
Recapitalization upon reverse merger		-		-		-		3,000,000		300		(300	)		-			-			-
Issuance of 119,053 shares of common stock at $0.37 per share, previously accrued		-		-		-		119,053		12		445,293			(445,305	)		-			-

15

OMNIMMUNE HOLDINGS, INC.

(A DEVELOPMENT STAGE ENTERPRISE)

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIENCY

 (Continued)

	Preferred Stock						Common Stock
	Shares		Value		Additional Paid-in Capital		Shares		Value		Additional Paid-in Capital		Common Stock Subscribed			Accumulated Deficit During the Development Stage		Total Stockholders Equity
Issuance of 119,053 shares of common stock at $0.37 per share, previously accrued		-		-		-		119,053		12		445,293		(445,305	)		-		-
Issuance of 1,055,507 shares of common stock for cash at a price of $0.011 per share		-		-		-		1,055,508		106		44,690		-			-		44,796
Issuance of 100,000 shares of common stock and 20,000 warrants to purchase additional shares of common stock at a price of $0.05 per share as a discount on notes payable		-		-		-		100,000		10		55,991		-			-		56,001
Issuance of 1,055,508 shares of common stock at a price of $0.03 per share to a board member for services		-		-		-		1,055,507		105		29,895		-			-		30,000
Issuance of 150,000 shares of common stock at a price of $1.25 per share to officers for services		-		-		-		150,000		15		187,485		-			-		187,500
Issuance of 137,500 shares of common stock at a price of $0.05 per share as a discount to notes payable		-		-		-		137,500		14		6,861		-			-		6,875

16

OMNIMMUNE HOLDINGS, INC.

(A DEVELOPMENT STAGE ENTERPRISE)

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIENCY

 (Continued)

	Preferred Stock						Common Stock
	Shares		Value		Additional Paid-in Capital		Shares			Value			Additional Paid-in Capital			Common Stock Subscribed		Accumulated Deficit During the Development Stage			Total Stockholders Equity
Sale of 707,200 shares of common stock and 707,200 warrants to purchase additional shares of common stock at a price of $2.50 per share for cash, net of costs of $359,729		-		-		-		707,200			71			1,408,200			-		-			1,408,271
Cancellation of shares issued for technology license		-		-		-		(279,788	)		(28	)		(842,486	)		-		-			(842,514	)
Value of options to purchase 2,250,000 shares of common stock at a price of $2,50 per shares issued to board member for extension of payment terms		-		-		-		-			-			2,811,962			-		-			2,811,962
Value of warrants to purchase 75,000 shares of common stock at $2,50 per share issued to a board member for services		-		-		-		-			-			93,733			-		-			93,733
Value of warrants to 70,180 shares of common stock at $1,78 per share issued to a board member for extension of credit terms		-		-		-		-			-			129,278			-		-			129,278
Value of vested portion of options issued to officer		-		-		-		-			-			54,848			-		-			54,848
Discount to notes payable due to beneficial conversion feature		-		-		-		-			-			1,019,208			-		-			1,019,208
Loss for the year ended December 31, 2008		-		-		-		-			-			-			-		(5,989,872	)		(5,989,872	)
Balance as of December 31, 2008		-	$	-	$	-		8,814,921		$	880		$	15,592,797		$	-	$	(19,337,999	)	$	(3,744,322	)

17

OMNIMMUNE HOLDINGS, INC.

(A DEVELOPMENT STAGE ENTERPRISE)

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIENCY

	Preferred Stock						Common Stock
	Shares		Value		Additional Paid-in Capital		Shares		Value		Additional Paid-in Capital		Common Stock Subscribed		Accumulated Deficit During the Development Stage			Total Stockholders Equity
40,845 shares to be issued for the exercise of 42,108 warrants to purchase shares of common stock		-		-		-		-		-		-		1,137		-			1,137
Issuance of shares for services at a price of $0.30 per share		-		-		-		50,000		5		14,995		-		-			15,000
Issuance of shares for services at a price of $0.44 per share		-		-		-		50,000		5		21,995		-		-			22,000
Value of vested portion of 100,000 options issued to consultant		-		-		-		-		-		41,598		-		-			41,598
Loss for the year ended December 31, 2009		-		-		-		-		-		-		-		(1,761,268	)		(1,761,268	)
Balance as of December 31, 2009		-	$	-	$	-		8,914,921	$	890	$	15,671,385	$	1,137	$	(21,099,267	)	$	(5,425,855	)
Discount to  notes payable associated with  beneficial conversion feature		-		-		-		-		-		895,100		-		-			895,100
Discount to accrued interest associated with beneficial conversion feature		-		-		-		-		-		111,845		-		-			111,845
Value of vested portion of 100,000 options issued to consultant		-		-		-		-		-		10,399		-		-			10,399
Loss for the three months ended March 31, 2010		-		-		-		-		-		-		-		(1,001,300	)		(1,001,300	)
Balance as of March 31, 2010		-	$	-	$	-		8,914,921	$	890	$	16,688,729	$	1,137	$	(22,100,567	)	$	(5,409,811	)

See notes to consolidated financial statements.

18

OMNIMMUNE HOLDINGS, INC.

(A DEVELOPMENT STAGE ENTERPRISE)

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	For the Three			For the Three			Cumulative
	Months Ended			Months Ended			from Inception
	March 31,			March 31,			(January 12, 2005) to
	2010			2009			March 31, 2010
Cash flows from operating activities:
Net loss	$	( 1,001,300	)	$	(378,429	)	$	( 22,100,567	)
Adjustments to reconcile net loss to net
cash used in operating activities:
Non-cash compensation		10,399			10,401			4,095,507
Amortization of discount on notes payable		177,943			3,231			8,942,679
Amortization of discount on accrued interest		317			-			317
Impairment of technology licenses and equity securities		-			-			1,701,936
(Gain) or loss on restructuring of debt		505,755			-			(5,071,245	)
Redemption of shares previously issued for license agreement		-			-			(842,513	)
Net change in operating assets and liabilities:
Advances to related party		-			-			(10,000	)
Prepaid insurance		9,784			-			(16,021	)
Accounts payable and accrued liabilities, net		108,246			307,130			9,121,827
Net cash used in operating activities		(188,856	)		(57,667	)		(4,178,080	)
Cash flows from investing activities:
Cash portion of investment in technology license		-			-			(6,000	)
Net cash used in investing activities		-			-			(6,000	)
Cash flows from financing activities:
Proceeds from cash advances		-			10,000			1,006,400
Principal payments on cash advances		-						(130,000	)
Proceeds from notes payable		183,500						1,828,474
Proceeds from the exercise of warrants		-						1,137
Principal payments on debt		-						(512,993	)
Stock sold for cash, net of costs		-						1,738,271
Proceeds from (repayments) to line of credit		319			(2,589	)		253,381
Net cash provided by financing activities		183,819			7,411			4,184,670
Net increase (decrease) in cash and cash equivalents		(5,037	)		(50,256	)		590
Cash and cash equivalents at beginning of period		5,627			52,615			-
Cash and cash equivalents at end of period	$	590		$	2,359		$	590

See notes to consolidated financial statements.

19

CONSOLIDATED STATEMENTS OF CASH FLOWS

(continued)

Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest	$	5,759	$	3,051	$	79,839
Taxes	$	-	$	-	$	-
Discount to notes payable associated with beneficial conversion feature	$	895,100	$	3,238	$	15,723,340
Discount to accrued interest associated with beneficial conversion feature	$	111,845	$	-	$	111,845
Common stock issued for services	$	-	$	-	$	354,875
Notes payable issued under restructure of debt	$	-	$	-	$	7,284,998
Value of warrant issued as discount on debt	$	-	$	-	$	331,510
Notes payable issued for accounts payable	$	-	$	-	$	287,768
Common stock issued for technology license	$	-	$	-	$	920,610
Common stock issued for the conversion of preferred stock	$	-	$	-	$	355,000
Notes payable issued for services	$	-	$	-	$	3,746,971
Impairment of technology licenses	$	-	$	-	$	616,908
Value of warrants issued for debt	$	-	$	-	$	12,747
Issuance of common stock for cash	$	-	$	-	$	1,408,271
(Gain) loss from the restructuring of debt	$	505,755	$	-	$	(5,071,238	)
Value of vested portion of options issued for services	$	-	$	-	$	2,908,409
Common stock issued for accounts payable	$	-	$	-	$	30,000
Cash advance converted to note payable	$	20,000	$	-	$	541,200
Capitalization of interest on debt	$	-	$	-	$	33,751
Value of warrants and options issued for services	$	-	$	10,401	$	2,905,694

See notes to consolidated financial statements.

20

OMNIMMUNE HOLDINGS, INC.

(A DEVELOPMENT STAGE ENTERPRISE)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Business and Basis of Presentation

Omnimmune Holdings, Inc. (“Omnimmune” or the “Company”) is the holding company of Omnimmune Corp., a development-stage biotechnology company integrating complementary cancer therapeutic, diagnostic and prognostic technologies. Our mission is to provide a comprehensive and personalized approach to the clinical management of cancer through improved diagnostic, prognostic and therapeutic interventions.

The Company’s operating subsidiary, Omnimmune Corp., is currently a development stage company under the provisions of Financial Accounting Standards Board “FASB” Accounting Standard Codification “ASC” 915-10-15 (formerly referred to as Statement of Financial Accounting Standards, (“SFAS”) No 7). The Company, whose principal business is to act as a holding company for Omnimmune Corp., is also a development-stage company. The accounts of the Company also include those of its wholly owned subsidiary, InVitro Technologies, Inc., an inactive company.

Merger with Roughneck Supplies, Inc.

The predecessor of the Company was originally incorporated on February 22, 2007, in the State of Nevada as Roughneck Supplies, Inc. (“Roughneck”). On August 6, 2008, Roughneck merged with and into Omnimmune Holdings, Inc. On August 7, 2008, Omnimmune Corp., a privately held Texas corporation incorporated on January 15, 1997 merged with and into Omnimmune Acquisition Corp., a Delaware corporation, and a wholly-owned subsidiary of the Company formed for the purpose of the merger.  As a result, (i)  Omnimmune Corp became  a  wholly-owned subsidiary of the Company, (ii) the shareholders of Omnimmune Corp. became the majority stockholders of the Company and the shareholders prior to the merger were reduced to a minority ownership, (iii) the historical management of the Company resigned, an d the management of Omnimmune Corp. became the management of the Company, (iv) the business of Omnimmune Corp. became the business of Omnimmune and the former business of Roughneck was eliminated, and (v) the historical financial statements of Omnimmune Corp. became the historical financial statements of the Company. Therefore, as a consequence of the two mergers, one on August 6, 2008 and one on August 7, 2008, Omnimmune (formerly Roughneck) went from being a public corporation domiciled in Nevada formerly in the business of marketing and retailing oil and gas drilling supply products with little or no continuing operations and a fiscal year end of May 31, to being a public company domiciled in Delaware in the biotechnology business in the development stage with a fiscal year end of December 31.  These transactions are described in detail in the Company’s Form 8-K filed with the SEC on August 12, 2008, as amended on August 21, 2008, August 27, 2008 and September 5, 2008, respectively.

Going Concern

The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As shown in the accompanying consolidated financial statements the Company had less than $1,000 in cash at March 31, 2010 and incurred losses from operations of $1,001,300 and $378,429 for the three months ended March 31, 2010 and 2009, respectively; and $22,100,567 from inception (January 15, 1997) through March 31, 2010 In addition, the Company’s current liabilities exceed its current assets by $4,384,776 as of March 31, 2010. These factors among others, including the Company’s weak cash position (i.e. less than $1,000 in cash as of March 31, 2010), as well as its delinquent status under certain key license agreeme nts and other payment obligations,  indicate that the Company will be unable to continue as a going concern for a reasonable period of time absent the near-immediate infusion of substantial additional capital.

21

If operations and cash flows substantially improve, including through funds realized upon one or more  debt or equity financing transactions, management believes that the Company can meet its ongoing obligations and continue in business.  However, there remains a substantial risk that management’s actions will not result in the resolution of the Company’s liquidity problems or its eventual emergence as a profitable company.

The accompanying consolidated financial statements do not include any adjustments that might result should the Company be unable to continue as a going concern.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reported periods.  Actual results could materially differ from those estimates. 

