SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
10-QSB/A
[ X ]
Quarterly Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 for the quarterly period ended September 30,
2004 or
[
] Transitional Report Under Section 13 or 15(d) of
the Securities Exchange Act of 1934 for the transition period from
_______________ to ________________.
____________________________________________
Commission
File No. 0-32917
|
PROTOKINETIX,
INC.
a
development stage corporation
(Name
of small business issuer in its charter)
(formerly
known as RJV NETWORK, INC.)
|
_____________________________________________
Nevada
|
94-3355026
|
(State
or other Jurisdiction
of
Incorporation or Organization)
|
(IRS
Employer
Identification
Number)
|
_____________________________________________
885
West Georgia Street, Suite 1500
Vancouver,
British Columbia Canada
|
V6C
3E8
|
(Address
of Principal Executive Offices)
|
(Zip
Code)
|
Issuer's
Telephone Number (604) 687-6607
Check
whether the issuer (1) filed all reports required to be filed by Section 13 or
15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the Company was required to file such reports), and
(2) has been subject to such filing requirements for the past 90
days.
Yes [ X ]
No [ ].
Indicate
by check mark whether the registrant is an accelerated filer (as defined in Rule
12b-2 of the Exchange Act).
Yes [ ]
No [ X ].
State the
number of shares outstanding of each of the issuer's classes of common equity,
as of the latest practicable date: As of November 19, 2004, there were
28,583,206 shares of the Company's USD $0.0000053 par value common stock issued
and outstanding.
Transitional
Small Business Disclosure Format:
This form
10-QSB/A for the three and nine month ended September 30, 2004 is being filed in
order to amend incorrect financial statements in the original filing
of form 10-QSB for the three and nine month ended September 30,
2004
TABLE OF
CONTENTS
FORM
10-QSB QUARTERLY REPORT
_________________________
PROTOKINETIX,
INC.
a
development stage corporation
(formerly
known as RJV NETWORK, INC.)
Section
|
Heading
|
|
|
Part
I
|
Financial
Information
|
|
|
Item
1
|
Financial
Statements
|
|
Balance
Sheet at September 30, 2004 (Unaudited)
|
|
Statements
of Operations (Unaudited)
for
the three months and nine ended September 30, 2004 and 2003, and for the
Period From December 23, 1999 (Date of Inception) to
September
30, 2004
|
|
Statements
of Stockholders' Equity (Deficit) (Unaudited)
for
the nine months ended September 30, 2004, and for the Period From December
23, 1999 (Date of Inception) to September 30,
2004
|
|
Statements
of Cash Flows (Unaudited)
for
the nine months ended September 30, 2004 and 2003, and for the Period From
December 23, 1999 (Date of Inception) to
September
30, 2004
|
|
Notes
to Financial Statements
|
Item
2
|
Management's
Discussion and Analysis
|
Item
3
|
Controls
and Procedures
|
|
|
Part
II
|
Other
Information
|
|
|
Item
1
|
Legal
Proceedings
|
Item
2
|
Changes
in Securities
|
Item
3
|
Defaults
Upon Senior Securities
|
Item
4
|
Submission
of Matters to a Vote of Security Holders
|
Item
5
|
Other
Information
|
Item
6
|
Exhibits
and Reports on Form 8-K
|
|
|
|
Signatures
|
|
Certifications
of Chief Executive Officer and Chief Financial Officer
|
|
Sarbanes-Oxley
Certifications
|
Item 1.
ProtoKinetix,
Inc.
Financial
Statements for the
Period
Ended September 30, 2004
PROTOKINETIX,
INC. (formerly known as RJV Network, Inc.)
(A
Development Stage Company)
BALANCE
SHEET
September
30, 2004
(Unaudited)
(Restated)
ASSETS
|
|
|
|
|
|
Current
Asset, as restated
|
|
|
|
Cash
|
|
|
|
|
$
|
39,156
|
|
Computer
Equipment
|
|
1,683
|
|
|
|
|
|
|
|
|
|
|
$
|
40,839
|
|
LIABILITIES
AND STOCKHOLDERS' EQUITY (DEFICIT)
|
|
|
|
|
|
|
|
Current
Liabilities
|
|
|
|
Due
to outside management consultants
|
|
|
|
|
$
|
128,005
|
|
Accounts
payable
|
|
|
|
|
|
52,639
|
|
Accrued
interest
|
|
|
|
|
|
18,900
|
|
Note
payable, related party
|
|
|
|
|
|
315,000
|
|
Total
current liabilities
|
|
|
|
|
|
514,544
|
|
Stockholders'
Equity (Deficit)
|
|
|
|
Common
stock, $.0000053 par value; 100,000,000 common shares authorized;
27,155,806 shares issued and outstanding
|
|
|
|
|
|
145
|
|
Common
stock, issuable; 2,050,000 shares
|
|
|
|
|
|
11
|
|
Additional
paid-in capital
|
|
|
|
|
|
5,242,169
|
|
Deficit
accumulated during the development stage, as restated
|
|
|
|
|
|
(5,716,030
|
)
|
|
|
|
|
|
|
(473,705)
|
|
|
|
|
|
|
$
|
40,839
|
|
(See
Notes to Financial Statements)
PROTOKINETIX,
INC. (formerly known as RJV Network, Inc.)
