UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-KSB
(Mark One)
[x] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the fiscal year ended December 31, 2001
-----------------
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from ________ to __________
Commission File Number 0-26285
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AGE RESEARCH, INC.
--------------------------------------------------
(Exact name of registrant as specified in charter)
DELAWARE 87-0419387
- ------------------------------ -------------------------
State or other jurisdiction of (I.R.S. Employer I.D. No.)
incorporation or organization
31103 Rancho Viejo Road, #2102, San Juan Capistrano, CA 92675
- ------------------------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
Issuer's telephone number, including area code (800) 597-1970
---------------
Securities registered pursuant to section 12(b) of the Act:
Title of each class Name of each exchange on which registered
None N/A
- ------------------ -----------------------------------------
Securities registered pursuant to section 12(g) of the Act:
Common Stock, par value $0.001
- ------------------------------
(Title of class)
Check whether the Issuer (1) filed all reports required to be filed by
section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days. (1) Yes [X]
No [ ] (2) Yes [X] No [ ]
Check if disclosure of delinquent filers in response to Item 405 of
Regulation S-B is not contained in this form, and no disclosure will be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form
10-KSB or any amendment to this Form 10-KSB. [X]
State issuer's revenues for its most recent fiscal year: $8,277
State the aggregate market value of the voting stock held by nonaffiliates
computed by reference to the price at which the stock was sold, or the average
bid and asked prices of such stock, as of a specified date within the past 60
days:
The market value of shares held by nonaffiliates is $2,229,072 based on the
bid price of $0.05 per share at March 19, 2002.
As of March 19, 2002, the Company had 67,259,301 shares of common stock
issued and outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
List hereunder the following documents if incorporated by reference and the
part of the form 10-KSB (e.g., part I, part II, etc.) into which the document
is incorporated: (1) Any annual report to security holders; (2) Any proxy or
other information statement; and (3) Any prospectus filed pursuant to rule
424(b) or (c) under the Securities Act of 1933: NONE
PART I.
ITEM 1. DESCRIPTION OF BUSINESS
ITEM 1. DESCRIPTION OF BUSINESS
Since December 1987, the Company has marketed its RejuvenAge products to
physicians practicing skin therapy medical specialities. The RejuvenAge
products are non-prescription skin care products that do not contain Retin-A
or any other precription drug. In addition to the RejuvenAge products, the
Registrant sells a proprietary moisturizing shaving cream for sensitive or
irritated beard conditions called Bladium.
The Company owns the formulations for both the RejuvenAge and Bladium
products. The products are manufactured by independent contractors. In order
to increase its profitability and reduce expenses, in fiscal 1998 the Company
reduced its office expenses to a minimum and eliminated its advertising and
salary expenses.
ITEM 2. DESCRIPTION OF PROPERTIES
None. The Company vacated its warehouse facility in May 2000. The remaining
minimal inventory is stored at the president's house.
ITEM 3. LEGAL PROCEEDINGS
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS
No matters were submitted to a vote of shareholders of the Company during the
fourth quarter of the fiscal year ended December 31, 2001.
PART II
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
The table below sets forth, for the respective periods indicated, the prices
for the Company's common stock in the over-the-counter market as reported by
the NASD's OTC Bulletin Board. The Company's common stock was cleared for
quotations on the OTCBB in January 2000 under the symbol "AGER". The bid
prices represent inter-dealer quotations, without adjustments for retail mark-
ups, mark-downs or commissions and may not necessarily represent actual
transactions.
High Bid Low Bid
-------- -------
Fiscal Year Ended December 31, 2001
- -----------------------------------
First, Second, Third, and Fourth Quarter .08 .03
Fiscal Year Ended December 31, 2000
- -----------------------------------
First, Second, Third, and Fourth Quarter .06 .03
Fiscal Year Ended December 31, 1999
- -----------------------------------
First, Second, Third and Fourth Quarter N/A N/A
At March 19, 2002, the bid and ask price for Company's Common Stock as quoted
on the OTC Bulletin Board was $0.05 and $0.05, respectively.
