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Genesis Solar Corp – ‘10QSB’ for 6/30/07

On: Monday, 8/13/07, at 6:39pm ET · As of: 8/14/07 · For: 6/30/07 · Accession #: 1000096-7-308 · File #: 2-87052-D

  As Of                Filer                Filing    For·On·As Docs:Size              Issuer               Agent

 8/14/07  Genesis Solar Corp                10QSB       6/30/07    3:39K                                    Mitchell Fi… Printing/FA

Quarterly Report — Small Business — Form 10-QSB
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10QSB       Form 10-Qsb (6-30-2007)                               16     71K 
 2: EX-31       Rule 13A-14(A)/15D-14(A) Certifications                2±     8K 
 3: EX-32       Section 1350 Certifications                            1      5K

10QSB — Form 10-Qsb (6-30-2007)
Document Table of Contents

Page	(sequential)	\|	(alphabetic)	Top
			Alternative Formats (Word, et al.) Controls and Procedures Defaults Upon Senior Securities Exhibits Financial Statements Legal Proceedings Management's Discussion and Analysis or Plan of Operation Other Information Submission of Matters to A Vote of Security Holders Unregistered Sales of Equity Securities and Use of Proceeds
1	1st Page - Filing Submission
2	Item 1:. Financial Statements
"	Item 3. Defaults Upon Senior Securities
"	Item 4. Submission of Matters to A Vote of Security Holders
"	Item 5. Other Information
11	Item 2. Management's Discussion and Analysis or Plan of Operation
14	Item 3. Controls and Procedures
"	Item 1. Legal Proceedings
"	Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
15	Item 6. Exhibits

10QSB 1st Page of 16 TOC ↑Top Previous Next ↓Bottom Just 1st
 
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

 FORM 10-QSB

X       QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES    
----     EXCHANGE ACT OF 1934                                                   

For the quarterly period ended June 30, 2007                                    

OR

      TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
----     EXCHANGE ACT OF 1934                                                   

For the transition period from                to                                
                 --------------    -----------------

Commission file number:   2 - 87052 - D                                         
-------------               

 Cogenco International, Inc.
--------------------------------------------------------------------------------
(Exact name of Registrant as specified in its charter)

Colorado                                            84-0914754
--------------------------------------------------------------------------------
(State or other jurisdiction of                     (IRS Employer Identification
incorporation or organization)                                Number)         

Suite 1840, 6400 South Fiddler's Green Circle, Greenwood Village, CO 80111
--------------------------------------------------------------------------------
 (Address of principal executive offices and Zip Code)

(303) 758-1357
--------------------------------------------------------------------------------
 (Registrant's telephone number)

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: Yes X No ___          

Indicate by check mark whether the registrant is a shell company (as defined in 
Rule 12b-2 of the Exchange Act): Yes XX No ___                                  

The number of shares outstanding of the issuer's classes of common stock, as of 
August 14, 2007, is 2,656,256 shares, $.01 par value.                           

Transitional Small Business Issuer Disclosure Format:  Yes ___  No XX           

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                                                        [Enlarge/Download Table]


                           COGENCO INTERNATIONAL, INC.                                                                      
                          (A Development Stage Company)                                                                     

                                      INDEX                                                                                 
                                      -----                                                                                 

PART I.  FINANCIAL INFORMATION                                                           Page No.                           
------------------------------                                                           --------                           

                                                                                                                            
     Item 1:      Financial Statements                                                                                      

         Balance Sheet - March 31, 2007 and June 30, 2007 (unaudited)                        2                              

         Statement of Operations - For the Three Months Ended June 30, 2006 and                                             
         2007 and Cumulative Amounts from Inception of the Development Stage                                                
         (July 26, 1990) through June 30, 2007 (unaudited)                                   3                              

         Statement of Stockholders' Equity - For the Three Months Ended                                                     
         June 30, 2007 (unaudited)                                                           4                              

         Statement of Cash Flows - For the Three Months Ended June 30, 2006 and                                             
         2007 and Cumulative Amounts from Inception of the Development Stage                                                
         (July 26, 1990) through June 30, 2007 (unaudited)                                   5                              

         Notes to Unaudited Financial Statements                                             6                              

     Item 2:      Management's Discussion and Analysis or Plan of Operation                 10                              

     Item 3:      Controls and Procedures                                                   13                              

PART II.  OTHER INFORMATION                                                                 13                              
---------------------------                                                                                                 

     Item 1:      Legal Proceedings                                                         13                              

     Item 2.      Unregistered Sales of Equity Securities and Use of Proceeds               13                              

     Item 3.      Defaults upon senior securities.                                          13                              