(A
Development Stage Company)
STATEMENTS
OF OPERATIONS
For the
Three and Nine Months Ended September 30, 2004 and 2003, and the Period
From
December
23, 1999 (Date of Inception) to September 30, 2004
(Unaudited)
(Restated)
|
|
Three
Months
Ended
September
30, 2004
|
|
Three
Months
Ended
September
30, 2003, as restated
|
|
Nine
Months
Ended
September
30, 2004
|
|
Nine
Months
Ended
September
30, 2003, as restated
|
|
Cumulative
During the Development Stage
|
|
Interest
income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
124
|
|
Expense
reimbursement
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
from BioKinetix
|
|
|
|
|
|
|
|
|
|
|
|
2,000
|
|
|
2,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,000
|
|
|
2,124
|
|
General
and administrative
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Licenses,
as restated
|
|
|
|
|
|
|
|
|
45,756
|
|
|
|
|
|
2,445,756
|
|
Professional
fees
|
|
|
127,340
|
|
|
26,600
|
|
|
1,161,007
|
|
|
37,997
|
|
|
1,682,705
|
|
Consulting
fees
|
|
|
71,000
|
|
|
495,000
|
|
|
593,626
|
|
|
495,000
|
|
|
1,255,016
|
|
Rent
|
|
|
6,420
|
|
|
15,000
|
|
|
18,546
|
|
|
15,000
|
|
|
41,046
|
|
Administrative
fees
|
|
|
|
|
|
16,500
|
|
|
2,308
|
|
|
16,560
|
|
|
18,295
|
|
Promotional
|
|
|
2,518
|
|
|
13,500
|
|
|
3,805
|
|
|
13,500
|
|
|
15,648
|
|
Utilities
|
|
|
2,350
|
|
|
3,750
|
|
|
5,294
|
|
|
3,750
|
|
|
12,417
|
|
Research
|
|
|
|
|
|
|
|
|
109,533
|
|
|
|
|
|
109,532
|
|
Investor
relations
|
|
|
8,160
|
|
|
|
|
|
46,563
|
|
|
|
|
|
46,563
|
|
Interest
|
|
|
6,300
|
|
|
|
|
|
18,900
|
|
|
|
|
|
18,900
|
|
Other
|
|
|
4,926
|
|
|
2,400
|
|
|
16,132
|
|
|
2,594
|
|
|
28,811
|
|
|
|
|
229,014
|
|
|
572,750
|
|
|
2,021,470
|
|
|
584,401
|
|
|
5,674,689
|
|
Loss
from continuing operations, as restated
|
|
$
|
(229,014)
|
|
$
|
(572,750)
|
)
|
$
|
(2,021,470)
|
)
|
$
|
(582,401)
|
|
$
|
(5,672,565)
|
)
|
Discontinued
operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss
from operations of
the
discontinued segment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(43,465
|
)
|
Net
loss, as restated
|
|
$
|
(229,014)
|
|
$
|
(572,750)
|
|
$
|
(2,021,470)
|
|
$
|
(582,401)
|
|
$
|
(5,716,030)
|
|
Net
loss per share
(basic
and fully diluted)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing
operations
|
|
$
|
(0.01)
|
|
$
|
(0.03)
|
|
$
|
(0.07)
|
|
$
|
(0.04)
|
|
|
|
|
Discontinued
operations
|
|
|
(0.00)
|
|
|
(0.00)
|
|
|
(0.00)
|
|
|
(0.00)
|
|
|
|
|
Net
loss per common share, as restated
|
|
$
|
(0.01)
|
|
$
|
(0.03)
|
|
$
|
(0.07)
|
|
$
|
(0.04)
|
|
|
|
|
Weighted
average shares
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
outstanding
|
|
|
29,063,667
|
|
|
17,222,283
|
|
|
28,260,875
|
|
|
15,811,058
|
|
|
|
|
(See
Notes to Financial Statements)
PROTOKINETIX,
INC. (formerly known as RJV Network, Inc.)
