UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549___________________________**FORM 10-K**________________________________ ýANNUAL REPORT PURSUANT TO SECTION 13
OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934  For the fiscal year ended December
31, 2012  Commission file number 0-54856 DYNAMIC
APPLICATIONS CORP.(Exact Name Of Registrant
As Specified In Its Charter) Delaware
    98-0573566(State of Incorporation)
    (I.R.S. Employer Identification No.)c/o Eli Gonen, 14 Menachem Begin Street,
    Ramat Gan, Israel
    52700(Address of Principal Executive Offices)
    (ZIP Code) Registrant's Telephone Number, Including Area Code: (972) 3-7523922
Securities Registered Pursuant to Section 12(g) of The Act: Common
Stock, $0.00001 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. YesxNo ̈Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K is not contained herein, and will not be contained, to the best of the
registrant's knowledge, in the definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this Form 10-K. ̈ On December 31, 2012, the aggregate market value of the 142,182 common stock held by
non-affiliates of the Registrant was approximately $11,375 based on the last trade of the
Registrants common stock at $0.18 on March 28, 2013. On March 31, 2013, the Registrant had
15,829,450 shares of common stock outstanding. Indicate by check
mark whether the registrant is a large accelerated filer, an accelerated filer, a
non-accelerated filer(as
defined in Rule 12b-2 of the Exchange Act)or a smaller
reporting company. Large accelerated
    filer  ̈
    Accelerated filer  ̈
    Non-Accelerated
    filer  ̈
    Smaller reporting
    companyx Indicate by check mark whether the registrant is a shell
company (as defined in Rule 12b-2 of the Exchange Act).Yes ̈Nox




TABLE OF CONTENTS Item
    ____
    Description
       _________
    Page
    ____**PART
    I**ITEM 1.
    DESCRIPTION OF BUSINESS
    3ITEM 1A.
    RISK FACTORS
    9ITEM 1B.
    UNRESOLVED STAFF COMMENTS
    9ITEM 2.
    DESCRIPTION OF PROPERTY
    9ITEM 3.
    LEGAL PROCEEDINGS
    9ITEM 4.
    MINE SAFETY DISCLOSURES
    9**PART
    II**ITEM 5.
    MARKET
    FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
    10ITEM 6.
    SELECTED FINANCIAL DATA
    11ITEM 7.
    MANAGEMENT'S
    DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATION
    11ITEM 7A.
    QUANTITATIVEAND
    QUALITATIVE DISCLOSURE ABOUT MARKET RISK
    15ITEM 8.
    FINANCIAL STATEMENTS
    AND SUPPLEMENTARY DATA
    16ITEM 9.
    CHANGES
    IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
    28ITEM 9A.
    CONTROLS AND PROCEDURES
    28ITEM 9B.
    OTHER INFORMATION
    28******PART
    III**ITEM 10.
    DIRECTORS
    AND EXECUTIVE OFFICERS OF THE REGISTRANT AND CORPORATE GOVERNANCE
    29ITEM 11.
    EXECUTIVE COMPENSATION
    30ITEM 12.
    SECURITY
    OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED SHAREHOLDER MATTERS
    31ITEM 13.
    CERTAIN
    RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE
    31ITEM 14.
    PRINCIPAL ACCOUNTING FEES AND
    SERVICES
    31ITEM 15.
    EXHIBITS AND FINANCIAL
    STATEMENT SCHEDULES
    32




PART I

ITEM 1. DESCRIPTION OF BUSINESS Back to Table of Contents Cautionary Statement regarding Forward-Looking Statements


This Annual Report on Form 10-K includes forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended. The Registrant has based these
forward-looking statements on its current expectations and projections about future
events. These forward-looking statements are subject to known and unknown risks,
uncertainties and assumptions about the Registrant that may cause its actual results,
levels of activity, performance or achievements to be materially different from any future
results, levels of activity, performance or achievements expressed or implied by such
forward-looking statements. In some cases, you can identify forward-looking statements by
terminology such as "may," "will," "should,"
"could," "would," "expect," "plan,"
"anticipate," "believe," "estimate," "continue,"
or the negative of such terms or other similar expressions. Factors that might cause or
contribute to such a discrepancy include, but are not limited to, those described in this
Annual Report on Form 10-K and in the Registrant's other Securities and Exchange
Commission filings.

We were incorporated in Delaware on March 7, 2008 and are a development stage company
engaged in the business of developing equipment covered by a patent (Patent No.
5,497,555). We acquired the patent from Appelfeld Zer Fisher ("AZF"), an Israeli
law firm that specializes in intellectual property law including among other things the
filing, prosecuting and the commercialization of patents, in a patent transfer and sale
agreement dated March 27, 2008 (the "Patent Agreement") for consideration of
$17,000. The patent and related technology covers the design and development of an
electromagnetic percussion device with a striking piston made of a single monolithic block
(the "Patented Device"). Prior to the Patent Agreement with AZF, the Company had
not been involved in any similar patent transactions and our management, while having
significant business experience, did not have any meaningful experience in technological
areas generally or in the field of electromagnets specifically. However, the Company's
CFO, a CPA and attorney by training, had served as a consultant to other reporting
companies by principally providing SEC reporting and disclosure services. These included
companies that had also acquired other patents pursuant to similar patent transfer and
sale agreements with AZF, as follows: Crown Dynamics Corp., Dynamic Ventures Corp.,
Consumer Products Services Group (formerly Global Dynamics Corp.) and Advanced Ventures
Corp., all companies with securities registered under Section 12 of the Exchange Act. In
addition, we understand that another issuer, Santa Fe Petroleum, Inc. (formerly Baby All
Corp.), filed an S-1in 2011 with disclosure that it had acquired a patent from a party
other than AZF. The foregoing information was provided to the Company by its CFO/Director,
Mr. Asher Zwebner. We are not aware of other public companies that may have been involved
in patent acquisition agreements with AZF.

On May 5, 2008, we filed a registration statement on Form S-1 pursuant to which we
offered and sold to the public 2,000,000 shares of our common stock at $0.04 per share,
resulting in gross proceeds of $80,000 and net proceeds of approximately $60,000.
Notwithstanding our successful IPO and a subsequent raise of approximately $200,000 in
December 2008, the Company cash resources were applied to a significant extent to
executive compensation and consulting fees, without devoting resources to the development
of the Patented Device. During the period from December 31, 2008 through September 30,
2009, the Company's cash position was reduced from approximately $130,000 to less that
$100 and the Company announced that it had ceased efforts to pursue development of the
patent.

The Company became delinquent in its reporting obligations under the Securities
Exchange Act of 1934 (the "Exchange Act") by it failure to file its annual
report on Form 10-K for its year-ended December 31, 2009, any quarterly reports in 2010
and its Form 10-K for the year-ended December 31, 2010. On July 26, 2011, the Company
filed Form 15 to terminate its registration under the Exchange Act.