     Item 4.      Submission of matters to a vote of security holders.                      13                              

     Item 5.      Other information.                                                        14                              

     Item 6.      Exhibits                                                                  14                              

     Signatures                                                                             15                              

     Certification pursuant to Securities Exchange Act of 1934 and Sections 302                                             
     and 906 of the Sarbanes-Oxley Act of 2002                                                                              

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PART I.     FINANCIAL INFORMATION                                                                                           

ITEM 1.  FINANCIAL STATEMENTS                                                                                               

                                 COGENCO INTERNATIONAL, INC.                                                                
                                (A Development Stage Company)                                                               
                                        BALANCE SHEET                                                                       
                                March 31, 2007 and June 30, 2007                                                            
                                          (Unaudited)                                                                       

                                             ASSETS                                                                         
                                             ------                                                                         

                                                                           March             June                           
                                                                        -----------      -----------                        
Current assets:                                                                                                             
    Cash, in interest bearing accounts                                  $    41,744      $    13,057                        
    Certificate of deposit (Note 3)                                          81,152           82,028                        
    Marketable securities                                                   572,000          324,656                        
    Receivable - related party (Note 3)                                        --              2,675                        
    Prepaid expense                                                           5,460            5,460                        
                                                                        -----------      -----------                        

      Total current assets                                                  700,356          427,876                        

Computer equipment, at cost, net of accumulated                                                                             
    depreciation of $1,147 (March) and $1,342 (June)                          2,353            2,157                        
Investment in securities of DMI (Note 4)                                    100,000          330,000                        
                                                                        -----------      -----------                        

Total assets                                                            $   802,709      $   760,033                        
                                                                        ===========      ===========                        

                                LIABILITIES AND STOCKHOLDERS' EQUITY                                                        
                                ------------------------------------                                                        
Current liabilities:                                                                                                        
    Note payable - officer                                              $     2,500      $     2,500                        
    Accounts payable                                                          8,193           19,307                        
    Accounts payable - related party                                         14,976           17,924                        
    Accrued salary - officer                                                 93,750          129,250                        
                                                                        -----------      -----------                        

      Total current liabilities                                             119,419          168,981                        

Stockholders' equity:                                                                                                       
    Preferred stock, $.01 par value; 10,000,000 shares                                                                      
      authorized, no shares issued and outstanding                             --               --                          
    Common stock, $.01 par value; 50,000,000 shares                                                                         
      authorized, 2,656,256 (March) and 2,656,256 (June)                                                                    
      shares issued and outstanding                                          26,563           26,563                        
    Additional paid-in capital                                            6,466,325        6,466,325                        
    Stock subscription receivable                                           (28,000)         (10,369)                       
    Accumulated deficit (including $4,522,006 deficit                                                                       
      accumulated during the development stage at                                                                           
      June 30, 2007)                                                     (5,781,598)      (5,891,467)                       
                                                                        -----------      -----------                        

    Total stockholders' equity                                              683,290          591,052                        
                                                                        -----------      -----------                        

    Total liabilities and stockholders' equity                          $   802,709      $   760,033                        
                                                                        ===========      ===========                        

                                              See accompanying notes.                                                       
                                                         2                                                                  

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                                              COGENCO INTERNATIONAL, INC.                                                   
                                             (A Development Stage Company)                                                  
                                                STATEMENT OF OPERATIONS                                                     
                            For the Three Months Ended June 30, 2006 and 2007 and Cumulative                                
             Amounts from Inception of the Development Stage (July 26, 1990) Through June 30, 2007                          
                                                     (Unaudited)                                                            

                                                                                              Cumulative                    
                                                                                              amounts from                  
                                                  2006                    2007                 Inception                    
                                                 ----                     ----                -----------                   

Revenues:                                                                                                                   
    Rental Income                             $     9,000             $     8,025             $    44,350                   
    Interest income                                   782                     994                  47,651                   
                                              -----------             -----------             -----------                   

      Total Revenues                                9,782                   9,019                  92,001                   

Costs and expenses:                                                                                                         
    Research and development                      197,527                    --                 3,250,000                   
    Salary - officer                               37,500                  37,500                 262,500                   
    Legal fees - related party (Note 3)             4,500                   1,500                 210,270                   
    Legal fees                                      5,867                  37,964                 114,150                   
    Consulting and travel expenses -                                                                                        
      related party                                 4,001                   1,449                 187,576                   
    Dry hole costs                                   --                      --                   123,086                   
    General and administration                     15,814                  23,917                 348,805                   
    Rent and storage expenses                      16,380                  16,362                 112,705                   
    Depreciation                                      196                     196                   4,915                   
                                              -----------             -----------             -----------                   