Since its inception, the Company has not paid any dividends on its Common
Stock, and the Company does not anticipate that it will pay dividends in the
foreseeable future. At March 19, 2002, the Company had approximately 275
shareholders of record based on information provided by the Company's transfer
agent.
ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
Results of Operations
- ---------------------
Year ended December 31, 2001 Compared to December 31, 2000
- ----------------------------------------------------------
Revenues and Costs of Sales. For the fiscal year ended December 31, 2001, the
Company had sales of $8,277, with cost of sales of $1,146, for a gross profit
of $7,131. For the fiscal year ended December 31, 2000, the Company had sales
of $14,257, with cost of sales of $5,776, for a gross profit of $8,481. Sales
declined due to the lack of any marketing program. Cost of sales decreased as
a percentage of total sales, but management believes that such sales costs
have been reduced to a minimum already and cannot be decreased further.
Management believes that for the Company to have any significant increase in
sales volume the Company will require substantial expenditures in advertising.
General and Administrative Expense. Total operating expenses for 2001 were
$16,400, compared to total operating expenses for 1999 of $15,553. The
expenses in 2001 and 2000 are primarily attributable to the preparation and
filing of periodic reports under Section 13 and/or 15(d) of the Exchange Act.
The higher expenses in 2001 were attributed primarily to higher accounting and
legal expenses. The net loss from operations for 2001 was $9,269 compared to
net loss from operations for 2000 of $7,072.
Liquidity and Capital Resources
- -------------------------------
Historically, the Company has financed its operations through a combination of
cash flow derived from operations and debt and equity financing. At December
31, 2001, the Company had a working capital deficit of $11,733 based on
current assets of $3,152 consisting of cash $1,970; accounts receivable of
$929; and inventory of $253; and current liabilities $14,885, consisting of
accounts payable and accrued expenses of $8,685 and officers' loan of $6,200.
Based on its current marketing program and sales, it is clear that the Company
will have to increase its sales volume significantly in order to have
profitable operations. At this time, however, the Company does not have any
working capital to expand its marketing efforts.
The Company proposes to finance its needs for additional working capital
through some combination of debt and equity financing. Given its current
financial condition, it is unlikely that the Company could make a public sale
of securities or be able to borrow any significant sum from either a
commercial or private lender. The most likely method available to the Company
would be the private sale of its securities. There can be no assurance that
the Company will be able to obtain such additional funding as needed, or that
such funding, if available, can be obtained on terms acceptable to the
Company.
ITEM 7. FINANCIAL STATEMENTS
The financial statements of the Company are set forth immediately following
the signature page to this Form 10-KSB.
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
The Company has had no disagreements with its certified public accountants
with respect to accounting practices or procedures or financial disclosure.
PART III
ITEM 9. DIRECTORS AND EXECUTIVE OFFICERS, PROMOTERS, AND CONTROL
PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT
The names of the Company's executive officers and directors and the
positions held by each of them are set forth below:
Name Position
- ---- --------
Richard F. Holt President and Director
Wendy E. Holt Vice President and Director
The term of office of each director is one year and until his or her
successor is elected at the Company's annual shareholders' meeting and is
qualified, subject to removal by the shareholders. The term of office for
each officer is for one year and until a successor is elected at the annual
meeting of the board of directors and is qualified, subject to removal by the
board of directors.
Biographical Information
- ------------------------
Set forth below is certain biographical information with respect to each
of the Company's officers and directors.
Richard F. Holt, age 61, has been president and director of the Company since
August 1995. In 1963, Mr. Holt graduated from Stanford University with a
Bachelor of Science degree. Mr. Holt earned an MBA from UCLA School of
Business in 1968. From 1969 to 1985, Mr. Holt was the CEO of Modulearn, Inc.,
and Micro General, Inc. From 1985 until 1995, when he became president of the
Company, Mr. Holt worked independently as an investor.
Wendy E. Holt, age 29, was appointed vice-president and director of the
Company in April 2000. Ms. Holt is a graduate of UCLA (1995) with degrees in
business and history. For the past six years she has worked for Tricon Food
Services as a creator and implementor of internet functions in the Human
Resources department.