During 2011, we had discussions with a limited number of unaffiliated persons and
shareholders for the purpose of investing in our securities as part of a plan on our part
to pursue the development of our Patented Device. As part of the renewed interest in
development of our Patented Device with view to its commercial exploitation, we became
current with the OTC Markets by filing all requisite reports required by SEC Rule 15c2-11.
We have continued to be current under the rules of the OTC Markets and we filed a Form
10/12G to again become a reporting company under the Exchange Act. We are in the comment
stage with respect to our Form 10/12G/A.

During 2011 and 2012, we had preliminary discussions together with our investors
related to renewing our efforts to develop our Patented Device, which was the reason our
investors had a renewed interest in our Company. As a result, we engaged the services of a
chief scientific advisor with extensive experience in engineering and electromagentics and
in April 2013 we entered into a Development/Manufacturing and Marketing Agreement. See the
disclosure under "Third Party Manufacturers," "Employees,"
"Recent Developments" and "Subsequent Events" below.
Electromagnetic Percussion Devices  Generally, an electromagnetic percussion device is
comprised of the following: (a) a housing; (b) an instrument connected to, and extending
beyond, the housing; (c) a driving member reciprocal within the housing, the driving
member including an intermediate region of a first diameter and an enlarged anterior head
of a second diameter, the second diameter being larger than the first diameter; (d) a
piston body reciprocal within the housing and adapted to impact the instrument, the piston
body including a coupling element for slidably accommodating the head of the driving
member, thereby coupling the driving member and the piston body together, the coupling
element including a plurality of leaves which enclose and confine the head of the driving
member when the coupling element is within the housing but which can be moved apart when
the coupling element is outside the housing to allow the head of the driving member to be
inserted into, or removed from, the coupling element; (e) an electromagnetically active
body connected to the driving member; and (f) an electromagnetic coil connected to the
housing, the coil operationally coupled to the electromagnetically active body so as to
cause the reciprocation of the driving member.

From our inception through December 31, 2012, we were unable and, in fact, did not
devote any significant efforts to develop, either alone or with third parties, a Prototype
of our Patented Device. Notwithstanding the foregoing, our management, which has remained
virtually unchanged since inception, continued to believe in the potential of our Patented
Device.

Based upon the information that we received when we acquired the rights to the Patented
Device we believed, and continue to believe, that our Patented Device incorporated a
unique design in which the positions of the electromagnetic coil and electromagnetically
active body are reversed. This advantage, we understood, should successfully address the
shortcomings of the previously known configurations by providing an electromagnetic
percussion device whose striking piston is made of a single monolithic block of material
and which, as a result, should be more durable and rugged than heretofore comparable
devices described above. Further, in our Patented Device, our design provides that prior
to impact between the anterior end of piston body and the posterior end of the instrument,
the current in the electromagnetic coil switches direction. This is designed to decelerate
the motion of driving member leaving the piston body unaffected by the switch in current
direction, creating a small gap between itself and driving member so that at this moment
piston body strikes the instrument there is no direct contact between piston body and the
driving member. As a result, no impact shock is transmitted from piston body to driving
member thereby reducing wear on driving member and its permanent magnet thereby
significantly increasing its useful life and reliability.  Our management's position is that its belief in the Patented Device, notwithstanding
the rather lengthy delay in development and its mistaken determination in July 2011 to
cease development efforts, was justified based upon its ability to successfully conclude
the agreement with GUMI, as described more fully below as well as in its Form 8-K filed
with the SEC on March 5, 2013.
Third-Party Manufacturers-Relationship with GUMI Tel Aviv Ltd


Because of our limited financial and personnel resources, our plan since the
acquisition of the Patent, has been to rely on third parties to develop a Prototype of the
Patented Device and thereafter to contract for the manufacture and marketing of commercial
models of our Patented Device. To that end, subsequent to our year ended December 31,
2012, we entered into a distribution agreement with GUMI Tel Aviv Ltd, a major,
privately-held Israeli technology company engaged in the manufacture and sale of
industrial equipment ("GUMI"). See the discussion under "Subsequent
Events" below.
Intellectual Property


On March 27, 2008, we executed the Patent Agreement with AZF , the owner of the
technology, pursuant to which we acquired all right, title and interest in, the Patented
Device and the underlying patent, the application for which was filed with the United
States Patent and Trademark Office ("USPTO") on December 19, 1994. On April 13,
2008, the patent assignment to the Company was recorded in the USPTO. We understand that
no actions were taken with respect to exploitation of the patent from December 1994
through April 2008.

For patent applications that were pending and for patents that were
still in force on June 8, 1995, the patent term is the later of either 17 years from the
patent issue date or 20 years from the filing date of the earliest U.S. application to
which priority is claimed. All patents that issued on an application that was filed before
June 8, 1995, have a term that is the greater of the 20 year term or 17 years from the
patent grant ( See 35 U.S.C. 154(c).)

Because our US patent 5,497,555 is based on US application filed Dec. 19, 1994 (i.e.
before 08/06/1995), our patent will expire 20 years to application file date of Dec. 19,
1994, or an expiration date of Dec.18, 2014.
Competition


There are many companies in the electromagnetic percussion field, including major
international manufacturers, having far greater financial and other resources, together
with significantly greater operating histories, than the Company. We are not, however,
aware of any other company that has developed, manufactured, and/or marketed a device of a
similar nature that incorporates a design in which the positions of the electromagnetic
coil and electromagnetically active body are reversed.

We believe our patented technology and design incorporated in our Patented Device,
should permit us to successfully addresses certain shortcomings of the presently known
configurations by providing an electromagnetic percussion machine whose striking piston is
made of a single monolithic block of material. The Company believes that its technology is
more durable and rugged than previous technologies and/or methods. Notwithstanding the
foregoing, in view of the fact that we have not yet produced a working Prototype nor any
commercial models of our Patented Device, there can be no assurance that our beliefs about
the durability will prove to be correct.
Existing Or Potential Future Government Regulations


We may be subject to the provisions of the Federal Consumer Product Safety Act and the
Federal Hazardous Substances Act, among other laws. These acts empower the CPSC to protect
the public against unreasonable risks of injury associated with consumer products. The
CPSC has the authority to exclude from the market articles that are found to be hazardous
and can require a manufacturer to repair or repurchase such devices under certain
circumstances. Any such determination by the CPSC is subject to court review. Violations
of these acts may also result in civil and criminal penalties. Similar laws exist in some
states and cities in the U.S. and in many jurisdictions throughout the world.
Employees


Other than our current officers and directors, and our recently retained chief
scientific advisor, Gennady Nickelshpur, we have no other full-time or part-time
employees. During the next twelve months, we believe that we may be required to hire a
limited number of either full or part-time employees to further our business plan related
to our Patented Device as well as retain one or more additional advisors to supplement the
efforts of Mr. Nickelshpur. Our hiring plan is dependent upon available financial
resources. We expect that when we complete development of our Patented Device, principally
with the efforts of Mr. Nickelshpur, the timing of which we cannot assure, and assuming
that our resources are sufficient, that we will need to hire up both part-time and
full-time employees and scientific advisors for our operations as they grow.
Recent Developments


On October 26, 2012, the Company's reverse stock split on a 1:100 basis ("Reverse
Split") was implemented and approved by FINRA. In connection with the Reverse Split,
the Company also amended its Certificate of Incorporation to reduce its authorized shares
of common stock from 20 billion shares, consisting of 19.8 billion shares of common stock
and 20 million shares of preferred stock to 520 million shares consisting of 500 million
shares of common stock and 20 million shares of preferred stock. While there can be no
assurance, the Company believes that its capital structure, as amended, should make
investment in our shares of common stock potentially more desirable to investors and the
financial community in general.

