<PAGE>

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                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                            ------------------------

                                  FORM 10-KSB

<Table>
<S>    <C>
(MARK ONE)
[X]    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
       SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED
       DECEMBER 31, 2001

[ ]    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
       SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD
       FROM            TO           .

COMMISSION FILE NO. 0-11472
</Table>

                         DONLAR BIOSYNTREX CORPORATION
 (Exact name (formerly Biomune Systems, Inc.) of registrant as specified in its
                                    charter)

<Table>
<S>                                            <C>
                   NEVADA                                       87-0380088
       (State or other jurisdiction of             (I.R.S. Employer Identification No.)
       incorporation or organization)
</Table>

                             6502 SOUTH ARCHER ROAD
                          BEDFORD PARK, ILLINOIS 60501
             (Address of principal executive offices with Zip Code)

                                 (708) 563-9200
              (Registrant's telephone number, including area code)

SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT: none

SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT: common stock
($0.0001 par value per share)

     Indicate by check mark whether the registrant (1) has 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
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days:  Yes [X]  No [ ].

     The aggregate market value of common stock held by non-affiliates of the
registrant was $4,195,028 based on the average of the closing bid and ask prices
of $0.27 per share on March 28, 2002. The number of shares outstanding of the
registrant's common stock as of March 28, 2002 was 48,816,662.

     On October 31, 2000, the registrant declared a 1-for-5 reverse stock split
of its common stock, reducing the number of issued and outstanding shares of
stock by a factor of 5. Outstanding common stock data in this report have been
adjusted to reflect this reverse stock split.

     Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation SB is not contained herein, and will not be contained, to the
best of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K.  [X]
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--------------------------------------------------------------------------------
<PAGE>

                         DONLAR BIOSYNTREX CORPORATION

                         2001 FORM 10-KSB ANNUAL REPORT

                               TABLE OF CONTENTS

<Table>
<S>         <C>                                                             <C>
                                       PART I
Item 1.     Description of Business.....................................      1
Item 2.     Description of Properties...................................      9
Item 3.     Legal Proceedings...........................................      9
Item 4.     Submission of Matters to a Vote of Security Holders.........     10
                                      PART II
            Market for Registrant's Common Equity and Related
Item 5.     Stockholder Matters.........................................     10
Item 6.     Management's Discussion and Analysis or Plan of Operation...     11
Item 7.     Financial Statements and Supplementary Data.................     13
Item 8.     Changes or Disagreements with Accountants...................     13
                                      PART III
Item 9.     Directors and Executive Officers............................     13
Item 10.    Executive Compensation......................................     15
            Security Ownership of Certain Beneficial Owners and
Item 11.    Management..................................................     17
Item 12.    Certain Relationships and Related Transactions..............     18
            Exhibits, Financial Statement Schedules, and Reports on Form
Item 13.    8-K.........................................................     18
</Table>

                           FORWARD LOOKING STATEMENTS
--------------------------------------------------------------------------------

This report and the documents incorporated by reference in this report contain
forward-looking statements. These forward-looking statements are based on our
current expectations, estimates and projections about our industry, management's
beliefs and certain assumptions made by us. Words such as "anticipates,"
"expects," "intends," "plans," "believes," "seeks," "estimates" and variations
of these words or similar expressions are intended to identify forward-looking
statements. These statements are not guarantees of future performance and are
subject to certain risks, uncertainties and assumptions that are difficult to
predict. Therefore, our actual results could differ materially from those
expressed or forecasted in any forward-looking statements as a result of a
variety of factors, including those set forth in "Description of
Business -- Certain Business Considerations and Risk Factors" above and
elsewhere in, or incorporated by reference into, this report. We undertake no
obligation to update publicly any forward-looking statements for any reason,
even if new information becomes available or other events occur in the future.
--------------------------------------------------------------------------------

                                        i
<PAGE>

                                     PART I

ITEM 1. DESCRIPTION OF BUSINESS

BUSINESSES ACQUIRED FROM DONLAR CORPORATION

     In transactions closing in November 2000 and January 2001, Donlar
Biosyntrex Corporation ("Biosyntrex"), then know as Biomune Systems, Inc.,
acquired from Donlar Corporation ("Donlar") in exchange for 41,279,520 shares of
Biosyntrex's common stock, representing approximately 96% of Biosyntrex's shares
then outstanding on a fully diluted basis, substantially all of Donlar's
businesses and assets plus cash consideration. The businesses acquired from
Donlar were the manufacturing and marketing of agricultural, industrial and
consumer products. Donlar also transferred to Biosyntrex all technology, know
how and patents for the crop nutrient management and oil field services
businesses created after November 3, 2000, as well as all technology resulting
from Donlar pharmaceutical research and development activities after November 3,
2000. Donlar's ownership interest in Biosyntrex has decreased since January 2001
as a result of transfers of common stock by Donlar and issuances of additional
common stock by Biosyntrex.

     The foregoing transactions have been accounted for as a reverse acquisition
of Biosyntrex by Donlar. Accordingly, the financial statements included in this
report are based on Donlar's historical financial statements until November 3,
2000, the date of acquisition, and thereafter, include the activity of both
Donlar and Biosyntrex. Biosyntrex's fiscal year end was changed to December 31
starting with 2000. All references to fiscal years prior to 2000 represent a
fiscal year end of September 30.

RESTRUCTURING PLAN

     In 2002, Biosyntrex and Donlar began implementing a plan which is intended
to significantly restructure their collective debt and capital structures in
order to eliminate a substantial portion of their debt and to ultimately result
in the merger of the two companies (the "Restructuring Plan"). The Restructuring
Plan is scheduled to be completed by July 2002.

     As part of the Restructuring Plan, on March 18, 2001, Biosyntrex and Donlar
entered into a Bridge and Consolidated Term Loan Agreement with Tennessee
Farmers Life Insurance Company (the "Loan Agreement"), a copy of which is filed
with this report and incorporated herein by reference. Pursuant to the terms of
the Loan Agreement, Biosyntrex and Donlar obtained a bridge loan facility in the
amount of approximately $2.1 million to be used to refinance certain short term
debt, provide working capital, pay certain accounts payable creditors and pay
expenses of the transaction. In addition, the terms of an existing loan to
Donlar in the original principal amount of approximately $17.64 million were
restated and made the joint and several obligation of Donlar and Biosyntrex in
the total amount of $19.2 million, reflecting the original amount of the loans
and accrued, unpaid interest thereon (the "Restated Loans"). Each of the loans
is secured by substantially all of the assets of Biosyntrex and Donlar.

     Loans under the bridge loan facility bear interest at a rate of eleven
percent (11%) per annum with one half of such interest payable on a quarterly
basis on the last business day of March, June, September and December and the
other half payable at maturity on March 18, 2003.

     The Restated Loans are divided into two loans. The first such loan is in
the principal amount of approximately $10.18 million, bears interest at a rate
of nine percent (9%) per annum until March 18, 2003, at which time such interest
is payable, and thereafter bears interest at eleven percent (11%) per annum
payable on a quarterly basis on the last business day of March, June, September
and December. The principal balance of the loan is payable in equal quarterly
installments of not less than $222,500 commencing on March 31, 2003 and
thereafter on the last business day of March, June, September and December. Any
remaining unpaid principal and interest is payable on March 31, 2007. The second
such loan is in the principal amount of $9.0 million, bears interest at a rate
of one percent (1%) per annum, but neither interest nor principal are payable
until the first to occur of one of certain events described in the Loan
Agreement, the latest of which is March 18, 2005, after which time the interest
that has accrued is payable in full within thirty (30) days and thereafter is
payable quarterly on the last business day of March, June, September and
December together

                                        1
<PAGE>

with principal payments of not less than $222,500. Any remaining unpaid
principal and interest is payable on March 31, 2007.

     As a condition of the loans and as part of the Restructuring Plan,
Biosyntrex and Donlar have agreed to use their best efforts to merge Biosyntrex
into Donlar on or before July 7, 2002 (the "Merger"). In the Merger, each share
of Biosyntrex's common stock other than shares owned by Donlar will be exchanged
for approximately 0.26 shares of Donlar's common stock. As a result of the
Merger and related transactions described herein, Biosyntrex's shareholders
(other than Donlar) will collectively receive approximately 4.04 million shares
of Donlar's common stock representing approximately 19.44% of the shares of
common stock outstanding following the Merger and approximately 4.32% of the
shares of common stock on a fully diluted basis. The shares of Biosyntrex's
common stock owned by Donlar will be cancelled. The Merger requires the approval
of a majority of the respective shareholders of Biosyntrex and Donlar.

     Biosyntrex and Donlar also made numerous representations, warranties and
covenants in the Loan Agreement. Among the covenants, Biosyntrex and Donlar
agreed to limit their ability to incur additional indebtedness, make any
investments or loans, pay dividends, purchase, redeem or issue capital stock or
sell or encumber assets. In addition, Biosyntrex and Donlar agreed to sell or
discontinue the nutritional and nutraceuticals business on or before March 18,
2003.

     There can be no assurance that Biosyntrex and Donlar will be able to comply
with the covenants and events of default in the Loan Agreement, some of which
events of default are entirely beyond their respective control. Each of the
loans made or restated pursuant to the Loan Agreement is subject to acceleration
and the application of higher default rates of interest in the event Biosyntrex
or Donlar defaults in the payment of principal or interest when due, breaches
any covenants contained in the Loan Agreement that are not remedied within five
(5) calendar days or any other specified event of default occurs.