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
- -------------------------------------------------
The Company believes that under the SEC's rules for reporting of securities
transactions by directors and executive officers, all required reports have
been timely filed.
ITEM 10. EXECUTIVE COMPENSATION
The Company has not had a bonus, profit sharing, or deferred compensation plan
for the benefit of its employees, officers or directors. Except as noted
below, the Company has not paid any salaries or other compensation to its
officers, directors or employees for the years ended December 31, 2001, 2000
and 1999, nor at any time during 2001, 2000 or 1999. Further, the Company has
not entered into an employment agreement with any of its officers, directors
or any other persons and no such agreements are anticipated in the immediate
future. It is intended that the Company's directors may be compensated for
services provided to the Company. As of the date hereof, no person has
accrued any compensation from the Company.
The following tables set forth certain summary information concerning the
compensation paid or accrued for each of the Company's last three completed
fiscal years to the Company's or its principal subsidiaries chief executive
officer and each of its other executive officers that received compensation in
excess of $100,000 during such period (as determined at December 31, 2001, the
end of the Company's last completed fiscal year):
SUMMARY COMPENSATION TABLE
Long Term Compensation
----------------------
Annual Compensation Awards Payouts
Other Restricted
Name and Annual Stock Options LTIP All other
Principal Position Year Salary Bonus($) Compensation Awards /SARs Payout Compensation
- ------------------ ---- ------ -------- ------------ ------ ------- ------ ------------
Richard F. Holt 2001 $ -0- -0- -0- -0- -0- -0- -0-
President 2000 $ -0- -0- -0- -0- -0- -0- -0-
1999 $ -0- -0- -0- -0- -0- -0- -0-
Options/SAR Grants in Last Fiscal Year
None.
Bonuses and Deferred Compensation
None.
Compensation Pursuant to Plans
None.
Pension Table
Not Applicable.
Other Compensation
None.
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following tables sets forth the number of shares of the Company's
Common Stock, par value $0.001, held by each person who is believed to be
the beneficial owner of 5% or more of the 67,259,301 shares of the Company's
common stock outstanding at March 19, 2002, based on the Company's transfer
agent's list, and the names and number of shares held by each of the Company's
officers and directors and by all officers and directors as a group.
Title of Name and Address Amount and Nature of Percent
Class Of Beneficial Owner Beneficial Ownership of Class
- -------- ------------------- --------------------- --------
Common Mark A. Scharmann 4,605,000 Direct 6.85
1661 Lakeview Circle 3,200 Indirect(1) 0.01
Ogden, UT 84403
Common Wendy E. Holt (2) 5,000,000 Direct 7.43
205 1/2 Agate Street
Balboa Island, CA 92662
Common Richard B. Holt (3) 5,400,000 Direct 8.03
24382 Antilles Way
Dana Point, CA 92629
Common Jean Armstrong, 8,026,050 Direct 11.93
P.O. Box 6743
Pine MTN. Club, CA 93222
Common Eldridge D. Huntington 6,000,000 Direct 8.92
5314 Anaheim Road
Long Beach, CA 90815
Common Richard F. Holt, 9,601,833 Direct 14.27
1 Strawberry Lane 50,000 Indirect(4) 0.07
San Juan Capistrano, CA 92675
Officers and Directors
- ----------------------
Common Richard F. Holt, ---- see above ----
President/director
Common Wendy E. Holt (2) ---- see above ----
Vice-president/director
All Officers, Directors,
as a Group (2 Persons) 14,601,833 Direct 21.71
50,000 Indirect 0.07
========== =====
- -----------------------
(1) Shares held of record by Troika Capital Investments, a company controlled
by Mark Scharmann.
(2) Wendy E. Holt is the adult daughter of Richard F. Holt.
(3) Richard B. Holt is the adult son of Richard F. Holt.
(4) Shares held of record by Richard F. Holt's spouse.
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
During December 1999, directors holding notes agreed to convert an aggregate
of $96,602 in principal debt and $36,000 in accrued interest into 3,315,050
shares of the Company's common stock. The shares were issued in year 2000 and
were recorded as paid-in capital in 1999. See Note 4 to the Financial
Statements.
ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K
(a)(1)FINANCIAL STATEMENTS. The following financial statements are included
in this report:
Title of Document Page
- ----------------- ----
Independent Auditors' Report of Harold Y. Spector,
Certified Public Accountant 9
Balance Sheet as of December 31, 2001 and 2000 10
Statements of Operations for the years ended
December 31, 2001 and 2000 11
Statements of Changes in Stockholders' Equity for the years ended
December 31, 2001 and 2000 12
Statements of Cash Flows for the years ended December 31, 2000 and 1999 13
Notes to Financial Statements 14
(a)(2)FINANCIAL STATEMENT SCHEDULES. The following financial statement
schedules are included as part of this report:
None.
(a)(3)EXHIBITS. None.
(b) REPORTS ON FORM 8-K. None.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, this report has been signed below by the following persons on behalf
of the Company and in the capacities and on the dates indicated:
Date: March 22, 2001 By /S/ Richard F. Holt, President and
Principal Accounting Officer
Harold Y. Spector
Certified Public Accountant
80 South Lake Avenue, Suite 723
Pasadena, California 91101
Independent Auditor's Report
To the Board of Directors and Stockholders of Age Research, Inc.
I have audited the accompanying balance sheet of Age Research, Inc.(a Delaware
Corporation), as of December 31, 2001, and the related statements of
operations, changes in stockholders' equity and cash flows for the years ended
December 31, 2001 and 2000. These financial statements are the responsibility
of the Company's management. My responsibility is to express an opinion on
these financial statements based on my audits.
I conducted my audits in accordance with generally accepted auditing
standards. Those standards require that I plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. I believe that my audits have a reasonable basis for
my opinion.
In my opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Age Research, Inc. as of
December 31, 2001, and the results of its operations and its cash flows for
the years ended December 31, 2001 and 2000, in conformity with accounting
principles generally accepted in the United States.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 9 to the
financial statements, the Company's significant operating losses raises
substantial doubt about its ability to continue as a going concern.
Management's plan regarding those matters are also described in Note 9. These
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.
/s/ Harold Y. Spector
Pasadena, CA
March 11, 2002
AGE RESEARCH, INC.
BALANCE SHEET
December 31, 2001
ASSETS
Current Assets
Cash $ 1,970
Accounts Receivable 929
Inventory 253
-----------
Total Current Assets 3,152
-----------
Property and Equipment
Furniture and Fixtures 5,560
Machinery and Equipment 1,794
-----------
7,354
Less: Accumulated Depreciation (7,354)
-----------
Total Property and Equipment -
-----------
TOTAL ASSETS $ 3,152
===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts Payable and Accrued Expenses $ 8,685
Officers' Loan 6,200
-----------
Total Current Liabilities 14,885
-----------
Long-Term Liabilities 0
-----------
Total Liabilities 6,344
-----------
Stockholders' Equity
Common stock, $.001 par value, 100,000,000
shares authorized and 67,259,301 shares
issued and outstanding 67,259
Paid-in Capital 730,264
Accumulated Deficit (809,256)
-----------
Total Stockholders' Deficit (11,733)
-----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 3,152
===========
The accompanying notes are an integral part of these financial statements.
AGE RESEARCH, INC.
STATEMENT OF OPERATIONS
For the years ended December 31, 2001 and 2000
2001 2000
------------- ----------------
SALES $ 8,277 14,257
COST OF SALES - Schedule A 1,146 5,776
------------- ----------------
GROSS PROFIT 7,131 8,481
OPERATING EXPENSES 16,400 15,553
------------- ----------------
INCOME (LOSS) FROM OPERATIONS (9,269) (7,072)
------------- ----------------
OTHER INCOME (EXPENSES)
Interest Income 6 11
Interest Expenses (203) -
------------- ----------------
Total Other Income (Expenses) (197) 11
------------- ----------------
NET LOSS BEFORE TAXES (9,466) (7,061)
PROVISION FOR INCOME TAXES 800 800
------------- ----------------
NET LOSS $ (10,266) $ (7,861)
============= ================
NET LOSS PER SHARE $ (0.00) $ (0.00)
============= ================
WEIGHTED AVERAGE NUMBER OF SHARES 67,259,301 66,706,793
============= ================
The accompanying notes are an integral part of these financial statements.
