IMMULABS CORPORATION
Filing Type: 10QSB
Description: Quarterly Report
Filing Date: November 8, 2001
Period End: September 30, 2001
Primary Exchange: Over the Counter Bulletin Board
Ticker: IMLB
Table of Contents
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10QSB OTHERDOC
Item 1.........................................................................3
Balance Sheet..................................................................3
Income Statement...............................................................4
Cash Flow Statement............................................................5
Item 2........................................................................10
Part II.......................................................................13
Item 1........................................................................13
Item 2........................................................................14
Item 3........................................................................14
Item 4........................................................................14
Item 5........................................................................14
Item 6........................................................................14
U. S. Securities and Exchange Commission
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarter ended September 30, 2001
------------------
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from ___________________ to ___________________
Commission File No. 0-26760
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Immulabs Corporation
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(Name of Small Business Issuer in its Charter)
Colorado 84-1286065
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(State or Other Jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No)
2nd Floor - 827 West Pender Street
Vancouver, BC V6C 3G8 Canada
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(Address of Principal Executive Offices)
(604) 763-6547
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Issuer's Telephone Number
N/A
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(Former Name or Former Address, if changed since last Report)
Check whether the Issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the Company was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.
(1) Yes X No (2) Yes X No
--- --- --- ---
(ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE YEARS)
Not applicable
(APPLICABLE ONLY TO CORPORATE ISSUERS)
State the number of shares outstanding of each of the Issuer's classes of common
equity, as of the latest practicable date:
October 31, 2001
Common - 39,097,661 shares
DOCUMENTS INCORPORATED BY REFERENCE
A description of any "Documents Incorporated by Reference" is contained in Item
6 of this Report.
Transitional Small Business Issuer Format Yes No X
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Immulabs Corporation
(formerly North American Resorts, Inc.)
Form 10-QSB for the Quarter ended September 30, 2001
Table of Contents
Page
Part I - Financial Information
Item 1 Financial Statements 3
Item 2 Management's Discussion and Analysis or Plan of Operation 10
Part II - Other Information
Item 1 Legal Proceedings 13
Item 2 Changes in Securities 14
Item 3 Defaults Upon Senior Securities 14
Item 4 Submission of Matters to a Vote of Security Holders 14
Item 5 Other Information 14
Item 6 Exhibits and Reports on Form 8-K 14
Signatures 14
2
Immulabs Corporation
(A Development Stage Company)
Balance Sheets
As at As at
September 30, December 31,
2001 2000
$ $
(unaudited) (audited)
ASSET
Current Asset
Cash 2,162 55,838
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Total Asset 2,162 55,838
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LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current Liabilities
Accounts payable 387,828 366
Accrued liabilities - 5,000
Due to related party (Note 4) 31,509 15,000
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Total Liabilities 419,337 20,366
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Stockholders' Equity (Deficit)
Preferred stock - no par value 50,000,000 shares authorized
nil and 482,815 shares issued and outstanding respectively - -
Common Stock, $0.001 par value 300,000,000 shares
authorized 39,097,661 and 39,161,428 shares issued and
outstanding respectively 39,098 39,161
Stock based compensation 6,711,536 6,734,583
Additional Paid-in Capital 1,780,977 2,058,989
Deficit Accumulated During the Development Stage (8,948,786) (8,797,261)
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Total Stockholders' Equity (Deficit) (417,175) 35,472
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Total Liabilities and Stockholders' Equity (Deficit) 2,162 55,838
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Commitments and Contingencies (Notes 1 and 5)
3
(The accompanying notes are an integral part of the financial statements)
Immulabs Corporation
(A Development Stage Company)
Statements of Operations
Accumulated from
November 1, 1985
(Date of Inception) Three Months Ended Nine Months Ended
to September 30, September 30, September 30,
2001 2001 2000 2001 2000
$ $ $ $ $
(unaudited) (unaudited) (unaudited) (unaudited) (unaudited)
Revenue - - - - -
- ----------------------------------------------------------------------------------------------------------------------------
Expenses
General and Administrative
Amortization 2,833 - - - 567
Investor relations 170,716 - - 15,074 13,600