     Each of the loans is convertible at the option of the holder at any time
prior to repayment into common stock of Biosyntrex and, subsequent to the
Merger, into common stock of Donlar. Loans made under the bridge loan facility
convert into Donlar's post-Merger common stock at a rate of one share per $0.29
of outstanding principal amount of the loans. The Restated Loans convert into
Donlar's post-Merger common stock at a rate of one share per $0.68 of
outstanding principal amount of the loans. The conversion rates are subject to
antidilution protection. The holders of the loans have certain registration
rights with respect to the shares issuable upon conversion.

     In 2002, Donlar also reached agreements with Willis Stein and Partners,
L.P. and Star Polymers, L.L.C. (collectively the "Willis Stein Group") to (i)
exchange $9.0 million of original principal amount of notes plus accrued
interest for shares of a new series of senior convertible preferred stock with a
stated liquidation value of $9.0 million and convertible into approximately
13.23 million shares of Donlar's post-Merger common stock and (ii) exchange all
of the equity securities held by the Willis Stein Group in Donlar for 1.0
million shares of Donlar's post-Merger common stock. The foregoing exchanges are
subject to the satisfaction of certain conditions precedent. The Willis Stein
Group also agreed to vote its shares of voting stock of Donlar in favor of the
Merger.

     Donlar also reached agreement in 2002 with Dr. Robert Gale Martin
("Martin"), a director of Donlar and Biosyntrex, to (i) exchange approximately
$9.9 million of original principal amount of notes plus accrued interest for
shares of senior convertible preferred stock in the face amount of $9.0 million
and convertible into approximately 13.23 million shares of Donlar's common
stock, (ii) relinquish rights to receive royalty payments from Donlar or
Biosyntrex and all of his equity securities in Donlar in exchange for 5.0
million shares of Donlar's post-Merger common stock and (iii) surrender for
cancellation any warrants to purchase shares of Donlar stock for a warrant to
purchase 3.0 million shares of Donlar's post-Merger common stock at an exercise
price of $0.68 per share. Martin also agreed to vote his shares of voting stock
of Donlar in favor of the Merger.

     To further eliminate debt from Biosyntrex's balance sheet, Donlar is
seeking the agreement of the holders of approximately $1.9 million of original
principal amount of notes to exchange their notes for shares of senior

                                        2
<PAGE>

convertible preferred stock in the face amount of approximately $1.9 million and
convertible into approximately 2.8 million shares of Donlar's common stock.

PRODUCTS

     Biosyntrex's businesses are conducted through three product lines:

     - BioPolymers, consisting of the performance chemicals business acquired
       from Donlar;

     - AgriSciences, consisting of the agricultural businesses acquired from
       Donlar; and

     - Optim Nutrition, consisting of Biosyntrex's nutritional and
       nutraceuticals business.

     Donlar was organized in 1990 to develop, manufacture and market an entirely
new protein technology with the potential to replace a generation of older,
non-biodegradable and potentially toxic chemicals. This new family of
biopolymers, known as thermal polyaspartates ("TPA"), is non-hazardous,
non-toxic, hypoallergenic, environmentally friendly and biodegradable. These
proteins are used in a broad range of industrial, agricultural and consumer
markets. Donlar has 140 global patents that protect its technology, products and
marketplace. The U.S. Government recognized the environmental benefits of this
technology in 1996 when it awarded Donlar the first Presidential Green Challenge
Chemistry Award.

     TPA products are beta proteins (biopolymers) manufactured from the common
biological amino acid, L-aspartic acid. TPA is a highly active biopolymer that
is completely soluble in water. By varying the manufacturing method, different
properties can be built into the biopolymer, tailoring it to a specific use.
Products are formulated and packaged into both powder and liquid forms.

     Donlar developed and marketed several products utilizing TPA which are now
manufactured and marketed by Biosyntrex.

     In the performance chemicals markets, Biosyntrex offers products utilizing
TPA that are believed to be environmentally superior to non-biodegradable and
environmentally non-friendly chemicals used in a wide variety of industrial and
consumer products. These products are used to prevent mineral scale and metal
corrosion in industrial processes using high volumes of water, such as offshore
oil and gas production and industrial cooling water. TPA can also be used as a
biodegradable antiredeposition agent for detergents. Antiredeposition agents are
those detergent ingredients that prevent dirt particles from re-attaching to the
fabric in the wash cycle once the fabric has been cleaned.

     In agriculture, Biosyntrex's products are believed to significantly
increase the effectiveness of fertilizers by allowing the plant to absorb
fertilizers more efficiently. Donlar also holds patents under which Biosyntrex
is developing products that will have the effect of dramatically reducing the
use of herbicides and insecticides. Biosyntrex believes that since herbicides
and insecticides are made more efficacious when mixed with TPA, significantly
less herbicide and insecticide needs to be applied. The products thereby benefit
growers and farmers through increased yields and reduced crop inputs. The
products also benefit the environment through a reduction in ground water
contamination by fertilizers, herbicides and insecticides. Additionally, TPA
biodegrades harmlessly in the soil after having served its function.

     Biosyntrex's historical nutritional and nutraceuticals business is being
phased out. Pursuant to the terms of the Loan Agreement, Biosyntrex has agreed
to complete the phase out of the nutritional and nutraceuticals business on or
before March 18, 2003.

EMPLOYEES

     As of December 31, 2001, Biosyntrex had 13 full-time employees.

CERTAIN BUSINESS CONSIDERATIONS AND RISK FACTORS

     The short and long-term success of Biosyntrex is subject to certain risks,
many of which are substantial in nature. Shareholders and prospective
shareholders in Biosyntrex should consider carefully the following factors, in
addition to other information contained in this report.
                                        3
<PAGE>

     History of Operating Losses; Uncertainty of Future Profitability. Both
Biosyntrex and Donlar have incurred significant net operating losses since their
formations. As of December 31, 2001, Biosyntrex, including the historical
financial results of Donlar, had an accumulated deficit of $90.8 million and a
total shareholders' deficit of $32.2 million. The factors contributing to these
significant operating losses include:

     - marketing expenditures;

     - acquisition expenses and costs;

     - expansion of research and development programs;

     - costs associated with pre-clinical studies and clinical trials;

     - nutritional studies;

     - regulatory compliance requirements;

     - trials for other products under development; and

     - implementation of programs to market products ultimately approved for
       distribution.

     Biosyntrex's future success and ability to achieve profitability depends
upon its ability to successfully operate the businesses acquired from Donlar.
There can be no assurance that Biosyntrex will ever achieve significant revenues
or profitable operations.

     Going Concern. The consolidated financial statements of Biosyntrex have
been prepared on the assumption that Biosyntrex will continue as a going
concern. Biosyntrex's independent public accountants have issued their report
dated April 5, 2002 that includes an explanatory paragraph stating that
Biosyntrex's recurring losses and accumulated deficit, among other things, raise
substantial doubt about its ability to continue as a going concern. Biosyntrex's
historical sales are limited and it has been necessary to rely upon financing
from debt and the sale of its equity securities to sustain operations.

     Debt Obligations. Each of the loans made or restated pursuant to the Loan
Agreement is subject to acceleration and the application of higher default rates
of interest in the event Biosyntrex or Donlar defaults in the payment of
principal or interest when due, breaches any covenants contained in the Loan
Agreement that are not remedied within five calendar days or any other specified
event of default occurs. There can be no assurance that Biosyntrex and Donlar
will be able to comply with the covenants and events of default in the Loan
Agreement, some of which events of default are entirely beyond their respective
control. Even if there are no future defaults, the loans made under the bridge
loan facility are due and payable on March 18, 2003, at which time Biosyntrex
and Donlar must either pay or refinance it. There is no assurance that
Biosyntrex and Donlar will have the resources to pay the debt when it is due or
that the holders of the loans or any other source would be willing to provide
the resources to refinance the debt.

     Sale of Equity Securities; Future Dilution. Biosyntrex may need to sell
additional equity securities or obtain other forms of financing to fund its
operations. The Loan Agreement limits Biosyntrex's ability to issue additional
equity and to incur additional indebtedness without its lender's approval.
Absent such additional financing, Biosyntrex may find it necessary to postpone
or cancel some or all of its planned business activities. This could adversely
affect Biosyntrex's ability to conduct its business operations, generate future
revenues and introduce new products. There can be no assurance, however, that
additional financing will be available, or, if available, that it will be
available on acceptable terms or in required amounts. Furthermore, if additional
funds are raised by issuing shares of common stock or securities convertible
into common stock, those sales or conversion will result in further and possibly
substantial dilution of Biosyntrex's shareholders. Substantial dilution may make
it more difficult for investors to sell their shares or may result in a lower
price of Biosyntrex's securities.

     Volatility of Stock Price. The trading price of Biosyntrex's common stock
has been and is likely to continue to be subject to wide fluctuations in
response to the quarter-to-quarter variations in Biosyntrex's operating results,
material announcements by Biosyntrex or its competitors, governmental regulatory
action, conditions in the industries in which it operates, or other events or
factors, many of which are beyond

                                        4
<PAGE>

Biosyntrex's control. Biosyntrex's operating results in future quarters may be
below the expectations of securities analysts and investors. In such event, the
price of the common stock would likely decline, perhaps substantially. In
addition, the stock market has historically experienced extreme price and volume
fluctuations. Moreover, Biosyntrex's common stock may be even more prone to
volatility than the securities of other businesses in light of the relatively
small number of shares held by non-affiliates of Biosyntrex. Given such a
relatively small public float, there can be no assurance that the prevailing
market price of common stock will not be artificially inflated or deflated by
trading even of relatively small amounts of common stock.

     Absence of Dividends. Biosyntrex has never declared or paid cash dividends
on its common stock and it does not anticipate that any cash dividends will be
declared on its common stock in the foreseeable future.