Long-lived Assets

In accordance with ASC 360-10-15 (formerly referred to as SFAS No.  144),  long-lived  assets to be held and used are analyzed for impairment  whenever  events or changes in  circumstances  indicate that the  carrying  amount  of an asset  may not be  recoverable.  ASC 360-10-15 relates to assets that can be amortized and the life  determinable.  The Company evaluates  at each  balance  sheet date whether  events and  circumstances  have occurred  that  indicate  possible  impairment.  If there are  indications  of impairment, the Company uses future undiscount ed cash flows of the related asset or asset  grouping over the remaining life in measuring  whether the assets are recoverable.  In the event such cash flows are not expected to be  sufficient to recover  the  recorded  asset  values,  the  assets  are  written  down to their estimated  fair value.  Long-lived  assets to be disposed of are reported at the lower of  carrying  amount or fair value of asset less the cost to sell.  During the three months ended March 31, 2010 and 2009, the Company recognized no impairment of long-lived assets.  From inception to March 31, 2010 an impairment of license agreement in the amount of $1,701,936 was recorded.

Cash and Cash Equivalents

For the purposes of the statement of cash flows, cash equivalents include highly liquid debt instruments with original maturities of three months or less which are not securing any corporate obligations.

Net Income (Loss) Per Common Share

The Company computes earnings per share under ASC 260-10-45 (Financial  Accounting Standard No. 128,  "Earnings Per Share" (SFAS 128)).  Net loss per common share is computed by dividing net loss by the weighted  average  number of shares of common stock and dilutive common stock equivalents  outstanding during the year.  Dilutive common stock  equivalents  consist of shares  issuable upon  conversion of  convertible notes and the exercise of the Company's  stock options and warrants  (calculated using the  treasury  stock  method).  During the three months ended March 31, 2010 and 2009, and from inception to March 31, 2010,  common stock equivalent s  were not  considered  in the  calculation  of the weighted  average number of common shares outstanding because they would be anti-dilutive, thereby decreasing the net loss per common share.

At March 31, 2010, the following convertible securities were not included  in fully-diluted loss per share because the result would have been anti-dilutive:  Options to purchase 2,350,000 shares at $2.50 per share; Warrants to purchase 70,180 shares at $1.78 per share, warrants to purchase 75,000 shares at $2.50 per share, and warrants to purchase 727,200 shares at $5.00 per share; debt convertible into 72,470,000 shares at $0.01 per share; debt convertible into 2,442,441 shares at $0.1781 per share, and debt convertible into 2,000,000 shares at $0.50 per share. Cash advance convertible into 17,040,000 shares at $0.01 per share.

22

At March 31, 2009, the following convertible securities were not included  in fully-diluted loss per share because the result would have been anti-dilutive:  Options to purchase 2,350,000 shares at $2.50 per share; warrants to purchase 25,265 shares at $0.10 per share, warrants to purchase 70,180 shares at $1.78 per share, warrants to purchase 75,000 at $2.50 per share, and warrants to purchase 727,200 shares at $5.00 per share; debt convertible into 5,368,886  shares at $0.18 per share, and debt convertible into 2,000,000 shares at $0.50 per share.

Research and Development

The Company  accounts for research and development  costs in accordance with ASC 7.30-10-15 (formerly referred to as Statement  of  Financial  Accounting Standards  No. 2 ("SFAS 2"),  "Accounting  for Research and  Development  Costs"). Under ASC 730-10-15, all research and development  costs must be charged to expense as  incurred.  Accordingly, internal research and development costs are expensed as incurred.  Third-party research and  development  costs are expensed  when the contracted  work has been performed or as milestone  results have been achieved. Company-sponsored research and  development  costs&# 160; related to both present and future  products  are expensed in the period  incurred.  There were no expenditures  on research and product  development for the three months ended March 31, 2010 and 2009, and from inception through March 31, 2010.

Concentrations of Credit Risk

Financial  instruments and related items, which potentially  subject the Company to  concentrations  of credit risk,  consist primarily of cash, cash equivalents and related party  receivables.  The Company  places its cash and temporary cash investments with credit quality institutions.  At times, such investments may be in excess of the FDIC  insurance  limit.

Comprehensive Income

ASC 220-10-15 (formerly referred to as Statement of Financial  Accounting  Standards No. 130 ("SFAS  130"),  "Reporting Comprehensive  Income,")  establishes  standards for reporting and  displaying of comprehensive  income,  its components and accumulated  balances.  Comprehensive income is defined to include all changes in equity except those  resulting  from investments by owners and distributions to owners. Among other disclosures, ASC 220-10-15 requires  that all items that are required to be  recognized  under  current accounting  standards as  components  of  comprehensive  income be reported in a finan cial  statement  that is  displayed  with  the  same  prominence  as  other financial  statements.  During the three months ended March 31, 2010 and 2009 there were no items  of other comprehensive income.

Stock Based Compensation

Effective January 1, 2006, the Company adopted ASC 718-10 (formerly referred to as SFAS No. 123 (revised), "Share-Based Payment" (SFAS 123(R)) which superseded APB Opinion No. 25, "Accounting for Stock Issued to Employees" (the intrinsic value method ) utilizing the modified prospective approach. Prior to the adoption of ASC 718-10 we accounted for stock option grant in accordance with ASC 718-10 and accordingly, recognized compensation expense for stock option grants.

Under the modified prospective approach, ASC 718-10 applies to new awards and to awards that were outstanding on January 1, 2006 that are subsequently modified, repurchased or cancelled. Under the modified prospective approach, compensation cost recognized in the nine months of fiscal 2006 includes compensation cost for all share-based payments granted prior to, but not yet vested as of January 1, 2006, based on the grant-date fair value estimated in accordance with the original provisions of ASC 718-10, and compensation cost for all share-based payments granted subsequent to January 1, 2006 based on the grant-date fair value estimated in accordance with the provisions of ASC 718-10 Prior periods were not restated to reflect the impact of adopting the new standard.

23

A summary of option activity under the Plan as of March 31, 2010, and changes during the period ended are presented below:

	Options		Weighted Average Exercise Price
Outstanding at December 31, 2009		2,350,000	$	2.50
Issued		-		-
Exercised		-		-
Forfeited or expired		-		-
Outstanding at March 31, 2010		2,350,000	$	2.50
Vested at March 31, 2010		2,336,029	$	2.50
Non-vested at March 31, 2010		13,971	$	2.50

Aggregate intrinsic value of options outstanding and exercisable at March 31, 2010 was $0. Aggregate intrinsic value represents the difference between the Company's closing stock price on the last trading day of the fiscal period, which was $0.03 as of March 31, 2010, and the exercise price multiplied by the number of options outstanding. As of March 31, 2010, total unrecognized stock-based compensation expense related to stock options was $17,351. The total fair value of options vested during the three months March 31, 2010 and 2009 was $10,399.

Income Taxes

The Company has implemented the provisions of ASC 740-10-05 (formerly referred to as Statement of Financial Accounting Standards No. 109, "Accounting for Income Taxes" (SFAS 109)). ASC 740-10-05 requires that income tax accounts be computed using the liability method. Deferred taxes are determined based upon the estimated future tax effects of differences between the financial reporting and tax reporting bases of assets and liabilities given the provisions of currently enacted tax laws.

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets, including tax loss and credit carryforwards, and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

Deferred income tax expense represents the change during the period in the deferred tax assets and deferred tax liabilities. The components of the deferred tax assets and liabilities are individually classified as current and non-current based on their characteristics. Realization of the deferred tax asset is dependent on generating sufficient taxable income in future years. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Due to the uncertainties as to the realization of deferred tax assets, an allowance has been provided regarding all deferred tax assets of the Company.

Fair Value of Financial Instruments

The Company  measures its financial  assets and  liabilities in accordance  with  accounting  principles  generally accepted in the United States of America.  The estimated fair values approximate their carrying value because of the short-term maturity of these  instruments  or the stated  interest  rates are indicative of market interest rates.

Reclassifications

Certain reclassifications have been made in prior year's financial statements to conform to classifications used in the current year.

Foreign Currency

Aside from one of its license agreements, which requires milestone and other payments to be made in Euros, the Company is not involved any transactions with foreign currency implications.

24

Significant Recent Accounting Pronouncements

In March 2010, the FASB issued Accounting Standards Update (“ASU”) No. 2010-11, which is included in the Codification under ASC 815.  This update clarifies the type of embedded credit derivative that is exempt from embedded derivative bifurcation requirements.  Only an embedded credit derivative that is related to the subordination of one financial instrument to another qualifies for the exemption.  This guidance became effective for the Company’s interim and annual reporting periods beginning January 1, 2010.  The adoption of this guidance did not have a material impact on the Company’s condensed financial statements.

In February 2010, the FASB issued ASU No. 2010-09, which is included in the Codification under ASC 855, Subsequent Events (“ASC 855”).  This update removes the requirement for an SEC filer to disclose the date through which subsequent events have been evaluated and became effective for interim and annual reporting periods beginning January 1, 2010.  The adoption of this guidance did not have a material impact on the Company’s condensed financial statements.

In January 2010, the FASB issued ASU No. 2010-06, which is included in the Codification under ASC 820, Fair Value Measurements and Disclosures (“ASC 820”).  This update requires the disclosure of transfers between the observable input categories and activity in the unobservable input category for fair value measurements.  The guidance also requires disclosures about the inputs and valuation techniques used to measure fair value and became effective for interim and annual reporting periods beginning January 1, 2010.  The adoption of this guidance did not have a material impact on the Company’s condensed financial statements.

2. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

Accounts payable and accrued liabilities at March 31, 2010 and December 31, 2009 were  $835,231  and $906,893, respectively, consisting of trade payables. Accounts payable and accrued liabilities – related parties at March 31, 2010 and December 31, 2009 of $1,288,032 and $1,156,038, respectively, consisting of accrued liabilities to directors  and senior management for services performed. 

3. LINE OF CREDIT

The Company has bank loan and credit card agreements with various banks. The bank loan is jointly guaranteed by two of the Company’s shareholders.  The Company's Chief Executive Officer, Harris Lichtenstein, co-signs the credit card agreements  and remains jointly liable with the Company on all outstanding amounts due for these credit card liabilities. At March 31, 2010 and December 31, 2009, the Company had the following amounts due under its loan and credit agreements:

	March 31, 2010		December 31, 2009
Bank loan	$	149,976	$	149,976
Credit cards		103,402		103,083
Total	$	253,378	$	253,059

4. ACCRUED INTEREST

During the three months ended March 31, 2010, the Company entered into a debt restructuring agreement with a note holder.  Pursuant to the terms of this agreement, the accrued interest as of March 31, 2010 in the amount of $111,845  and principal balance of $521,200 are  now convertible into shares of the Company’s common stock at a price of $0.01 per share. This results in a beneficial conversion feature in the amount of $111,845 on the accrued interest, which is considered a discount to accrued interest.  This discount is amortized using the effective interest method and will be amortized over the remaining life of the note.  As of March 31, 2010, amortization expense was $317 and was charged to interest expense.

25

Notes payable and accrued interest at March 31, 2010 and December 31, 2009 are  summarized as follows:

	March 31,		December 31,
	2010		2009
Number of notes payable		26		16
Number of notes payable - related party		4		4
Principal amount - notes payable, net of discount	$	1,007,336	$	1,016,420
Principal amount - notes payable - related party, net of discount	$	1,004,745	$	1,003,563
Accrued interest, net of discount	$	261,430	$	327,076
Accrued interest - related party	$	485,870	$	483,835

Interest expense (net) consisted of the following for the three  months ended March 31, 2010 and 2009:

	For the Three Months Ended March 31,
	2010		2009
Accrued interest - notes payable	$	46,208	$	46,699
Accrued interest - notes payable – related party		2,036		1,216
Bank credit line		3,051		3,051
Amortization of discount on notes payable		177,943		3,238
Amortization of discount on accrued interest		317		-
Credit Cards		2,379		2,487
Interest (income)		-		(3	)
Total interest	$	231,934	$	56,688

5. CASH ADVANCES

During the three months ended March 31, 2010, the Company received no new non-interest bearing, payable on demand, unsecured cash advances from  shareholders. All previous advances are demand obligations and bear no interest.

During the three months ended March 31, 2010, the Company converted $20,000 of cash advances into notes payable.

During the three months ended March 31, 2010, the Company entered into an agreement whereby $170,400 of the cash advances became convertible into shares of the Company’s common stock at a price of $0.01 per share.  This resulted in a beneficial conversion feature in the amount of $170,400, which was charged to operations during the three months ended March 31, 2010.