As of March 31, 2010, the Company was not in compliance with Section 13(a) of the
Exchange Act because the Company had failed to file its annual report for the year ended
December 31, 2009. Subsequently, the Company failed to file its quarterly reports for the
period ended March 31, 2010, June 30, 2010, September 30, 2010, its annual report for the
year ended December 31, 2010, its quarterly report for the period ended March 31, 2011 and
June 30, 2011. The Company filed a Form 15 on July 27, 2011 to seek suspension of duty to
file reports under Section 15(d) of the Exchange Act. At the time the suspension of duty
to file reports under Section 15(d) of the Exchange Act became effective, we were not in
compliance with the reporting requirements of the Exchange Act. Following the effective
date of our registration statement on Form S-1, on May 15, 2008, we had been voluntarily
filing Exchange Act reports.

There is currently only a very limited trading market in our shares. There can be no
assurance, that an active trading market for our common stock will commence. Further, in
the event that an active trading market commences, there can be no assurance as to the
market price of our shares of common stock, whether any trading market will provide
liquidity to investors, or whether any trading market will be sustained. Nevertheless, we
believe that our recently implemented Reverse Split and the amendment to our capital
structure, together with our ability to raise capital through loans from our directors,
officers and affiliated persons, should make investment in our shares more desirable to
investors and to the financial community.
Termination of Green Biofuels Holding Ltd. Agreement


On January 12, 2010, the Company entered into a termination agreement with Green
Biofuels Holding Ltd., an Israeli corporation ("GBH"), and Messrs. Shlomo Palas,
Samuel Keshet and Eliezer Weinberg (the "Termination Agreement"). Pursuant to
the Termination Agreement, the original Cooperation and Partnership Agreement with GBH,
dated August 9, 2009, for which the Company paid no consideration, and any rights, title
and interest and all obligations and liabilities arising out of or relating to the Carbon
Credit Project (as defined in such agreement) were contributed and transferred from the
Company to GBH and assumed by GBH and the August 8, 2009 agreement was terminated. At the
same date as the Termination Agreement, the Company and Messrs. Shlomo Palas, Samuel
Keshet and Eliezer Weinberg (the "Subscribers") terminated the Private Placement
Subscription Agreement between the Company and the Subscribers, and the shares, which had
never been issued, were effectively cancelled.
Subsequent Events


On January 15, 2013, the Company entered into a consulting agreement with Gennady
Nickelshur to serve as the Company's chief scientific advisor ("CSO"). The
agreement with Mr. Nickelshpur provides for cash compensation based upon an hourly rate
and the grant to the CSO of options pursuant to an ESOP to be adopted by the board of
directors. The terms of the ESOP have yet to be determined. Reference is made to the
disclosure under Item 10. "DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
PERSON" below.

On March 5, 2013, the Company and GUMI Tel Aviv Ltd, a major, privately-held Israeli
technology company ("GUMI"), entered into development/manufacturing/marketing
agreement ("GUMI Agreement"). GUMI is engaged in the manufacture, import/export,
marketing and install industrial equipment and designing technical solutions to major
Israeli customers, including, among others, the Israeli Defense Forces (IDF), El-Al
Airlines, major Israeli Aerospace companies, as well as foreign industrial customers.
Further, GUMI recently entered into a Joint Venture with a large Indian industrial company
to build a factory in India to manufacture specially designed pipes for the aviation
industry. GUMI has eight operating subsidiaries, approximately 200 full-time employees,
more than 100 sub-contractors, and is among Israel's largest manufacturers and
distributors of industrial equipment.

Pursuant to the GUMI Agreement, GUMI agreed to: (i) complete the development of the
Prototype of the Patented Device; (ii) manufacture the commercial model(s) of the Patented
device; and (iii) market the commercial model(s) of the Patented Device.

In consideration for developing the Prototype and manufacturing and
marketing/distributing commercial models of the Patented Device as well as incurring all
related costs and expenses in connection therewith, the Company shall compensate GUMI as
follows: (i) upon the execution of the GUMI Agreement, the Company granted GUMI warrants
(the "Warrants") exercisable to purchase 200,000 shares of the Company's common
stock ("Warrant Shares") at an exercise price of $0.05 per share (the
"Exercise Price"); (ii) upon completion of the Prototype, granting GUMI
additional Warrants to purchase 200,000 additional Warrant Shares at the Exercise Price;
and (iii) upon completion of a Commercial Device ready for manufacture and sale, granting
GUMI additional Warrants to purchase 200,000 additional Warrant Shares at the Exercise
Price. The Warrants shall expire 3 years from the date of each grant and shall be subject
to adjustment in the event of any recapitalization of the Company's capital stock.

In addition to the consideration represented by the grant of Warrants, the Agreement
further provides that following commencement of sale of the Commercial Device and until
such time that GUMI has recouped all costs and expenses that it has incurred and paid in
connection with the completion of development of the Prototype and the manufacture of the
Commercial Device ("Date of Recoupment"), one hundred (100%) percent of the net
sales revenues shall be paid and distributed to GUMI. On and after the Date of Recoupment,
net sales revenues shall be paid sixty-five (65%) percent to GUMI and thirty-five (35%)
percent to the Company.

We were informed by GUMI on April 4, 2013 that it has made significant progress toward
completion of the development of the Prototype. GUMI has further informed us that it
identified and is negotiating with an engineer with extensive R&D experience to lead
the development project in order to expedite their efforts to produce a working Prototype.
Gumi also reported that as soon as the engineer is engaged, they expect that they will be
able to present us with commercial models of our Patented Device within approximately 12
to 16 weeks. As a result, it is our hope and expectation that we will have commercial
models available for sale during 2013.

Reference is made to the Company's Form 8-K filed with the SEC on March 7, 2013 to
which the GUMI Agreement is attached as an exhibit 10.3.
ITEM 1A. RISK FACTORS Back to Table of Contents We are a development stage company with only a limited operating history and may never
be able to carry out our business plan or achieve any revenues or profitability; as a
development stage company, potential investors have a high probability of losing their
entire investment.