     Stages of Commercialization of Products. Donlar was founded in 1990 and
until 1996 was engaged principally in research and development activities, and
from 1996 through 2000, market development activities. These market development
activities have been continued by Biosyntrex since the acquisition of Donlar's
businesses. While the marketing of the TPA products has commenced in the crop
nutrition and oil field services area, Biosyntrex has not achieved full
commercialization, and its product applications are in various stages of
commercialization. As a result, the TPA products have been sold only in limited
quantities and there can be no assurance that a significant market will develop
for such products with respect to any of their potential applications. The crop
nutrition and performance chemical products have been used commercially for only
a short period of time. Current and potential customers in the agricultural,
performance chemicals, and other fields in which Biosyntrex's products have
potential applications require predictable and consistent performance. Although
certain products incorporating the TPA technology have passed product
performance and reliability testing in both laboratory and commercial use, there
can be no assurance that they will continue to do so consistently in the future,
will meet future customer performance standards or will offer sufficient price
or performance advantages required to achieve commercial success. Biosyntrex's
failure to develop, manufacture and commercialize TPA products on a timely and
cost effective basis would have a material adverse effect on Biosyntrex's
business, results of operations and financial condition.

     Need for Acceptance by Agricultural Customers. Biosyntrex's future success
in agriculture depends largely on acceptance of the TPA technology by
agricultural customers and the ability of Biosyntrex to educate those customers
about the proper methods and rates of application required to obtain the levels
of increased yield that the TPA products are capable of generating.
Traditionally, agricultural end users have been slow to adopt new technologies
until their consistent effectiveness and economic value have been evidenced over
several growing seasons. Successful introduction of Biosyntrex's products will
also depend to a large extent on recommendations of prior users. Although
research data has shown that the crop nutrition products marketed by Biosyntrex
result in increased yields, the level of such increase and, thus, the economic
return from use of such products, depends on the method and rate of application
and the type of crop and prevailing weather and soil conditions. There can be no
assurance that Biosyntrex will be able to demonstrate that the purchase of its
crop nutrition products will be consistently cost effective for the intended
users.

     The crop nutrition products marketed by Biosyntrex have been the subject of
agricultural industry media reports and articles. While a handful of these
reports and articles have been skeptical or negative in tone, Biosyntrex
attributes this critical comment to natural skepticism associated with new
products and technologies, competitive issues, and the limited number, and
general public unavailability, of farm field trial results. In addition, while
some reported university studies have suggested inconsistent performance results
from the products, management believes that these results may have been affected
by nonconformity with the recommended methods and rates of application and by
such variables as weather and soil conditions. Further, the purpose of many of
these studies was to establish recommended methods and rates of application,
rather than to validate the product's effectiveness. Biosyntrex's future success
will depend, in large part, on its ability to replicate Donlar's field trial
successes on an expanding scale in each crop growing season and to publicly
disseminate the results of those trials, not only to agricultural industry
media, but also directly to potential end users. There can be no assurance that
Biosyntrex will be successful in overcoming user resistance resulting from
adverse publicity regarding the crop nutrition products.

                                        5
<PAGE>

     Dependence on Patents and Protection of Proprietary Information.
Biosyntrex's success will depend, in part, on its ability to obtain patent
protection for the TPA processes, materials, and methods of use, to preserve
their trade secrets, and to operate without infringing the patent or other
proprietary rights of others. Donlar has been granted 48 United States patents.
Each time that Donlar filed a patent application in the United States, it filed
similar applications in foreign jurisdictions that Donlar believed were
important to its future business and that afford reasonable protection to
intellectual property rights. Donlar has been granted 92 foreign patents,
including patents granted by the European Community, South Africa, Israel,
Japan, Mexico, Russia and Egypt, and currently has numerous patent applications
pending in such jurisdictions. No assurance can be given that the patent
applications filed by Donlar will result in issued patents or that the scope and
breadth of any claims allowed in any patents issued to Donlar or Biosyntrex will
exclude competitors or provide competitive advantages to Biosyntrex. In
addition, there can be no assurance that any patents issued to Donlar or
Biosyntrex will be held valid if subsequently challenged, that others will not
claim rights in the patents and other proprietary technology owned by Donlar or
Biosyntrex, or that others have not developed or will not develop similar
products or technologies without violating any of Donlar's or Biosyntrex's
proprietary rights.

     Donlar's and Biosyntrex's inability to obtain patent protection, preserve
their trade secrets or operate without infringing the proprietary rights of
others, as well as their loss of any rights to technology that they now have or
acquire in the future, could have a material adverse effect on Biosyntrex's
business, results of operations and financial condition. Litigation, which could
result in substantial cost to, and diversion of effort by, Donlar and
Biosyntrex, may be necessary to enforce patents issued to Donlar or Biosyntrex,
to defend Donlar or Biosyntrex against infringement claims made by others, or to
determine the ownership, scope or validity of the proprietary rights of Donlar,
Biosyntrex and others. An adverse outcome in any such litigation could subject
Donlar and Biosyntrex to significant liabilities to third parties, require them
to seek licenses from third parties, and/or require them to cease using certain
technology, any of which could have a material adverse effect on Biosyntrex's
business, results of operations and financial condition.

     Donlar or Biosyntrex may also become involved in interference proceedings
declared by the United States Patent and Trademark Office ("PTO") in connection
with one or more of Donlar's or, in the future, Biosyntrex's patents or patent
applications to determine priority of invention. Any such proceeding could
result in substantial cost to Donlar or Biosyntrex, as well as a possible
adverse decision as to priority of invention of the patent or patent application
involved. In addition, Donlar or Biosyntrex may become involved in reissue or
reexamination proceedings in the PTO in connection with the scope or validity of
their patents. Any such proceeding could have a material adverse effect on their
business, results of operations and financial condition, and an adverse outcome
in such proceeding could result in a reduction of the scope of the claims of any
such patents or such patents being declared invalid. In addition, from time to
time, to protect their competitive position, Donlar and Biosyntrex, or either of
them, may initiate reexamination proceedings in the PTO with respect to patents
owned by others. Such proceedings could result in substantial cost to, and
diversion of effort by, Donlar and Biosyntrex, and an adverse decision in such
proceedings could have a material adverse effect on Biosyntrex's business,
results of operations and financial condition.

     Biosyntrex relies on trade secrets and proprietary know-how in the conduct
of the its operations. Donlar has used and, Biosyntrex now uses employee and
third-party confidentiality and non-disclosure agreements to protect such trade
secrets and know-how. There can be no assurance that the obligation to maintain
the confidentiality of such trade secrets or proprietary information will not
wrongfully be breached by employees, consultants, advisors or others, that
Donlar and Biosyntrex will have adequate remedies for any breach, or that the
trade secrets or proprietary know-how will not otherwise become known or be
independently developed or discovered by third parties.

     Projected Future Demand for Raw Material Exceeds Current Worldwide
Supply. The primary raw material in the TPA products, produced and sold by
Biosyntrex, is L-aspartic acid. Because L-aspartic acid accounts for a major
portion of Biosyntrex's finished goods costs, any material increase in the price
of this raw material could have a material adverse effect on Biosyntrex. There
are only a limited number of suppliers of L-aspartic acid worldwide and
substantially all of the commercially available L-aspartic acid is produced by
non-domestic sources. Biosyntrex currently purchases primarily from sources
outside the United States. Biosyntrex believes that the world supply of
L-aspartic acid is sufficient to meet its needs over the near term. It
                                        6
<PAGE>

is thus important for Biosyntrex's long-term growth that it secure a low cost
and consistent supply of L-aspartic acid.

     Competition. While Biosyntrex is not aware of any technology directly
competitive with its TPA products in the agricultural field, there are numerous
types of products that make claims as plant growth regulators and stimulants
that affect a plant's genetic or immune system. In the performance chemicals
field there is substantial competition by other chemical products, but also from
other manufacturers of polyaspartate type products using production methods that
may be outside the scope of Donlar's production patents and in target
applications that may be outside the scope of Donlar's methods of use patents.
The larger producers of other chemical products have substantially greater
financial and technical resources, larger research and development staffs, and
greater manufacturing and marketing capabilities than Biosyntrex. There can be
no assurance that Biosyntrex's performance chemicals products will compete
effectively against products produced by such competitors.

     Limited Manufacturing Capacity and Experience. Biosyntrex's success will
depend, in part, on its ability to manufacture its products in significant
quantities, with consistent quality, at acceptable costs and on a timely basis.
Biosyntrex has limited experience in high-volume manufacturing. With respect to
the Peru, Illinois manufacturing facility, Biosyntrex may incur significant
continuous operation costs.

     Reliance on a Single Manufacturing Facility. The Peru, Illinois plant is
Biosyntrex's sole manufacturing facility and the only facility capable of
producing its products in quantities sufficient to meet its projected needs.
While Biosyntrex maintains business interruption insurance in the amount of $15
million, any material disruption in the Peru plant's operations, whether due to
fire, natural disaster, or otherwise, and whether or not covered by that
insurance, could have a material adverse effect on Biosyntrex's business,
results of operations and financial condition.

     Uncertainty of Regulatory Approvals. Biosyntrex's crop nutrition products
may not be distributed in the various states without regulatory approval by the
applicable state agricultural agency. Obtaining such approval generally requires
that Biosyntrex demonstrate that the products are safe and efficacious over a
defined time period. Donlar has already obtained such approvals for the crop
nutrition products so that the products can be sold in 46 states. In addition,
Biosyntrex's products are subject to approval by foreign regulatory authorities.