(A
Development Stage Company)
STATEMENTS
OF STOCKHOLDERS' EQUITY (DEFICIT)
For the
Nine Months Ended September 30, 2004, and the Period From
December
23, 1999 (Date of Inception) to September 30, 2004
(Unaudited)
(Restated)
|
|
|
|
|
|
|
|
|
|
|
|
Deficit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
Common
Stock
|
|
|
|
During
the
|
|
|
|
|
|
Common
Stock
|
|
Issuable
|
|
Paid-in
|
|
Development
|
|
|
|
|
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
Capital
|
|
Stage
|
|
Total
|
|
Issuance
of common stock, December 1999
|
|
|
9,375,000
|
|
$
|
50
|
|
|
-
|
|
$
|
-
|
|
$
|
4,950
|
|
$
|
-
|
|
$
|
5,000
|
|
Net
loss for period
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(35
|
)
|
|
(35
|
)
|
Balance,
December 31, 2000
|
|
|
9,375,000
|
|
|
50
|
|
|
-
|
|
|
-
|
|
|
4,950
|
|
|
(35
|
)
|
|
4,965
|
|
Issuance
of common stock, April 2001
|
|
|
5,718,750
|
|
|
30
|
|
|
|
|
|
|
|
|
15,220
|
|
|
|
|
|
15,250
|
|
Net
loss for year
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(16,902
|
)
|
|
(16,902
|
)
|
Balance,
December 31, 2001
|
|
|
15,093,750
|
|
|
80
|
|
|
-
|
|
|
-
|
|
|
20,170
|
|
|
(16,937
|
)
|
|
3,313
|
|
Net
loss for year
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(14,878
|
)
|
|
(14,878
|
)
|
Balance,
December 31, 2002
|
|
|
15,093,750
|
|
|
80
|
|
|
-
|
|
|
-
|
|
|
20,170
|
|
|
(31,815
|
)
|
|
(11,565
|
)
|
Issuance
of common stock for services:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
July
2003
|
|
|
2,125,000
|
|
|
11
|
|
|
|
|
|
|
|
|
424,989
|
|
|
|
|
|
425,000
|
|
August
2003
|
|
|
300,000
|
|
|
2
|
|
|
|
|
|
|
|
|
14,998
|
|
|
|
|
|
15,000
|
|
September
2003
|
|
|
1,000,000
|
|
|
5
|
|
|
|
|
|
|
|
|
49,995
|
|
|
|
|
|
50,000
|
|
October
2003
|
|
|
1,550,000
|
|
|
8
|
|
|
|
|
|
|
|
|
619,992
|
|
|
|
|
|
620,000
|
|
Issuance
of common stock for licensing rights
|
|
|
14,000,000
|
|
|
74
|
|
|
|
|
|
|
|
|
2,099,926
|
|
|
|
|
|
2,100,000
|
|
Common
stock issuable for licensing rights
|
|
|
|
|
|
|
|
|
2,000,000
|
|
|
11
|
|
|
299,989
|
|
|
|
|
|
300,000
|
|
Shares
cancelled on September 30, 2003
|
|
|
(9,325,000
|
)
|
|
(49
|
)
|
|
|
|
|
|
|
|
49
|
|
|
|
|
|
|
|
Net
loss for year, as restated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(3,662,745
|
)
|
|
(3,662,745
|
)
|
Balance,
December 31, 2003, as restated
|
|
|
24,743,750
|
|
|
131
|
|
|
2,000,000
|
|
|
11
|
|
|
3,530,108
|
|
|
(3,694,560
|
)
|
|
(164,310)
|
|
Issuance
of common stock for services:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March
2004
|
|
|
1,652,300
|
|
|
9
|
|
|
|
|
|
|
|
|
991,371
|
|
|
|
|
|
991,380
|
|
May
2004
|
|
|
500,000
|
|
|
3
|
|
|
|
|
|
|
|
|
514,997
|
|
|
|
|
|
515,000
|
|
July
2004
|
|
|
159,756
|
|
|
1
|
|
|
|
|
|
|
|
|
119,694
|
|
|
|
|
|
119,695
|
|
August
2004
|
|
|
100,000
|
|
|
1
|
|
|
|
|
|
|
|
|
70,999
|
|
|
|
|
|
71,000
|
|
Common
stock issuable for cash
|
|
|
|
|
|
|
|
|
50,000
|
|
|
|
|
|
15,000
|
|
|
|
|
|
15,000
|
|
Net
loss for period, as restated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2,021,470)
|
|
|
(2,021,470)
|
|
Balance,
September 30, 2004, as restated
|
|
|
27,155,806
|
|
$
|
145
|
|
|
2,050,000
|
|
$
|
11
|
|
$
|
5,242,169
|
|
$
|
(5,716,030
|
)
|
$
|
473,705
|
|
See Notes
to Financial Statements
PROTOKINETIX,
INC. (formerly known as RJV Network, Inc.)