6. NOTES PAYABLE

During January 2010, the Company entered into a debt restructuring agreement, whereby the Company modified the conversion price of the convertible note in the amount of $521,200 from $0.18 per share to $0.01 per share.  Pursuant to the guidance ASC 470-50-40 (formerly referred to as EITF 96-19), this modification was treated as an extinguishment of debt.  This resulted in the acceleration of the remaining discount on the original note in the amount of $505,755, which was charged to operations during the three months ended March 31, 2010 as a loss on debt restructuring.  A beneficial conversion feature was calculated on the modified note, which resulted in a discount of $521,200.  This discount is being amortized via the effective interest method over the remaining term of the note.

26

The Company has convertible notes payable outstanding which contain a provision for contingent warrants that are potentially issuable.  Pursuant to the convertible notes agreements, these warrants are issuable if  the note holder elects to convert at least 25% of the principal amount of the note during the term of the note.  At March 31, 2010, there are contingent 5 year warrants issuable to purchase an aggregate of 43,000 shares  of the Company’s common stock at a price of $5.00 per share.

The following table lists the notes payable at March 31, 2010 and December 31, 2009:

	Principal balance:
	March 31, 2010		December 31, 2009
Convertible note payable to a related party in the amount of $2,000,000 dated June 14, 1994. On March 3, 2007, this note was replaced with a new note in the amount of $3,170,188, which included accrued interest in the amount of $959,089, a salary payable of $106,575, and a loss of $104,524.  On March 1, 2008, this note was replaced with a new note in the amount of $500,000, the amount of $2,670,188 was forgiven by the note holder. The note signed on March 1, 2008 is a non interest bearing note, and is payable contingent upon (a) the Company’s receipt of revenues, as defined, in which case the Company will pay 2% of such revenues, as received, in satisfaction of this note; and/or (b) the sale of substantially all of the Company’s assets.  Interest in the amount of $0 was accrued on these  notes during the three  months ended March 31, 2010 and 2008, respectively.   Total accrued interest at March 31, 2010 and 2009 amounted to $222,521.	$	500,000	$	500,000
Convertible note payable to a related party in the amount of $1,170,356 dated May 15, 2002.  On March 3, 2007, this note was replaced with a new note in the amount of $1,342,127, which included accrued interest of $379,324, and a gain of $207,553. On March 1, 2008, this note was replaced with a new note in the amount of $500,000, the amount of $842,127 was forgiven by the debt holder. The note dated March 1, 2008 is a non interest bearing note, and is payable contingent upon (a) the Company’s receipt of revenues, as defined, in which case the Company will pay 2% of such revenues, as received, in satisfaction of this note; and/or (b) the sale of substantially all of the Company’s assets. Interest in the amount of $0 was accrued on these notes during the three  months ended March 31, 2010 and 2009, respect ively.   Total accrued interest at March 31, 2010 and 2009 amounted to $94,206.		500,000		500,000
Convertible note payable to a related party in the amount of $25,000 dated March 10, 2005.  On March 3, 2007, this note was replaced with a new note in the amount of $30,211, which includes accrued interest of $4,938 and a loss of $272.  On March 31, 2008, this note was replaced with a new note in the amount of $33,232, which includes accrued interest of $3,021. The note bears interest at the rate of 10% per annum, and was due in full on February 28, 2013.  This note is convertible into common stock of the Company at a conversion price of $0.1781 per share. A beneficial conversion feature in the amount of $33,232 was recorded as a discount to the note and is being amortized over the term of the note via the effective interest rate method at a rate of 8.3%. Interest in the amount of $819 was accrued on this note during the three months ended March 31, 2010 and 2009. Total accrued interest at March 31, 2010 and 2009 amounted to $6,928 and $3,605, respectively.		33,232		33,232
Convertible note payable to a related party in the amount of $37,000 dated February 26, 2005.  On March 3, 2007, this note was replaced with a new note in the amount of $44,848, which included accrued interest of $6,418, and loss of $1,430. On March 1, 2008, this note was replaced with a new note in the amount of $49,333, which includes accrued interest of $4,485.  The note bears interest at the rate of 10% per annum, and is due in full on February 1, 2013. This note is convertible into common stock of the Company at a conversion price of $1.78 per share. A beneficial conversion feature in the amount of $49,333 was recorded as a discount to the note, and is being amortized over the term of the note via the effective interest rate method at a rate of 8%. Interest in the amount of $1,216 was accrued on this note durin g the three months ended March 31, 2010 and 2009. Total accrued interest at March 31, 2010 and 2009 amounted to $10,285 and $5,352, respectively.		49,333		49,333
Note payable in the amount of $8,110 dated December 31, 1997.  On March 3, 2007, this note was replaced with a new note in the amount of $19,442, which included accrued interest of $7,437, and loss of $3,895. The note bears interest at the rate of 10% per annum, and is due in full on February 28, 2010.  Interest in the amount of $479 was accrued on this note during the three months ended March 31, 2010 and 2009.   Total accrued interest at March 31, 2010 and 2009  amounted to $5,997 and $4,054, respectively. During the period ended December 31, 2008, the Company exercised its right to extend the maturity date until February 28, 2010. This note is currently past due and may be called by the payee at any time.		19,442		19,442

27

	Principal balance:
	March 31, 2010		December 31, 2009
Note payable in the amount of $11,932 dated December 31, 1999.  On March 3, 2007, this note was replaced with a new note in the amount of $23,641, which included accrued interest of $8,168, and a loss of $3,540. The note bears interest at the rate of 10% per annum, and is due in full on February 28, 2010.  Interest in the amount of $583 was accrued on this note during the three months ended March 31, 2010 and 2009.  Total accrued interest at March 31, 2010 and 2009  amounted to $7,293and $4,929 respectively. During the period ended December 31, 2008, the Company exercised its right to extend the maturity date until February 28, 2010. This note is currently past due and may be called by the payee at any time.		23,641		23,641
Note payable in the amount of $33,860 dated December 31, 2000.  On March 3, 2007, this note was replaced with a new note in the amount of $60,971, which included accrued interest of $20,882, and a loss of $6,228. The note bears interest at the rate of 10% per annum, and is due in full on February 28, 2010.  Interest in the amount of $1,503 was accrued on this note during the three months ended March 31, 2010 and 2008. Total accrued interest at March 31, 2010 and 2009  amounted to $18,809 and $12,712, respectively.  During the period ended December 31, 2008, the Company exercised its right to extend the maturity date until February 28, 2010. This note is currently past due and may be called by the payee at any time.		60,971		60,971
Note payable in the amount of $25,000 dated February 28, 2001. On March 3, 2007, this note was replaced with a new not in the amount of $44,355, which included accrued interest in the amount of $15,014, and a loss of $4,341. On March 1, 2008, this note was replaced with a new note in the amount of $127,305, which consolidated two other notes payable to this note holder in the amounts of $41,774, and $28,603, and accrued interest of $11,573.The note bears interest at the rate of 10% per annum, and is due in full on February 28, 2013. This note is convertible into shares  of common stock at a rate of $1.78 per share.  A beneficial conversion in the amount of $127,305 was recorded for this note and is being amortized over the term of the note via the effective interest rate method at a rate of 8.2%. Interest in the amount of $3,139 was accrued on this note during the three months ended March 31, 2010 and 2009. Total accrued interest at March 31, 2010 and 2009 amounted to $26,542 and $13,812, respectively.		127,305		127,305
Note payable in the amount of $16,750 dated June 1, 2002.  On March 3, 2007, this note was replaced with a new note in the amount of $45,224, which included accrued interest in the amount of $14,275, and a loss of $3,322. The note bears interest at the rate of 10% per annum, and is due in full on February 28, 2010.  Interest in the amount of $1,115 was accrued on this note during the three months ended March 31, 2010 and 2009. Total accrued interest at March 31, 2010 and 2009  amounted to $13,951 and $9,429, respectively. During the period ended December 31, 2008, the Company exercised its right to extend the maturity date until February 28, 2010. This note is currently past due and may be called by the payee at any time.		45,224		45,224
Note payable in the amount of $18,000 dated June 1, 2002.  On March 3, 2007, this note was replaced wit ha new note in the amount of $28,350, which included accrued interest in the amount of $8,551, and a loss of $1,798. On March 1, 2008, this  note was replaced with a new note in the amount of $31,185, which includes accrued interest in the amount of $2,835. The note bears interest at the rate of 10% per annum, and is due in full on February 28, 2013. This note is convertible into shares  of common stock at a rate of $1.78 per shares.  A beneficial conversion feature in the amount of $31,285 was recorded for this note and is being amortized over the term of the note via the effective interest rate method at a rate of 8.3%. Interest in the amount of $769 was accrued on this note during the t hree months ended March 31, 2010 and 2009.  Total accrued interest at March 31, 2010 and 2009 amounted to $6,502 and $3,383, respectively.		31,185		31,185

28

	Principal balance:
	March 31, 2010		December 31, 2009
Note payable in the amount of $62,019 dated July 1, 2005. On January 1, 2007, this note was replaced with a new note in the amount of $94,334, which included accrued interest of $9,328, and a loss of 422,987. On March 1, 2008, this note was replaced with a new note in the amount of $88,132, which includes accrued interest in the amount of $2,221. The note bears interest at the rate of 10% per annum, and is due in full on February 28, 2013.  This note is convertible into shares  of common stock at a price of $1.78 per share.  A beneficial conversion feature was recorded in the amount of $91,149 on the note. Interest in the amount of $2,173 was accrued on this note during the three months ended March 31, 2010 and 2009. Total accrued interest at March 31, 2010 and 2009 amounted to $17,625 and $8,812, respecti vely.		88,132		88,139
Note payable in the amount of $25,000 dated October 6, 2005.  On March 3, 2007, this note was replaced with a new note in the amount of $28,603, which included interest in the amount of $3,500, and a loss of $103. On March 1, 2008, this note was consolidated into a new note in the amount of $29,025, and is due on February 28, 2013. Interest in the amount of $716 was accrued on this note during the three months ended March 31, 2010 and 2009. Total accrued interest at March 31, 2010 and 2009 amounted to $6,051 and $3,148, respectively.		29,025		29,025
Note payable in the amount of $69,806 dated March 3, 2007. On March 1, 2008, this note was replaced with a new note in the amount of $76,787, which included accrued interest in the amount of $6,981. The note bears interest at a rate of 10% per annum, and is due in full on February 28, 2013.  This note is convertible into shares (post shares) of common stock at a rate of $1.78 per share.  A beneficial conversion feature in the amount of $76,787 was recorded on the note and is being amortized over the term of the note via the effective interest rate method at a rate of 8.3%. Interest in the amount of $1,893 was accrued on this note during the three months ended March 31, 2010 and 2009.  Total accrued interest at March 31, 2010 and 2009 amounted to $15,950 and $8,272, respectively.		76,787		76,787
Note payable  in the amount of $550,000 dated June 24, 2008.  The note bears interest at a rate of 10% per annum, and is due in full on June 24, 2010.  This note becomes convertible into shares  of common stock upon the closing of a qualified financing.  Interest in the amount of $13,562 was accrued during the three months ended March 31, 2010 and 2009.  Total accrued interest at March 31, 2010 and 2009 amounted to $97,192 and $42,192, respectively.		550,000		550,000
Convertible note payable in the amount of $521,200 dated March 1, 2008. The note bears interest at a rate of 10% per annum, and is due in full on February 28, 2013. This note is convertible into common stock at a rate of $1.78 per share.  A beneficial conversion feature in the amount of $521,200 was recorded and is being amortized over the term of the note via the effective interest rate method at a rate of 8.3%.  During the three months ended March 31, 2010, the Company entered into a debt restructuring agreement, whereby the conversion rate for the note payable was reduced to $0.01 per share.  This restructuring agreement was accounted for as an extinguishment of debt, and the unamortized  balance of the discount of in the amount of $505,755 was charged to operations during the three months end ed March 31, 2010.  A new discount representing the value of the beneficial conversion feature associated with the $0.01 conversion price was calculated in the amount of $521,200, and this amount was charged to additional paid-in capital.   Interest in the amount of $12,852 was accrued on this note during the three months ended March 31, 2010,  and 2009.   Total accrued interest at March 31, 2010 and 2009 amounted to $111,845 and $59,724, respectively.		521,200		521,200
Note payable in the amount of $287,768 dated October 31, 2008. The note bears interest at a rate of 10% per annum, and was due in full on June 30, 2009.  Interest in the amount of $7,096 was accrued on this note during the three months ended March 31, 2010 and 2009. Total accrued interest at March 31, 2010 and 2009 amounted to $40,682 and $11,905, respectively. This note is currently past due and may be called by the payee at any time.		287,768		287,768
Convertible note payable in the amount of $10,000 dated January 14, 2010.  The note bears interest at the rate of 10% per annum, and is due in full on January 14, 2015. This note is convertible into common stock of the Company at a conversion price of $0.01 per share. A beneficial conversion feature in the amount of $10,000 was recorded as a discount to the note, and is being amortized over the term of the note via the effective interest rate method at a rate of 8%. Interest in the amount of $208 and $0 was accrued on this note during the three months ended March 31, 2010 and 2009, respectively. Total accrued interest at March 31, 2010 and 2009 amounted to $208 and $0, respectively.		10,000		-