     Reliance on Single Technology. Although Donlar has obtained numerous
patents covering manufacturing processes, composition and methods of use, all of
Biosyntrex's products are based on its TPA technology. The fields in which
Biosyntrex intends to sell its products are highly competitive and intensive
research and development is always being undertaken by governmental entities,
educational institutions and private enterprises with respect to products having
practical effects such as those of certain of Biosyntrex's products. There can
be no assurance that competitive products will not be introduced by third
parties or that competing materials based on different or new technologies may
not become commercially available. There can be no assurance that Biosyntrex's
competitors will not succeed in developing or marketing materials, technologies
or products that exhibit superior performance or are more commercially desirable
or more cost effective than those developed and marketed by Biosyntrex. Any of
the foregoing could have a material adverse effect on Biosyntrex's business,
results of operations and financial condition.

     Risks Associated with Rapid Growth. Biosyntrex's proposed growth will place
significant demands on its management, as well as its administrative,
operational and financial resources. Biosyntrex's ability to manage its future
growth will require Biosyntrex to implement new, and improve existing,
operational, financial and management information systems. Biosyntrex's success
will depend, in large part, upon its ability to attract and retain highly
qualified research and development, management, manufacturing and marketing and
sales personnel and to continue to motivate and manage its work force,
particularly its sales force. If Biosyntrex is unable to effectively manage any
of these factors, Biosyntrex's business, its financial condition and results of
operations could be materially and adversely affected. No assurance can be given
that Biosyntrex will experience growth or that it will be successful in managing
its growth, if any.

     Limited Marketing Experience. While Biosyntrex's sales force has experience
in marketing products to agricultural and performance chemicals end users,
Biosyntrex has limited experience in marketing and selling

                                        7
<PAGE>

the TPA products. To market its products effectively, Biosyntrex will be
required to develop an expanded marketing and sales force that can effectively
demonstrate the advantages of, and recommended methods and rates of application
for, the TPA product applications. The crop nutrition products will also rely
heavily on the availability of recommendations of prior users. Biosyntrex
currently maintains arrangements with third parties for distribution of certain
of its TPA products in the performance chemicals field and Biosyntrex expects to
enter into additional arrangements with third parties for the commercialization
and marketing of its products. Biosyntrex's future success will depend in part
on the continued relationships with distributors, its ability to enter into
other similar arrangements, the continuing interest of the existing distributors
in current and potential product applications and, eventually, the distributors'
success in marketing and willingness to purchase Biosyntrex's products. There
can be no assurance that Biosyntrex will be successful in its marketing efforts,
that it will be able to establish adequate sales and distribution capabilities,
that it will be able to enter into or maintain marketing or distribution
arrangements with third parties on financially acceptable terms, or that any
third parties with whom it enters into such arrangements will be successful in
marketing its products.

     Reliance on Key Personnel. Biosyntrex's principal executive officers have
an average of over 25 years of collective experience in chemicals research,
development and sales. The loss of the services of these executive officers or
other key personnel, or the failure of Biosyntrex to attract and retain other
skilled and experienced personnel on acceptable terms, could have a material
adverse effect on Biosyntrex's business, results of operations and financial
condition.

     Customer Concentration. Biosyntrex has only recently begun commercial sales
of its agricultural and performance chemicals products. Biosyntrex sells its
crop nutrition products primarily to agricultural distributors and its
performance chemicals products to chemical service companies. While Biosyntrex
expects to significantly increase its sales in these product lines and to focus
its sales efforts on a more specifically targeted group of agriculture and
chemical distributors, sales may continue to be concentrated among a relatively
small group of customers, though not necessarily those that currently
represented the largest portions of Donlar's sales in the past. Thus, the loss
of any single customer could have a material adverse effect on Biosyntrex, its
results of operations and its financial condition.

     Markets for Crop Nutrition Products are Seasonal and Volatile. Demand for
Biosyntrex's crop nutrition products can be expected to be significantly
affected by agricultural conditions, which can be unpredictable and volatile as
a result of a number of factors. The most important factors are weather
conditions and patterns, current and projected grain stocks and prices, and
governmental agricultural policies, including those that directly or indirectly
influence the number of acres planted, the level of grain stocks, the mix of
crops planted, and crop prices. Because of its dependence on agricultural
markets, the crop nutrition business is seasonal and Biosyntrex's operating
results may vary significantly from quarter to quarter.

     Environmental and Other Regulatory Matters. Like other manufacturers,
Biosyntrex is subject to a broad range of Federal, state, local and foreign laws
and requirements, including those governing discharges in the air and water, the
handling and disposal of solid and hazardous substances and wastes, the
remediation of contamination associated with the release of hazardous
substances, work place safety and equal employment opportunities. Donlar and
Biosyntrex have made expenditures to comply with such laws and requirements.
Biosyntrex believes, based on information currently available to management,
that it is in compliance with applicable environmental and other legal
requirements and that it will not require material capital expenditures to
maintain compliance with such requirements in the foreseeable future.

     Governmental authorities have the power to enforce compliance with such
laws and regulations, and violators may be subject to penalties, injunctions or
both. Third parties may also have the right to enforce compliance with such laws
and regulations. As Biosyntrex develops new formulations for TPA products and
combine the TPA with other products, such as herbicides and insecticides, those
products may become subject to additional review and approval requirements
governing the sale and use of products such as those produced by Biosyntrex.
Biosyntrex's manufacturing processes do not currently result in the generation
of hazardous wastes. However, there can be no assurance that this will always be
the case, and there can be no assurance that material costs or liabilities will
not be incurred by Biosyntrex in the future as a result of the manufacturing
operations. It is also possible that other developments, such as additional or
increasingly strict

                                        8
<PAGE>

requirements of laws and regulations of these types, or enforcement policies
thereunder, could significantly increase Biosyntrex's costs of operations.

     Liability Risk. Products sold by Biosyntrex may expose it to potential
liability for personal injury or property damage claims relating to the use of
those products, particularly if used in a manner not in conformity with
Biosyntrex's instructions. Although product liability claims historically have
not had a material adverse effect on Donlar or Biosyntrex, there can be no
assurance that Biosyntrex will not be subject to or incur liability for such
claims in the future. Although Biosyntrex maintains product liability insurance
in amounts that management deems commercially reasonable, a significant claim
that is uninsured or partially insured could result in loss or deferral of
revenues, diversion of resources, or damage to Biosyntrex's reputation, any of
which could have a material adverse effect on Biosyntrex's business, operating
results, and financial condition.

     Special Statement Concerning Forward-looking Statements. This report, in
particular the "Business" and "Management's Discussion and Analysis or Plan of
Operation" sections, contains forward-looking statements concerning the
expectations and anticipated operating results of Biosyntrex. All of the
forward-looking statements contained in this report are made in reliance upon
the safe harbor protection for forward-looking statements provided by the
Securities Act and the Exchange Act. Numerous factors govern whether any
forward-looking statement made by Biosyntrex will be or can be achieved. Any one
of those factors could cause actual results to differ materially from those
projected by the forward-looking statements made in this report. These
forward-looking statements include plans and objectives of management for future
operations, including plans and objectives relating to the products and the
future economic performance of Biosyntrex. Forward-looking statements are based
on current expectations that may be affected by a number of risks and
uncertainties. They are also based on certain assumptions.

     Assumptions involve judgments with respect to, among other things, future
economic, competitive and market conditions and future business decisions, which
are difficult or impossible to predict accurately and may be beyond the control
of Biosyntrex. Although Biosyntrex believes that the assumptions underlying the
forward-looking statements in this report are reasonable, any of these
assumptions could prove inaccurate. Therefore, there can be no assurance that
the results contemplated in any of the forward-looking statements will be
realized. Budgeting and other management decisions are subjective in many
respects and are susceptible to interpretations and periodic revision based on
actual experience and business developments, the impact of which may cause
Biosyntrex to alter its marketing capital expenditure plans or other budgets.
This will affect Biosyntrex's results of operations. In light of the significant
uncertainties inherent in the forward-looking statements, any such statement
should not be regarded as a representation by Biosyntrex or any other person
that the objectives or plans of Biosyntrex will be achieved.

ITEM 2. DESCRIPTION OF PROPERTIES

     Biosyntrex's marketing, sales, distribution and administrative operations
are located in an approximately 6,700 square foot office and laboratory space in
Bedford Park, Illinois which is leased from the Illinois Institute of
Technology. Biosyntrex's manufacturing operations are conducted in Donlar's
Peru, Illinois plant.

     To meet its initial projected production requirements for TPA, Donlar
constructed a TPA manufacturing facility in Peru, Illinois on a 40-acre parcel
purchased by Donlar in 1996. This 50,000 square foot facility currently contains
two chemical reactors, the larger of which is designed to produce nominally, 30
million pounds of TPA products annually. The facility is large enough to
accommodate additional reactors and Biosyntrex anticipates adding other reactors
serially over the next several years as demand for its products increases. This
expansion process is essentially modular and is not expected to involve
substantial engineering or technical expenses or delays. The Peru facility is
strategically located near barge, rail and road transportation facilities.

ITEM 3. LEGAL PROCEEDINGS

     None.

                                        9
<PAGE>

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

     None.