(A
Development Stage Company)
STATEMENTS
OF CASH FLOWS
For the
Nine Months Ended September 30, 2004 and 2003, and the Period From
December
23, 1999 (Date of Inception) to September 30, 2004
(Unaudited)
(Restated)
|
|
|
|
|
|
|
|
|
|
Nine
Months
Ended
September
30, 2004
|
|
Nine
Months
Ended
September
30, 2003
|
|
Cumulative
During
the
Development
Stage
|
|
Cash
Flows From Operating Activities
|
|
|
|
|
|
|
|
Net
loss for period, as restated
|
|
$
|
(2,021,470)
|
|
$
|
(582,401)
|
|
$
|
(5,716,030)
|
|
Issuance
of common stock for services and expenses, as restated
|
|
|
1,697,075
|
|
|
490,000
|
|
|
5,207,075
|
|
Change
in amounts due to outside management
|
|
|
5,139
|
|
|
|
|
|
128,005
|
|
Change
in accrued interest
|
|
|
18,900
|
|
|
|
|
|
18,900
|
|
Change
in accounts payable
|
|
|
11,091
|
|
|
10,986
|
|
|
52,639
|
|
Net
cash flows used in operating activities
|
|
|
(289,265)
|
|
|
(81,415)
|
|
|
(309,411)
|
|
Cash
Flows from Investing Activities, as restated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchase
of computer equipment
|
|
|
(1,683
|
)
|
|
|
|
|
(1,683
|
)
|
Net
cash flows used in investing activities
|
|
|
(1,683
|
)
|
|
|
|
|
(1,683
|
)
|
Cash
Flows From Financing Activities, as restated
|
|
|
|
|
|
|
|
|
|
|
Issuance
of common stock for cash
|
|
|
15,000
|
|
|
|
|
|
35,250
|
|
Repayment
of loan from stockholder
|
|
|
|
|
|
(5,155
|
)
|
|
|
|
Increase
in due to outside management consultants
|
|
|
|
|
|
86,650
|
|
|
|
|
Advances
under note payable, related party
|
|
|
315,000
|
|
|
-
|
|
|
315,000
|
|
Net
cash flows from financing activities
|
|
|
330,000
|
|
|
81,495
|
|
|
350,250
|
|
Net
change in cash
|
|
|
39,052
|
|
|
80
|
|
|
39,156
|
|
Cash,
beginning of period
|
|
|
104
|
|
|
579
|
|
|
-
|
|
Cash,
end of period
|
|
$
|
39,156
|
|
$
|
659
|
|
$
|
39,156
|
|
(See
Notes to Financial Statements)
NOTES
TO FINANCIAL STATEMENTS
Note
1. Organization and Plan of Operations
ProtoKinetix,
Inc. (formerly known as RJV Network, Inc.) (the "Company"), a development stage
company, was incorporated under the laws of the State of Nevada on December 23,
1999. The Company was formed for the purpose of developing an internet-based
listing site that would provide detailed commercial real estate property
listings and related data. In 2002, the Company suspended its original business
plan while it considered a potential merger with another company, BioKinetix. In
2003, the Company discontinued its original business plan and entered into the
licensing agreement described below. Effective as of the date of the license
agreement, the Company became a medical research company in the development
stage.
In 2003,
the Company entered into an assignment of license agreement (the "Agreement")
with BioKinetix, Inc., an Alberta, Canada, corporation. The Agreement provided
the Company with an exclusive assignment of all of the rights (the "Rights")
that BioKinetix possessed relating to two proprietary technologies that are
being developed for the creation and commercialization of "superantibodies," an
enhancement of antibody technology that makes ordinary antibodies much more
lethal. In consideration, the Company's Board of Directors authorized the
Company to issue 16,000,000 shares of its stock to the shareholders of
BioKinetix. Also, the Company's existing directors agreed to resign and the
Company cancelled 9,325,000 common shares owned by the former president
(representing the majority of his shares). New Company directors were installed.
In October 2003, 14,000,000 of the committed shares were issued. The remaining
2,000,000 shares are expected to be issued in 2004.
Note 2.