29

	Principal balance:
	March 31, 2010		December 31, 2009
Convertible note payable in the amount of $30,000 dated January 14, 2010.  The note bears interest at the rate of 10% per annum, and is due in full on January 14, 2015. This note is convertible into common stock of the Company at a conversion price of $0.01 per share. A beneficial conversion feature in the amount of $30,000 was recorded as a discount to the note, and is being amortized over the term of the note via the effective interest rate method at a rate of 8%. Interest in the amount of $625 and $0 was accrued on this note during the three months ended March 31, 2010 and 2009, respectively. Total accrued interest at March 31, 2010 and 2009 amounted to $625 and $0, respectively.		30,000		-
Convertible note payable in the amount of $55,000 dated January 19, 2010.  The note bears interest at the rate of 10% per annum, and is due in full on January 19, 2015. This note is convertible into common stock of the Company at a conversion price of $0.01 per share. A beneficial conversion feature in the amount of $55,000 was recorded as a discount to the note, and is being amortized over the term of the note via the effective interest rate method at a rate of 8%. Interest in the amount of $1,070 and $0 was accrued on this note during the three months ended March 31, 2010 and 2009, respectively. Total accrued interest at March 31, 2010 and 2009 amounted to $1,070 and $0, respectively.		55,000		-
Convertible note payable in the amount of $10,000 dated January 20, 2010.  The note bears interest at the rate of 10% per annum, and is due in full on January 20, 2015. This note is convertible into common stock of the Company at a conversion price of $0.01 per share. A beneficial conversion feature in the amount of $10,000 was recorded as a discount to the note, and is being amortized over the term of the note via the effective interest rate method at a rate of 8%. Interest in the amount of $192 and $0 was accrued on this note during the three months ended March 31, 2010 and 2009, respectively. Total accrued interest at March 31, 2010 and 2009 amounted to $192 and $0, respectively.		10,000		-
Convertible note payable in the amount of $10,000 dated January 20, 2010.  The note bears interest at the rate of 10% per annum, and is due in full on January 20, 2015. This note is convertible into common stock of the Company at a conversion price of $0.01 per share. A beneficial conversion feature in the amount of $10,000 was recorded as a discount to the note, and is being amortized over the term of the note via the effective interest rate method at a rate of 8%. Interest in the amount of $192 and $0 was accrued on this note during the three months ended March 31, 2010 and 2009, respectively. Total accrued interest at March 31, 2010 and 2009 amounted to $192 and $0, respectively.		10,000		-
Convertible note payable in the amount of $20,000 dated January 20, 2010.  The note bears interest at the rate of 10% per annum, and is due in full on January 20, 2015. This note is convertible into common stock of the Company at a conversion price of $0.01 per share. A beneficial conversion feature in the amount of $20,000 was recorded as a discount to the note, and is being amortized over the term of the note via the effective interest rate method at a rate of 8%. Interest in the amount of $384 and $0 was accrued on this note during the three months ended March 31, 2010 and 2009, respectively. Total accrued interest at March 31, 2010 and 2009 amounted to $384 and $0, respectively.		20,000		-
Convertible note payable in the amount of $45,000 dated January 22, 2010.  The note bears interest at the rate of 10% per annum, and is due in full on January 22, 2015. This note is convertible into common stock of the Company at a conversion price of $0.01 per share. A beneficial conversion feature in the amount of $45,000 was recorded as a discount to the note, and is being amortized over the term of the note via the effective interest rate method at a rate of 8%. Interest in the amount of $863 and $0 was accrued on this note during the three months ended March 31, 2010 and 2009, respectively. Total accrued interest at March 31, 2010 and 2009 amounted to $863 and $0, respectively.		45,000		-

30

	Principal balance:
	March 31, 2010		December 31, 2009
Convertible note payable in the amount of $3,500 dated March 26, 2010.  The note bears interest at the rate of 10% per annum, and is due in full on March 26, 2015. This note is convertible into common stock of the Company at a conversion price of $0.01 per share. A beneficial conversion feature in the amount of $3,500 was recorded as a discount to the note, and is being amortized over the term of the note via the effective interest rate method at a rate of 8%. Interest in the amount of $5 and $0 was accrued on this note during the three months ended March 31, 2010 and 2009, respectively. Total accrued interest at March 31, 2010 and 2009 amounted to $5 and $0, respectively.		3,500		-
Convertible note payable in the amount of $10,000 dated January 1, 2010.  The note bears interest at the rate of 10% per annum, and is due in full on January 1, 2015. This note is convertible into common stock of the Company at a conversion price of $0.01 per share. A beneficial conversion feature in the amount of $10,000 was recorded as a discount to the note, and is being amortized over the term of the note via the effective interest rate method at a rate of 8%. Interest in the amount of $244 and $0 was accrued on this note during the three months ended March 31, 2010 and 2009, respectively. Total accrued interest at March 31, 2010 and 2009 amounted to $244 and $0, respectively.		10,000		-
Convertible note payable in the amount of $10,000 dated January 1, 2010.  The note bears interest at the rate of 10% per annum, and is due in full on January 1, 2015. This note is convertible into common stock of the Company at a conversion price of $0.01 per share. A beneficial conversion feature in the amount of $10,000 was recorded as a discount to the note, and is being amortized over the term of the note via the effective interest rate method at a rate of 8%. Interest in the amount of $244 and $0 was accrued on this note during the three months ended March 31, 2010 and 2009, respectively. Total accrued interest at March 31, 2010 and 2009 amounted to $244 and $0, respectively.		10,000		-

Total outstanding	$	3,146,752		$	2,943,252
Less discount on notes payable		(1,134,671	)		(932,269	)
Total – net of discounts		2,012,081			2,019,983
Less current portion – net of discounts		(987,046	)		(987,046	)
Long-term portion – net of discounts	$	1,025,035		$	1,032,937
Related Party	$	1,004,745		$	1,003,563
Related Party – current portion		-			-
Related Party – long term portion	$	1,004,745		$	1,003,563
Non-related party	$	1,007,336		$	1,016,420
Non-related party – current portion		987,046			987,046
Non-related party – long term portion	$	20,290		$	29,374

31

7. EQUITY

On July 8, 2008, the Company filed an amendment to the articles of incorporation to the State of Delaware amended the number of authorized shares from 300,000,000 to 50,000,000 and the par value from $0.01 to $0.0001. At March 31, 2010 and December 31, 2009, the Company had issued and outstanding 8,914,921 shares of common stock.  No shares of preferred stock are issued or outstanding.

Term Sheet for Debt Restructuring and Agreed Upon Restructuring

 As described in the Company’s Form 8-K filed on January 26, 2010, the Company entered into a Term Sheet (the “Term Sheet”) for Debt Financing and Agreed Upon Restructuring with Margie Chassman (“Chassman”), pursuant to which (i) up to $500,000 in convertible debt financing may take place at a conversion price of $0.01 per share (the “Convertible Debt Financing”), of which $208,500 has been funded to date, (ii) the conversion price related to approximately $800,000 in existing unsecured indebtedness to Chassman was fixed at $0.01 per share, (iii) Chassman agreed to a 2-year lock-up with respect to her convertible debt and underlying stock, subject to agreed upon quarterly leakage amounts, and (iv) management and certain angel investors received limited anti-dilution protection that will re sult in the issuance to management of such additional shares as are required to maintain management’s specified collective ownership interest through the next $3.5 million in net financing and the angel investors to maintain their specified collective ownership interest through the initial round of up to $500,000 in convertible debt financing.

The number of currently issued and outstanding shares of the Company’s stock stands at 8,914,921 as of March 31, 2010.  However, based on, among other things: (i) additional shares that will be issued to management and certain angel investors through the anti-dilution protection prescribed in the Term Sheet, (ii) the adjustment in the conversion price of certain previously issued notes, and (iii) the conversion price offered to investors in the Convertible Debt Financing, the number of additional shares of common stock of the Company that could be issued or has become issuable is greatly in excess of that number and, subject to an increase in authorized share capital to permit conversion, would substantially exceed the total number of authorized shares of Common Stock of the Company.  Although contractual proh ibitions contained in the convertible notes themselves and in the Term Sheet would prevent the conversion of any debt or equity securities to the extent such conversion would result in an issuance of shares in an amount greater than the number of authorized shares of the Company, once the Company’s authorized share capital is increased, existing holders of common stock could experience substantial dilution if the Company’s convertible debt holders choose to convert their debt to equity.   Management plans, in due course, to seek appropriate shareholder authorization to increase the number of authorized shares of the Company to a number sufficient to accommodate conversion of all then-outstanding debt and equity securities.

Common Stock

For the three months ended March 31, 2010, there were no new issuances of common stock of the Company.

32

Warrants

The following table summarizes the changes in warrants outstanding and the related prices for the shares of the Company’s common stock issued to non-employees of the Company. The following table summarizes the warrants outstanding as of March 31, 2010:

Warrants Outstanding				Warrants Exercisable
Exercise Prices		Number Outstanding	Weighted Average Remaining Contractual Life (years)	Weighted Average Exercise Price		Number Exercisable	Weighted Average Remaining Contractual Life (years)
$	1.78-2.50	145,180	5.67	$	1.78-2.50	145,180	5.67
5.00		727,200	3.36		5.00	727,200	3.36
Total		872,380	3.74			872,380	3.74

The following table summarizes the changes in warrants outstanding and the related prices for the shares of the Company’s common stock issued to non-employees of the Company. The following table summarizes the warrants outstanding as of December 31, 2009: 

Warrants Outstanding				Warrants Exercisable
Exercise Prices		Number Outstanding	Weighted Average Remaining Contractual Life (years)	Weighted Average Exercise Price		Number Exercisable	Weighted Average Remaining Contractual Life (years)
$	1.78-2.50	145,180	5.92	$	1.78-2.50	145,180	5.92
5.00		727,200	3.61		5.00	727,200	3.61
Total		872,380	3.99			872,380	3.99

Transactions involving warrants are summarized as follows:

	Number of Shares		Weighted Average Price Per Share
Outstanding at December 31, 2009		872,380	$	4.54
Granted		-		-
Exercised		-		-
Cancelled or expired		-		-
Outstanding at March 31, 2010		872,380	$	4.54

The Company has convertible notes payable outstanding which contain a provision for contingent warrants that are potentially issuable. Pursuant to the convertible notes agreements that warrants are issuable if the notes holder elects to convert at least 25% of the principal amount due, during the term of the note. According to the convertible note payable agreements there are warrants issuable to purchase 120,710 shares of common stock. Upon issuance these warrants are exercisable for 5 years at a price of $1.80 per share. 

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Options

During the year ended December 31, 2008, the Company issued options to purchase 100,000 shares of common stock at a price per share of $2.50. These options were valued at an aggregate of $124,192, and vest at the following rate: 33,000 vested at the time of issuance, and the balance vest ratably over a 23 month period.  During the three months ended March 31, 2010, the Company charged to operations the fair value of the vested options, or $10,399.