      Total costs and expenses                    281,785                 118,888               4,614,007                   
                                              -----------             -----------             -----------                   

        Net loss (Note 2)                     $  (272,003)            $  (109,869)            $(4,522,006)                  
                                              ===========             ===========             ===========                   

Basic and diluted loss per common share       $     (0.11)            $     (0.04)            $     (2.75)                  
                                              ===========             ===========             ===========                   

Weighted average number of common                                                                                           
    shares outstanding                          2,578,756               2,656,256               1,645,978                   
                                              ===========             ===========             ===========                   

                                                   See accompanying notes.                                                  
                                                               3                                                            

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                                                      COGENCO INTERNATIONAL, INC.                                           
                                                     (A Development Stage Company)                                          
                                                   STATEMENT OF STOCKHOLDERS' EQUITY                                        
                                                For the Three Months Ended June 30, 2007                                    
                                                             (Unaudited)                                                    

                                              Common stock        Additional       Stock                          Total     
                                       ------------------------     paid-in     Subscription    Accumulated    stockholders'
                                          Shares       Amount       capital      Receivable       deficit         equity    

Balance at March 31, 2007                2,656,256   $    26,563   $ 6,466,325   $   (28,000)   $(5,781,598)   $   683,290  
Adjustment - stock price guarantee                                                    17,631                        17,631  
Net loss for the three months                                                                                               
   ended June 30, 2007                        --            --            --            --         (109,869)      (109,869) 
                                       -----------   -----------   -----------   -----------    -----------    -----------  

Balance at June 30, 2007                 2,656,256   $    26,563   $ 6,466,325   $   (10,369)   $(5,891,467)   $   591,052  
                                       ===========   ===========   ===========   ===========    ===========    ===========  

                                                         See accompanying notes.                                            
                                                                   4                                                        

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                                             COGENCO INTERNATIONAL, INC.                                                    
                                            (A Development Stage Company)                                                   
                                               STATEMENT OF CASH FLOWS                                                      
                                          March 31, 2007 and June 30, 2007                                                  
                     For the Three Months Ended June 30, 2006 and 2007 and Cumulative Amounts                               
                  from Inception of the Development Stage (July 26, 1990) Through June 30, 2007                             
                                                    (Unaudited)                                                             

                                                               Three months Ended June 30,          Cumulative              
                                                           -------------------------------          amounts from            
                                                                2006                2007              Inception             
                                                                ----                ----              ---------             
Cash flows from operating activities:                                                                                       
    Net loss                                               $  (272,003)         $  (109,869)         $(4,522,006)           
    Adjustment to reconcile net loss to net                                                                                 
      cash used in operating activities:                                                                                    
        Research and development expenses                      197,527                 --              3,250,000            
        Depreciation expense                                       196                  196                4,915            
        Consulting fees paid directly by                                                                                    
          common stock purchasers                                 --                   --                 50,000            
        Change in receivable and prepaid expense                  --                 (2,675)              (8,135)           
        Change in accounts payable and                                                                                      
          accrued expenses                                      15,861               49,562              171,478            
                                                           -----------          -----------          -----------            

        Net cash used in operations                            (58,419)             (62,786)          (1,053,748)           

Cash flows from investing activities:                                                                                       
    Contract payments                                             --                   --             (3,250,000)           
    Purchase of securities                                        --               (230,000)            (330,000)           
    Sale of securities                                            --                264,975              264,975            
    Purchase certificate of deposit                               (690)                (876)             (82,028)           
    Purchase of computer equipment                                --                   --                 (7,072)           
                                                           -----------          -----------          -----------            

        Net cash provided by (used in)                                                                                      
          investing activities                                    (690)              34,099           (3,404,125)           

Cash flows from financing activities:                                                                                       
    Proceeds from sale of common stock                            --                   --              4,468,400            
    Short-term borrowings                                         --                   --                102,500            
    Repayments of short-term borrowings                           --                   --               (100,000)           
                                                           -----------          -----------          -----------            

        Net cash provided by financing                                                                                      
          activities                                              --                   --              4,470,900            
                                                           -----------          -----------          -----------            

Net increase (decrease) in cash                                (59,109)             (28,687)              13,027            

Cash and cash equivalents at                                                                                                
    beginning of year                                           99,738               41,744                   30            
                                                           -----------          -----------          -----------            

Cash and cash equivalents at                                                                                                
    end of period                                          $    40,629          $    13,057          $    13,057            
                                                           ===========          ===========          ===========            

                                                        See accompanying notes.                                             
                                                                    5                                                       