Management fees (Note 5(a)) 440,000 90,000 150,000 270,000 150,000
Office 1,951 1,391 118 1,758 118
Professional fees
Accounting and audit 22,000 600 3,188 3,800 10,500
Financial services 56,266 - - 56,266 -
Legal - general corporate matters 19,207 - 13,488 1,171 18,036
Legal - services rendered to a
former attorney 993,750 - 993,750 - 993,750
Salaries 71,500 33,000 - 71,500 -
Stock based compensation - stock
options (Note 3(a)(ii)) 1,780,977 - 300,000 (278,012) 943,750
Transfer agent and regulatory 12,456 528 1,142 2,158 4,282
Travel and promotion 7,111 - - 3,310 -
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3,578,767 125,519 1,461,686 147,025 2,134,603
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Selling and Marketing
Advertising 89,238 - - - -
Marketing 13,500 - - 4,500 -
Option agreement written-off (Note 1) 15,000 - - - -
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117,738 - - 4,500 -
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Total Expenses 3,696,505 125,519 1,461,686 151,525 2,134,603
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Loss from Continuing Operations (3,696,505) (125,519) (1,461,686) (151,525) (2,134,603)
Loss from Discontinued Operations (5,252,281) - - - (60,000)
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Net Loss For the Period (8,948,786) (125,519) (1,461,686) (151,525) (2,194,603)
============================================================================================================================
Net Loss Per Share (0.01) (0.04) (0.01) (0.12)
============================================================================================================================
Weighted Average Shares Outstanding
(with retroactive effect for a
consolidation and a stock split) 39,098,000 39,176,000 39,081,000 17,873,000
============================================================================================================================
4
(The accompanying notes are an integral part of the financial statements)
Immulabs Corporation
(A Development Stage Company)
Statements of Cash Flows
Nine months ended
September 30,
2001 2000
$ $
(unaudited) (unaudited)
Cash Flows from Operating Activities
Net loss for the period (151,525) (2,194,603)
Adjustments to reconcile net loss to cash
Common and preferred stock issued for services rendered 59,840 1,007,350
Amortization - 567
Stock based compensation - stock options (278,012) 943,750
Non-cash working capital item
Increase in accounts payable and accrued liabilities 299,512 50,000
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Net Cash Used in Operating Activities (70,185) (192,936)
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Cash Flows from Financing Activities
Common shares issued - 225,001
Increase in advances from a related party 16,509 -
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Net Cash From Financing Activities 16,509 225,001
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Cash Flows to Investing Activities - -
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Increase (Decrease) in Cash (53,676) 32,065
Cash - Beginning of Period 55,838 -
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Cash - End of Period 2,162 32,065
=================================================================================================
Non-Cash Financing Activities -
Shares cancelled and returned to treasury 82,950 -
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Supplemental Disclosures
Interest paid - -
Income tax paid - -
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5
(The accompanying notes are an integral part of the financial statements)
Immulabs Corporation
(A Development Stage Company)
Notes to the Financial Statements
1. Nature of Operations and Continuance of Business
Immulabs Corporation, formerly North American Resorts, Inc. (the "Company")
was initially incorporated as Gemini Ventures, Inc. on November 1, 1985
under the laws of the State of Colorado. The Company changed its name to
Solomon Trading Company, Limited in July 1989; The Voyageur, Inc. in
November 1994; The Voyageur First, Inc. in December 1994 and North American
Resorts, Inc. in March 1995.
Effective September 1, 2000, as filed with the State of Colorado on June
30, 2000, the Company changed its name to Immulabs Corporation. The shares
of the Company currently trade on the Over the Counter Bulletin Board under
the ticker symbol "IMLB".
From 1995 through 1998, the Company was in the business of selling
vacations in Florida and the sale of time share memberships to the Ocean
Landings and Cypress Island Preserve facilities in Florida which were then
controlled by the Company and the operation of Cypress Island Preserve as a
tourist destination. During the fourth quarter of 1998, the Company
liquidated its holdings in these ventures and discontinued all operations.
With the disposition of all operations, the Company became fully dependent
upon the support of its controlling shareholders for the maintenance of its
corporate status and to provide all working capital. The controlling
shareholders intend to continue the funding of necessary expenses to
sustain operations.
On March 22, 2000 the Company amended its Articles of Incorporation to
allow for the issuance of up to 300,000,000 shares of $0.001 par value
common stock. Further on May 30, 2000 the Company's Board of Directors
effected a 1 new for 1,000 old consolidation of the issued and outstanding
shares which was approved by shareholders on March 20, 2000.