We are subject to all of the risks inherent in the establishment and growth of a
development stage business. We were established on March 6, 2008, for the purpose of
engaging in the development, manufacture, and sale of our Patented Device. While we have
not generated any revenues nor have we realized a profit from our operations to date, we
believe that our recent ability to raise capital from affiliated persons should enhance
our ability to raise equity capital from potential third-party investors so as to permit
us to complete development of our business plan, which includes completing a Prototype of
our Patented Device. There can be no assurance that we will be able to generate any
significant revenues or profitability, if at all, from our Patented Device. Accordingly,
our prospects must be considered in light of the risks, expenses and difficulties
frequently encountered in growing a development stage business in our industry and, as a
result, our Company is a highly speculative venture involving significant financial risk.
We expect to incur operating losses in the next twelve months because we have only a
very limited ability to generate revenues from operations unless and until our recently
completed Prototype results in the development of a working Prototype followed by models
of commercially viable Patented Devices.


To date we have not generated revenues from our Patented Device business. Our Patented
Device is not currently available for sale, and we are dependent upon GUMI for its
continued development. We expect to incur operating losses over the next twelve months and
until GUMI is successful in developing a working Prototype of our Patented Device. We
recognize that if we are unable to generate revenues, we may not be able to continue
operations. There can be no assurance that we will generate any operating revenues or ever
achieve profitable operations.
We expect that during the next twelve months, we will have to continue to rely on loans
from and/or purchases of our capital stock by our affiliates to fund our operating
expenses; we may require additional funds through the sale of our common stock from third
parties; this will be dependent upon favorable market conditions and interest in our
business activities by investors.


We have limited cash resources to fund our administrative and operating expenses for
the next twelve months. be dependent upon GUMI Because we do not expect to have any cash
flow from operations within the next twelve months, we will need to raise additional
capital, which may be in the form of loans from current stockholders and/or through the
issuance of restricted shares to investors. Our ability to access capital will depend on
our success in implementing our business plan. It will also depend upon the status of the
capital markets at the time such capital is sought. Should sufficient capital not be
available, the implementation of our business plan could be delayed and, accordingly, the
implementation of our business strategy would be adversely affected. If we are unable to
raise additional funds in the future, we may have to cease all substantive operations. In
such event it would not be likely that investors would obtain a profitable return on their
investment or a return of their investment at all.
Our auditors have expressed substantial doubt about our ability to continue as a going
concern, we may have to suspend or cease operations within twelve months.


Our audited financial statements for the period from March 7, 2008 (inception) through
December 31, 2012, were prepared using the assumption that we will continue our operations
as a going concern. We were incorporated on March 7, 2008, and do not have a history of
earnings. As a result, our independent accountants in their audit report have expressed
substantial doubt about our ability to continue as a going concern. Continued operations
are dependent on our ability to complete equity or debt financing activities or to
generate profitable operations. Such capital formation activities may not be available or
may not be available on reasonable terms. Our financial statements do not include any
adjustments that may result from the outcome of this uncertainty. There is not enough cash
on hand to fund our administrative expenses and operating expenses or our proposed
research and development program for the next twelve months. Therefore, we may be unable
to continue operations in the future as a going concern. If we cannot continue as a viable
entity, our stockholders may lose some or all of their investment in the Company's shares
of common stock.
We have no track record that would provide a basis for assessing our ability to conduct
successful business activities. We may not be successful in carrying out our business
objectives.


The revenue and income potential of our Patented Device is unproven to date. We have
only a very limited operating history which makes it difficult to evaluate the future
prospects of our business. While our management and principal shareholders purchased
restricted shares of common stock during 2012, there can be no assuance that our business
operations will prove to be successful is correct or that affiliates will continue to
invest in the Company. We continue to be dependent upon funding from affiliated
persons/principal shareholders and officers. Accordingly, there is only a limited basis
upon which potential investors would be able to assess the likelihood that we will be
successful in implementing our business plan, or if initially successful, in thereafter
generating any operating revenues or in achieving profitable operations.
We must rely on third parties to develop a working Prototype and manufacture and
distribute commercial models or our Patented Device.


Subsequent to our year ended December 31, 2012, we entered into the GUMI Agreement for
the development, manufacture and sale of our Patented Device, which resulted in the
completion of the non-working Prototype., We are completely dependent upon GUMI's success
in being able to develop a working Prototype and thereafter being able to manufacture and
distribute models of a commercially viable Patented Device. If the implementation of our
Agreement with GUMI does not develop in a timely economically satisfactory economic
manner, or if GUMI is not successful in creating a meaningful market for our Patented
Device, GUMI may determine not to devote substantial economic and personnel resources to
the manufacture and marketing of our Patented Device. If GUMI, for any reason, fails to
perform, we could experience significant time delays or we may be unable to commercialize
or continue our business plan.
We are a small development stage company with limited resources compared to some of our
potential competitors and we may not be able to compete effectively and develop and
thereafter increase market share.


The electromagnetic percussion system industry is very competitive and although we
believe our technology offers unique development opportunities, we cannot guarantee that
these features we believe to be unique are enough to effectively capture a significant
enough market share to successfully launch our product or sustain any market that GUMI may
be able to generate. Most of our competitors, assuming GUMI is successful in developing,
manufacturing and marketing models of our Patented Device, have longer operating
histories, significantly greater resources and name recognition, and a larger base of
distributors and customers than we have, notwithstanding the significant role that GUMI
will have. As a result, these competitors have greater name credibility with our potential
distributors and customers. Our competitors also may be able to adopt more aggressive
pricing policies and devote greater resources to the development, promotion, and sale of
their products and services than we can to ours. To be competitive, we must continue to
invest significant resources in research and development, sales and marketing, and
customer support. We may not have sufficient resources to make these investments or to
develop the technological advances necessary to be competitive, which in turn will cause
our business to suffer and restrict our profitability potential.
Our success will depend on our relationships with a third party for their
manufacturing, distribution channels and marketing expertise.