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 COGENCO INTERNATIONAL, INC.
 (A Development Stage Company)
 NOTES TO UNAUDITED FINANCIAL STATEMENTS
 June 30, 2007

1.   Basis of presentation                                                      
---------------------                                                 

  The accompanying financial statements have been prepared by the Company,
 without audit. In the opinion of management, the accompanying unaudited
 financial statements contain all adjustments (consisting of only normal
recurring accruals) necessary for a fair presentation of the financial
position as of March 31, 2007 and June 30, 2007, and the results of   
     operations and cash flows for the periods ended June 30, 2006 and 2007. The
financial statements have been prepared on a going concern basis which
  contemplates the realization of assets and liquidation of liabilities in
 the ordinary course of business. As shown in the accompanying financial
   statements, the Company has incurred significant losses from inception to
date and does not have sufficient funds on hand to continue to fund   
   operations. As a development stage company, the Company continues to rely
     on infusions of equity capital to fund operations. As a result, substantial
doubt exists about the Company's ability to continue to fund future   
operations using its existing resources. The Company continues to seek
equity investments of which there can be no assurance.                

2.   Income taxes                                                               
------------                                                          

  No provision for income taxes is required at March 31, 2007 and June 30,
   2007 because, in management's opinion and based on historical performance
the effective tax rate for the years will be zero.                    

As of March 31, 2007 and June 30, 2007, total deferred tax assets and 
valuation allowance are as follows:                                   

                                                                [Download Table]


                                                  March 31,     June 30,   
                                                    2007          2007     
                                                    ----          ----     
                                                                           
Deferred tax assets resulting from:                                        
  Loss carryforward                              $   303,500   $   350,100 
  Future deduction for research and development    1,212,300     1,212,300 
Valuation allowance                               (1,515,800)   (1,562,400)
                                                 -----------   ----------- 
                                                 $        --            -- 
                                                 ===========   =========== 

3.   Related party transactions                                                 
--------------------------                                            

  For the period from inception of the development stage to June 30, 2007,
the Company incurred legal costs of $88,221, from a law firm which was
  formerly a principal stockholder. A former principal of that law firm is
 both a director of the Company and a father of the Company's president.

   For the three months ended June 30, 2006, and 2007, and from inception of
    the development stage, the Company incurred legal costs of $4,500, $1,500,
     and $122,049, respectively, from two law firms in which a principal of each
  law firm is both a director of the Company and a father of the Company's
president.                                                            

6 

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COGENCO INTERNATIONAL, INC. 
 (A Development Stage Company)
 NOTES TO UNAUDITED FINANCIAL STATEMENTS
 June 30, 2007

3. Related party transactions (continued)                                       
-------------------------------------                                     

    In November 2004 we entered into an employment contract with David Brenman
    (the Company's president) which became effective on or about September 30,
   2005, when we paid DMI $3,250,000 for participation in the co-development
     agreement. The employment agreement was approved by our board of directors,
    including David Brenman's father and brother-in-law. The material terms of
   David Brenman's employment agreement are described in an annual report on
Form 10-KSB for the year ended March 31, 2007. We paid Mr. Brenman his
   salary as due under the employment agreement through August 15, 2006, but
we have been unable to make payments to him as required under his     
     employment agreement beginning August 31, 2006, except for $2,000 paid this
quarter. Mr. Brenman has orally agreed to defer (without interest)    
  collection of any other amounts due under his employment agreement until
    such time as Cogenco is adequately financed. Mr. Brenman was provided with
the $2,000 payment in salary to prevent our payroll company from      
discontinuing their services due to lack of use.                      

     During and subsequent to the fiscal years 2006 and 2007, Cogenco has raised
 $3,900,000 from offshore private placements using a Liechtenstein-based
     fund manager, MJM as a finder. MJM and Cogenco have entered into a Finder's
     Agreement containing the following terms: Cogenco agrees to engage MJM on a
    non-exclusive basis; Cogenco shall pay MJM a finder's fee of 7 1/2% of the
   funds raised from MJM's European clients; each party shall be entitled to
  indemnification under certain circumstances; and Cogenco shall reimburse
    MJM for related expenses. As a result, Cogenco has paid MJM a finder's fee
   of $292,500. The fund manager paid one-third of the finder's fee to David
W. Brenman president of Cogenco, in accordance with an oral agreement 
     between them. Pursuant to that oral agreement, Mr. Brenman will be entitled
to receive one-fifth of the fund manager's profits from making the    
    investment in Cogenco. Through January 1, 2007, MJM was owned and operated
   by Harold Janssen, who, through MJM and Genesis Investment Funds Limited,
is a principal shareholder of Cogenco and has had prior personal      
relationships with Mr. Brenman.                                       