Further, on November 2, 2000, the Company's Board of Directors effected a 4
new for 1 old split of the issued and outstanding shares. The effect of
this split is reflected in the financial statements as of the first day of
the first period presented.
On October 31, 2000 the Company entered into an Assignment Agreement with
Aggressive American Capital Partners, Inc., a significant majority
shareholder and a Company controlled by the President, in which the Company
obtained the exclusive rights to an Option Agreement dated February 23,
2000, amended April 11, 2000 and June 8, 2000, for $15,000, to acquire
Quest Research Group, Inc. ("Quest") and its various technologies. Quest
owns proprietary intellectual property that can be used to identify and
isolate harmful gasses in cigarette smoke and prove scientifically that
cigarette smoke destroys human white blood cells. Subsequent to the year
end, Quest is disputing the Option Agreement and the Company is currently
seeking to resolve the dispute through arbitration and appropriate legal
recourse. As a result, the $15,000 payment was written-off to operations in
fiscal 2000. To obtain a 50% interest in Quest the Company was to invest
$1,600,000 which time to pay is purported to have passed. To purchase the
balance of Quest the Company was to pay $175,000,000 within five years of
the first option being exercised.
These financial statements are prepared using generally accepted accounting
principles applicable to a going concern which contemplates the realization
of assets and liquidation of liabilities n the normal course of business.
However, the Company does not have significant cash or other material
assets, nor does it have an established source of revenues needed to cover
its operating costs and to allow it to continue as a going concern. The
Company has ongoing overhead expenses and will require significant capital
to execute upon its business plan to bring its new business to market. The
Company's ability to meet those obligations and continue as a going concern
is dependent upon raising new capital through issuing debt and/or equity
securities and then to generate revenues and profits.
6
2. Summary of Significant Accounting Policies
Use of Estimates and Assumptions
--------------------------------
The preparation of financial statements requires management to make
estimates and assumptions that affect the amounts reported in the financial
statements and accompanying notes. Actual results could differ from those
estimates.
Year End
--------
The Company's fiscal year end is December 31.
Cash and Equivalents
--------------------
For the purpose of the statements of cash flows, all highly liquid
investments with the maturity of three months or less are considered to be
cash equivalents.
Basic and Diluted Net Income (Loss) per Share
---------------------------------------------
The Company computes net income (loss) per share in accordance with SFAS
No. 128, "Earnings per Share" (SFAS 128). SFAS 128 requires presentation of
both basic and diluted earnings per share (EPS) on the face of the income
statement. Basic EPS is computed by dividing net income (loss) available to
common shareholders (numerator) by the weighted average number of shares
outstanding (denominator) during the period. Diluted EPS gives effect to
all dilutive potential common shares outstanding during the period
including stock options, using the treasury stock method, and convertible
preferred stock, using the if-converted method. In computing Diluted EPS,
the average stock price for the period is used in determining the number of
shares assumed to be purchased from the exercise of stock options or
warrants. Diluted EPS excludes all dilutive potential shares if their
effect is anti dilutive.
Accounting for Stock Based Compensation
---------------------------------------
The Company has adopted SFAS No. 123 "Accounting for Stock Based
Compensation" which requires that stock awards granted subsequent to
January 1, 1995 are recognized as compensation expense based on their fair
market value at the date of grant.
Interim Financial Statements
----------------------------
These interim unaudited financial statements have been prepared on the same
basis as the annual financial statements and in the opinion of management,
reflect all adjustments, which include only normal recurring adjustments,
necessary to present fairly the Company's financial position, results of
operations and cash flows for the periods shown. The results of operations
for such periods are not necessarily indicative of the results expected for
a full year or for any future period.
3. Share Capital
(a) Common Stock
(i) During the quarter ended March 31, 2001 the Company issued
140,833 shares to various consultants at a fair market value of
$59,840 for investor relations and financial advisory services.
(ii) Certain stock options were rescinded and 204,600 shares were
cancelled and returned to treasury. The cash consideration of
$82,950, received in fiscal 2000, is repayable to the optionees.
Stock based compensation of $278,012 was reversed.