We have contracted with GUMI Tel Aviv Ltd to complete development of a working
Prototype and to manufacture and sell models of our Patented Device. Our future revenue
growth, if any, will depend in large part on the success of GUMI's efforts. In the event
that GUMI is not successful in fulfilling any part of their obligations under our
Agreement, or if our Patented Device products do not develop a market that GUMI deems
satisfactory to recoup its costs and generate a profit, we may not be able to secure any
other manufacturing and distribution relationship with third parties. Our failure to
maintain our distribution channels, the loss of our distribution relationship with GUMI,
or a decline in the efforts of a material reseller or distributor could prevent us from
generating sufficient revenues to become profitable, which would have a material adverse
effect on the Company.
Our board of directors and executive officers have very limited experience in managing
a technology company; they may not be able to successfully operate such a business, which
could cause you to lose your investment


We are a development stage company and, utilizing the services and expertise of GUMI,
we intend to manufacture, market, and sell commercial models of our Patented Device, an
electromagnetic percussion system. Our current directors and officers have effective
control over all decisions regarding both policy and operations of our Company with no
oversight from other persons. Because of the limited experience, our board of directors
has negotiated an agreement with Mr. Gennady Nickelshpur to serve as our chief scientific
advisor. Our success is contingent upon the ability of Mr. Nickelshpur and other
specialists to work with our management team to make appropriate business decisions in
these areas. However, our directors and officers alone have no experience in operating a
company that develops or sells electromagnetic percussion systems and otherwise have
limited experience in technology. It is possible that this lack of relevant operational
experience could prevent us from becoming a profitable business and hinder an investor
from obtaining a return on his investment in us.
Our directors and officers have other outside business activities and will only be
devoting up to 10% to 20% of their time to our operations; our operations may be sporadic
which may result in periodic interruptions or suspensions of our business activities
unless we are successful in engaging the services of a more complete advisory team.


Our directors and officers are only engaged in our business activities on a part-time
basis. This could cause the officers a conflict of interest between the amount of time
they devote to our business activities and the amount of time required to be devoted to
their other activities. Our current directors and officers, intend to devote only
approximately 5 hours per week to our business activities. Any increase in business
activities may require that either our directors or officers engage in our business
activities on a full-time basis or that we hire additional employees in addition to our
chief scientific advisor; however, at this time, we have only limited resources to pursue
these options.
Our patent expires in December 2014; We have only a limited time to exploit our
Patented device on an exclusive basis.


Because our US patent is based on an application filed Dec. 19, 1994, our patent
expires 20 after the filing date - or. Dec.18, 2014. As a result, our patent only remains
in full force and effect until December 18, 2014, which gives us only a relatively limited
amount of time to commercially exploit our Patented Device. While we will explore the
possibility if there is any unless by working with GUMI on any enhanced development there
is a basis to file for either extending the existing patent or obtaining a new
"use" patent or other means of extension, of which there can be no assurance.
If our intellectual property protection is inadequate, competitors may gain access to
our technology and undermine our competitive position.


We regard our current and future intellectual property as important to our success, and
we rely on patent law to protect our proprietary rights, despite the fact that our patent
expires in approximately 19 months from the date of this annual report. As a result, our
intellectual property protection may not be adequate. Further, unauthorized third parties
may copy certain portions of our product or reverse engineer or obtain and use information
that we regard as proprietary. There can be no assurance that our intellectual property
rights can be successfully asserted in the future or that they will not be invalidated,
circumvented or challenged. In addition, the laws of some foreign countries do not protect
proprietary rights to the same extent as do the laws of the United States. Our means of
protecting our proprietary rights in the United States or abroad may not be adequate and
competitors may independently develop similar technology. Any failure to protect our
proprietary information and any successful intellectual property challenges or
infringement proceedings against us could have a material adverse affect on our business,
financial condition, or results of operations.
We may be subject to intellectual property litigation, such as patent infringement
claims, which could adversely affect our business.


Our success will also depend in part on our ability to develop a commercially viable
product without infringing the proprietary rights of others. Although we have not been
notified of any infringement claims, other patents could exist or could be filed which
would prohibit or limit our ability to develop and market our electromagnetic percussion
system in the future. In the event of an intellectual property dispute, we may be forced
to litigate. Intellectual property litigation would divert management's attention from
developing our product and would force us to incur substantial costs regardless of whether
or not we are successful. An adverse outcome could subject us to significant liabilities
to third parties, and force us to cease operations.
If and when we sell our Patented Device and other technology products, we may be liable
for product liability claims and we presently do not maintain product liability insurance.


Our electromagnetic percussion device being developed by GUMI may expose us to
potential liability from personal injury or property damage claims by end-users of the
product. We currently have no product liability insurance to protect us against the risk
that in the future a product liability claim or product recall could materially and
adversely affect our business, to the extent that we are not covered by insurance that
GUMI maintains at present or in the future. Inability to obtain sufficient insurance
coverage at an acceptable cost or otherwise to protect against potential product liability
claims could prevent or inhibit the commercialization of our product. We cannot assure you
that when we commence distribution of our product that we will be able to obtain or
maintain adequate coverage on acceptable terms, if necessary, or that such insurance will
provide adequate coverage against all potential claims.
Risks Related to Our Common Stock

It may be expected that in the future we will issue additional shares of our common
stock which would reduce investors ownership interests in the Company and which may
dilute our share value. We do not need stockholder approval to issue additional shares.


Our certificate of incorporation authorizes the issuance of 500,000,000 shares of
common stock, par value $0.00001 per share and 20,000,000 preferred shares. The future
issuance of all or part of our remaining authorized common stock may result in substantial
dilution in the percentage of our common stock held by our then existing stockholders. We
may value any common stock issued in the future on an arbitrary basis. The issuance of
common stock for future services or acquisitions or other corporate actions may have the
effect of diluting the value of the shares held by our investors, and might have an
adverse effect on any trading market for our common stock.
We are an smaller reporting company,which could make our common
stock less attractive to investors.


We are currently a smaller reporting company, meaning that we are not an
investment company, an asset-backed issuer, or a majority-owned subsidiary of a parent
company that is not a smaller reporting company and have a public float of less than $75
million and annual revenues of less than $50 million during the most recently completed
fiscal year. In the event that we are still considered a smaller reporting
company, at such time are we cease being an emerging growth company, the
disclosure we will be required to provide in our SEC filings will increase, but will still
be less than it would be if we were not a smaller reporting company.
Specifically, smaller reporting companies are permitted to provide more
simplified executive compensation disclosures in their filings; are exempt from the
provisions of Section 404(b) of the Sarbanes Oxley Act of 2002 ("SOX") requiring
that independent registered public accounting firms provide an attestation report on the
effectiveness of internal control over financial reporting; are not required to conduct
say-on-pay and frequency votes until annual meetings occurring on or after January 21,
2013; and have certain other decreased disclosure obligations in their SEC filings,
including, among other things, only being required to provide two years of audited
financial statements in annual reports, rather than three years.  Decreased
disclosures in our SEC filings due to our status as a smaller reporting
company may make it harder for investors to analyze the Companys results of
operations and financial prospects.
Our common stock is subject to the "penny stock" rules of the SEC and the
trading market in our securities is limited, which makes transactions in our stock
cumbersome and may reduce the value of an investment in our stock.