Restatement
During
2003 and 2004, the Company acquired license rights to proprietary medical
research technologies, which were capitalized at the time of acquisition as
intangible assets having indefinite lives. While the Company's management
continues to believe the license rights are of probable future benefit to the
Company in its continuing efforts to pursue the development of commercially
viable products, it was appropriate for accounting purposes to expense the cost
of the acquisition of the license rights. Accordingly, the accompanying
financial statements have been restated to correct the error and recognize as
expense the cost of those acquired license rights at the time of their
acquisition.
The
effects of the restatement on the September 30, 2004 financial statements are as
follows:
Intangible
assets decreased by $2,445,756 and the Accumulated Deficit increased by
$2,445,756.
Expenses
for the nine months ending September 30, 2004, specifically Licenses, increased
by $45,756 to $45,756, increasing the Loss from Continuing Operations and the
Net Loss by the same amount to ($2,021,470) for each. There was no effect on the
three months ended September 30, 2004. The loss per share did not
change from($0.01) for the three months ending September 30, 2004 and from
($0.07) for the nine months ended September 30, 2004.
For
purposes of the Statement of Cash Flows, the Net Loss for the Period increased
to ($2,021,470) and the Acquisition of Intangible Assets for $45,756 was
eliminated.
The
effect of the restatement on the amounts in the Cumulative During the
Development Stage period are as follows:
Expenses,
specifically Licenses, increased by $2,445,756 to $2,445,756 increasing total
expenses by a net amount of $2,445,756 to $5,674,689. The Loss from Continuing
Operations increased by $2,445,756 to ($5,672,565) and the Net Loss increased by
$2,445,756 to ($5,716,030).
For
purposes of the Statement of Cash Flows, the Net Loss for the Period increased
to ($5,716,030) and the Issuance of Common Stock for Services and Expenses
increased by $2,400,000 to $5,207,075, and the Acquisition of Intangible Assets
for $45,756 was eliminated.
Note
3. Summary of Significant Accounting Policies
The
interim period financial statements have been prepared by the Company pursuant
to the rules and regulations of the U.S. Securities and Exchange Commission (the
"SEC"). Certain information and footnote disclosure normally included in
financial statements prepared in accordance with accounting principles generally
accepted in the United States have been condensed or omitted pursuant to such
SEC rules and regulations. The interim period financial statements should be
read together with the audited financial statements and accompanying notes
included in the Company's audited financial statements for the years ended
December 31, 2003 and 2002. In the opinion of the Company, the unaudited
financial statements contained herein contain all adjustments necessary to
present a fair statement of the results of the interim periods
presented.
Note
4. Going Concern
As shown
in the financial statements, the Company has not developed a commercially viable
product, has not generated any revenues to date and has incurred losses since
inception, resulting in a net accumulated deficit of $5,716,031 at September 30,
2004. These factors raise substantial doubt about the Company's ability to
continue as a going concern.
The
Company will need additional working capital to continue its medical research or
to be successful in any future business activities and continue to pay its
liabilities. Therefore, continuation of the Company as a going concern is
dependent upon obtaining the additional working capital necessary to accomplish
its objective. Management is presently engaged in seeking additional working
capital.
The
accompanying financial statements do not include any adjustments to the recorded
assets or liabilities that might be necessary should the Company fail in any of
the above objectives and is unable to operate for the coming year.
Note
5. Note Payable, Related Party
On
February 1, 2004, the Company executed a subscription agreement under which
the Company issued to a corporation owned by a stockholder an 8% secured
convertible note in exchange for $315,000. The note is due February 1,
2005, and is convertible into shares of the Company's common stock at the lower
of $0.30 per share or 70% of the average of the three lowest trading prices for
the 30 days prior to the conversion date.
Note
6. Earnings per Share
Basic
loss per share is computed by dividing the net loss available to common
shareholders by the weighted average number of common shares outstanding in the
period. The Company's stock split 1:75 on August 24, 2001. In April 2002,
the Board of Directors approved a 2.5 for 1 split of the Company's stock. The
accompanying financial statements are presented on a post-split basis. The
earnings per share for the periods ended September 30, 2004 and 2003, and
the period cumulative during the development stage have been adjusted
accordingly. Diluted earnings per share takes into consideration common shares
of outstanding (computed under basic earnings per share) and potentially
dilutive securities. The effect of debt convertible into common shares was not
included in the computation of diluted earnings per share for all periods
presented because it was anti-dilutive due to the Company's losses.
