x
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ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGEACT
OF
1934 FOR FISCAL YEAR ENDED DECEMBER 31,
2005
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o
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TRANSITION
REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE
ACT OF
1934
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Nevada
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03-7392107
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(State
or other jurisdiction of incorporation or
organization)
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(I.R.S.
Employer Identification
No.)
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Page
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PART
I
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4
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7
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7
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7
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PART
II
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7
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8
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9
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14
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20
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21
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21
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PART
III
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21
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22
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23
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23
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24
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24
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25
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DESCRIPTION
OF BUSINESS
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Quality
Assurance Specialist
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Senior
Software Developer
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Project
Manager
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Database
Administrator
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Principal
Engineer
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Internet
Developer
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Senior
Systems Engineer
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Software
Developer
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LAN/WAN
Engineer
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Application
Testing Engineer III
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Computer
Analyst
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Application
Testing Engineer II
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Systems
Administrator
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Application
Testing Engineer I
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Business
Analyst III
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Technical
Writer / Editor
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Business
Analyst II
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Document
Publisher
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Business
Analyst I
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Description
of Property
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ITEM
3.
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LEGAL
PROCEEDINGS
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ITEM
4.
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SUBMISSION
OF MATTERS TO A VOTE OF SECURITY
HOLDERS
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ITEM
5.
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MARKET
FOR COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS
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HIGH
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LOW
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|||||
2004
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|||||
1st
Quarter
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0.280
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0.100
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|||||
2nd
Quarter
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0.360
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0.130
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|||||
3rd
Quarter
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0.200
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0.080
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|||||
4th
Quarter
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0.140
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0.090
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2005
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|||||||
1st
Quarter
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3.830
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2.50
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|||||
2nd
Quarter
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3.330
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0.31
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|||||
3rd
Quarter
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1.450
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0.20
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|||||
4th
Quarter
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0.950
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0.090
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MANAGEMENT'S
DISCUSSION AND ANALYSIS
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FINANCIAL
STATEMENTS
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ASSETS
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||||
CURRENT
ASSETS:
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||||
Cash
and Cash Equivalents
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$
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49,857
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Other
Current Assets
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29,077
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Accounts
Receivable
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628,468
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|||
Total
current assets
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707,402
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Property
And Equipment
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||||
Property
and Equipment
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873,529
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|||
Accumulated
Deprecation
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(824,625
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)
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Net
Property and Equipment
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$
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48,904
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TOTAL
ASSETS
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$
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756,306
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LIABILITIES
AND STOCKHOLDERS' EQUITY (DEFICIT)
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||||
LIABILITIES:
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Current
Liabilities:
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||||
Accounts
Payable (NOTE M)
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$
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390,416
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Tax
Payable (NOTE O)
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201,866
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Interest
Payable
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18,640
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Notes
Payable (NOTE L)
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186,399
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Line
of Credit (NOTE N)
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39,708
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TOTAL
LIABILITIES
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837,029
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STOCKHOLDERS’
EQUITY (DEFECIT)
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||||
Convertible
preferred stock, ($.001 par value, 5,000,000 authorized: 911,553
shares
issued and outstanding)
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911
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Common
stock ($.001 par; 100,000,000 shares authorized: 21,567,910 shares
issued
and outstanding
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21,568
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Additional
paid-in capital
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23,173,529
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Retained
Deficit
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(23,276,731
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)
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TOTAL
STOCKHOLDERS’ EQUITY
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(80,723
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)
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TOTAL
LIABILITIES AND STOCKHOLDERS’ EQUITY
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$
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756,306
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Preferred
Stock
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Common
Stock
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||||||||||||
Shares
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Amount
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Shares
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Amount
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||||||||||
Balances,
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|||||||||||||
December
31, 2003
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1,055,553
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1,055
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985,392
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$
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965
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Exercise
of consultants warrants
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-
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300,000
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$
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300
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Warrants
to consultants
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-
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-
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-
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-
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Conversion
of preferred shares into common shares
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(144,000
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)
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144
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$
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4,815
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Net
loss
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-
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-
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-
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-
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Balances,
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December
31, 2004
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911,553
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$
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911
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1,290,206
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$
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$1,290
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|||||||
Issuance
of Shares for Acquisition
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20,277,704
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$
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20,278
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Balances,
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|||||||||||||
December
31, 2005
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911,553
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$
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911
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21,567,910
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$
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21,568
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2005
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2004
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SALES
AND COST OF SALES
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Sales
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$
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2,298,802
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$
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341,199
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Cost
of sales
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145,693
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292,138
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Gross
Profit
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2,153,109
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49,061
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EXPENSES
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Selling,
general and administrative
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2,398,467
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1,839,824
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Depreciation
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-
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12,690
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Amortization
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-