                                    PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

     Biosyntrex's common stock was listed on the National Association of
Securities Dealers Automated Quotation ("Nasdaq") SmallCap Market under the
primary symbol "BIME." On November 27, 2000, Biosyntrex's common stock was
delisted from the Nasdaq SmallCap Market. Biosyntrex's stock is currently quoted
on the NASD over-the-counter bulletin board under the symbol "DBSY.OB" The
following table contains information about the range of high and low bid prices
for the common stock for each full quarterly period within the two most recent
fiscal years, based upon quotations on the Nasdaq SmallCap Market (and giving
effect to all stock splits occurring during such period or prior to the issuance
of this report):

<Table>
<Caption>
                       QUARTER ENDED                            HIGH(1)    LOW(1)
                       -------------                            -------    ------
<S>                                                             <C>        <C>
December 31, 2001...........................................     $0.57     $0.05
September 30, 2001..........................................     $0.50     $0.05
June 30, 2001...............................................     $1.42     $0.46
March 31, 2001..............................................     $1.50     $0.75
December 31, 2000...........................................     $1.04     $0.79
September 30, 2000..........................................     $2.35     $2.04
June 30, 2000...............................................     $4.07     $3.29
March 31, 2000..............................................     $8.60     $7.50
</Table>

-------------------------
(1) The source of these high and low prices through November 26, 2000 was
    Nasdaq, and subsequent to November 26, 2000 was the NASD over-the-counter
    bulletin board. The Nasdaq quotations reflect inter-dealer prices, without
    retail mark-up, mark-down or commission, may not represent actual
    transactions, and have been rounded up to the next highest two decimal
    places. Subsequent to November 26, 2000, the high represents the best
    (highest) price a prospective buyer is prepared to pay that day and the low
    represents the best (lowest) price at which someone who owns the security
    offers to sell it.

     The market price of the common stock is subject to significant fluctuations
in response to variations in Biosyntrex's quarterly operating results, general
trends in the market for Biosyntrex's products and product candidates, and other
factors, over many of which Biosyntrex has little or no control. In addition,
broad market fluctuations, as well as general economic, business and political
conditions, may adversely affect the market for Biosyntrex's common stock,
regardless of Biosyntrex's actual or projected performance. On March 28, 2002,
the average of the closing bid and ask prices of the common stock on the NASD
over-the-counter bulletin board was $0.27 per share.

     On March 28, 2002, there were approximately 5,000 holders of record of
Biosyntrex's common stock.

     As of March 28, 2002, Biosyntrex had the following series of preferred
stock outstanding:

          Series A 10% Cumulative Convertible Preferred Stock -- 39,124 shares
     outstanding, convertible into 232 shares of common stock; and

          Series B 10% Cumulative Convertible Preferred Stock -- 449 shares
     outstanding, convertible into 3 shares of common stock.

DIVIDENDS

     Biosyntrex has never declared or paid cash dividends on its common stock
and does not anticipate paying any cash dividend on its common stock in the
foreseeable future.

                                        10
<PAGE>

RECENT SALES OF UNREGISTERED EQUITY SECURITIES

     None during the period covered by this report that have not been previously
reported.

ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

     The following discussion and analysis of Biosyntrex's financial condition
and results of operations should be read in conjunction with the consolidated
financial statements and the notes thereto appearing elsewhere in this report.
See Item 7. -- "Financial Statements and Supplementary Data."

OVERVIEW

     From 1997 until November of 2000, Biosyntrex was primarily engaged in the
distribution and sale of nutritional and nutraceutical products. Biosyntrex's
principal products were biologic nutraceutical supplements and sports and
nutrition bars. As described in Part I, Item 1. "Description of Business" of
this report, as a result of the transaction that were completed in 2000 and in
early 2001, all of the operational activities of Donlar, except for Donlar's
genetic research activities, are now conducted by Biosyntrex. The former Donlar
businesses are now Biosyntrex's principal businesses and Biosyntrex is phasing
out its nutritional and nutraceutical business. Biosyntrex's marketing, sales,
distribution and administrative operations are conducted from Donlar's
headquarters in Bedford Park, Illinois, and its manufacturing operations are
conducted from Donlar's Peru, Illinois facility.

     Biosyntrex's reorganized businesses are conducted through three product
lines:

     - BioPolymers, consisting of the performance chemicals business acquired
       from Donlar;

     - AgriSciences, consisting of the agricultural business acquired from
       Donlar; and

     - Optim Nutrition, consisting of Biosyntrex's nutritional and
       nutraceuticals business.

     Biosyntrex current business is the production and marketing of products
initially developed by Donlar. Historically, Donlar began as a research and
development company to exploit the possibilities of developing, manufacturing
and marketing a new family of biodegradable polymers known as thermal
polyaspartates (TPA). Although there was no market at the time of Donlar's
inception for a new so-called "green chemistry," Donlar concluded that a market
would develop if the technology and products were available. It also determined
that the development of this technology and market would also require
substantial capital.

     It took about ten years and the use of extensive capital to reach the point
of commercialization whereby Biosyntrex's products and markets are protected by
a global intellectual property portfolio of patents. The products are
manufactured in a modern plant capable of producing high quality products at low
cost and are sold in a marketplace where Biosyntrex's TPA products can compete
on a cost/performance basis with conventional chemicals.

     As a result of this historical development, Biosyntrex' revenues from the
sale of its products increased from $1.4 million in 2000 to $2.4 million in
2001. Commercialization of the products began approximately two years ago
focusing on the building of three market's in oil production, agriculture and
detergents.

RESULTS OF OPERATIONS

     During the year ended December 31, 2001, Biosyntrex had revenues of
$2,352,834, compared to $1,381,994 for the year ended December 31, 2000. The
increase in revenues was due to growth in the BioPolymers product line from new
customers and new products.

     Cost of revenue was $2,639,022 in 2001, compared to cost of revenue of
$2,097,189 in 2000. This increase was due to the increased sales in 2001, offset
by decreased staff in the manufacturing area, as well as other cost reductions
at the manufacturing facility in Peru, Illinois for plant supplies, plant
repairs and equipment rental.

     Research and development cost decreased from $1,121,749 in 2000 to $821,414
in 2001 due to a reduction in research projects undertaken and a related
reduction in staffing levels for research.

                                        11
<PAGE>

     Selling, general and administrative expenses increased from $3,689,944 in
2000 to $7,054,783 in 2001. This increase in 2001 was the result of a $1.45
million increase in the amortization of goodwill and $3.17 million in non-cash
expenditures incurred in 2001. These increases were offset by a $440,000
reduction in employee expenses due to staff reductions, a $75,000 reduction in
travel expenses, a $98,000 reduction in consulting fees paid in cash, a $110,000
reduction in professional fees and $124,000 reduction in advertising expenses.
The non-cash expenditures for consulting services represent payments of these
services in the Biosyntrex common stock.

     Other expense increased from $7,136,982 in 2000 to $7,942,928 in 2001 as a
result of an $864,434 write down of investments in 2001 partially offset by a
reduction in interest expense from $7.24 million in 2000 to $7.08 million in
2001. In addition, in 2000 Biosyntrex realized a gain of $100,000 on the sale of
a product line.

     As a result of the foregoing, the net loss increased from $12,663,870 in
2000 to $16,105,313 in 2001.

LIQUIDITY AND CAPITAL RESOURCES

     Historically, Biosyntrex has been unable to finance its operations from
cash flows from operating activities. Biosyntrex was cash flow positive from
operations in the fourth quarter of 2001 and the first quarter of 2002 and
expects to be cash flow positive from operations for the year 2002. As of
December 31, 2001, Biosyntrex had cash of $3,746. In March of 2002, Biosyntrex
obtained additional bridge financing in connection with the restructuring of its
debt as described in Part I, Item 1. "Description of Business," but has no other
plans for its continued financing. Biosyntrex intends to continue in existence
through the operation of its businesses.

     Biosyntrex reduced its cash flows used in operations from $6,616,679 in
2000 to $1,773,455 in 2001, due to the continued effort to reduce costs and the
increased revenue during 2001. Biosyntrex has been able to decrease its
inventory levels by approximately $850,000 from 2000. In addition, it has
increased its accrued liabilities by approximately $3.2 million, primarily as a
result of accrued interest.

     Cash flows used in investing activities decreased to $100,329 in 2001 from
$423,670 during 2000. This is due to Biosyntrex limiting its capital
expenditures during 2001 and the fact that the costs associated with the reverse
merger transaction were incurred in 2000.

     Cash flows provided by financing activities decreased from $7,537,506
during 2000 to $1,001,095 during 2001. The cash from financing activities in
2000 resulted from the sale of convertible debt and the exercise of warrants.

     The audited consolidated financial statements of Biosyntrex have been
prepared on the assumption that it will continue as a going concern.
Biosyntrex's independent public accountants have issued their report dated April
5, 2002, that includes an explanatory paragraph stating that Biosyntrex's
recurring losses, among other things, raise substantial doubt about Biosyntrex's
ability to continue as a going concern.

                                        12
<PAGE>

ITEM 7. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

<Table>
<S>                                                             <C>
Index to Consolidated Financial Statements:
  Report of Independent Certified Public Accountants........    F-1
  Consolidated Balance Sheet as of December 31, 2001........    F-2
  Consolidated Statements of Operations for the Years Ended
     December 31, 2001 and 2000.............................    F-3
  Consolidated Statement of Shareholders' Deficit for the
     Years Ended December 31, 2001 and 2000.................    F-4
  Consolidated Statements of Cash Flows for the Years Ended
     December 31, 2001 and 2000.............................    F-5
  Notes to Consolidated Financial Statements................    F-7
</Table>

ITEM 8. CHANGES OR DISAGREEMENTS WITH ACCOUNTANTS

     None. Reference is made to Item 4. of the Current Report on Form 8-K filed
by Biosyntrex on December 4, 2000.

                                    PART III

ITEM 9. DIRECTORS AND EXECUTIVE OFFICERS

     The following table lists the persons currently serving as executive
officers and directors of Biosyntrex.