The following table summarizes the changes in options outstanding and the related prices for the shares of the Company’s common stock issued to non-employees of the Company. The following table summarizes the warrants outstanding as of March 31, 2010:

Options Outstanding					Options Exercisable
Exercise Prices		Number Outstanding		Weighted Average Remaining Contractual Life (years)	Weighted Average Exercise Price		Number Exercisable	Weighted Average Remaining Contractual Life (years)
$	2.50		2,350,000	8.02	$	2.50	2,319,283	8.02
Total			2,350,000	8.02			2,319,283	8.02

The following table summarizes the changes in options outstanding and the related prices for the shares of the Company’s common stock issued to non-employees of the Company. The following table summarizes the warrants outstanding as of December 31, 2009:

Options Outstanding					Options Exercisable
Exercise Prices		Number Outstanding		Weighted Average Remaining Contractual Life (years)	Weighted Average Exercise Price		Number Exercisable	Weighted Average Remaining Contractual Life (years)
$	2.50		2,350,000	8.27	$	2.50	2,285,791	8.27
Total			2,350,000	8.27			2,285,791	8.27

Transactions involving warrants are summarized as follows:

	Number of Shares		Weighted Average Price Per Share
Outstanding at December 31, 2009		2,350,000	$	2.50
Granted		-		-
Exercised		-		-
Cancelled or expired		-		-
Outstanding at March 31, 2010		2,350,000	$	2.50
Exercisable at March 31, 2010		2,336,029	$	2.50
Not exercisable at March 31, 2010		13,971	$	2.50

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8. RELATED PARTIES

Amounts due to related parties at March 31, 2010, consisted of the following:

Convertible Notes Payable to related parties

The Company has a note payable outstanding to its Chief Executive Officer, in the amount of $500,000 at March 31, 2010 and December 31, 2009. The note is a non interest bearing note, and is payable contingent upon (a) the Company’s receipt of revenues, as defined, in which case the Company will pay 2% of such revenues, as received, in satisfaction of this note; and/or (b) the sale of substantially all of the Company’s assets. During the three months ended March 31, 2010 and 2009, the Company accrued no interest on these notes.

The Company has a convertible note payable outstanding to Dennis Lichtenstein, a relative of the Chief Executive Officer, in the amount of $49,333 at March 31, 2010 and December 31, 2009. The note bears interest at a rate of 10% per annum. During the three months ended March 31, 2010 and 2009, the Company accrued interest in the amount of $1,216.   A beneficial conversion feature in the amount of $49,333 was recorded as a discount to the note, and is being amortized over the term of the note via the effective interest rate method at a rate of 8%.  As of March 31, 2010 a discount in the amount of $46,498 remained on this note.

The Company has a note payable outstanding to Alexander Krichevsky, an officer of the Company, in the amount of $500,000 at March 31, 2010 and December 31, 2009. The note is a non interest bearing note, and is payable contingent upon (a) the Company’s receipt of revenues, as defined, in which case the Company will pay 2% of such revenues, as received, in satisfaction of this note; and/or (b) the sale of substantially all of the Company’s assets.  During the three months ended March 31, 2010 and 2009, the Company accrued no interest on these notes.

The Company has a note payable outstanding to Jennie Fay Lichtenstein, a relative of the Chief Executive Officer, in the amount of $33,232 at March 31, 2010 and December 31, 2009. This note bears interest at a rate of 10% per annum. During the three months ended March 31, 2010 and 2009, the Company accrued interest in the amount of $819.   A beneficial conversion feature in the amount of $33,232 was recorded as a discount to the note and is being amortized over the term of the note via the effective interest rate method at a rate of 8.3%.  As of March 31, 2010, a discount in the amount of $31,322 remained on this note.

Accounts Payable and Accrued Liabilities- related parties

The Company had a liability to  an officer for consulting fees payable in the amount of $450,000 at March 31, 2010, which was included in accounts payable and  accrued liabilities - related party.

Accrued Salaries-related parties

During the three months ended March 31, 2010, the Company has accrued the salary and payroll taxes payable to Harris Lichtenstein, the Company’s Chief Executive Officer.  Pursuant to his employment agreement with the Company, Dr. Lichtenstein is to be paid an annual salary of $245,000 and, as a result, the Company has accrued the amount of $61,250 for each quarter.  During the three months ended March 31, 2010, the Company made payments of $13,077 to the Officer. As of March 31, 2010, the Company has accrued a total of $285,673 in accrued salary. During the three months ended March 31, 2010, the Company made payments of payroll taxes in the amount of $1,326, as of March 31, 2010, the Company has a total of $29,299 in accrued payroll taxes.

During the three months ended March 31, 2010, the Company has accrued the salary and payroll taxes payable to Alex Krichevsky, an officer of the Company.  Pursuant to his employment agreement with the Company Mr. Krichevsky is to be paid an annual salary of $245,000 and, as a result, the Company has accrued the amount of $61,250 for each quarter.  During the three months ended March 31, 2010, the Company made payments of $13,077 to the Officer. As of March 31, 2010, the Company has accrued a total of $293,173 in accrued salary.  During the three months ended March 31, 2010, the Company made payments of payroll taxes in the amount of $1,326, as of March 31, 2010, the Company has a total of $29,299 in accrued payroll taxes.

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During the three months ended March 31, 2010, the Company has accrued the consulting fees payable to Howard Becker, an officer of the Company.  Pursuant to the consulting agreement, Mr. Becker’s consulting firm, Becker Advisors, Ltd., is to be paid monthly fees of $8,600 for part-time service to the Company and, as a result, the Company has accrued the amount of $25,800 for each quarter.  In addition, under the consulting agreement, Becker Advisors is to be paid an hourly fee for all hours expended above a certain threshold amount. As of March 31, 2010, the Company has accrued a total of $197,000, which is shown in accounts payable-related party on the Company's balance sheet.

There are no agreements or understandings between the Company and the aforementioned executives regarding the payment of the above salaries, taxes and consulting fees, all of which are currently past due. As of the date of this report,  none of these executives has taken any action or steps in furtherance of the formal collection of these past due amounts.

9. COMMITMENTS AND CONTINGENCIES

Lease of office space

The Company leases office space in Houston, Texas under a month to month lease calling for annual rent of $8,400 .

ASRI License Agreement

The Company entered into a license agreement (the “ASRI License Agreement”) with Allegheny-Singer Research Institute (“ASRI”) on February 3, 1999, as amended. The two parties agreed to an amended and restated agreement which became effective February 1, 2005. ASRI granted the Company rights to develop, manufacture, sell, rent or lease Licensed Products in the Field (each as defined in the ASRI License Agreement). The Company agreed to pay royalties of 1-2% of net sales of all products covered in the agreement. The ASRI License Agreement gives the Company the right to sublicense to third parties. The Company agreed to pay ASRI between 5-20% of the sublicense income depending on the nature of the sublicense.

The Company and ASRI agreed to further amend the ASRI License Agreement which amendment became effective February 1, 2007. As part of the amendment, ASRI granted the Company an extension on the first payment of licensing fees from the original due date of February 1, 2007 to May 1, 2007.  During the three months ended March 31, 2008, the Company issued 119,053 shares of common stock previously accrued, and has issued a total of 145,042 shares of common stock under this agreement.

The Company and ASRI agreed to further amend the license agreement, which amendment became effective June 30, 2008. ASRI granted the Company an extension of the second payment of licensing fees from the original due date of February 1, 2008 to June 30, 2008.     Thereafter, ASRI agreed to further extend from February 1, 2009 to August 1, 2009, the license fee of $50,000.

The Company has not made the payment of  $50,000 that was due on August 1, 2009, nor has it received a formal extension from ASRI with respect thereto.   The Company paid ASRI $15,000 toward this past due obligation and continues to engage in informal discussions with ASRI in an attempt to achieve a consensual payment arrangement to resolve its past due obligations under the ASRI License Agreement.  Although no agreement has been reached with ASRI regarding these delinquent obligations,  ASRI has not, as of the date of this report, declared a default under the ASRI License Agreement, after which we would have a contractual period in which to make such payment and cure the default before the ASRI License Agreement could be terminated. Should such a declaration of default be issued, there is no ass urance that the Company would have sufficient wherewithal to cure the default within the prescribed cure period or to otherwise stave off the termination of the ASRI License Agreement.

As of March 31, 2010, the Company has paid $102,500, of which $10,000 payments were made during the period ended March 31, 2010,  in licensing fees under this agreement and has accrued the past due amount of $30,000.

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Columbia License Agreement

The Company entered into a license agreement (the “Columbia License Agreement”) with Columbia University (“Columbia”) that was effective February 1, 2005, pursuant to which  Columbia granted the Company rights to develop, manufacture, sell, rent or lease Licensed Products in the Field (each as defined in the Columbia License Agreement). Columbia received a 5% equity stake in the Company. In addition, the Company paid a nonrefundable license fee of $30,000. The agreement provided that  $15,000 was to be paid 60 days from the effective date of the agreement and the other $15,000 to be paid one year from the effective of the agreement. The Company agreed to reimburse Columbia for past expenses of $50,000, of which $25,000 has been paid and the other $25,000 is due after sales of the licensed products amount to $1,000,000. The Company agreed to pay royalties of 1-2% of net sales of all products covered in the agreement. The agreement gives the Company the right to sublicense to third parties. The Company agreed to pay Columbia between 10-20% of the sublicense income depending on the nature of the sublicense. The Company agreed to pay annual license maintenance fees according to the schedule below:

$10,000 during the fiscal year ended December 31, 2007

$20,000 during the fiscal year ending December 31, 2008

$35,000 during the fiscal year ending December 31, 2009

$50,000 on or before February 1, 2010; and $40,000 each year thereafter.

During the three months ended March 31, 2008, the Company issued 119,053 shares of common stock previously accrued, and has issued a total of 145,042 shares of common stock under the Columbia License Agreement.

During the year ended December 31, 2008, the Company entered into an amendment to the Columbia License Agreement, pursuant to which Columbia terminated the Stock Purchase agreement. As a result, the Company cancelled 279,788 shares of common stock, which had been previously issued to Columbia. Also during the year ended December 31, 2008, the Company and Columbia agreed to further amend the Columbia License Agreement which amendment became effective June 30, 2008. The annual license maintenance fees have been amended to the schedule shown below:

$52,500 due on or before May 1, 2009

$75,000 due on or before May 1, 2010

$60,000 due on May 1 each year thereafter

During the fourth quarter 2009, Columbia and the Company agreed to a further amendment to the Columbia License Agreement, pursuant to which the $52,500 license maintenance fee due on May 1, 2009 was split into two equal payments of $26,250, the first of which continued to be due on May 1, 2009, and the second of which was extended to August 1, 2009.    The Company has not made the required payments of  $26,250 that were due, respectively, on May 1, 2009 and August 1, 2009, nor has it received a formal extension from Columbia with respect thereto.  The Company has paid an additional $17,500 toward the May 1 payment and continues to engage in informal discussions with Columbia in an attempt to achieve a consensual payment arrangement to resolve its past due obligations under the Columbia License Ag reement.  Although no agreement has been reached with Columbia regarding these delinquent obligations, Columbia has not, as of the date of this report, declared a default under the Columbia License Agreement, after which we would have a contractual period in which to make such payment and cure the default before the Columbia License Agreement could be terminated.   Should such a declaration of default be issued, there is no assurance that the Company would have sufficient wherewithal to cure the default within the prescribed cure period or to otherwise stave off the termination of the Columbia License Agreement

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 IGR License Agreement

The Company entered into a licensing agreement with Institut Gustave Roussy (IGR) that was effective November 1, 2007 (the “IGR License Agreement”). IGR granted the Company rights to use the Licensed Patents, Licensed Material and Licensed Information (each as defined in the IGR License Agreement). The Company agreed to pay a one time license fee of €125,000, of which €25,000 was payable on the effective date, €50,000 was payable one year from effective date and €50,000 is due two years from effective date. In addition, the Company agreed to pay license maintenance fees according to the schedule below:

€10,000 during the fiscal year ending December 31, 2008

€20,000 during the fiscal year ending December 31, 2009

€35,000 during the fiscal year ending December 31, 2010

€50,000 on or before November 1, 2011 and €50,000 every year thereafter

During the year ended December 31, 2007, the Company paid $36,087 (approximately €25,000).

In accordance with the above described schedule, on November 1, 2008, the Company was obligated to pay a total of €60,000 to IGR in license fees and maintenance fees, which payments were not made. The Company and IGR agreed to modify the payment schedule described above, so that the €10,000 maintenance fee that would otherwise have been due on November 1, 2008 matured in December 2008, at which time it was paid by the Company, and the  license fee €50,000 otherwise due on November 1, 2008, became payable in two equal installments of €25,000 on March 1, 2009 and June 1, 2009, respectively.