    In October 2005, Cogenco entered into an office lease with an unaffiliated
   party for approximately 3,210 square feet at the rate of $5,350 per month
  over its term of 38 months. A certificate of deposit of $82,028 has been
pledged as collateral on a letter of credit in the amount of $70,000  
    securing the lease. With the consent of the unaffiliated landlord, Cogenco
   has agreed to sublease a portion of the space (approximately 1,605 square
feet) to another company (Micro-Imaging Solutions, Inc. or "MIS") for 
     $2,675 per month (Cogenco's cost). The income from this sublease was $9,000
   and $8,025 for the three months ended June 30, 2006 and 2007. At June 30,
2007, there was a receivable in the amount of $2,675 for one month of 
     rental income. MIS will also be responsible for its pro-rata share of other
expenses incurred under the lease. The sublease is on a month-to-month
     basis, and Cogenco expects that MIS's use of the office space will continue
    during the remaining term of Cogenco's lease, depending on MIS's financial
capabilities. An affiliate of David Brenman has a significant equity  
interest in MIS. The lease and sublease was approved by the remaining 
  members of the Cogenco board of directors, including Mr. David Brenman's
father and his brother-in-law.                                        

7 

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COGENCO INTERNATIONAL, INC. 
 (A Development Stage Company)
 NOTES TO UNAUDITED FINANCIAL STATEMENTS
 June 30, 2007

4.   Contract payment                                                           
----------------                                                      

In August 2004, Cogenco entered into a letter agreement with DMI      
BioSciences, Inc. ("DMI") for an agreement by which Cogenco would     
 participate in the development of a drug for the treatment of asthma in
    humans. The parties modified this agreement in November 2004 and, pursuant
to the modification, Cogenco paid DMI $100,000 and entered into a     
 co-development agreement with DMI for the development of a drug for the
    treatment of asthma in humans (the "Old Development Agreement"). Under the
terms of the agreements, as amended, Cogenco paid DMI $3,250,000 by   
  September 30, 2005. Once Cogenco paid DMI the full $3,250,000 it had the
right to participate in revenues from sales of the asthma products.   

  In February 2006, Cogenco and DMI negotiated a restated letter of intent
     (the "New LOI") which contemplated additional payments of $7,000,000 to DMI
by November 30, 2006. In addition, the parties negotiated a new       
co-development agreement (the "New Development Agreement") for the    
     development of a drug for the treatment of multiple sclerosis. Upon signing
     the New Development Agreement, the Old Development Agreement was terminated
(although the payments that Cogenco has made were credited to the New 
Development Agreement).                                               

    Cogenco did not make any of the payments to DMI contemplated under the New
 Development Agreement. Cogenco did not have the funds necessary to make
    these payments. The New LOI also amended the suggestion in the August 2004
letter agreement that the parties will attempt to negotiate a business
combination between DMI and Cogenco (provided that Cogenco becomes    
adequately funded with at least $25,000,000). Since the business      
    combination did not occur by October 30, 2006, upon notice from Cogenco to
 DMI, on June 22, 2007, Cogenco converted its $3,250,000 investment into
1,000,000 shares of DMI common stock and Cogenco became a minority    
shareholder of DMI.                                                   

   Of the total payments of $3,250,000 made to DMI, we included $197,527 and
  $0 in research and development costs for the three months ended June 30,
2006 and 2007, respectively.                                          

Commencing in March 2007 through June 30, 2007, we have entered into  
certain stock purchase agreements with DMI under which the Company has
   purchased a total of 401,429 shares at a total purchase price of $330,000
  and which enable the Company to purchase up to an additional $670,000 of
     DMI common stock at prices up to $1.00 per share. If Cogenco completes that
purchase by December 31, 2007, it will acquire a warrant to purchase  
  another 1,000,000 shares of DMI common stock exercisable for one year at
   $1.00 per share. Specifically, in March 2007, we purchased 100,000 shares
    of DMI common stock at $1.00 per share; in April 2007, we purchased 21,429
 shares of DMI common stock at $.70 per share; in May 2007, we purchased
    180,000 shares of DMI common stock at $.75 per share; and in June 2007, we
    purchased 100,000 shares of DMI common stock at $.80 per share. See Note 5
for stock purchases Cogenco has made subsequent to June 30, 2007.     

As a result of these transactions, as of June 30, 2007, Cogenco owned 
     1,401,429 shares of DMI common stock (approximately 12% of the total number
of DMI shares then outstanding, or about 6% on a fully-diluted basis).