<Table>
<Caption>
                        NAME                            AGE                   POSITION
                        ----                            ---                   --------
<S>                                                     <C>    <C>
Larry P. Koskan.....................................    59     Chief Executive Officer, President and
                                                               Chairman of the Board, November 2000
                                                               to present
Joel H. Lurquin.....................................    36     Controller and Treasurer, November
                                                               2000 to present
Robert P. Pietrangelo...............................    61     Vice President, November 2000 to
                                                               present; Chief Operating Officer, July
                                                               2001 to present
Robert W. Cooper(1)(2)..............................    73     Director
Dr. Robert G. Martin(2).............................    60     Director
Dean R. Kleckner(1)(2)..............................    70     Director
</Table>

-------------------------
(1) Member of Audit Committee

(2) Member of Compensation Committee

     Larry P. Koskan, Donlar's founder, has served as a director, President and
Chief Executive Officer of Donlar since its inception in 1990, and as Chairman
of the Board of Donlar since 1992. Prior to founding Donlar, Mr. Koskan held
several research and development and manufacturing positions during a 23 year
career with Nalco Chemical Company. As Corporate Research Development Director
for Nalco, his duties included establishing large-volume market opportunities
for innovative, specialty polymers. He also served as Vice President of Research
and Development of Nalco's Water and Waste Treatment Division. Mr. Koskan holds
a B.S. in Education and Chemistry from the University of Kansas and an M.S. in
Organic Chemistry from Loyola University of Chicago and is the inventor or
co-inventor of over 20 U.S. patents.

     Robert P. Pietrangelo joined Donlar in April 1997 as its Vice President,
Sales and Marketing of the Performance Chemicals Division and in October 1997
was named President of that division. In July of 2001, he was appointed Chief
Operating Officer of the Company. Prior to joining Donlar, Mr. Pietrangelo held
various management positions in the performance chemicals industry, including
marketing manager with CPS Chemical (1989 to 1996) and Strategic Business Unit
Manager with Rohm & Haas Company (1984 to
                                        13
<PAGE>

1989). Mr. Pietrangelo has a B.A. in Chemistry and Mathematics from LaSalle
University and an M.B.A. in Marketing and Finance from Drexel University.

     Joel H. Lurquin joined Donlar in 1995 as Controller. Prior to joining
Donlar, Mr. Lurquin was a senior auditor with Bansley and Kiener, Certified
Public Accountants. He has a B.S. in Accounting from DePaul University.

     Robert W. Cooper has served as a director of Donlar since June 1992. He has
been a principal of Cooper-Pruyn Architects, Ltd. since 1996 and President and
Chief Executive Officer of R.W. Cooper and Associates, a company providing
engineering and management services to the food processing, chemical and
building materials industries, since 1983. Mr. Cooper is a Registered
Professional Engineer in Illinois and is a member of ASCE and the Illinois
Society of Professional Engineers.

     Dr. Robert G. Martin has served as a director of Donlar since June 1992.
Dr. Martin, a cataract surgeon, has been a principal of Carolina Eye Associates,
a 15-office ophthalmic practice, since 1977. He is Chairman of the Board of the
Society for Excellence in Eye Care and past president of the American Board of
Eye Surgery. Dr. Martin holds a B.S. in Chemistry and an M.D. from the
University of North Carolina at Chapel Hill.

     Dean R. Kleckner has served as a director of Donlar since November 3, 2000.
He has been a President of the American Farm Bureau Federation since 1986. Mr.
Kleckner also operates a 350-acre corn, soybean and hog farm in Iowa.

     No family relationships exist between or among any of Biosyntrex's officers
and directors.

BOARD OF DIRECTORS COMMITTEES

     The Board of Directors has established a Compensation Committee and an
Audit Committee.

COMPENSATION COMMITTEE

     The Compensation Committee makes recommendations to the Board of Directors
with respect to the compensation of management employees and administers plans
and programs relating to employee benefits, incentives and compensation. The
Compensation Committee also determines the persons to receive options under
Biosyntrex's stock option plans and the number of options to be granted.

AUDIT COMMITTEE

     The Audit Committee makes recommendations to the Board of Directors with
respect to the engagement of Biosyntrex's independent public accountants and
reviews the scope and effect of the audit engagement.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

     Section 16(a) of the 1934 Act requires Biosyntrex's directors and executive
officers, and persons who own more than 10% of a registered class of
Biosyntrex's equity securities, to file with the SEC initial reports of
ownership and reports of changes in ownership of Biosyntrex's common stock and
other equity securities. Officers, directors and greater than 10% shareholders
are required by SEC Regulations to furnish Biosyntrex with copies of all Section
16(a) reports they file. Based solely upon a review of the copies of such
reports furnished to Biosyntrex, Biosyntrex believes that there was compliance
for the year ended December 31, 2001 with all Section 16(a) filing requirements
applicable to Biosyntrex's greater than 10% beneficial owners. Biosyntrex's
officers and directors have not filed initial reports on Form 3 with the SEC.
Management is working with such persons to prepare and file the required forms.
Biosyntrex is not aware of any reportable transactions by its officers and
directors during 2001.

                                        14
<PAGE>

ITEM 10. EXECUTIVE COMPENSATION

     The following table sets forth the annual and long-term compensation in
fiscal years 2001, 2000 and 1999 for Biosyntrex's Chief Executive Officer and
Chief Operating Officer.

                           SUMMARY COMPENSATION TABLE

<Table>
<Caption>
                                                                                                      LONG TERM
                                              ANNUAL COMPENSATION                                COMPENSATION AWARDS
                             ------------------------------------------------------   -----------------------------------------
            (A)              (B)         (C)       (D)        (E)           (F)          (G)          (H)         PAYOUTS (I)
---------------------------  ----      --------   -----   ------------   ----------   ----------   ----------   ---------------
                                                                                      SECURITIES
                                                             OTHER       RESTRICTED   UNDERLYING
                                                             ANNUAL        STOCK       OPTIONS/       LTIP         ALL OTHER
NAME AND PRINCIPAL POSITION  YEAR       SALARY    BONUS   COMPENSATION     AWARDS     SARS(#)(3)   PAYOUTS($)   COMPENSATION($)
---------------------------  ----       ------    -----   ------------   ----------   ----------   ----------   ---------------
<S>                          <C>       <C>        <C>     <C>            <C>          <C>          <C>          <C>
Larry P. Koskan..........    2001      $159,623    -0-        -0-           -0-            -0-        -0-               -0-
  President and Chief        2000(1)   $ 30,833    -0-        -0-           -0-            -0-        -0-               -0-
  Executive Officer
Robert P. Pietrangelo....    2001      $161,367    -0-        -0-           -0-        500,000        -0-               -0-
  Vice President and Chief
  Operating Officer
Michael G. Acton.........    2000(2)   $100,000    -0-        -0-           -0-            -0-        -0-           $20,000(4)
  Chief Executive Officer    1999(2)   $100,000    -0-        -0-           -0-         48,000        -0-               -0-
</Table>

-------------------------
(1) Mr. Koskan replaced Mr. Acton on November 3, 2000 as Chief Executive
    Officer.

(2) Ended September 30th of each of the fiscal years indicated.

(3) Adjusted to reflect all stock splits prior to the issuance of this report.

(4) Represents fair market value of 8,000 shares of common stock of Biosyntrex
    granted to Mr. Acton on December 22, 1999.

STOCK PLANS

     As of December 31, 2001, 1,325,000 shares of Biosyntrex's common stock were
subject to options and issuable upon exercises of options granted under the 2001
Equity Incentive Plan.

OPTION GRANTS IN FISCAL YEAR 2001

     The following table sets forth information concerning the grant of stock
options and stock appreciation rights (SARS) made under Biosyntrex's plans
during the fiscal year ended December 31, 2001 to each named executive officer:

                       OPTION GRANTS IN LAST FISCAL YEAR

<Table>
<Caption>
                                                  INDIVIDUAL GRANTS
                                               ------------------------
              (A)                   (B)            (C)           (D)          (E)          (F)            (G)
-------------------------------  ----------    ------------    --------    ----------    --------      ---------
                                                                                          POTENTIAL REALIZABLE
                                 NUMBER OF      % OF TOTAL                                  VALUE OF ASSUMED
                                 SECURITIES      OPTIONS       EXERCISE                  ANNUAL APPRECIATION FOR
                                 UNDERLYING     GRANTED TO     OR BASE                       OPTION TERM(2)
                                  OPTIONS      EMPLOYEES IN     PRICE      EXPIRATION    -----------------------
             NAME                 GRANTED      FISCAL YEAR     ($/SH.)        DATE        5%($)         10%($)
             ----                ----------    ------------    --------    ----------     -----         ------
<S>                              <C>           <C>             <C>         <C>           <C>           <C>
Robert P. Pietrangelo..........   500,000(1)      37.45         $0.20         2011       $62,889       $159,374
</Table>

-------------------------
(1) These options were granted at an exercise price equal to the per share
    market value of the common stock on the grant date. The 500,000 options
    become exercisable 20% percent each year beginning one year after the date
    of grant.

(2) The potential realizable value is calculated based on the term of the option
    (10 years) at its date of grant. It is calculated by assuming that the stock
    price on the date of grant ($0.20) appreciates at the indicated annual rate
    compounded annually for the entire term of the option; however, the optionee
    will not

                                        15
<PAGE>

    actually realize any benefit from the option unless the market value of the
    Company's common stock in fact increases over the option price.

     As part of the restructuring plan described in "Item 1: Description of
Business -- Restructuring Plan," if the Merger is completed all options
previously granted will be cancelled. It is anticipated that new options will be
issued by the surviving corporation in the Merger to replace cancelled options.