AGE RESEARCH, INC.
STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
For The Years Ended December 31, 2001 and 2000
Paid
Common in Accumulated
Shares Stock Capital Deficit Total
------------ ------------ ------------ ------------ ------------
Balance at December 31, 1999 63,994,251 $ 63,944 $ 733,579 $ (791,129) $ 6,394
Issuance of stock for debt 3,315,050 3,315 (3,315) 0
Net Loss (7,861) (7,861)
------------ ------------ ------------ ------------ ------------
Balance at December 31, 2000 67,259,301 67,259 730,264 (798,990) (1,467)
Net Loss (10,266) (10,266)
------------ ------------ ------------ ------------ ------------
Balance at December 31, 2001 67,259,301 $ 67,259 $ 730,264 $ (809,256) $ (11,733)
============ ============ ============ ============ ============
The accompanying notes are an integral part of these financial statements.
AGE RESEARCH, INC.
STATEMENTS OF CASH FLOWS
For the years ended December 31, 2001 and 2000
2001 2000
------------- ----------------
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income (Loss) $ (10,266) $ (7,861)
Adjustment to reconcile net income to
net cash provided by operating
activities
Depreciation 65 231
(Increase) Decrease in:
Accounts Receivable 884 1,448
Inventory 923 5,776
Increase (Decrease) in:
Accounts Payable and Accrued Expenses 2,341 1,214
------------- ----------------
Net Cash Provided (Used) by Operating
Activities (6,053) 808
------------- ----------------
CASH FLOWS FROM INVESTING ACTIVITIES - -
------------- ----------------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from Officers' Loan 6,200 -
------------- ----------------
Net Cash Provided (Used) by Financing
Activities 6,200 -
------------- ----------------
NET INCREASE (DECREASE)IN CASH 147 808
CASH AT BEGINNING OF YEAR 1,823 1,015
------------- ----------------
CASH AT END OF YEAR $ 1,970 $ 1,823
============= ================
SUPPLEMENTARY DISCLOSURES:
Cash paid for:
Interest paid $ - $ -
============= ================
Income Taxes Paid $ 800 $ 800
============= ================
Noncash investing and financing activities:
In 2000, the Company issued 3,315,050 shares of stock to complete 1999 debt
conversion.
The accompanying notes are an integral part of these financial statements.
PAGE> 14
AGE RESEARCH, INC.
NOTES OF FINANCIAL STATEMENTS
For The Years Ended December 31, 2000 and 1999
NOTE 1 - NATURE OF OPERATIONS
Age Research, Inc. ("the Company"), fka Volt Research, Inc., was incorporated
under the laws of Utah on July 10, 1984. In April, 1987, the Company changed
its name to Age Research, Inc., and changed its state of domicile to Delaware.
Age Research, Inc. produces and sells a line of premium skin care products to
physicians and mail order. The Company has developed its own line of
dermatologist-formulated skin care products including moisturizers, cleaners,
sunscreens, and anti-aging emollients with glycolic acid. The products are
sold under the name of RejuvenAge, which is trademarked in U.S. and U.K., and
name of Bladium, which is trademarked in U.S.. The trademark in U.K. will be
expired in September, 2006.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Use of estimates
- ----------------
In preparing financial statements in conformity with accounting principles
generally accepted in the United States, management is required to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and the disclosure of contingent assets and liabilities at the
date of the financial statements and revenues and expenses during the
reporting period. Actual results could differ from these estimates.
Revenue Recognition
- -------------------
Revenue from sales is recognized when the products are shipped. The Company
adopted Staff Accounting Bulletin No. 101, "Revenue Recognition in Financial
Statements"("SAB 101") in the fourth quarter of 2000. The adoption of SAB 101
did not have a material impact on the Company's operating results or financial
positions.