The SEC has adopted Rule 15g-9 which establishes the definition of a "penny
stock," for the purposes relevant to us, as any equity security that has a market
price of less than $5.00 per share or with an exercise price of less than $5.00 per share,
subject to certain exceptions. For any transaction involving a penny stock, unless exempt,
the rules require: (i) that a broker or dealer approve a person's account for transactions
in penny stocks; and (ii) the broker or dealer receive from the investor a written
agreement to the transaction, setting forth the identity and quantity of the penny stock
to be purchased. In order to approve a person's account for transactions in penny stocks,
the broker or dealer must: (i) obtain financial information and investment experience
objectives of the person; and (ii) make a reasonable determination that the transactions
in penny stocks are suitable for that person and the person has sufficient knowledge and
experience in financial matters to be capable of evaluating the risks of transactions in
penny stocks. The broker or dealer must also deliver, prior to any transaction in a penny
stock, a disclosure schedule prescribed by the Security and Exchange Commission relating
to the penny stock market, which, in highlight form: (i) sets forth the basis on which the
broker or dealer made the suitability determination; and (ii) that the broker or dealer
received a signed, written agreement from the investor prior to the transaction.

Generally, brokers may be less willing to execute transactions in securities subject to
the "penny stock" rules. This may make it more difficult for investors to
dispose of our common stock and cause a decline in the market value of our stock.

Disclosure also has to be made about the risks of investing in penny stocks in both
public offerings and in secondary trading and about the commissions payable to both the
broker-dealer and the registered representative, current quotations for the securities and
the rights and remedies available to an investor in cases of fraud in penny stock
transactions. Finally, monthly statements have to be sent disclosing recent price
information for the penny stock held in the account and information on the limited market
in penny stocks.
Our controlling shareholder owns 50.5% of the Company's common stock and thus may
influence certain actions requiring stockholder vote without the requirement of any other
shareholder vote or consent.


If there is a shareholder meeting, as a consequence of the controlling
shareholders significant equity interest, the controlling shareholder has certain
discretion regarding proposals submitted to a vote by shareholders. As a result, the
controlling shareholder has the ability to control the outcome of matters submitted to our
stockholders for approval, including the election of directors and any merger,
consolidation, or sale of all or substantially all of our assets. In addition, the
controlling shareholder has the ability to control the appointment of management and
therefore the business affairs of the Company. Additionally, in the event that the
controlling shareholder controls the Company at the time of his death, control may be
transferred to a person or entity that he designates as his successor. As controlling
stockholder, Mr. Shenker is entitled to vote his shares in his own interests, which may
not always be in the interests of our stockholders generally.
There is only a limited trading market for our common stock and any market that may
develop may not be sustained.


From August 20, 2008 through April 26, 2010, our common stock was subject to quotation
on the FINRA BB under the symbol DYAP. As a result of our failure to remain
current in filing our quarterly report for the period ended March 31, 2010 and subsequent
delinquency in fulfilling our reporting requirements, our common stock became subject to
quotation on the OTC market. In April 2012, the Company began to become current with the
OTC Markets and since that time there has been a limited trading market for the common
stock. There can be no assurance that there will be an active trading market for the
common stock if and when the Company becomes a reporting company under the Exchange Act.
In the event that an active trading market commences, there can be no assurance as to the
market price of the shares of common stock, whether any trading market will provide
liquidity to investors, or whether any trading market will be sustained.
Because the Company has no revenues and has negative cash flow, no cash dividends have
been paid nor are any dividends likely to be paid in the foreseeable future, it ever .


We do not expect to pay dividends for the foreseeable future because we have no
revenues. The payment of dividends will be contingent upon our future revenues and
earnings, if any, capital requirements and overall financial condition. The payment of any
future dividends will be within the discretion of our board of directors. It is our
expectation that management will determine to retain any earnings for use in business
operations and accordingly, we do not anticipate declaring any dividends in the
foreseeable future.
ITEM 1B. UNRESOLVED STAFF
COMMENTS Back
to Table of Contentss The Company received a comment letter dated February 28, 2013 related
to its registration statement on Form 10-12g/A (file no. 000-54856) filed on February 13,
2013. The Company is in the process of preparing an amendment to it Form 10-12g/A in
response to the comments from the SEC.
ITEM 2. DESCRIPTION OF PROPERTY Back to Table of Contents The Companys corporate office is located at the offices of Terra Holdings, 14
Menachem Begin Street, Ramat Gan, Israel. Terra Holdings is a company owned and controlled
by Mr. Gonen, the Companys chairman, and provides this office space, consisting of
approximately 100 square feet, to the Company on a rent-free basis. The Company believes
that these facilities are sufficient for the near future.
ITEM 3. LEGAL PROCEEDING Back to Table of Contents None.
ITEM 4. MINE SAFETY DISCLOSURES Back to Table of
Contents Not Applicable.




PART II ITEM 5.
MARKET FOR REGISTRANT'S COMMON STOCK AND RELATED STOCKHOLDER MATTERBack to Table of Contents Market Information


From August 20, 2008 through April 26, 2010, our common stock was trading on the FINRA
BB under the symbol DYAP. In connection with not filing its quarterly report
for the period ended March 31, 2010 and subsequent delinquency in our reporting
requirements under the Exchange Act, our common stock became subject to quotation on the
OTC market but there was no active trading market in the common stock on the OTC market.
In April 2012, the Company commenced filings in order to become current with the OTC
Markets and has continued to make filings with the OTC Markets to date. Since April 2012,
there has been a limited trading market for the Company's common stock. There can be no
assurance that there will be an active trading market for the common stock if and when the
Company becomes a reporting company under the Exchange Act. In the event that an active
trading market commences, there can be no assurance as to the market price of the shares
of common stock, whether any trading market will provide liquidity to investors, or
whether any trading market will be sustained.

For the periods indicated, the following table sets forth the high and low bid prices
per share of common stock. The below prices represent inter-dealer quotations without
retail markup, markdown, or commission and may not necessarily represent actual
transactions. The information below has been adjusted for a one-for-one hundred (1:100)
reverse split effective October 26, 2012. Fiscal 2012
    
    Fiscal 2011
    
    Fiscal 2010High
    
    Low
    
    High
    
    Low
    
    High
    
    LowFirst
    Quarter ended March 31
    
    $
    0.35
    
    $
    0.13
    
    $
    0.22
    
    $
    0.17
    
    $
    1.10
    
    $
    0.75Second Quarter ended June 30
    
    $
    0.35
    
    $
    0.13
    
    $
    0.29
    
    $
    0.15
    
    $
    0.50
    
    $
    0.30Third Quarter ended September 30
    
    $
    0.24
    
    $
    0.13
    
    $
    0.79
    
    $
    0.58
    
    $
    0.30
    
    $
    0.18Fourth Quarter ended December 31
    
    $
    0.21
    
    $
    0.08
    
    $
    0.50
    
    $
    0.20
    
    $
    0.45
    
    $
    0.17 As of December 31, 2012, our shares of common stock were held by approximately 67
stockholders of record. The transfer agent of our common stock is Nevada Agency and
Transfer Company, 50 W. Liberty Street, Suite 880, Reno, NV 89501; Phone: (775) 322-0626.
Nevada Agency and Transfer Company is registered under the Exchange Act.
Dividends