AGGREGATED OPTION EXERCISES AND FISCAL YEAR-END OPTION VALUE

     The following table sets forth information with respect to the exercise of
stock options by each named executive officer during the fiscal year ended
December 31, 2001, as well as the aggregate number and value of unexercised
options held by such officers on December 31, 2001:

                AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
                        AND FISCAL YEAR-END OPTION VALUE

<Table>
<Caption>
                                                                 NUMBER OF SECURITIES
                                                                      UNDERLYING        VALUE OF UNEXERCISED
                                                                 UNEXERCISED OPTIONS    IN-THE-MONEY OPTIONS
                                 SHARES ACQUIRED                 AT DECEMBER 31, 2001   AT DECEMBER 31, 2001
                                  ON EXERCISES        VALUE        (#)EXERCISABLE/        ($)EXERCISABLE/
             NAME                    (#)(1)        REALIZED($)      UNEXERCISABLE         UNEXERCISABLE(2)
             ----                ---------------   -----------   --------------------   --------------------
<S>                              <C>               <C>           <C>                    <C>
Robert P. Pietrangelo..........        -0-             -0-           -0-/500,000            $-0-/$77,500
</Table>

-------------------------
(1) All share amounts and exercise prices were adjusted to reflect all stock
    splits prior to the issuance of this report.

(2) At December 31, 2001, the average of the closing bid and ask prices for
    Biosyntrex's common stock was $0.355.

COMPENSATION OF DIRECTORS

     Members of the Board of Directors who are not directly or indirectly
employed by Biosyntrex have their expenses reimbursed in connection with
attending meetings of the Board of Directors. In addition, during 2001 options
were granted to Dean Kleckner and Robert Copper to purchase 50,000 and 100,000
shares of common stock, respectively, at an exercise price of $0.20, for their
service on the board.

EMPLOYMENT CONTRACTS

     The Company entered into an employment agreement dated September 7, 2001,
with Robert P. Pietrangelo to serve as chief operating officer of the Company.
The employment agreement is for a two year term, automatically renewing for an
additional three years if sales exceed expenses before the conclusion of the
second year. Under the employment agreement, Mr. Pietrangelo is paid an annual
salary of $160,000, subject to annual increases at the discretion of the board
of directors, and is entitled to receive for 2001 (i) options to purchase
500,000 shares of the Company's common stock at $0.20 per share vesting in equal
annual increments over five years and (ii) options to purchase an additional
500,000 shares of the Company's common stock at $0.20 per share immediately
vested in full if the Company achieves $2.0 million in sales in 2001 and the
Company's sales exceed expenses by December 31, 2001.

     Donlar entered into an employment agreement dated July 1, 1996, with Larry
Koskan to serve as President and Chief Executive Officer of Donlar Corporation.
Mr. Koskan's employment by the Company has continued under the terms of the
Donlar employment agreement. The employment agreement was for an initial five
year term and has been extended for an additional two years. Under the
employment agreement, Mr. Koskan is paid an annual base salary of $185,000 which
amount may be increased from time to time by the Compensation Committee of the
Board of Directors. Mr. Koskan is further entitled to full compensation during
any period or periods of disability not exceeding two years in the aggregate and
a term life insurance policy in the face amount of $500,000 throughout the term
of his employment. If Mr. Koskan's employment is terminated involuntarily as
defined in his employment agreement, then Mr. Koskan is entitled to severance

                                        16
<PAGE>

pay in a lump sum amount equal to his base compensation for the twenty-four
months immediately preceding the termination.

REPORT ON REPRICINGS OF OPTIONS/SARS

     None.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     To Biosyntrex's knowledge, the following table sets forth information
regarding ownership of Biosyntrex's outstanding common stock on March 28, 2002
by beneficial owners of more than 5% of the outstanding shares of common stock.
No director or executive officer of Biosyntrex owns any common stock.

<Table>
<Caption>
                                                                      SHARES OF COMMON STOCK
                                                                        BENEFICIALLY OWNED
                     NAME AND ADDRESS                         ---------------------------------------
                  OF BENEFICIAL OWNER(1)                        NUMBER          PERCENTAGE OF CLASS
                  ----------------------                        ------          -------------------
<S>                                                           <C>              <C>
Donlar Corporation........................................    33,279,520                68.2%
6502 South Archer Road
Bedford Park, IL 60501
Lasalle Bank(2)...........................................     8,000,000                16.4%
135 South LaSalle Street
Chicago, IL 60603
</Table>

-------------------------
(1) A person is deemed to be the beneficial owner of securities that can be
    acquired by such person within 60 days from the date on which beneficial
    ownership is calculated, upon the exercise of options or warrants or
    otherwise. Each beneficial owner's percentage of ownership is determined by
    assuming that options, warrants, or other rights to acquire shares, held by
    such person (but not those held by any other person) and exercisable within
    sixty (60) days from the date hereof have been fully exercised. Percentages
    are calculated based on 48,816,662 shares of common stock outstanding as of
    March 28, 2002 (as adjusted for shares deemed to be beneficially owned by
    such shareholder).

(2) The 8,000,000 shares of common stock owned by Lasalle Bank were previously
    pledged to Lasalle Bank as collateral for a loan to a shareholder of Donlar.
    For a description of the pledge, see "Item 5. Other information." in
    Biosyntrex's quarterly report on Form 10-QSB for the quarter ended June 30,
    2001. Pursuant to an agreement between Lasalle Bank and the Donlar
    shareholder, the 8,000,000 shares were transferred to Lasalle Bank in March
    of 2002.

     The following table sets forth securities authorized for issuance under
equity compensation plans that have been previously approved by security holders
and not previously approved by security holders.

                           EQUITY COMPENSATION PLANS

<Table>
<Caption>
                                                                                          NUMBER OF SECURITIES
                                      NUMBER OF SECURITIES TO BE     WEIGHTED-AVERAGE     REMAINING AVAILABLE
                                       ISSUED UPON EXERCISE OF      EXERCISE PRICE OF     FOR FUTURE ISSUANCE
                                         OUTSTANDING OPTIONS,      OUTSTANDING OPTIONS,       UNDER EQUITY
           PLAN CATEGORY                 WARRANTS AND RIGHTS       WARRANTS AND RIGHTS     COMPENSATION PLANS
           -------------              --------------------------   --------------------   --------------------
<S>                                   <C>                          <C>                    <C>
Equity compensation plans approved
  by security holders...............          1,874,509               1.37                      125,491
Equity compensation plans not
  approved by security holders......         N/A                       N/A                     N/A
Total...............................          1,874,509               1.37                      125,491
</Table>

                                        17
<PAGE>

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     Donlar Corporation -- Donlar acquired 96% of Biosyntrex on November 3,
2000.

     In November 2000 and January 2001, pursuant to an amended stock purchase
agreement and an amended asset purchase agreement between Biosyntrex and Donlar,
Biosyntrex issued 41,279,520 million shares of common stock, par value $0.0001
per share, representing approximately 96% of Biosyntrex's shares outstanding on
a fully diluted basis, in a private placement to Donlar. Biosyntrex issued those
shares in exchange for $2,413,500 in cash and the transfer to Biosyntrex from
Donlar of the exclusive right to distribute, and the exclusive right to all
future sales from Donlar's agricultural, industrial and consumer products. In
addition, Donlar transferred to Biosyntrex all technology, know how and patents
for the crop nutrition management and oil field services businesses created
after November 3, 2000, as well as all technology resulting from Donlar
pharmaceutical research and development activities after November 3, 2000.
Donlar's ownership interest in Biosyntrex has decreased since January 2001 as a
result of transfers of common stock by Donlar and issuances of additional common
stock by Biosyntrex.

     Christopher D. Illick -- Mr. Illick was the Chairman of Biosyntrex's Board
of Directors until he resigned in the fourth quarter of 2000.

     Biosyntrex had a Consulting Agreement with Christopher D. Illick, one of
Biosyntrex's directors and a member of its Compensation and Audit Committees.
That Consulting Agreement provided for Mr. Illick's services as a director of
Biosyntrex and as a member of Biosyntrex's Compensation and Audit Committees.
Pursuant to that Consulting Agreement, Biosyntrex issued Mr. Illick 45 shares of
common stock each month during his service as a director.

ITEM 13. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

     (a) Documents filed as part of this Form 10-KSB:

        1. Financial Statements (included in Part II, Item 7)
          Report of Independent Certified Public Accountants
          Consolidated Balance Sheet as of December 31, 2001
          Consolidated Statements of Operations for the Years Ended December 31,
           2001 and 2000
          Consolidated Statement of Shareholders' Deficit for the Years Ended
           December 31, 2001 and 2000
          Consolidated Statements of Cash Flows for the Years Ended December 31,
           2001 and 2000
           Notes to Consolidated Financial Statements

        2. Financial Statement Schedules: Financial statement schedules have
           been omitted because they are not required or are not applicable, or
           because the required information is shown in the financial statements
           or notes thereto.