Thereafter, IGR agreed to split the €25,000 payment that would otherwise have been due on March 1, 2009, into two payments, the first of which was in the amount of €15,000 and continued to be due in March 2009.  The second payment of  €10,000 became due no later than June 2009.  The Company paid to IGR  the  €15,000 that was due in March 2009 and paid the remaining balance of the March 1 payment in August 2009.  Subsequent to the period covered by this report, the Company paid IGR an additional $25,000 toward this past due obligation and continues to engage in informal discussions with IGR in an attempt to achieve a consensual payment arrangement to resolve its past due obligations under the IGR License Agreement.  Although no agreement has be en reached with IGR regarding these delinquent obligations, IGR has not, as of the date of this report, declared a default under the IGR License Agreement, after which we would have a contractual period in which to make such payment and cure the default before the IGR License Agreement could be terminated. Should such a declaration of default be issued, there is no assurance that the Company would have sufficient wherewithal to cure the default within the prescribed cure period or to otherwise stave off the termination of the IGR License Agreement.

As of March 31, 2010, the Company has accrued $73,347, and has paid total licensing fees of $91,653, $25,000 of which was paid during the three months ended March 31, 2010.

Ohio State Licensing Agreement

The Company entered into a licensing agreement (the “OSU License Agreement”) with Ohio State University (OSU) that was effective April 18, 2008, pursuant to which  OSU granted the Company rights to use the Licensed Patents, Licensed Material and Licensed Information (each as defined in the OSU License Agreement). The OSU License Agreement provides for payment by the Company of a one time license fee of $300,000, of which $5,000 was paid on execution, $45,000 was paid on the first business day following the Phase 1 Data Review Period, $50,000 was paid in September 2009, $100,000 was originally due November 15, 2008, $50,000 was originally due June 30, 2009, and $50,000 was originally due September 30, 2009. In addition, the OSU License Agreement provides for reimbursement to OSU for its patent expenses according to the schedule below:

 $12,738 payable in eight quarterly payments beginning October 1, 2009

With respect to the license fee of $100,000 which, under the OSU License Agreement, was scheduled to be paid on or before November 15, 2008, the parties previously reached an understanding whereby $10,000 was to be and was paid immediately, $40,000 was to be due on March 1, 2009 and the balance of $50,000 would be due on June 30, 2009.  In addition, it is the Company’s position that the parties agreed to extend until September 30, 2009 the $50,000 license fee which, under the OSU Agreement, was scheduled to be paid on June 30, 2009, although OSU disputes that this amendment was effectuated.   

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As described in detail in the Company’s Form 8-K filed with the SEC on August 24, 2009, on August 17, 2009, OSU issued a formal notice (the “Notice”) to the Company of its alleged default under the OSU License Agreement based on the Company’s non-payment of certain license fees.   The Company has acknowledged that certain license fees called for under the OSU License Agreement have not been paid.  However, as reported by the Company in the aforementioned 8-K the Company believes that it has meritorious defenses and counterclaims to OSU’s claim of breach under the OSU License Agreement.

The OSU License Agreement provides that if the Company fails to make any required payment when due, OSU  has the right to terminate the OSU License Agreement on 30 days’ written notice, which has been provided to the Company in the form of the Notice.  Under Section 11.2 of the OSU License Agreement, any payments which, in fact, are due and owing as of the date of the Notice must be paid in full within 30 days of the receipt of the Notice, failing which the OSU License Agreement would terminate automatically.  However, Section 11.5 of the OSU License Agreement provides that if the Company, as licensee, disputes an alleged default or breach, the 30 day cure period shall be tolled pending the resolution of the dispute.  Such tolling is conditioned upon the posting of an appropriate bond and p ayment of all attorney fees and costs should OSU prevail.  Once the dispute is resolved, either for or against the Company, the Company would have the remainder of the cure period to pay such amounts found to be due to avoid automatic termination of the OSU License Agreement.

The Company has provided formal notice to OSU that it disputes OSU’s characterization in the Notice that the Company’s non-payment of scheduled fees and interest constitutes a breach of the OSU License Agreement.  On October 9, 2009, OSU advised the Company that it did not believe that the issues raised by the Company constituted a valid dispute that would call into play the tolling provisions of Section 11.5 and stated its view that it was considering the OSU License Agreement as terminated.   While not waiving its right to assert that the License Agreement was terminated, OSU also demanded a bond from the Company in the amount of $450,371.79 under Section 11.5 of the OSU License Agreement pending the resolution of the dispute.  Thereafter, the Company advised OSU of its position that, ba sed on the nature of its claims against OSU, the provisions in the OSU License Agreement that purport to require a bond were not enforceable and that no bond was required.  The Company further informed OSU that, in its view, if it were determined subsequently that a bond was required, the amount of any such bond would be substantially less than that demanded by OSU.  As of the date of this report, no formal action has been taken by either OSU or the Company regarding the bond or the underlying dispute.

Omnimmune continues to engage in discussions regarding the voluntary termination of the OSU License Agreement on terms acceptable to both parties.  The Company cannot predict the likelihood that this dispute will be resolved consensually, or if litigation ensues, of prevailing in its dispute with OSU, either with respect to the question of the need for a bond or the amount thereof, or as to the underlying dispute itself.   However, if it were ultimately determined that the Company’s defenses and counterclaims lack merit and the dispute were resolved in favor of OSU, it is highly likely that the OSU License Agreement will be terminated.  Also, if it were determined that a bond was required within 30 days of receipt of the Notice from OSU, or if a bond is required which the Company is unable to po st, it is highly likely that the OSU License Agreement will be terminated.  In addition, if OSU were to prevail in its position that the Company was in breach of the OSU License Agreement, the Company would also face an award or judgment for all past due payments, plus interest, legal fees and court costs.  The Company believes that whether through litigation or settlement, and regardless of which party prevails, there is a substantial likelihood that the OSU License Agreement will be terminated, leaving the Company free to focus on its core diagnostic technologies.

The technology that is the subject of the OSU License Agreement relates exclusively to the Company’s vaccine technology and has no direct connection to the Company’s diagnostic and prognostic technologies that are under license from academic institutions other than OSU.  Any termination of the OSU License Agreement, whether through a consensual understanding with OSU or through an adverse result following litigation, will have no effect on the Company’s portfolio of diagnostic and prognostic technologies, which are expected to be the Company’s primary focus going forward.

As of March 31, 2010, the Company has paid $110,000 in licensing fees under this agreement, plus an additional $200,000 in related payments under separate gift agreements with OSU.  The Company has accrued unpaid license fees in the amount of $163,738, which obligations are noted as being disputed.

Contingent warrants issuable

The Company has convertible notes payable outstanding which contain a provision for contingent warrants that are potentially issuable. Pursuant to the convertible notes agreements that warrants are issuable if the notes holder elects to convert at least 25% of the principal amount due, during the term of the note. According to the convertible note payable agreements, there are potentially 1,207,096 warrants issuable to purchase shares of common stock. Upon issuance these warrants are exercisable for 5 years at a price of $0.1781 per share.

10. SUBSEQUENT EVENTS

As of the date of this interim financial report, there have been no subsequent events that warrant disclosure by the Company.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Overview

Omnimmune Holdings, Inc. (“Omnimmune” or the “Company”) is the holding company of Omnimmune Corp., a development-stage biotechnology company integrating complementary cancer therapeutic, diagnostic and prognostic technologies.  Our mission is to provide a comprehensive and personalized approach to the clinical management of cancer through improved diagnostic, prognostic and therapeutic interventions.  Omnimmune has acquired licensed rights to breakthrough diagnostic and  platform monoclonal antibody technologies.

Omnimmune intends to play a leading role in the development of personalized cancer treatment with the selection of prophylactic and therapeutic vaccines (active immunization), monoclonal antibodies (passive immunization) and genomic-based products, which target a hormone called human chorionic gonadotropin (“hCG”).  Appropriate patient-specific passive immunotherapies will be based upon a patient’s own sequences of hCGß (human chorionic gonadotropin beta subunit), and its gene products (mRNA).  HCGß and its genes have been detected in a majority of cancers studied to date, and is a well validated, ubiquitous, and prototypical  tumor associated antigen marker.  On this basis, hCGß has enormous potential as a target for the diagnosis and treatment of cancer pat ients.  The application of appropriate patient-specific immunotherapy will be based upon the genomic expression and translation of a patient’s own subunit marker(s), as determined by Omnimmune’s combined immuno-genomic cancer diagnostic and prognostic systems.  An immuno-genomic companion diagnostic trial is being planned by Omnimmune, and is expected to take place during the 2010 calendar year, subject to the Company obtaining sufficient financing.  Omnimmune expects that the results of that trial will be a prelude to the development of a widely applicable diagnostic system for the diagnosis, prognosis and determination of recurrence of many types of cancer.  Omnimmune plans to conduct a Phase I trial with its lead candidate anti-hCGb monoclonal antibodies based upon the results of the diagnostic trial.

Omnimmune believes that this customized diagnostic-therapeutic coupling approach represents a new paradigm for targeted therapy, and will significantly alter the way in which cancer patients will be managed in the future.

Omnimmune’s objective is to be a leader in the implementation (reduction to practice) of previously discovered and characterized vaccines and monoclonal antibodies, and in the discovery, development and commercialization of new vaccines (active immunization) and monoclonal  antibodies for diagnostic, prognostic and therapeutic (passive immunization) purposes, as well as genomic-based products targeting hCGß.

Omnimmune’s unique hCGß and related technologies, which are protected through an expanding intellectual property portfolio, have been developed at institutions including Columbia University of New York, New York (“Columbia”), The Allegheny-Singer Research Institute of the West Penn Allegheny Health System, Pittsburgh, Pennsylvania (“Allegheny”) and The Institute Gustave Roussy, Paris, France (“IGR”).

The predecessor of the Company was originally incorporated on February 22, 2007, in the state of Nevada as Roughneck Supplies, Inc. (“Roughneck”).  On August 6, 2008, Roughneck merged with and into Omnimmune Holdings, Inc. which resulted in (i) Roughneck changing its domicile from Nevada to Delaware, (ii) Roughneck changing its name from “Roughneck Supplies, Inc.” to “Omnimmune Holdings, Inc.”, (iii) Roughneck changing its fiscal year end from May 31 to December 31 and (iv) Roughneck’s shareholders becoming the stockholders of the Company.

On August 7, 2008, Omnimmune Corp., a privately-held Texas corporation, merged with and into Omnimmune Acquisition Corp., a Delaware corporation, and a wholly-owned subsidiary of the Company formed for the purpose of the merger.  As a result, (i) Omnimmune Corp. became a wholly-owned subsidiary of the Company, (ii) the shareholders of Omnimmune Corp. became the majority stockholders of the Company and the shareholders prior to the merger were reduced to a minority ownership, (iii) the historical management of the Company resigned, and the management of Omnimmune Corp. became the management of the Company, (iv) the business of Omnimmune Corp. became the business of Omnimmune and the former business of Roughneck was eliminated, and (v) the historical financial statements of Omnimmune Corp. became the historical financial s tatements of the Company.  Therefore, as a consequence of two mergers, one on August 6, 2008, and one on August 7, 2008, Omnimmune (formerly Roughneck) went from being a public corporation domiciled in Nevada formerly in the business of marketing and retailing oil and gas drilling supply products with little or no continuing operations and a fiscal year end of May 31, to being a public company domiciled in Delaware in the biotechnology business with a fiscal year end of December 31.  These transactions are described in detail in the Company’s Form 8-K filed with the SEC on August 12, 2008, as amended on August 21, 2008, August 27, 2008 and September 5, 2008, respectively.

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Results of Operations

Because we produce no revenues, we rely entirely on debt and equity financing to fund ongoing operations, and expect to continue to do so for the foreseeable future.   Generating revenues and ultimately achieving profitability will require the successful completion of our research and development programs, and the subsequent commercialization of the results or of products derived from such research and development efforts or from our patents and patents pending and those licensed from our strategic collaborators.  No assurances can be given as to our ability to identify sufficient sources of funding to sustain our operations, commercialize our products or achieve profitability.   These matters raise substantial doubt about our ability to continue as a going concern. The financial statements do no t include any adjustments that may result from the outcome of this uncertainty. In order to alleviate our working capital deficiency and address our continued financing concerns, management intends to continue to take affirmative steps towards identifying sources of capital that will be sufficient to fund our operations until such time as we are cash flow positive.

Three Months Ended March 31, 2010 and March 31, 2009

Revenue

As a development stage pharmaceutical company, we produce no revenues and do not expect to produce any revenues for the foreseeable future.  