Holders of common stock are entitled to dividends when, as, and if declared by the
Board of Directors, out of funds legally available therefore. We have never declared cash
dividends on its common stock and our Board of Directors does not anticipate paying cash
dividends in the foreseeable future as it intends to retain future earnings to finance the
growth of our businesses. There are no restrictions in our articles of incorporation or
bylaws that restrict us from declaring dividends.
Securities Authorized for Issuance Under Equity Compensation Plans


No equity compensation plan or agreements under which our common stock
is authorized for issuance has been adopted during the fiscal year ended December 31,
2012. **Sale of Unregistered
Securities**

Date
    Title
    Shares Issued
    Persons
    Consideration Per Share8/24/2011
    Common Stock
    1,100,000
    Shenker, Jacky
    $0.00317 per share in cash pursuant to Section 4(2)9/29/2011
    Common Stock
    40,000
    Gonen, Eli - related party - Chairman
    $0.00317 per share in cash pursuant to Section 4(2)9/29/2011
    Common Stock
    40,000
    Goore, Ori - related party - CEO,
    Director
    $0.00317 per share in cash pursuant to Section 4(2)9/29/2011
    Common Stock
    900,000
    Uziel, Amir
    $0.00317 per share in cash pursuant to Section 4(2)9/29/2011
    Common Stock
    900,000
    Mediouni, Guil
    $0.00317 per share in cash pursuant to Section 4(2)9/29/2011
    Common Stock
    900,000
    Katz, Ruth
    $0.00317 per share in cash pursuant to Section 4(2)9/29/2011
    Common Stock
    900,000
    Krasney, Lavi
    $0.00317 per share in cash pursuant to Section 4(2)9/29/2011
    Common Stock
    900,000
    Krasney, Elimelech
    $0.00317 per share in cash pursuant to Section 4(2)9/29/2011
    Common Stock
    3,900,000
    Shenker, Jacky
    $0.00317 per share in cash pursuant to Section 4(2)12/23/2011
    Common Stock
    3,000,000
    Shenker, Jacky
    $0.00317 per share in cash pursuant to Section 4(2)12/23/2011
    Common Stock
    400,000
    Uziel, Amir
    $0.00317 per share in cash pursuant to Section 4(2)12/23/2011
    Common Stock
    400,000
    Mediouni, Guil
    $0.00317 per share in cash pursuant to Section 4(2)12/23/2011
    Common Stock
    400,000
    Katz, Ruth
    $0.00317 per share in cash pursuant to Section 4(2)12/23/2011
    Common Stock
    400,000
    Krasney, Lavi
    $0.00317 per share in cash pursuant to Section 4(2)12/23/2011
    Common Stock
    400,000
    Krasney, Elimelech
    $0.00317 per share in cash pursuant to Section 4(2)1/10/2012
    Common Stock
    180,000
    Fruchter, Lazar
    $0.00317 per share in cash pursuant to Section 4(2)1/10/2012
    Common Stock
    120,000
    Ehud Barzilay Holding &
    $0.00317 per share in cash pursuant to Section 4(2)1/10/2012
    Common Stock
    40,000
    Goore, Ori - related party - CEO,
    Director
    $0.00317 per share in cash pursuant to Section 4(2)1/10/2012
    Common Stock
    40,000
    Gonen, Eli - related party - Chairman
    $0.00317 per share in cash pursuant to Section 4(2) In various private placement transactions from August 2011 through December 2012, the
Company issued a total of 14,960,000 restricted shares in Regulation S offerings for an
aggregate purchase price of $47,387 to approximately 12 investors. The sales of these
securities were exempt under either Section 4(2) of the Securities Act of 1933, as amended
(the "Act") and the rules and regulations promulgated by the SEC thereunder,
including Regulation S. The investors represented to the Company that they have sufficient
knowledge and experience in financial and business matters to evaluate the risks and
merits of the investment (the "sophisticated investor"), or be able to bear the
investment's economic risk, have access to the type of information normally provided in a
prospectus; and agreed not to resell or distribute the securities to the public other than
in compliance with the Act. In addition, the Company did not use any form of public
solicitation or general advertising in connection with the offerings.

On September 13, 2011, the Company issued a $40,000 promissory note in connection with
a loan from an unaffiliated third party. On December 22, 2011, the promissory note was
converted to a convertible promissory note that bears interest at 15% per annum and is due
on December 31, 2013. The note has conversion rights that allow the noteholder, at the
lender's sole discretion, to convert the principal balance into the Companys common
stock at any time after June 30, 2013 at $0.01 at the lender's sole discretion. **ITEM 6. SELECTED FINANCIAL DATA**Back to Table of
Contents None. ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS
OF OPERATIONBack
to Table of Contents The following discussion contains forward-looking statements. Forward-looking
statements give our current expectations or forecasts of future events. You can identify
these statements by the fact that they do not relate strictly to historical or current
facts. They use of words such as "anticipate", "estimate",
"expect", "project", "intend", "plan",
"believe", and other words and terms of similar meaning in connection with any
discussion of future operating or financial performance. From time to time, we also may
provide forward-looking statements in other materials we release to the public.
Plan of Operation


We are a development stage company that acquired the technology and received a patent
for an electromagnetic percussion system, our Patented Device in 2008. From 2008 until
2011, we devote minimal resources and efforts to development of our Patented Device.
During the later part of 2011 and into 2012, we renewed our interest in pursuing
development of our Patented Device. Subsequent to our year-ended December 31, 2012, we
entered into an agreement with GUMI Tel Aviv Ltd, a major, privately-held Israeli
technology company engaged in the manufacture and sale of industrial equipment, to develop
the Prototype and thereafter manufacture and distribute models of our Patented Device. We
will continue to be dependent upon the ability of GUMI to successfully complete a
fully-operational Prototype of our Patented Device and to manufacture and market
commercial models. Our auditors have issued an opinion on our financial statements which
includes a statement describing concern about our ability to continue as a going concern.
This means that there is substantial doubt that we can continue as an on-going business
for the next twelve months unless we obtain additional capital to pay our bills and meet
our other financial obligations. This is because we have not generated any revenues and no
revenues are anticipated until GUMI is successful in generating sufficient sales revenues
to recoup its costs and thereafter generate additional revenues that profits we will share
with GUMI on a 65%/35% basis. Accordingly, we must raise capital from sources other than
the actual sale of the product until such time, if ever, that GUMI is successful with our
Patented Device. In 2008, the Company completed a capital formation activity in accordance
with a Registration Statement on Form S-1 submitted to the SEC to register and sell in a
self-directed offering 2,000,000 shares of newly issued common stock at an offering price
of $0.04 per share for proceeds of $80,000. The Company had incurred $20,000 of deferred
offering costs related to this capital formation activity. In December 2008, the Company
was successful in raising an additional $200,000 in equity capital. These funds were not
sufficient, given the relatively high costs of executive compensation and consulting
expenses, to permit the Company to devote sufficient resources to development of its
Patented Device.