(b) Stock options
On June 30, 2000, the company filed a Form S-8 Registration statement
under The Securities Act of 1933 with the U.S. Securities and Exchange
Commission to register 700,000 pre-split shares (2,800,000 post-split
shares) of common stock pursuant to the Company's 2000 Nonqualifying
Stock Option Plan ("2000 NQPlan"). This 2000 NQPlan is for persons
employed or associated with the Company, including without limitation
any employee, director, general partner, officer, attorney,
accountant, consultant or advisor, is intended to advance the best
interests of the Company by providing additional incentive to those
persons who have a substantial responsibility for its management,
affairs, and growth by increasing their proprietary interest in the
success of the Company, thereby encouraging them to maintain their
relationships with the Company. The determination of those eligible to
receive options under the 2000 NQPlan, and the amount, price, type and
timing of each Stock option and the terms and conditions shall rest at
the sole discretion of the Company's Board of Directors, subject to
the provisions of the 2000 NQPlan.
7
3. Share Capital (continued)
(b) Stock options (continued)
On June 30, 2000, the Company filed a Form S-8 Registration Statement
under The Securities Act of 1933 with the U.S. Securities and Exchange
commission to register 800,000 pre-split shares (3,200,000 post-split
shares) of common stock pursuant to the Company's 2000 Qualifying
Stock Option Plan ("2000 QPlan"). This 2000 QPlan is intended to
provide the key employees of the Company an incentive through stock
ownership in the Company and encourage them to remain in the Company's
employ. Any options granted under the 2000 QPlan must be granted
within ten (10) years of the adoption date of the 2000 QPlan. The
option price may be determined by the administrating committee and
shall not be less than the greater of the (i) par value of the
Company's Common Stock or (ii) the fair market value of the Company's
stock on the date that the option is granted. All granted options
shall be of a term selected by the administrating committee, but in no
event be for a term of longer than ten (10) years from the grant date.
On June 30, 2000, the Company granted options to purchase 150,000
pre-split shares (600,000 post-split shares) of the Company's common
stock at an exercise price of $1.00 per share under the 2000 NQPlan to
an individual providing acquisition and merger consulting services.
The individual immediately exercised 100,000 (400,000 post-split) of
these options and the remaining 50,000 (200,000 post-split) options on
July 6, 2000.
On August 31, 2000, the Company granted options to purchase a total of
300,000 pre-split shares (1,200,000 post-split shares) of common stock
at an exercise price of $5.50 per share under the 2000 NQPlan (100,000
shares) and the 2000 NQPlan (200,000 shares) to the Company's former
President and Chief Executive Officer. The President exercised 180,682
(722,728 post-split) of these options on September 11, 2000.
On October 17, 2000 the Company granted options to purchase 100,000
pre-split shares (400,000 post-split shares) of the Company's common
stock at an exercise price of $5.00 per share under the 2000 NQPlan to
a consultant. On October 27, 2000, 20,000 (80,000 post-split) options
and on November 2, 2000 another 20,000 (post-split) options were
exercised.
On October 27, 2000 the Company granted options to purchase 100,000
pre-split shares (400,000 post-split shares) of the Company's common
stock at an exercise price of $11.25 per share under the 2000 NQPlan
to the President.
On November 3, 2000 the Company granted options to purchase 40,000
pre-split shares of the Company's common stock at an exercise price of
$2.50 per share under the 2000 NQPlan to various directors, officers
and consultants.
On January 23, 2001 the Company repriced the outstanding stock options
to $0.80 per share for qualified options and $0.75 per share for
non-qualified options.
Shares Weighted
Under Option Average
# Option Price
$
Beginning of period 1,217,272 .77
Granted - -
Exercised - -
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End of period 1,217,272 .77
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4. Related Party Balances
The amount due to a related party includes $15,000 for the Assignment
Agreement to acquire Quest and is non-interest bearing, unsecured and
without specific terms of repayment. The remaining balance of $16,509 bears
interest of 7%, is unsecured and without specific terms of repayment.
8
5. Commitments
(a) Effective July 1, 2000 the Company entered into a Management Agreement
with Cyclone Financing Group Inc. ("Cyclone"), in the amount of
$50,000 per month plus reasonable expenses. This amount represents a
management fee payable for the management of the Company's affairs. As
of December 31, 2000, $170,000 was paid under this agreement and
$130,000 was forgiven by Cyclone. From January 1, 2001 to March 15,
2001 the monthly fee was reduced to $30,000 per month. On March 15,
2001, the agreement was terminated.
(b) Effective March 16, 2001 the Company entered into a Management
Agreement with Aggressive American Capital Partners, Inc. to pay
$30,000 per month.