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11,458
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Interest
Expense
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26,215
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(22,911
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)
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OTHER
INCOME (EXPENSE)
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Other
Income
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-
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1,049
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NET
INCOME (LOSS)
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$
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(271,573
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)
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$
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(1,836,773
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)
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Basicand
Diluted loss per share:
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$
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(.01
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)
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$
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(1.65
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)
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Weighted
average shares outstanding
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21,567,910
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1,115,605
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2005
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2004
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CASH
FLOWS FROM OPERATING ACTIVITIES:
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Net
loss
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$
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(271,573
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)
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$
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(1,836,773
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)
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Adjustments
to reconcile net loss to net cash used in
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|||||||
operating
activities:
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Non-cash
stock and option compensation
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-
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1,319,827
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Depreciation
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740,995
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24,148
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Amortization
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38,542
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-
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Other
assets
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50,550
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Notes
payable
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35,675
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Accounts
Payable and Accrued expenses
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222,192
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98,721
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Trade
accounts receivable
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(592,554
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)
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21,825
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NET
CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES
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223,827
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(398,610
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)
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CASH
FLOWS FROM INVESTING ACTIVITIES:
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Purchases
of equipment
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(782,714
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) |
(54,609
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)
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NET
CASH PROVIDED BY INVESTING ACTIVITIES
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(782,714
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)
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(54,609
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)
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CASH
FLOWS FROM FINANCING ACTIVITIES:
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|||||||
Proceeds
from exercise of options
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-
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421,500
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Proceeds
from notes payable
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-
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3,000
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|||||
Proceeds
from issuance of common stock
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608,744
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-
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|||||
NET
CASH PROVIDED BY FINANCING ACTIVITIES
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608,744
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421,412
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NET
INCREASE IN CHANGE IN CASH AND CASH EQUIVALENTS
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49,857
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(31,807
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)
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CASH
AND CASH EQUIVALENTS, beginning of year
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-
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31,807
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|||||
CASH
AND CASH EQUIVALENTS, end of year
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$
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49,857
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$
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-
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SUPPLEMENTAL
DISCLOSURE OF CASH FLOW INFORMATION:
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|||||||
Payment
of interest
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$
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-
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$
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-
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NON-CASH
FINANCING ACTIVITIES:
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|||||||
Stock
issued notes payable
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$
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-
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$
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-
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Exchange
of preferred stock to common stock
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-
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(144
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)
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2005
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||||
Income
Taxes
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$
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---
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Interest
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$
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7,515
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Total
deferred tax assets
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$
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7,900,000
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Valuation
allowance
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(7,900,000
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)
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Net
deferred tax asset
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$
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----
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2005
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||||
Income
tax computed at the federal statutory rate
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34
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%
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State
income taxes, net of federal tax benefit
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0
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%
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Valuation
allowance
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(34
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%)
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Total
deferred tax asset
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0
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%
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For
the year ending December 31, 2006
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$5,600.00
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WorldTeq
Corporation
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$
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370,348.00
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WorldTeq
Group
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20,068.00
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Total
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$
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390,416.00
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CHANGES
IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE
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CONTROLS
AND PROCEDURES
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OTHER
INFORMATION - none
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DIRECTORS,
EXECUTIVE OFFICERS,
PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH SECTION 16(A)
OF THE
EXCHANGE ACT
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Name
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Age
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Position
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Since
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Timothy
W. Carnahan
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38
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President,
Treasurer and Chairman of the Board of Directors
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September
2005
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Jeffrey
Lieberman
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38
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Secretary
and Director
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September
2005
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EXECUTIVE
COMPENSATION
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Annual
Compensation
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Long
Term Compensation
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|||||
Name
and Principal Position
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Year
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Salary
($)
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Bonus
($)
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Other
Annual Compensation ($)
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Restricted
Stock
Award(s) ($)
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Securities
Underlying
Options
(#)
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LTIP
Payouts ($)
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Other
($)
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Timothy
Carnahan
CEO,
President, Treasurer
and Chairman
of the Board
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2005
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142,000
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N/A
N/A
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Jeffrey
Lieberman,
Secretary
and Director
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2005
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60,000
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N/A
N/A
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ITEM
11.
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SECURITY
OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND
MANAGEMENT
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TITLE
OF CLASS
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NAME
AND ADDRESS
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Number
of
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%
OF
|
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Common
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Timothy
Carnahan
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15,645,000
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72.5%
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1300
Pennsylvania Ave Suite 700 NW
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Washington
DC 20007
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Common
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Jeffrey
Lieberman
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1,289,000
|
6%
|
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1300
Pennsylvania Ave Suite 700 NW
|
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Washington
DC 20007
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ITEM
12.
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CERTAIN
RELATIONSHIPS AND
RELATED TRANSACTIONS
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EXHIBITS
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31.1
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Certification
of Chief Executive Officer pursuant to Section 302 of Sarbanes-Oxley
Act
of 2002
|
32.1
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Certification
of the Company’s Chief Executive Officer pursuant to 18 U.S.C. Section
1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of
2002
|
PRINCIPAL
ACCOUNTANT FEES AND SERVICES
|