8 

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COGENCO INTERNATIONAL, INC. 
 (A Development Stage Company)
 NOTES TO UNAUDITED FINANCIAL STATEMENTS
 June 30, 2007

5.   Subsequent events                                                          
-----------------                                                     

Cogenco purchased an additional 82,353 shares of DMI common stock in  
   July 2007 at $.85 per share making the total number of DMI shares held by
Cogenco as of August 7, 2007 equal to 1,483,782.                      

9 

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ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION            

The statements contained in this Report on Form 10-QSB that are not purely      
historical are forward looking statements within the meaning of Section 27A of  
the Securities Act of 1933 and Section 21E of the Securities Exchange Act of    
1934, including statements regarding our expectations, hopes, intentions or     
strategies regarding the future. Forward looking statements include: statements 
regarding future products or product development; statements regarding future   
selling, general and administrative costs and research and development spending,
and our product development and marketing strategies; statements regarding      
future capital expenditures and financing requirements; and similar forward     
looking statements. All forward-looking statements included in this document are
based on information available to us on the date hereof, and we undertake no    
obligation to update any such forward-looking statements. It is important to    
note that our actual results could differ materially from those in such         
forward-looking statements.                                                     

Material Changes in Financial Condition                                         

Since the time Cogenco ceased active business operations in 1988, we have been  
actively seeking potential business opportunities. Except for a series of equity
financings in 2005, 2006, and 2007 and the activities with DMI BioSciences      
(described below), Cogenco has not engaged in any business operations for more  
than the past five years. Cogenco has not received any revenues from operations 
for more than the past ten years.                                               

Relationship with DMI BioSciences, Inc.                                         

As described in our most recent 10-KSB, during our 2004 fiscal year, we entered 
into a letter of intent and then an agreement with DMI BioSciences, Inc. ("DMI")
by which we agreed to participate in the development of a drug for the treatment
of asthma in humans. The letter of intent also included the parties' agreement  
to attempt to negotiate a business combination between DMI and Cogenco. Although
Cogenco provided DMI $3,250,000 in financing, Cogenco did not provide any       
further financing to DMI as contemplated by that agreement and the business     
combination contemplated between DMI and Cogenco did not occur. Although Cogenco
and DMI amended those agreements in February 2006, ultimately Cogenco did not   
provide the financing contemplated by the amended agreements. In June 2007, we  
converted the $3,250,000 investment into 1,000,000 shares of DMI common stock in
accordance with the pre-existing agreements. Because we had already expensed our
entire $3,250,000 investment for these shares as research and development       
expenses, the 1,000,000 shares are carried on our balance sheet at no basis, and
the conversion had no impact on our balance sheet or statement of operations.   

We subsequently entered into certain stock purchase agreements with DMI under   
which the Company has purchased a total of 483,782 shares, 82,353 shares of     
which were purchased in July 2007 at $.85 per share, for an aggregate purchase  
price of a total of $400,000 and which enable the Company to purchase up to an  
additional $600,000 of DMI common stock at prices up to $1.00 per share. If     
Cogenco completes that purchase by December 31, 2007, it will acquire a warrant 
to purchase another 1,000,000 shares of DMI common stock exercisable for one    
year at $1.00 per share.                                                        

The 483,782 shares purchased to date (with the 1,000,000 shares acquired upon   
conversion as described above) are not considered to be marketable securities   
and are, therefore, carried as non-current assets on our balance sheet at cost  
(not including the research and development expenses previously recognized by   
Cogenco). If (in the future) we judge the recoverability of our investment in   
these shares to be questionable, we will write-down or (if appropriate)         

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write-off the value of these shares. Based on management's review at June 30,   
2007 and as of the filing of this Form 10-QSB, management has determined that no
current write-down for the 1,483,782 shares is appropriate.                     

Investment Company Act                                                          

As a result of the DMI transactions and our acquisition of Helix Biopharma      
Corporation ("Helix") common stock (as described on our most recent 10-KSB),    
Cogenco is a minority shareholder of both Helix and DMI. Consequently, Cogenco  
may be considered to be an investment company for the purposes of the Investment
Company Act of 1940. At this time, we believe that if Cogenco is an investment  
company, it is a transient investment company meeting the exception from        
registration under the Investment Company Act set forth in Rule 3a-2. Cogenco   
does not, and does not intend to, primarily engage in the business of investing,
reinvesting, or trading in securities, or holding investment securities.        
However, the SEC may disagree with our interpretation. If we were required to   
register under the Investment Company Act, this would result in considerable    
expense to Cogenco, and a significant change in Cogenco's management and        
operations.                                                                     

Financial Condition                                                             

On June 30, 2007, we had working capital of $258,895; this represents a decrease
of $322,042 from our working capital of $580,937 on March 31, 2007. This        
decrease is attributable primarily to an increase in our accrued salaries       
payable to our president of approximately $35,500, the use of $230,000 (obtained
from the sale of Helix shares) to purchase shares of DMI common stock during the
quarter, and the use of $62,786 in operations as set forth in our cash flow     
statement. In addition to accrued salaries payable to our president, other      
current liabilities increased during the quarter as a result of timing          
differences. None of our current liabilities is past-due.                       