(c) On October 31, 2000 the Company entered into an Assignment Agreement
with Aggressive American Capital Partners, Inc., a significant
majority shareholder and a Company controlled by the President, in
which the Company obtained the exclusive rights to an Option Agreement
dated February 23, 2000, amended April 11, 2000 and June 8, 2000, for
$15,000, to acquire Quest Research Group, Inc. ("Quest") and its
various technologies. Quest owns proprietary intellectual property
that can be used to identify and isolate harmful gasses in cigarette
smoke and prove scientifically that cigarette smoke destroys human
white blood cells. Subsequent to the year end, Quest is disputing the
Option Agreement and the Company is currently seeking to resolve the
dispute through arbitration and appropriate legal recourse. As a
result, the $15,000 payment was written-off to operations in fiscal
2000. To obtain a 50% interest in Quest the Company was to invest
$1,600,000 which time to pay is purported to have passed. To purchase
the balance of Quest the Company was to pay $175,000,000 within five
years of the first option being exercised.
9
Part I - Item 2
Management's Discussion and Analysis of Financial Condition and Results of
Operations
(1) Caution Regarding Forward-Looking Information
Many important factors may affect the Company's likelihood of future success
including; difficulties in successfully raising capital (given the Company's
lack of operating history, lack of profitable operations presently and for the
foreseeable future and limitations on the market for the Company's securities),
in developing and commercializing its products (including the ability to
overcome technical hurdles that may arise), in meeting applicable existing or
new regulatory standards, in receiving required regulatory approvals, in
obtaining necessary patents and licenses, in defending against third party
infringement of patents and licenses, in protecting itself from costly,
unforeseen legal disputes, in producing products in commercial quantities at
reasonable costs, in competing successfully against other products and in
marketing products successfully and in successfully addressing the concerns and/
or obtaining the support of lobbies in various countries. There can be no
assurance that the Company will be successful in its efforts to develop and
commercialize new products. Most importantly at this stage, the Company's
success and each step required to achieve such success depends on its ability to
raise significant further financing on an ongoing basis and there is no
guarantee it will be able to do so. The company is still in the development
stage and has no revenues. Additionally, funds may be raised through the
issuance of equity shares and such securities might have rights, preferences or
privileges senior to its common stock and will likely result in dilution to
existing shareholders. The Company is therefore subject to a number of known and
unknown risks and uncertainties that could cause actual operation or results to
differ materially from those that are anticipated.
Certain information included in the Company's releases and filings to date
contain statements that are forward looking, such as statements related to the
future anticipated direction of the industry, plans for future expansion, the
ability to acquire the technologies described and the Company which developed
these technologies, expected independent validation of the technologies or
product(s), success or potential of the technologies described and acceptance of
such technologies by industry and the market, various business development
activities, planned capital expenditures, future funding resources, anticipated
sales growth and potential contracts and subsequent return for investors. These
are all forward looking statements, and are subject to a number of known and
unknown risks and uncertainties that could cause actual operation or results to
differ materially from those that are anticipated.
While Immulabs' stated mission is to develop revolutionary technology into
highly focused and successful businesses, it is unrealistic and premature to
speculate on Immulabs' future revenue at this time, except as to the
difficulties involved.
Immulabs entire success and each step required to achieve such success depends
on its ability to raise significant further financing on an ongoing basis and
there is no guarantee it will be able to do so. The company continues to have no
revenues.
10
Readers are cautioned that Immulabs does not own the Quest technology, nor does
it own its originator, Quest Research Group Inc. At this point, Immulabs only
has rights assigned under an option agreement to acquire such technology, which
agreement may or may not be completed by the parties, in multiple stages, none
of which have yet been exercised or completed. This agreement is currently in
dispute. If the contract is enforced, each stage of exercise will require
considerable further financing and there is no guarantee Immulabs will be able
to secure such financing, or that it can secure it on terms favorable to
Immulabs. Investors are cautioned that this or any other agreement entered into
by Immulabs may also be subject to future legal claims or challenges, or
attempts at repudiation. Quest currently wishes to have the contract cancelled
and the Company is seeking to have the matter determined through arbitration or
mediation.
Any and all claims of the company of any nature, particularly scientific claims,
including those with respect to Sensi Filter's TM or NT Assay'sTM capabilities
such as the ability to monitor, gauge, and reduce damage to white cells as
described herein, and any implications that it may thereby lead to less
hazardous cigarette smoke or other benefits, require further research and
independent validation, and investors are cautioned to await such additional
research and validation before relying upon any scientific claims. There can be
no guarantee as to the results such further scrutiny will provide.