Cash and Cash Equivalents
- -------------------------
For purposes of the statements of cash flows, the Company considers all highly
liquid investments with of maturity of three months or less to be cash
equivalents.
Fair Value of Financial Instruments
- -----------------------------------
The carrying amounts of the financial instruments have been estimated by
management to approximate fair value.
Accounts Receivable
- -------------------
Management of the Company considers accounts receivable to be fully
collectible, accordingly, no allowance for doubtful accounts is required. If
amounts become uncollectible, they will be charged to operations when that
determination is made. Bad debt expense for years ended December 31, 2001 and
2000 was $105 and $116, respectively.
AGE RESEARCH, INC.
NOTES OF FINANCIAL STATEMENTS
For The Years Ended December 31, 2001 and 2000
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Inventories
- -----------
Inventories consist of products already packaged and ready for shipments to
customers, and are stated at cost, using the first-in, first-out method.
In 2000, the Company wrote off obsolete inventory of $1,333, which was charged
to cost of goods sold. None was in 2001.
Property and Equipment
- ----------------------
Property and Equipment are stated at cost. Depreciation is computed over their
estimated useful lives using straight-line method for financial reporting, and
accelerated methods for tax reporting, therefore, temporary differences exist.
Expenditures for major renewals and betterment that extend the useful lives of
the assets are capitalized. Expenditures for maintenance and repairs are
charged to expense as incurred.
Depreciation expense was $65 and $231 for the years ended December 31, 2001
and 2000, respectively.
Income Taxes
- ------------
Income Tax expense is based on pretax financial accounting income. Deferred
tax assets and liabilities are recognized for the expected tax consequences of
temporary differences between the tax bases of assets and liabilities and
their reported amounts.
Shipping and Handling Costs
- ---------------------------
In September 2000, the Emerging Issues Task Force ("EITF") reached a final
consensus on EITF Issue 00-10, "Accounting for Shipping and Handling Fees and
Costs." This consensus requires that all amounts billed to a customer in a
sale transaction related to shipping and handling, if any, represent revenue
and should be classified as revenue. The Company historically has classified
shipping charges to customers as revenue. With respect to the classification
of costs related to the shipping and handling incurred by the seller, EITF
determined that the classification of such costs is an accounting policy
decision that should be disclosed. It also determined that if such costs are
significant and are not included in cost of sales, a company should disclose
both the amount(s) of such costs and the line item(s) on the income statement
that include them. The Company historically has included inbound shipping
charges in cost of sales and classified outbound shipping charges as operating
expenses. For years ended December 31, 2001 and 2000, the outbound shipping
charges included as operating expenses were $830 and $1,249, respectively.
Recent Accounting Pronouncement
- -------------------------------
In June 2001, Statement of Financial Accounting Standards ("SFAS") No. 141,
"Business Combinations" was issued establishing accounting and reporting
standards requiring all business combinations initiated after June 30, 2001,
to be accounted for using the purchase method. SFAS No. 141 is effective for
the Company for the fiscal quarter beginning July 1, 2001. The impact of this
statement is dependent on future acquisition activity.
AGE RESEARCH, INC.
NOTES OF FINANCIAL STATEMENTS
For The Years Ended December 31, 2001 and 2000
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Also in June 2001, SFAS No. 142 "Goodwill and Other Intangible Assets" was
issued effective for the first period of all fiscal years beginning after
December 15, 2001, with early adoption permitted for entities with Fiscal
years beginning after March 15, 2001. SFAS 142 requires goodwill to be tested
for impairment under certain circumstances, and written off when impaired,
rather than being amortized as previous standards required. The Company
currently does not own any intangible assets and as a result, does not
anticipate any impact on the Company's consolidated financial statements.
In September 2000, SFAS No. 140, "Accounting for Transfers and Servicing of
Financial Assets and Extinguishments of Liabilities" was issued effective for
all related transactions occurring after March 31, 2001. The statement
replaces SFAS No. 125, "Accounting for Transfers and Servicing of Financial
Assets and Extinguishments of Liabilities". The new statement, while largely
including the provisions of SFAS No. 125, revises the standards for accounting
for securitizations and other transfers of financial assets and collateral and
requires certain additional disclosure. The statement was effective for the
Company for the fiscal quarter beginning April 1, 2001 and the Company
believes the adoption will not have a significant impact on its financial
position.