During
2003, the Company obtained certain licensing rights in exchange for 16,000,000
common shares of the Company's stock, 2,000,000 of which shares remain to be
issued. For purposes of earnings per share computations, all of these shares
have been included as outstanding as of October 2003, the date of the original
issuance of the shares to affect the acquisition of the license rights. In
September 2004, the Company received $15,000 cash in exchange for 50,000 common
shares which are expected to be issued in the fourth quarter. These shares are
considered outstanding as of September 2004 for purposes of earnings per share
computations.
Note
7. Discontinued Operations
In 2003,
the Company signed the licensing agreement described in Note 1. This
agreement changed the Company's business plan to that of a medical research
company. Accordingly, the operating results related to the internet-based real
estate listing segment have been presented as discontinued operations in these
financial statements for all periods presented.
Note
8. Subsequent Events
Subsequent
to September 30, 2004, the Company issued 1,382,400 shares to various
consultants and directors for consulting services.
Item
2.
Management's
Discussion and Analysis
Please review "Forward
Looking Information and Cautionary Statement" section below.
A.
Plan of
Operation
General
ProtoKinetix
Inc., (the "Company," or "PROTOKINETIX") is a biotechnology research and
development company focused on the application of SuperAntibody-based products
for the treatment and diagnosis of certain cancers.
Plan of Operation
.
The ProtoKinetix business plan is based primarily on the furtherance of certain
intellectual property rights obtained by way of "sub-licenses" of technology
from other companies. At present, PROTOKINETIX has no product or products, and
has received no patents or FDA approval for any product or diagnostic
procedures.
On July
5, 2003, ProtoKinetix, Inc. entered into an assignment of license agreement (the
"Agreement") with BioKinetix Research, Inc. ("BioKinetix"). The Agreement
provided the Company with a 100% assignment of all of the rights (the "Rights")
that BioKinetix possessed relating to two proprietary technologies that are
being developed for the creation and commercialization of "super antibodies," an
enhancement of antibody technology that makes ordinary antibodies much more
lethal.
ProtoKinetix
Inc.'s mission is to develop a new generation of medicines and diagnostics for
the treatment of malignancies. The Company will be focused on the anti-cancer
applications of certain monoclonal antibodies, termed "Super antibodies," that
may improve medicinal and treatment potencies and increase sensitivity in use as
diagnostics. ProtoKinetix hopes to use this technology to create new antibodies
and diagnostic assays that will be able to be used to treat and detect certain
cancers.
In
particular, ProtoKinetix will attempt to create a SuperAntibody that will attach
to RECAF molecules. The RECAF molecules with the SuperAntibody attached are
theoretically expected to then attach to cancer cells, with minimal or no harm
to non-cancerous cells, so that the SuperAntibody can destroy the cancer
cells.
Please
note that ProtoKinetix is a development stage company that has not yet begun
operations. It is also important to understand that there has been no
development of any product (antibodies) to date by the Company, and that such
development may never begin, and there can be no certainty that any such
antibodies will be developed by the Company, and, even if a product is
developed, that the desired results for which it was originally intended will be
achieved.
We face
exposure to fluctuations in the price of our common stock due to the very
limited cash resources we have. For example, the Company has very limited
resources to pay legal and accounting professionals. If we are unable to pay a
legal or accounting professional in order to perform various professional
services for the Company, it may be difficult for the Company to maintain its
reporting status under the '34 Exchange Act. If the Company felt that it was
likely that it would not be able to maintain its reporting status, it would make
a disclosure by filing a Form 8-K with the SEC. In any case, if the Company was
not able to maintain its reporting status, it would become "delisted" and this
would potentially cause an investor or an existing shareholder to lose all or
part of his investment.
Definitions
of the terms used above are as follows:
"SuperAntibody"
is an industry-adopted term used to describe genetically-engineered antibodies,
isolated from a single blood cell, which have been expanded in the laboratory to
attack or have a desired effect on certain targeted antigens, such as cancer
cells.
"RECAF" -
Receptor Alpha Fetaprotein. This is a carbohydrate molecule that is located on
the surface of cancer cells.
"Receptor"
- A structure exposed on the cell surface used for signaling or transport of
molecules into the cell.
Milestone Events during the
Quarter Ending September 30, 2004 and Subsequent Events
On
September 8, 2004, the Company announced the execution of a definitive agreement
("Agreement") with The Perigene Company for the exclusive worldwide right to
license and market the gem-Difluoro platform technology (“GDPT”). The
transaction related to the Agreement closed on September 19,
2004.
The GDPT
will be used in Registrant’s research with Anti-Freeze-Glyco Proteins (“AFGP”),
and will be further developed and incorporated into Registrant’s products. The
licensed AFGP technology has been shown to produce a stable AFGP that is able to
prevent ice crystals from forming in cells at temperatures below freezing. As
such, the Registrant believes that the licensed AFGP technology may give the
Registrant the ability to produce a variety of AFGPs that can be tailored to
meet specific needs.