This quarterly report contains certain forward-looking statements and
information relating to the Company that are based on the beliefs of the Company
or management as well as assumptions made by and information currently available
to the Company or management. When used in this document, the words
"anticipate," "believe," "estimate," "expect" and "intend" and similar
expressions, as they relate to the Company or its management, are intended to
identify forward-looking statements. Such statements reflect the current view of
the Company regarding future events and are subject to certain risks,
uncertainties and assumptions, including the risks and uncertainties noted.
Should one or more of these risks or uncertainties materialize, or should
underlying assumptions prove incorrect, actual results may vary materially from
those described herein as anticipated, believed, estimated, expected or
intended. In each instance, forward-looking information should be considered in
light of the accompanying meaningful cautionary statements herein.
(2) Results of Operations, Liquidity and Capital Resources
As of the date of this filing, the Company has no operations, assets or
liabilities. Accordingly, the Company is dependent upon management and/or
significant shareholders to provide sufficient working capital to preserve the
integrity of the corporate entity at this time. It is the intent of management
and significant shareholders to provide sufficient working capital necessary to
support and preserve the integrity of the corporate entity. The Company is
currently actively seeking a suitable merger or acquisition candidate(s).
Management recognizes that additional funds through additional private sales of
Company stock, capital contributions from existing significant shareholders
and/or loans from existing significant shareholders will be required in the
future. However, there can be no assurance that the Company will be able to
obtain additional funds to support the Company's liquidity requirements or, that
such funding, if available, will be obtained on terms favorable to or affordable
by the Company.
11
Further, the Company executed a management agreement with Aggressive American
Capital Partners, Inc., of 2nd Floor, 827 West Pender Street, Vancouver, British
Columbia, Canada V6C 3G8, an entity owned and controlled by the Company's
President, at the amount of $30,000 (US Dollars), plus reasonable pre-approved
expenses, per month, effective March 15, 2001. This amount represents a fee
payable for services related to the management of the company's affairs
including: facilitating and advising on the acquisition of projects,
administration (i.e. bookkeeping, photocopying, faxing, office space, telephone
charges, supplies, news dissemination), compliance, merger advice, and other
related operational services.
The current management group intends to actively to seek, investigate and, if
warranted, acquire an interest in one or more business opportunities or
ventures. As of the date hereof, the Company's primary area of activity has been
in the biotechnology arena, whereby the company has been engaged in seeking to
acquire and commercialize discoveries involving the immune system. The Company's
mission over the past year has been primarily to acquire revolutionary
BioTech/BioMed technologies that are near market readiness and to develop those
technologies for global commercialization. To this end, in November 2000,
Immulabs acquired the exclusive rights to purchase technologies developed by
Quest Research Group, Inc. ("Quest") of Boston, Massachusetts, and to buy up to
100% of the company itself. Quest's biotech research had resulted in the
development of two technologies of interest to the Company, which the Company
sought to commercialize.
In the event the mediation or arbitration provisions of the Company's option
agreement are enforced, and through the dispute resolution mechanism it is
determined that the Company is entitled to have the option contract upheld, with
sufficient further time for the Company to exercise, then the Company will
continue to maintain its option to acquire an initial 50% of Quest and its
products for $1,600,000.00, and a further option to acquire the balance of Quest
and its products for $175,000,000, each within a set time limit. Being options,
the exercise of these provisions will be available to, but not required of, the
Company. If the Company determines that it wishes to complete the Quest
acquisition, these amounts will be required within the prescribed times. In the
interim, the Company will be obligated to continue its due diligence efforts
with respect to Quest. It is through such due diligence efforts that the Company
learned of certain information that affects its position with regard to Quest.
Quest, meanwhile, has asserted that the Company failed to take the required
steps to exercise in the time allowed.
In furtherance of its emphasis on health and wellness, the Company has recently
begun considering and evaluating potential opportunities in the area of improved
lifestyles for the aging population. In particular, it has directed its focus to
the assisted living facilities industry, and the possibility it sees therein for
integration of its concepts of improvement of health and quality of life. No
final decisions in this respect have been made as of the time of this writing,
however, the Company has viewed and evaluated certain facilities for possible
acquisition.