Costs and Expenses

Our selling, general and administrative expenses decreased approximately 18% to $263,611  in the three months ended March 31, 2010, from $321,741 for the same period in 2009.  For the three months ended March 31, 2010, selling, general, and administrative expenses consisted  primarily of payroll and employee benefits of $134,979; consulting fees of $72,800; financing fees of $23,000; non cash compensation of $10,399; insurance expense of $10,225; legal and accounting fees of $6,938;  and office rent expense of $2,313.    The decrease in the selling, general and administrative expenses was the result of a reduction in legal fees, due to the completion of the reverse merger and the financings in the prior period, and to a reduction in non-cash compensation during the current per iod.

Interest Expense

Interest expense increased approximately 309% to $231,934 in the three months ended March 31, 2010, from $56,688 for the same period in 2009. The primary reason for this increase was the acceleration of a portion of the amortization of the discount which resulted from the amending of a note payable during the three months ended March 31, 2010.

Loss on Restructuring of Debt 

During the three months ended March 31, 2010, the Company had a loss on the extinguishment of debt in the amount of $505,755, there is no such activity in the comparable period.  This loss is the result of the acceleration of the amortization of the discount on a convertible note payable pursuant to the modification to the terms of the note payable (see Note 6).

Net Loss

For the reasons stated above, our net loss for the three months ending March 31, 2010 was $1,001,300, compared to a net loss for the three months ending March 31, 2009 of $378,429.  For the period since inception January 15, 1997 through March 31, 2010, our accumulated net loss is $22,100,567.

Liquidity and Capital Resources

Net cash  used in operating activities was $188,856 for the three months ended March 31, 2010, compared to net cash used in operating activities of $57,667 for the same period in 2009. This increase was the result of the restructuring of debt during the three months ended March 31, 2010, and there was no comparable activity during the three months ended March 31, 2009. From inception through March 31, 2010, cash  used in operating activities was $4,178,080.

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Net cash provided by financing activities was $183,819 for the three months ended March 31, 2010, compared  to $7,411  for  the same period in 2009.   The primary reason for the increase is during the three months ended March 31  2010, the Company issued convertible notes payable in the aggregate amount of $183,500, and there was no comparable activity during the three months ended March 31, 2009. From inception through March 31, 2010, we have generated $4,184,670 in cash from financing activities.  We have financed our operations primarily through loans from shareholders and investors in our bridge financings and private placement equity offerings.

Management is seeking to raise additional money through private debt and equity offerings to enable us to satisfy our cash requirements in the coming months and beyond and to fund ongoing research and development activities.  We are not self-supporting through internally generated capital, and rely exclusively on our continued ability to raise additional funds through private or public debt or equity financings to meet our ongoing cash needs.  

We will require substantial additional funding in order to meet our obligations to our licensors, continue our research and product development programs, including preclinical testing and clinical trials of our product candidates, and meet ongoing operating expenses.   We are currently delinquent with all of our principal licensors with respect to our diagnostic technologies, and are subject to the ongoing risk that our licensing partners will begin to take aggressive measure in an attempt to terminate their license agreements with the Company and reclaim their technologies.  We expect to continue to incur substantial losses through at least the next several years and may incur losses in subsequent periods.  The amount and timing of our future losses are highly uncertain.  Our ability to ach ieve and thereafter sustain profitability will be dependent upon, among other things, successfully developing, commercializing and obtaining regulatory approval or clearances for our technologies and products resulting from these technologies, which will require substantial additional funding, the availability of which is uncertain.

There is no assurance that we will obtain financing sufficient to pay ongoing obligations or to fund our working capital and other cash requirements.  No assurance can be given that any such additional funding will be available or that, if available, can be obtained on terms favorable to us.  If we are unable to raise needed funds on acceptable terms, we will not be able to develop our products, take advantage of future opportunities or respond to competitive pressures or unanticipated requirements.  A material shortage of capital will require us to take drastic steps such as reducing our levels of operations, disposing of selected assets, curtailing our development efforts or seeking an acquisition partner.  If cash is insufficient, we may  not be able to retain our licensed technologies an d may be forced to discontinue operations.

Off-Balance Sheet Arrangements

We have not entered into any transactions with unconsolidated entities in which we have financial guarantees, subordinated retained interests, derivative instruments or other contingent arrangements that expose us to material continuing risks, contingent liabilities or any other obligations under a variable interest in an unconsolidated entity that provides us with financing, liquidity, market risk or credit risk support.

Critical Accounting Policies

The preparation of our consolidated financial statements in conformity with accounting principles generally accepted in the United States requires us to make estimates and judgments that affect our reported assets, liabilities, revenues, and expenses, and the disclosure of contingent assets and liabilities.

We base our estimates and judgments on historical experience and on various other assumptions we believe to be reasonable under the circumstances. Future events, however, may differ markedly from our current expectations and assumptions. While there are a number of significant accounting policies affecting our consolidated financial statements; we believe the following critical accounting policy involves the most complex, difficult and subjective estimates and judgments:

Stock Based Compensation   Effective January 1, 2006, the Company adopted ASC 718-10 utilizing the modified prospective approach. Prior to the adoption of ASC 718-10 we accounted for stock option grant in accordance with ASC718-10, and accordingly, recognized compensation expense for stock option grants.

Under the modified prospective approach, ASC 718-10 applies to new awards and to awards that were outstanding on January 1, 2006 that are subsequently modified, repurchased or cancelled. Under the modified prospective approach, compensation cost recognized in the nine months of fiscal 2006 includes compensation cost for all share-based payments granted prior to, but not yet vested as of January 1, 2006, based on the grant-date fair value estimated in accordance with the original provisions of ASC 718-10, and compensation cost for all share-based payments granted subsequent to January 1, 2006 based on the grant-date fair value estimated in accordance with the provisions of ASC 718-10. Prior periods were not restated to reflect the impact of adopting the new standard.

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A summary of option activity under the Plan as of March 31, 2010, and changes during the period ended are presented below:

	Options		Weighted Average Exercise Price
Outstanding at December 31, 2009		2,350,000	$	2.50
Issued		-		-
Exercised		-		-
Forfeited or expired		-		-
Outstanding at March 31, 2010		2,350,000	$	2.50
Vested at March 31, 2010		2,336,029	$	2.50
Non-vested at March 31, 2010		13,971	$	2.50

There was no aggregate intrinsic value of options outstanding and exercisable at March 31, 2010. Aggregate intrinsic value represents the difference between the Company's closing stock price on the last trading day of the fiscal period, which was $0.03 as of March 31, 2010, and the exercise price multiplied by the number of options outstanding. As of March 31, 2010, total unrecognized stock-based compensation expense related to stock options was $17,351. The total fair value of options vested during the three months March 31, 2010 and 2009 was $10,399.

Revenue Recognition.   Our policy is to recognize revenue over the period that we perform required activities under the terms of various agreements.  Revenue from transactions that do not require future performance obligations from us is recognized as contemplated in the agreements, typically upon acceptance and when collectability is reasonably assured.  Revenue resulting from the achievement of milestone events stipulated in the agreements will be recognized when the milestone is achieved.

Research and Development. Research and development expenditures, including direct and allocated overhead expenses, are charged to expense as incurred.

Royalties.  We are required to remit royalty payments based on product sales to certain parties under our license agreements.  From time to time we have been in default under certain of our material license agreements with respect to our payment obligations and achievement of performance milestones; however, such license agreements are currently in good standing.

Long-Lived Assets.  Equipment is stated at acquired cost less accumulated depreciation.  Laboratory and office equipment are depreciated on the straight-line basis over the estimated useful lives (three to seven years).

Impairment of long-lived assets is recognized when events or changes in circumstances indicate that the carrying amount of the asset or related group of assets may not be recoverable.  If the expected future undiscounted cash flows are less than the carrying amount of the asset, an impairment loss is recognized at that time.  Measurement of impairment may be based upon appraisal, market value of similar assets or discounted cash flows.

Patent Costs and Rights.  Patent costs and rights are expensed as incurred.

Income Taxes.  As of March 31, 2010, we had aggregate unused net operating loss carryforwards of approximately $8,050,000.  These carryforwards may be used to reduce future tax liabilities and expire at various dates through 2027.  Our use of current net operating loss carryforwards may be substantially limited as a result of the change in ownership related to the Merger and the Offering.

Recent Accounting Pronouncements

For a summary of recently issued accounting standards, please see Note 1 to the consolidated unaudited financial statements included in Part I, Item 1 in this report.

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Cautionary Notice Regarding Forward Looking Statements

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), Section 21E of the Securities Exchange Act of 1934 (the “Exchange Act”) and the Private Securities Litigation Reform Act of 1995.  Forward-looking statements reflect the current view about future events and financial performance based on certain assumptions.  They include opinions, forecasts, projections, guidance, expectations, beliefs or other statements that are not statements of historical fact.  In some cases, forward-looking statements can be identified by words such as “may,” “can,” “will,” “should,” “could,” “expects,” “hopes,R 21; “believes,” “plans,” “anticipates,” “estimates,” “predicts,” “projects,” “potential,” “intends,” “approximates” or the negative or other variation of such terms and other comparable expressions.  Forward-looking statements in this report may include statements about:

•        future financial and operating results, including projections of revenues, income, expenditures, cash balances and other financial items;

•        capital requirements and the need for additional financing;

•         our ability to develop commercially viable products;

•         our intellectual property rights and similar rights of others, including actual or potential competitors;

•         the outcome of regulatory submissions and approvals and clinical trials;

•         the performance of our future products and their potential to generate revenues;

•         our beliefs and opinions about the safety and efficacy of any of our future products and the results of our studies;

•         development of new products;

•         growth, expansion and acquisition strategies;

•         current and future economic and political conditions;

•         overall industry and market performance;

•         competition;

•         management’s goals and plans for future operations; and

•         other assumptions described in this report underlying or relating to any forward-looking statements.

The forward-looking statements in this report are only predictions.  Actual results could and likely will differ materially from these forward-looking statements for many reasons, including the risks described under “Risk Factors” and elsewhere in this report.  No guarantee about future results, performance or achievements can be made.  These forward-looking statements are made only as of the date hereof, and we undertake no obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise.  The safe harbors for forward-looking statements provided by the Private Securities Litigation Reform Act are unavailable to issuers of “penny stock.”  Our shares may be considered a penny stock and, as a result, the safe harbors may not be available to us.

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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not applicable.

ITEM 4. CONTROLS AND PROCEDURES

(a) Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act).  Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act are recorded, processed, summarized and reported, within the time periods specified in the SEC's rules and forms.  Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.

As required by Rule 13a-15(e), our management has carried out an evaluation, with the participation and under the supervision of our Chief Executive Officer and Chief Financial Officer, Dr. Harris Lichtenstein, of the effectiveness of the design and operation of our disclosure controls and procedures, as of March 31, 2010.  Based upon, and as of the date of that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of December 31, 2009, our disclosure controls and procedures were effective to ensure that information required to be disclosed by us in reports we file or submit under the Exchange Act was complete.

(b) Management’s Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rule 13a-15(f) of the Exchange Act. Because of its inherent limitations, internal control over financial reporting is not intended to provide absolute assurance that a misstatement of our financial statements would be prevented or detected.  As required by Exchange Act Rule 13a-15(f), for the period covered by the Annual Report on Form 10-K for the year ended December 31, 2009, our management, under the supervision and with the participation of the Company's Chief Executive Officer and Chief Financial (and principal accounting) Officer conducted an evaluation of the effectiveness of our internal control over financial reporting with reference to the framework in Internal Control--Integr ated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

Based on, and as of the date of that evaluation, our Chief Executive Officer and Chief Financial Officer  concluded that as of December 31, 2009, our internal controls over financial reporting were effective.  

(c)  Changes in Internal Control over Financial Reporting

There were no changes in internal controls over financial reporting that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially effect, our internal control over financial reporting.

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PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Although no formal legal proceedings are currently pending between OSU and the Company regarding the dispute under the OSU License Agreement, such formal proceedings, either by or against the Company, could commence at any time.  See Note 9, “Commitments and Contingencies -- OSU License Agreement.”  The Company may be subject to other lawsuits, claims and other legal matters that arise in the ordinary course of conducting business, none of which, in management’s opinion, would be expected to have a material adverse impact on the Company’s financial condition, results of operations or cash flows.

ITEM 1A. RISK FACTORS

An investment in our common stock involves a high degree of risk.  You should carefully consider the risks and uncertainties described below and all other information contained in this report before deciding to invest in shares of  our common stock.  While all risks and uncertainties that we believe to be material to our business and, therefore, the value of our common stock are described below, it is possible that other risks and uncertainties that affect our business will arise or become material in the future.  If we are unable to effectively address these risks and uncertainties, our business, financial condition or results of operations could be materially and adversely affected.  In this event, the value of the common stock could decline and you could lose all or a portion of your investment.