As of the
date of this filing, the Registrant (1) has no customers for an AFGP molecule,
and (2) has not sold any products containing the AFGP
molecule.
|
(1)
|
Plan of Operation for the Next Twelve
Months
The Company’s short-term goal is to design a research
program towards the development of a therapeutic agent . Any long term
objectives will be defined by Management's ability to execute on the
development of the aforementioned intellectual property rights that were
the subject of the Company's public
filings.
|
(2)
Plan of Operation for
the Next Quarterly Period
The Company’s goal is to continue its research
and development of the AFGP technology to produce
AFGPs that are tailored to meet specific needs. To meet this goal, the
Company will seek to secure additional financing for further development of the
AFGP
technology, as well as implementation of the AFGP technology
into its products.
Item
3. Controls and Procedures
A.
Evaluation of disclosure
controls and procedure
.
Under the
supervision and with the participation of our management, currently consisting
of Dr. John Todd, we have evaluated the effectiveness of the design and
operation of our disclosure controls and procedures within 90 days of the filing
date of this quarterly report, and based on their evaluation, our Chief
Executive Officer and Chief Financial Officer have concluded that these
disclosure controls and procedures are effective in timely alerting them to
material information relating to the Company required to be included in the
Company’s periodic SEC filings. There were no significant changes in our
internal controls or in other factors that could significantly affect these
controls subsequent to the date of their evaluation.
Disclosure
controls and procedures are the controls and other procedures that are designed
to ensure that information required to be disclosed by us in the reports we file
or submit under the Exchange Act is recorded, processed, summarized, and
reported, within the time periods specified in the Securities and Exchange
Commission’s rules and forms. Disclosure controls and procedures include,
without limitation, controls and procedures designed to ensure that information
required to be disclosed by us in the reports that we file under the Exchange
Act is accumulated and communicated to our management, including our Chief
Executive Officer and Chief Financial Officer, as appropriate, to allow timely
decisions regarding required disclosure.
B.
Changes in Internal
Controls
Not
applicable.
FORWARD
LOOKING INFORMATION AND CAUTIONARY STATEMENTS
Please
note that ProtoKinetix (the "Company") is a development stage company that has
not yet sold or marketed any products. The Company had no revenues for the
quarter ended September 30, 2004.
It is
important to understand that although the Company (as is discussed below) is
focused on various efforts related to the use of antibodies and super antibodies
in order to identify and treat malignancies, to date, there has been no
development of any product (antibodies or super antibodies) by the Company.
Although the Company is continuing to conduct research based on the above
referred to and below stated theses, such successful research and development
and the ultimate commercialization of a viable product may never occur, and
there can be no certainty that any such antibodies will be developed by the
Company. Further, even if a product or antibody or SuperAntibody is developed,
the desired results for which it was originally intended may not be
achieved.
The core
of the Company's thesis regarding it's research and development efforts is that
there is a protein receptor site (hereinafter referred to as "RECAF") common to
many malignant or cancerous cells. The Company has a license from Biocurex, Inc.
to develop SuperAntibody therapies for the RECAF receptor site. As of the date
of this report, the Company is engaged in efforts to validate the existence of
the RECAF receptor site. However, the Company's efforts to validate the
existence of the RECAF receptor site may fail and no such site may be located.
If this is the case, the complete foundation of the Company's efforts may be
undermined.
The
Company faces exposure to fluctuations in the price of our common stock due to
the very limited cash resources we have. For example, the Company has very
limited resources to pay legal and accounting professionals. If we are unable to
pay a legal or accounting professional in order to perform various professional
services for the Company, it may be difficult, if not impossible, for the
Company to maintain its reporting status as a public company. If the Company
felt that it was likely that it would not be able to maintain its reporting
status, it would make a disclosure by filing a Form 8-K with the SEC. In any
case, if the Company was not able to maintain its reporting status, it would
become "delisted" and this could potentially cause an investor or an existing
shareholder to lose all or part of his investment.
The
foregoing discussion, as well as the other sections of this Quarterly Report on
Form 10-QSB, contains forward-looking statements that reflect the Company's
current views with respect to future events and financial results.