12
Other than the above-noted, the Company has no operating assets and has no other
business opportunities or ventures under contemplation for acquisition. However,
in the above-noted industries, the Company does propose to investigate new
potential opportunities in the form of businesses, investors or entrepreneurs,
with a concept which has not yet been placed in operation, or in the form of
firms which are developing companies in need of limited additional funds for
expansion into new products or services, and which are seeking to develop a new
product or service. The Registrant may also seek to acquire established
businesses or revenue-generating properties which are available for purchase or
joint-venture. These may include ones which are experiencing financial or
operational difficulties and are in need of the limited additional capital the
Registrant could provide.
The Registrant anticipates that it will seek to merge with an existing business.
After the merger, the surviving entity will be the Registrant (Immulabs
Corporation); however, management from the acquired entity will in all
likelihood operate the Registrant. There is, however, a remote possibility that
the Registrant may seek to acquire and operate an ongoing business, in which
case the existing management might also be retained.
Due to the absence of capital available for investment by the Registrant, the
types of businesses seeking to be acquired by the Registrant will no doubt be
smaller businesses. In light of the downturn in the current market for
publicly-traded securities as a whole, the Company will , if possible on terms
favorable to the Company, likely give priority to businesses with a reduced risk
profile and increased security for investors. In all likelihood, chosen business
opportunities will involve the acquisition of or merger with corporation(s)
which do not need additional cash but which desire to establish a public trading
market for its Common Stock. Accordingly, the Registrant's ability to acquire
any business of substance may be extremely limited.
It is the intent of the current management to continue seeking further suitable
situations for merger or acquisition. Further, the Registrant is dependent upon
management and/or significant shareholders to provide sufficient working capital
to preserve the integrity of the corporate entity during this phase. It is the
intent of management and significant shareholders to provide sufficient working
capital necessary to support and preserve the integrity of the corporate entity.
However, there is no assurance that the Registrant will be able to structure or
finance and/or acquire any business opportunity or venture.
The Company has few ongoing material contractual agreements. The Company has
entered into a management services agreement with Aggressive American Capital
Partners, Inc. for management services, at the rate of $30,000.00 per month. In
addition, the Company has entered into an employment agreement with its
President for remuneration of $10,000.00 per month.
For these and any other material commitments of the Company, the Company, facing
a difficult financial environment in the public markets, may require the
assistance of management and significant shareholders to continue to meet
financial obligations and other needs within the near-term. The Company does
intend, however, to first attempt to raise further financing through private
placements with accredited investors.
Part II - Other Information
Item 1 - Legal Proceedings
To the best of the knowledge of the Officers and Directors of the Company,
neither the Company nor any of its Officers and Directors are parties to any
legal Proceeding or litigation other than as described below. Further, the
Officers and Directors know of no threatened or contemplated legal proceedings
or litigation other than as described below. None of the Officers and Directors
has been convicted of a felony and none has been convicted of any criminal
offense, felony or misdemeanor, relating to securities or performance in
corporate office. To the best of the knowledge of the Officers and Directors, no
investigations of felonies, misfeasance in office or securities investigations
are either pending or threatened at the present time.
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The Company's only pending legal matter is that it is currently seeking action
to compel arbitration or mediation, pursuant to contract, in order to resolve
the option agreement dispute with Quest Research Group Inc. of Boston, Mass.
Quest Research Group Inc. informed the Company in February, 2001 that it takes
issue with the Company's performance under the present option agreement and
wishes to terminate the same. In its review of this matter with counsel, the
Company has discovered other resulting legal issues related to the position
which the Company plans to advance, and has contacted Quest repeatedly to
require mediation or arbitration as provided for in the option agreement.
However, the Company has yet to receive any reply and has therefore retained
counsel to pursue necessary legal channels to compel this alternative dispute
resolution mechanism.
Item 2 - Changes in Securities
Refer to Notes to Financial statements attached hereto.
Item 3 - Defaults on Senior Securities
None
Item 4 - Submission of Matters to a Vote of Security Holders
None
Item 5 - Other Information
None
Item 6 - Exhibits and Reports on Form 8-K
None
- --------------------------------------------------------------------------------
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant has
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
Immulabs Corporation
November 6, 2001 /s/ Bruce Deildal
- ---------------- ----------------------------------
Bruce Deildal
President and Director
November 6, 2001 /s/ Ellen Luthy
- ---------------- ----------------------------------
Ellen Luthy
Chief Financial Officer,
Secretary-Treasurer and Director
14