In June 1988, the FASB issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities", as amended by SFAS No. 138, which was
issued in June 2000. SFAS No. 133 establishes accounting and reporting
standards for derivative instruments. The Company currently does not use
derivative financial products for hedging or speculative purposes and as a
result does not anticipate any impact on the Company's financial statements.
NOTE 3 - COMMON STOCK TRANSACTIONS
On December 13, 1999, the Board of Directors approved to convert notes payable
of $96,602 plus accrued interest of $36,000 into 3,315,050 shares of the
Company's common stock. The transaction was recorded as paid-in capital in
1999. In March 2000, all 3,315,050 shares were issued. There was no stock
issued during 2001.
NOTE 4 - INCOME TAXES
Provision for income tax for years ended December 31, 2001 and 2000 consisted
of $800 minimum state franchise tax each year.
As of December 31, 2001, the Company has net operating losses carryforwards,
approximately, of $643,568 to reduce future taxable income. To the extent not
utilized, the loss carryforwards will begin to expire through 2021. The
Company's ability to utilize its net operating loss carryforwards is uncertain
and thus a valuation reserve has been provided against the Company's net
deferred tax assets.
The deferred net tax assets consist of the following at December 31:
2001 2000
----------- -------------
Net Operating Loss Carryforwards $ 218,813 $ 107,946
Depreciation - (6)
Valuation Allowance (218,813) (107,940)
----------- -------------
Net deferred tax assets $ - $ -
=========== =============
AGE RESEARCH, INC.
NOTES OF FINANCIAL STATEMENTS
For The Years Ended December 31, 2001 and 2000
NOTE 5 - NET LOSS PER SHARE
Net loss per share is computed based on the weighted average number of shares
of common stock outstanding during the period. Basic net loss per share was
$0.00 for both years ended December 31, 2001 and 2000. Diluted net loss per
share is the same as basic net loss per share due to the lack of dilutive
items in the Company.
2001 2000
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Numerator:
Net loss $ (10,266) $ (7,861)
=========== ===========
Denominator:
Weighted Average No. of Shares 67,259,301 66,706,793
=========== ===========
Loss per share - Basic and Diluted $ (0.00) $ (0.00)
=========== ===========
NOTE 6 - SEGMENT INFORMATION
SFAS No. 131 "Disclosures about Segments of an Enterprise and Related
Information" requires that a publicly traded company must disclose information
about its operating segments when it presents a complete set of financial
statements. Since the subsidiary did not have any assets and operations in
2000 or 1999, and all income are derived from the Company, accordingly,
detailed information of the reportable segment is not presented.
NOTE 7 - RELATED PARTY LOANS
An officer has advanced loans which are payable on demand with no due date.
Interest is being charged at 6% per annum. The balance of these notes at
December 31, 2001 and 2000 was $6,200 and $0, respectively.
NOTE 8 - LEASES
The Company leases a warehouse facility for $234 per month on a month-to-month
basis. At the end of May 2000, the Company vacated the warehouse. Rent expense
for 2001 and 2000 was $0 and $2,785, respectively.
NOTE 9 - GOING CONCERN
The accompanying financial statements are presented on the basis that the
Company is going concern. Going concern contemplates the realization of assets
and the satisfaction of liabilities in the normal course of business over a
reasonable length of time. As shown in the accompanying financial statements,
the Company suffered losses of $10,266 and $7,861 for years ended December 31,
2001 and 2000, respectively, and as of December 31, 2001, the Company's
current liabilities exceeded its current assets by $11,733 and its total
liabilities exceeded its total assets by $11,733.
Management is currently involved in active negotiations to obtain additional
financing and actively increasing marketing efforts to increase revenues. The
Company's continued existence depends on its ability to meet its financing
requirements and the success of its future operations. The financial
statements do not include any adjustments that might result from the outcome
of this uncertainty.