Our auditors have substantial doubts as to our ability to continue as a going concern.

The auditor’s report on our financial statements for the year ended December 31, 2009 expresses an opinion that substantial doubt exists as to whether Omnimmune can continue to meet its ongoing obligations and remain in business.  Because Omnimmune has been issued an opinion by its auditors that substantial doubt exists as to whether we can continue as a going concern, it may be more difficult for us to attract investors, and we may not survive.  Our future is dependent upon our ability to obtain financing and upon future profitable operations from the development and commercialization of our products.  We may seek additional funds through private placements of equity or the incurrence of additional debt.  Our financial statements do not include any adjustments relating to the recoverabilit y and classification of recorded assets, or the amounts of and classification of liabilities that might be necessary in the event we cannot continue in existence.

We require additional financing, and an inability to raise the necessary capital or to do so on acceptable terms would jeopardize our ability to stay in business.

As of March 31, 2010, we had a cash of $509, and less than $1,000 of the date of this report.  The Company has been unable to meet certain of its ongoing obligations, including payments due to senior management, employees, consultants, employees, attorneys, noteholders, licensors and other creditors.   Absent immediate additional infusions of capital, the Company does not have sufficient liquidity to meet its ongoing obligations on a timely basis, and must resort to consensual extensions and hope that creditors will refrain from pursuing default remedies with respect to delinquent obligations of the Company.  The limited amount of cash on hand jeopardizes the Company’s ability to fund operations and satisfy its ongoing obligations in a timely manner, including to the licensors of its core techno logies. In addition, if we are unable in the near future to raise sufficient capital to fund storage costs related to the Company’s cell-lines, sequences and other samples and materials being held in frozen storage for future testing and to actually pursue the testing of those materials so as to advance the development of the technologies being licensed from third parties, there is a substantial risk that we will not be given access to the stored materials or that, through the passage of time, the stored samples will degrade or otherwise lose their value to the Company. 

We may seek to raise additional funds through public or private equity or debt financing, licensing and other agreements, a line of credit, asset sales or other arrangements.  However, we cannot be sure that any additional funding, when needed, will be available on terms favorable to us or at all.  Furthermore, any additional equity or equity-related financing may be dilutive to our stockholders, and debt financing, if available, may subject us to restrictive covenants and significant interest costs.  We may also choose to obtain funding through licensing and other contractual arrangements.  Such agreements may require us to relinquish our rights to certain of our technologies, products or marketing territories.  

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If we are unable to obtain additional capital, we may then attempt to preserve our available resources by various methods including deferring the satisfaction of commitments, reducing expenditures on our research and development programs or otherwise scaling back our operations. If we are unable to raise additional capital or defer costs, that inability would have a material adverse effect on our financial position, results of operations and prospects and our business could fail.

We are or soon may be past due under certain of our material license agreements and other agreement and notes with respect to our payment obligations.  There is no assurance that we will receive extensions of these obligations or that we will not default under these agreements in the future; any such defaults could materially and adversely affect our business.

Each of our existing license agreements with third party collaborators requires us to make periodic payments to the licensors for the licensed rights, including, by way of example, upfront and annual license maintenance fees, royalties based on product sales utilizing the licensed technology, sublicensing royalties, milestone payments based on certain achievements as we conduct trials on the licensed products and progress them through the FDA approval process, and the reimbursement or payment of costs associated with prosecuting the patents subject to these license agreements.

Given our significant cash flow limitations and our inability to raise additional capital, we have had difficulties making required milestone and other payments under certain of our license agreements.  With the exception of OSU, with whom the Company is engaged in an ongoing dispute regarding the purported termination of the OSU License Agreement (See Note 10--Commitments and Contingencies), and based on voluntary concessions and extensions by the affected licensors, no notice of default has been issued under any of our license agreements as of the date of this Report.  However, there is no assurance that existing or future delinquencies will not lead to the issuance of a notice of default, that we will be able to remain current on the payment of our license fees on a go-forward basis, or that the respective licens ors will cooperate in any requests for waivers or extensions. All of the license agreements require the licensors to give written notice of any payment default, which would then commence a period of between 30 days and 90 days, depending on the particular license agreement, during which time the Company could cure the default. If we default in the payment of any of our obligations to our licensors, there is no assurance that we will be in a position to cure any such defaults during the particular cure period. In that event, the continued existence and/or exclusivity of the affected license could be at risk.

Additionally, our license agreements provide for various performance and achievement milestones to ensure that we devote adequate personnel and financial resources to the commercialization of the licensed patents and processes.   For example, if we do not achieve the milestones in our agreements with The Allegheny-Singer Research Institute and Columbia University, the respective licensor can, with prior notice and an opportunity to cure, elect to terminate the subject license agreement or convert the exclusive worldwide license to a non-exclusive license.  With respect to our license agreement with IGR, we have until November 1, 2010 to achieve net sales or sublicense revenue from products developed with the licensed patents, after which time the licensed rights will become non-exclusive; however, we can reques t two one-year extensions of the exclusive license with the payment of an additional license fee to the licensor. 

 In addition to our license agreements, a number of material obligations to certain lenders, including $550,000 in principal indebtedness owed to certain bridge lenders, significant monies owed to employees, consultants and attorneys, and other debt holders, are either due currently or will become due during 2010, and the Company has no present wherewithal to satisfy these obligations.  Although no creditor has issued a notice of default under the applicable debt instrument or otherwise sought to enforce its remedies, there is no assurance that the holders of the Company’s debt, including certain related parties, will continue to acquiesce to any extensions or will not otherwise seek to pursue remedies they may have or will have once their obligations are past due.  Should the Company fail to either pay t he amounts due or work out consensual extensions and/or modifications of terms, it may default on such obligations, which could significantly and irreparably harm the Company’s business.

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Substantial future issuances and sales of our common stock, the exercise and sale of our common stock underlying our warrants or options, or the conversion and sale of our common stock underlying our convertible promissory notes could result in substantial dilution for existing shareholders and could also depress our stock price.

The market price for our common stock could decline, perhaps significantly, as a result of issuances of a large number of shares of our common stock in the public market or even the perception that such issuances could occur.  Such issuances may be direct, as in the case of stock issued to investors as part of a financing or similar transaction, or indirect, in the form of the issuance of convertible debt or equity  securities that could be converted into common stock at prices substantially lower than the then-current trading price of the Company’s common stock.  In addition, the Company may reduce the conversion price associated with already issued securities to induce the holders of such securities to advance additional sums to the Company.  Because of the Company’s dire financial condition and difficulty raising funds needed to continue to fund ongoing operations, there is a significant likelihood that the Company will have to issue such dilutive securities in order to raise necessary funding.   Should the Company issue substantial additional stock, or notes or preferred stock convertible into the Company’s common stock, such issuances would have an adverse dilutive effect on all existing shares of the Company’s common stock  and would likely cause the market price for our common stock to decline, perhaps significantly.

Furthermore, and as described above in Note 7, “Equity,” and as more fully described n the Company’s Form 8-K filed on January 26, 2010, the Company entered into a Term Sheet (the “Term Sheet”) for Debt Financing and Agreed Upon Restructuring with Margie Chassman (“Chassman”), pursuant to which (i) up to $500,000 in convertible debt financing may take place at a conversion price of $0.01 per share (the “Convertible Debt Financing”), of which $208,500 has been funded to date, (ii) the conversion price related to approximately $800,000 in existing unsecured indebtedness to Chassman was fixed at $0.01 per share, (iii) Chassman agreed to a 2-year lock-up with respect to her convertible debt and underlying stock, subject to agreed upon quarterly leakage amounts, and (iv) management and c ertain angel investors received limited anti-dilution protection that will result in the issuance to management of such additional shares as are required to maintain management’s specified collective ownership interest through the next $3.5 million in net financing and the angel investors to maintain their specified collective ownership interest through the initial round of up to $500,000 in convertible debt financing.

The number of currently issued and outstanding shares of the Company’s stock stands at 8,914,921 as of March 31, 2010.  However, based on, among other things: (i) additional shares that will be issued to management and certain angel investors through the anti-dilution protection prescribed in the Term Sheet, (ii) the adjustment in the conversion price of certain previously issued notes, and (iii) the conversion price offered to investors in the Convertible Debt Financing, the number of additional shares of common stock of the Company that could be issued or has become issuable is greatly in excess of that number and, subject to an increase in authorized share capital to permit conversion, would substantially exceed the total number of authorized shares of Common Stock of the Company.  Although contractual proh ibitions contained in the convertible notes themselves and in the Term Sheet would prevent the conversion of any debt or equity securities to the extent such conversion would result in an issuance of shares in an amount greater than the number of authorized shares of the Company, once the Company’s authorized share capital is increased, existing holders of common stock could experience substantial dilution if the Company’s convertible debt holders choose to convert their debt to equity.   Management plans, in due course, to seek appropriate shareholder authorization to increase the number of authorized shares of the Company to a number sufficient to accommodate conversion of all then-outstanding debt and equity securities.  This would not only result in a substantial increase in the number of shares of common stock issued, thereby diluting existing shareholders significantly, it could also result in a significant adverse impact on the company’s share price.

Funding for early stage biotechnology companies has been severely curtailed and may continue to prove challenging for the foreseeable future.

Over the past year and more, funding for early stage biotechnology companies such as ours has been drastically reduced from previous levels, and traditional sources of financing have all but disappeared.  There is a substantial risk that the ongoing economic situation will worsen or continue for an extended period, which could exacerbate funding difficulties for Omnimmune and other similarly situated companies.  The current economic climate substantially increases the risk that Omnimmune will not be able to raise sufficient funding levels to execute on its business plan or remain current on its obligations to its licensors and other creditors.

Additional Risk Factors are set forth in the Company’s most recent filing under Form 10-K dated May 17, 2010, covering the calendar year ended December 31, 2009.

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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

For more information about unregistered sales of our securities, see Item 1, Note 8 of this report for a discussion of our sales of convertible promissory notes and Units.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS

EXHIBIT NO.	NAME OF EXHIBIT
2.1	Agreement of Merger, dated as of August 6, 2008, by and between Roughneck Supplies, Inc. and Omnimmune Holdings, Inc. (incorporated by reference to Exhibit 2.1 to our Current Report on Form 8-K filed on August 12, 2008).
2.2	Agreement of Merger and Plan of Reorganization, dated as of August 7, 2008, by and among the Omnimmune Holdings, Inc., Omnimmune Acquisition Corp., a wholly owned subsidiary of the Company, and Omnimmune Corp. (incorporated by reference to Exhibit 2.2 to our Current Report on Form 8-K filed on August 12, 2008).
2.3	Certificate of Merger, effective August 6, 2008, merging Roughneck Supplies, Inc. with and into Omnimmune Holdings, Inc. (incorporated by reference to Exhibit 2.3 to our Current Report on Form 8-K filed on August 12, 2008).
2.4	Articles of Merger, effective August 7, 2008, merging Omnimmune Corp. with and into Omnimmune Acquisition Corp. (incorporated by reference to Exhibit 2.4 to our Current Report on Form 8-K filed on August 12, 2008).
4.1	Second Amended and Restated Convertible Demand Promissory Note
10.1	Registration Rights Agreement, dated as of August 7, 2008, by and among Omnimmune Holdings, Inc. and the stockholders of Omnimmune Holdings, Inc. parties thereto (incorporated by reference to Exhibit 10.15 to our Current Report on Form 8-K filed on August 12, 2008).
10.2	Form of Lock-Up Agreement between the Company and executive officers and certain stockholders (incorporated by reference to Exhibit 10.18 to our Current Report on Form 8-K filed on August 12, 2008).
10.3	Amendment and Pledge dated July 31, 2008, to Gift Agreement entered into as of April 18, 2008, by and among The Ohio State University Medical Center, The Ohio State University Foundation and Omnimmune Corp. (incorporated by reference to Exhibit 10.23 to our Current Report on Form 8-K filed on August 12, 2008).
31.1	Chief Executive Officer Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Chief Executive Officer Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

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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.

	OMNIMMUNE HOLDINGS, INC.
Dated: May 24, 2010	/s/ HARRIS A. LICHTENSTEIN
	Harris A. Lichtenstein
	Chief Executive Officer

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