Included in our working capital is a certificate of deposit in the amount of    
$82,028 which is not available to us for the payment of our current liabilities 
except for rent as it comes due.                                                

We have had significant cash flow difficulties and, as discussed above, we were 
unable to pay our obligations to DMI and, except for a payment of $2,000 that   
was paid in June 2007, our president has deferred (without interest) collection 
of his salary since August 15, 2006, until Cogenco is adequately financed. Mr.  
Brenman was provided with the $2,000 payment in salary to prevent our payroll   
company from discontinuing their services due to lack of use.                   

During the past several years, we have paid our operating expenses with funds   
and marketable securities raised from the recent sales of our securities to     
Genesis Investment Funds Limited, an accredited investor. Except to the extent  
that we are able to liquidate our shares of Helix Pharmaceutical (provided to us
by Genesis), we will not be able to meet our current obligations or pursue any  
business opportunity without a substantial amount of additional funding, and we 
cannot provide any assurance that we will be able to obtain that financing on   
reasonable terms, if at all.                                                    

As described in our most recent 10-KSB, in November 2004, we entered into an    
employment contract with David Brenman which became effective on or about       
September 30, 2005. Under the terms of this employment agreement, Mr. Brenman is
entitled to receive (among other things) an annual salary of $150,000. We paid  
Mr. Brenman his salary as due under this employment agreement through August 15,
2006, and the $2,000 payment discussed above, but we have otherwise been unable 
to make any subsequent payments to him as required under his employment         
agreement. In addition, we anticipate that we will continue to be unable to make
any payments under this employment agreement for the foreseeable future. Except 
for the $2,000 payment discussed above, Mr. Brenman has agreed to defer the     
compensation due to him under his employment agreement (without interest) until 
such time as the Company has adequate resources to be able to make such         
payments.                                                                       

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Material Changes in Results of Operations                                       

We are not operating in any business at this time, although we are continuing to
seek out business opportunities. Business opportunities require working capital 
to investigate and complete, and at the present time we do not have the         
necessary working capital and we can offer no assurance that, if the need       
arises, we will be able to obtain financing on reasonable terms, if at all. We  
have not received any revenues from operations for more than the past ten years 
and, therefore, we anticipate that we will continue to incur losses.            

During the quarter ended June 30, 2007, we had an operating loss of $(109,869). 
This represents a $162,134 decrease from our operating loss of $(272,003) for   
the quarter ended June 30, 2006. The operating loss for the current quarter was 
caused principally by costs and expenses consisting of officer's salary of      
$37,500, rent and storage of $16,362, legal fees of $37,964 and general and     
administrative expenses of $23,917, with minimal offsetting interest income of  
$994 and rental income of $8,025. The loss recognized in the second quarter of  
fiscal 2006 was much greater because of the $197,527 in research and development
expenses incurred during that period.                                           

For the quarter ended June 30, 2007, total stockholders' equity decreased to    
$591,052. This represents a $92,238 decrease in shareholders' equity from March 
31, 2007. The decrease in stockholders' equity is the result of the continued   
net operating losses experienced by the Company and the corresponding rise in   
our accumulated deficit.                                                        

Plan of Operations                                                              

Cogenco is not engaged in any business operations at the present time. Although 
we receive proposals for business opportunities from third parties and we seek  
out business opportunities with others, we have not actively pursued any such   
business opportunity in more than the past two years except for the business    
transactions with DMI that were discussed above. We are no longer pursuing any  
business transactions with DMI inasmuch as we have terminated our agreements    
with DMI and have converted our research and development expenditures into      
shares of DMI common stock. We will continue reviewing other opportunities in   
the biotechnology industry and in other industries as we become aware of        
appropriate opportunities.                                                      

We will not be able to pursue any business opportunity without a substantial    
amount of additional funding provided from third parties. Consequently, we      
cannot offer any assurance that we will be able to obtain the funds necessary to
invest in other business opportunities. As reflected in our statements of cash  
flows, during the quarter ended June 30, 2007, we sold shares of Helix common   
stock for net proceeds (to Cogenco) of $264,975, and we plan to sell the balance
of the shares of Helix that we acquired in March 2007 in routine market         
transactions during the next six to ten months to help pay for our routine legal
and administrative expenses and further investment in DMI.                      