        3. Exhibits: The following Exhibits are filed with this Form 10-KSB:

<Table>
<Caption>
EXHIBIT NO.                      DESCRIPTION OF EXHIBIT
-----------                      ----------------------
<C>           <S>
   2.1        Stock Purchase Agreement, dated as of August 7, 2000,
              between Biosyntrex Systems, Inc. and Donlar Corporation.(10)
   2.2        Asset Purchase Agreement, dated as of August 7, 2000,
              between Biosyntrex Systems, Inc. and Donlar Corporation.(10)
   3.1        Amended and Restated Articles of Incorporation(5)
   3.2        Amended and Restated Bylaws (adopted March 22, 1996)(5)
   3.3        Certificate and Statement of Determination of Rights and
              Preferences of Series A 10% Cumulative Convertible Preferred
              Stock(5)
   3.4        Certificate and Statement of Determination of Rights and
              Preferences of Series B 10% Cumulative Convertible
              Non-Voting Preferred Stock(5)
</Table>

                                        18
<PAGE>

<Table>
<Caption>
EXHIBIT NO.                      DESCRIPTION OF EXHIBIT
-----------                      ----------------------
<C>           <S>
   3.5        Certificate and Statement of Determination of Rights and
              Preferences of Series D 8% Cumulative Convertible Non-Voting
              Stock(5)
   3.6        Certificate of Amendment to the Designation of Rights and
              Preferences Related to Series A 10% Cumulative Convertible
              Preferred Stock(5)
   3.7        Certificate and Statement of Determination of Rights and
              Preferences of Series C 8% Cumulative Convertible Non-Voting
              Preferred Stock(5)
   3.8        Certificate and Statement of Determination of Rights and
              Preferences of Series E, 8% Cumulative Convertible Preferred
              Stock(6)
   3.9        Certificate of Amendment of Determination of Rights and
              Preferences of Series F, 8% Cumulative Convertible Preferred
              Stock(6)
   3.10       Amendment to Determination of Rights and Preferences of
              Series F Preferred(6)
   3.11       Certificate and Statement of Determination of Rights and
              Preferences of Series G, 8% Cumulative Preferred Stock(6)
   3.12       Amendment to Designation of Rights and Preferences of Series
              G Preferred(6)
   3.13       Certificate and Statement of Determination of Rights and
              Preferences of the Series J, 8% Cumulative Convertible
              Preferred Stock(6)
   4.1        Form of Common Stock Certificate(3)
   4.3        Form of Series A 10% Cumulative Convertible Preferred Stock
              Certificate(3)
   4.4        Form of Series B 10% Cumulative Convertible Preferred Stock
              Certificate(2)
   4.5        Form of Series D 8% Cumulative Convertible Preferred Stock
              Certificate(1)
   4.6        Form of Series C 8% Cumulative Convertible Preferred Stock
              Certificate(5)
   4.7        Form of Series E Certificate(6)
   4.8        Form of Series F Certificate(6)
   4.9        Form of Series G Amendment(6)
   4.10       Form of Series J Certificate(6)
   4.11       Bridge and Consolidated Term Loan Agreement, dated March 18,
              2001, among Biosyntrex, Donlar and Tennessee Farmers Life
              Insurance Company
  10.43       Office Lease Agreement(2)
  10.50       Thomas Q. Garvey, III Indemnification Agreement(2)
  10.51       St. Luke's-Roosevelt Hospital Center Statement of
              Agreement(2)
  10.52       Michael G. Acton Agreement(2)
  10.53       Frank A. Eldredge Agreement(2)
  10.54       James Dalton Agreement(2)
  10.60       Amended License Agreement with PTI(1)
  10.77       1995 Stock Incentive Plan(1)
  10.80       Incentive Stock Option Agreement with Michael G. Acton (May
              4, 1995)(1)
  10.82       Amended 1995 Stock Incentive Plan(1)
  10.83       Non-Qualified Stock Option Agreement with Christopher D.
              Illick(1)
  10.84       Schedule Identifying Other Non-Qualified Stock Option
              Agreements(1)
  10.85       Incentive Stock Option Agreement with Frank A. Eldredge(1)
  10.86       Schedule Identifying other Incentive Stock option
              Agreements(1)
  10.95       Lease Agreement with Young Electric Sign company(5)
  10.97       Form of Registration Rights Agreement (Series C
              Preferred)(5)
</Table>

                                        19
<PAGE>

<Table>
<Caption>
EXHIBIT NO.                      DESCRIPTION OF EXHIBIT
-----------                      ----------------------
<C>           <S>
  10.98       Form of Investor Questionnaire and Subscription Agreement
              (Series C Preferred)(5)
  10.108      License Agreement with Biomed Patent Development LLC(5)
  10.112      First Amendment to Amended License Agreement with PTI(5)
  10.113      Contract with ML Industries(6)
  10.114      Contract with Medical Foods, Inc.(6)
  10.115      Contract with Harrogate Marketing LLC(6)
  10.116      Rockwood Purchase Agreement, as amended(6)
  10.117      Marketing and Consulting Services Agreement between
              Biosyntrex Systems, Inc., and Harrogate Marketing, L.L.C.
              dated as of August 14, 1999(7)
  10.118      Contract with Amerifit Nutrition, Inc.(8)
  10.119      License Agreement with Amerifit Nutrition, Inc.(8)
  10.120      Contract with ICN Pharmaceutical(8)
  10.121      Schedules to ICN Pharmaceutical Contract(8)
  10.122      Non-Competition Agreement with Amerifit Nutrition, Inc.(8)
  10.123      1999 Stock Option and Incentive Plan of Biosyntrex effective
              as of January 1, 1999(9)
  10.124      Form of Incentive Stock Option Grant and Agreement between
              Biosyntrex and certain directors, officers and employees of
              Biosyntrex(9)
  10.125      Form of Stock Option Grant and Agreement between Biosyntrex
              and certain directors, officers and employees of
              Biosyntrex(9)
  10.126      Form of Stock Award Letter.(9)
  10.127      Promissory Note in the principal amount of $1,115,024.80,
              dated as of August 7, 2000.(10)
  10.130      Capital Contribution, Assignment and Assumption
              Agreement(11)
  10.131      Form of Consulting Agreement with Peter Frugone(12)
  10.132      Form of Consulting Agreement with Media Relations Strategy,
              Inc.(13)
  10.133      Form of 2001 Equity Incentive Plan(14)
  10.134      Form of Employment Agreement dated September 7, 2001,
              between Biosyntrex and Robert P. Pietrangelo
  10.135      Form of Employment Agreement dated July 1, 1996, between
              Donlar and Larry Koskan
  23.1        Consent of Grant Thornton LLP
</Table>

-------------------------

 (1) Incorporated by reference to Biosyntrex's Annual Report on Form 10-K/A for
     the fiscal year ended September 30, 1995.

 (2) Incorporated by reference to Biosyntrex's Annual Report on Form 10-KSB for
     the fiscal year ended September 30, 1994.

 (3) Incorporated by reference to Biosyntrex's Annual Report on Form 10-K for
     the fiscal year ended September 30, 1993 and the two month period ended
     November 30, 1993.

 (4) Incorporated by reference to Biosyntrex's Annual Report on Form 10-K for
     the fiscal year ended September 30, 1992.

 (5) Incorporated by reference to Biosyntrex's Annual Report on Form 10-KSB for
     the fiscal year ended September 30, 1996.

 (6) Incorporated by reference to Biosyntrex's Annual Report on Form 10-KSB for
     the fiscal year ended September 30, 1998.

 (7) Incorporated by reference to Biosyntrex's Annual Report on Form 10-KSB for
     the fiscal year ended September 30, 1999.

                                        20
<PAGE>

 (8) Incorporated by reference to Biosyntrex's Quarterly Report on Form 10-QSB
     for the period ended December 31, 1999.

 (9) Incorporated by reference to Biosyntrex's Registration Statement on Form
     S-8 filed on February 2, 2000.

(10) Incorporated by reference to Biosyntrex's Current Report on Form 8-K filed
     on August 15, 2000.

(11) Incorporated by reference to Biosyntrex's Current Report on Form 8-K filed
     on January 22, 2001.

(12) Incorporated by reference to Biosyntrex's Registration Statement on Form
     S-8 filed on May 2, 2001.

(13) Incorporated by reference to Biosyntrex's Quarterly Report on Form 10-QSB
     for the quarter ended March 31, 2001.

(14) Incorporated by reference to Biosyntrex's Proxy Statement filed on June 20,
     2001.

     (b) Reports on Form 8-K filed during the last quarter of the period covered
         by this report.

         None.

                                        21
<PAGE>

                                   SIGNATURES

     Pursuant to the requirements of Section 13 or 15(d) of the Exchange Act,
the registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.

                                          DONLAR BIOSYNTREX CORPORATION
                                          (Registrant)

                                                  /s/ LARRY P. KOSKAN
                                          --------------------------------------
                                          By:      Larry P. Koskan
                                          Its:      President and Chief
                                          Executive Officer
                                          Date:    April 15, 2002

     In accordance with the Exchange Act, this report has been signed below by
the following persons on behalf of the registrant and in the capacities and on
the dates indicated.

<Table>
<Caption>
                     SIGNATURE                                       TITLE                       DATE
                     ---------                                       -----                       ----
<C>                                                    <S>                                  <C>

                /s/ LARRY P. KOSKAN                    Director, Chairman                   April 15, 2002
---------------------------------------------------
                  Larry P. Koskan

               /s/ ROBERT W. COOPER                    Director                             April 15, 2002
---------------------------------------------------
                 Robert W. Cooper

             /s/ DR. ROBERT G. MARTIN                  Director                             April 15, 2002
---------------------------------------------------
               Dr. Robert G. Martin

               /s/ DEAN R. KLECKNER                    Director                             April 15, 2002
---------------------------------------------------
                 Dean R. Kleckner
</Table>

                                        22
<PAGE>

                 DONLAR BIOSYNTREX CORPORATION AND SUBSIDIARIES

                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

<Table>
<Caption>
                                                                PAGE
                                                                ----
<S>                                                             <C>
Report of Independent Certified Public Accounts.............    F-1
Consolidated Balance Sheet as of December 31, 2001..........    F-2
Consolidated Statements of Operations for the Years Ended       F-3
  December 31, 2001 and 2000................................
Consolidated Statement of Shareholders' Deficit for the         F-4
  Years Ended December 31, 2001 and 2000....................
Consolidated Statements of Cash Flows for the Years Ended       F-5
  December 31, 2001 and 2000................................
Notes to Consolidated Financial Statements..................    F-7
</Table>

                                        23
<PAGE>

        THE COMPANY'S CONSOLIDATED FINANCIAL STATEMENTS WILL BE FILED BY
                AMENDMENT TO THIS ANNUAL REPORT ON FORM 10-KSB.

                                       F-1