Forward-looking statements usually include the verbs "anticipates," "believes,"
"estimates," "expects," "intends," "plans," "projects," "understands" and other
verbs suggesting uncertainty. The Company reminds shareholders that
forward-looking statements are merely predictions and therefore inherently
subject to uncertainties and other factors which could cause the actual results
to differ materially from the forward-looking statements. Potential factors that
could affect forward-looking statements include, among other things, the
Company's ability to identify, produce and complete film projects that are
successful in the marketplace, to arrange financing, distribution and promotion
for these projects on favorable terms in various markets and to attract and
retain qualified personnel.
Part
II. Other Information
Item
1.
Legal
Proceedings
None
Item
2.
Unregistered Sales
of Equity Securities and Use of Proceeds
During
the quarter ending September 30, 2004, the Company made the following stock
issuances:
DATE
|
NUMBER
OF SHARES
|
REASON
ISSUED
|
July
13, 2004
|
91,463
|
Payment
under Consulting Agreement
|
July
13, 2004
|
18,293
|
Payment
under Consulting Agreement
|
July
29, 2004
|
50,000
|
Payment
under Consulting Agreement (1)
|
August
25, 2004
|
100,000
|
Payment
under Consulting Agreement
|
TOTAL
|
259,756
|
|
(1) This
share issuance was made in lieu of cash payment for services rendered and was
considered an exempt transaction made under the Securities Act of 1933, Section
4(2).
Subsequent
Events:
Subsequent
to the end of the third quarter on September 30, 2004, the Company made the
following stock issuances:
DATE
|
NUMBER
OF SHARES
|
REASON
ISSUED
|
October
1, 2004
|
110,300
|
Payment
under Consulting Agreement
|
October
1, 2004
|
22,100
|
Payment
under Consulting Agreement
|
October
27, 2004
|
300,000
|
Payment
under Consulting Agreement
|
October
27, 2004
|
100,000
|
Payment
under Consulting Agreement
|
October
27, 2004
|
50,000
|
Payment
under Consulting Agreement
|
October
27, 2004
|
150,000
|
Payment
under Consulting Agreement
|
November
2, 2004
|
400,000
|
Payment
under Consulting Agreement (1)
|
November
2, 2004
|
250,000
|
Payment
under Consulting Agreement (1)
|
TOTAL
|
1,382,400
|
|
(1) This
share issuance was made in lieu of cash payment for services rendered and was
considered an exempt transaction made under the Securities Act of 1933, Section
4(2).
Disclosure Related to Form
S-8 Issuances
Prior to
issuing any common shares under Form S-8, the Company requests and receives an
executed verification from all issuees stating that the issuee is a natural
person and that: (a) the shares being issued are not being provided to create or
sustain a market for the Company's securities, and (b) that the shares are not
being issued as a part of a capital raising transaction. All consultants to the
Company are required to provide work product as a part of and condition to their
relationship with the Company. Consultant work product is delivered in
accordance with the terms and conditions of each respective Consultants'
agreement.
As of
November 2, 2004, there were 28,488,206 shares of the Company's common stock
issued and outstanding.
Item 3.
Defaults
Upon Senior Securities
None.
Item
4.
Submission of
Matters to a Vote of Security Holders
A
shareholder meeting was not held during the last calendar quarter.
There was
not a matter submitted to our shareholders during the third calendar quarter of
2004.
Item
5.
Other
Information
Not
applicable.
Item 6.
Exhibits and Reports Filed
on Form 8-K
(a)
Exhibits (numbered in accordance with Item 601 of Regulation S-B)
3.1
Certificate and Articles of Incorporation (1)
3.2
Bylaws of Registrant (2)
31.1**
Certification of Chief
Executive Officer Pursuant to Section 302
31.2**
Certification of Chief Financial Officer Pursuant to Section 302
32.1**
Certification of Chief Executive Officer Pursuant Section 906
32.2** Certification
of Chief Financial Officer Pursuant Sections 906
|
(1)
|
Certificate
of Incorporation filed as an exhibit to the Company's registration
statement on Form 10SB/A filed on July 24, 2001 and incorporated herein by
reference.
|
|
(2)
|
By-Laws
filed as an exhibit to the Company's registration statement on Form 10SB/A
filed on July 24, 2001 and incorporated herein by
reference.
|
**
Filed herewith.
(b) Forms
8-K
On
September 23, 2004, the Company filed an 8-K announcing the execution of the
License Agreement with Perigene.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report, for the period
ended September 30, 2004, to be signed on its behalf by the
undersigned, thereunto duly authorized.
|
|
|
|
PROTOKINETIX,
INC.
(Registrant)
|
|
|
|
|
|
|
Date: April
30, 2008
|
|
|
|
By:
|
/
s/ Ross Senior
|
|
|
|
|
Ross Senior
|
|
|
|
|
President, CEO and CFO
|
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