We plan to continue to invest funds (to the extent available) in DMI in         
accordance with our stock purchase agreement. Management believes that the      
investment in DMI has a potential for a significant return, but such return is  
subject to many significant risks as described in our most recent 10-KSB. Based 
on the due diligence conducted by the officer and directors of Cogenco we have  
concluded that it is a good business decision for the Company to continue to    
invest in DMI.                                                                  

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Off Balance Sheet Arrangements                                                  

We have no off balance sheet arrangements and thus no disclosure is required.   
Cogenco has an obligation to pay rent to an unaffiliated party under an office  
lease through December 2008 at the rate of $5,350 per month. This obligation is 
not reflected on Cogenco's balance sheet, although our rent expense is          
recognized on our Statement of Operations.                                      

ITEM 3.  CONTROLS AND PROCEDURES                                                

Our management, with the participation of our principal executive officer and   
our principal financial officer has evaluated the effectiveness of our          
disclosure controls and procedures as required by Exchange Act Rule 13a-15(b) as
of June 30, 2007 (the end of the period covered by this report). Based on that  
evaluation, our principal executive officer and our principal financial officer 
have concluded that these disclosure controls and procedures are effective as of
such date.                                                                      

Disclosure controls and procedures are controls and other procedures that are   
designed to ensure that information required to be disclosed in our reports     
filed or submitted under the Securities 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 in our reports filed under the Exchange Act
is accumulated and communicated to our management, including our principal      
executive officer and our principal financial officer, as appropriate, to allow 
timely decisions regarding required disclosure.                                 

There were no changes in our internal control over financial reporting during   
the quarter ended June 30, 2007, that have materially affected, or are          
reasonably likely to materially affect, our internal control over financial     
reporting.                                                                      

PART II - OTHER INFORMATION                                                     

ITEM 1.  LEGAL PROCEEDINGS.                                                     

Not applicable.                                                                 

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

Not applicable.                                                                 

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES.                                       

Not applicable.                                                                 

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

Not applicable.                                                                 

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ITEM 5.  OTHER INFORMATION.                                                     

As discussed above in Management's Discussion and Analysis, except for a payment
of $2,000 to prevent our payroll company from discontinuing their services, Mr. 
David Brenman has deferred (without interest) collection of his salary since    
August 15, 2006, until Cogenco is adequately financed.                          

ITEM 6.  EXHIBITS                                                               

A. Exhibits                                                                     

31. Certification pursuant to Rule 13a-14(a).                                   

32. Certification pursuant to 18 U.S.C. ss.1350.                                

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SIGNATURES                                                                      

Pursuant to the requirements of the Securities Exchange Act of 1934, the        
Registrant has duly caused this report to be signed on its behalf by the        
undersigned thereunto duly authorized.                                          

Date: August 13, 2007                 /s/ David W. Brenman                      
                --------------------
                       David W. Brenman, President
                         Principal  Executive Officer,
                           Principal  Accounting  Officer,
                       Principal Financial Officer
        and Director

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Dates Referenced Herein and Documents Incorporated by Reference

		Referenced-On Page
This ‘10QSB’ Filing	Date	First	Last	Other Filings

	12/31/07	9	11	10QSB
Filed as of:	8/14/07	1
Filed on:	8/13/07	16
	8/7/07	10
For Period End:	6/30/07	1	14
	6/22/07	9
	3/31/07	2	13	10KSB, NT 10-K
	1/1/07	8
	11/30/06	9
	10/30/06	9
	8/31/06	8
	8/15/06	8	15
	6/30/06	2	13	10QSB
	9/30/05	8	12	10QSB, NT 10-Q
				List all Filings

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Filing Submission 0001000096-07-000308 – Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)

Genesis Solar Corp – ‘10QSB’ for 6/30/07

On: Monday, 8/13/07, at 6:39pm ET · As of: 8/14/07 · For: 6/30/07 · Accession #: 1000096-7-308 · File #: 2-87052-D

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Quarterly Report — Small Business — Form 10-QSBFiling Table of Contents

10QSB — Form 10-Qsb (6-30-2007)Document Table of Contents

Dates Referenced Herein and Documents Incorporated by Reference

Quarterly Report — Small Business — Form 10-QSB
Filing Table of Contents

10QSB — Form 10-Qsb (6-30-2007)
Document Table of Contents