Our plan also contemplates that as we begin to generate revenues from our Patented
Device, together with our belief in our ability to raise either debt or equity funding
from both affiliated persons and from third parties, neither of which can there be any
assurance, we will seek to enhance our revenue stream by entering into joint ventures or
other business arrangements with third parties engaged in technology development. While
there can be no assurance that we will be successful in such efforts, we believe that in
Israel alone there are many opportunities that have and will continue to be presented to
us as well as to our shareholders.
Results of Operations during the year ended December 31, 2012 as compared to the year
ended December 31, 2011


We have not generated any revenues since inception. We have operating
expenses related to general and administrative expenses being a public company and
interest expenses. During 2012, we incurred a net loss of $87,413 due to  expenses
consisting of general and administrative expenses of $41,350, interest expenses of $7,648
and amortization of debt discount of $38,415 during the year ended December 31, 2012
compared to a net loss of $78,496 due to general and administrative expenses of $64,633,
interest expenses of $1,808 and amortization of debt discount of $12,055 during the year
ended December 31, 2011.
Liquidity and Capital Resources


On December 31, 2012, we had total assets of $8,101, all of which was
in cash as compared to total assets of $7,927 as of December 31, 2011, all of which was in
cash. We had total current liabilities of $88,364 consisting of $9,458 in accrued expenses
$28,436 in advances payable to related parties and $50,470 which is the current portion of
long term debt, compared to current liabilities of $30,525, comprised of $280 in account
payable-trade, $1,809 accrued interest, $28,436 in advances payable to related parties, on
December 31, 2011. Our accumulated deficits as of December 31, 2012 and 2011 were $504,895
and $417,482, respectively.

We used $41,629 in our operating activities during the year 2012, which
was mainly due to a net loss of $87,413 offset by increases in amortization of debt
discount of $38,415 and accounts payable and accrued liabilities of $7,369. We used
$67,457 in our operating activities during the year 2011, which was due to a net loss of
$78,496 offset by an increase in amortization of debt discount of $12,055 less a decrease
in accounts payable and accrued liabilities of $1,016.

We financed our negative cash flow from operations in 2012 through
proceeds from issuance of common stock in the amount of $12,003 and proceeds of debt
borrowings of $29,800, representing total cash generated by financing activities of
$41,803. We financed our negative cash flow from operations in 2011 through proceeds of
issuance of common stock of $35,380 and proceeds of debt borrowing of $40,000 representing
total cash generated by financing activities of $75,380.

We do not have, at present, sufficient capital resources to fully
implement our business plan. While we believe that we should be able to generate positive
cash flow from operations during the 3rd or 4th quarters of 2013, there can be no
assurance that this will prove to be correct or that revenues, if any, will be sufficient
to fund our ongoing operating expenses. Accordingly, we plan to raise these funds through
a private offering of our equity securities or through issuance of convertible debt
instruments. There can be no assurance that additional capital will be available to us. We
currently have no agreements, arrangements or understandings with any person to obtain
funds through bank loans, lines of credit or any other sources.

Our auditors have issued an opinion on our financial statements which
includes a statement describing our going concern status. This means that there is
substantial doubt that we can continue as an on-going business for the next twelve months
unless we obtain additional capital to pay our bills and meet our other financial
obligations. This is because we have not generated any revenues and no revenues are
anticipated until we begin marketing the product. Accordingly, we must raise capital from
sources other than the actual sale of the product. We must raise capital to implement our
project and stay in business. Even if we raise the maximum amount of money in this
offering, we do not know how long the money will last, however, we do believe it will last
at least twelve months.

There are no limitations in our articles of incorporation on our
ability to borrow funds or raise funds through the issuance of restricted common stock.
Our limited resources and lack of operating history may make it difficult to do borrow
funds or raise capital. Our inability to borrow funds or raise funds through the issuance
of restricted common stock required to facilitate our business plan may have a material
adverse effect on our financial condition and future prospects. To the extent that debt
financing ultimately proves to be available, any borrowing will subject us to various
risks traditionally associated with indebtedness, including the risks of interest rate
fluctuations and insufficiency of cash flow to pay principal and interest.
Off-Balance Sheet Arrangements


As of December 31, 2012, we did not have any off-balance sheet arrangements as defined
in Item 303(a)(4)(ii) of Regulation S-K promulgated under the Securities Act of 1934.
Contractual Obligations and Commitments


As of December 31, 2012, we did not have any contractual obligations.
Critical Accounting Policies
Development Stage Enterprise and Going Concern: The Company has been in the
development stage since inception. The accompanying financial statements have been
prepared in conformity with accounting principles generally accepted in the United States
of America, which contemplate continuation of the Company as a going concern. The Company
has not established any source of revenue to cover its operating costs, and as such, has
incurred an operating loss since inception. Further, as of December 31, 2012, the cash
resources of the Company were insufficient to meet its current business plan. These and
other factors raise substantial doubt about the Company's ability to continue as a going
concern. The accompanying financial statements do not include any adjustments to reflect
the possible future effects on the recoverability and classification of asset or the
amounts and classification of liabilities that may result from the possible inability of
the Company to continue as a going concern.
Use of Estimates: The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates and
assumptions that affect reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statement and the reported
amounts of revenues and expenses during the reporting period. Actual results could differ
from the estimates.
Cash and Cash Equivalents: For financial statement presentation purposes, the
Company considers those short-term, highly liquid investments with original maturities of
three months or less to be cash or cash equivalents. There were no cash equivalents as of
December 31, 2012 or 2011.
Property and Equipment: New property and equipment are recorded at cost.
Property and equipment included in the bankruptcy proceedings and transferred to the
Trustee had been valued at liquidation value. Depreciation is computed using the
straight-line method over the estimated useful lives of the assets, generally 5 years.
Expenditures for renewals and betterments are capitalized. Expenditures for minor items,
repairs and maintenance are charged to operations as incurred. Gain or loss upon sale or
retirement due to obsolescence is reflected in the operating results in the period the
event takes place.
Valuation of Long-Lived Assets: We review the recoverability of our long-lived
assets including equipment, goodwill and other intangible assets, when events or changes
in circumstances occur that indicate that the carrying value of the asset may not be
recoverable. The assessment of possible impairment is based on our ability to recover the
carrying value of the asset from the expected future pre-tax cash flows (undiscounted and
without interest charges) of the related operations. If these cash flows are less than the
carrying value of such asset, an impairment loss is recognized for the difference between
estimated fair value and carrying value. Our primary measure of fair value is based on
discounted cash flows. The measurement of impairment requires management to make estimates
of these cash flows related to long-lived assets, as well as other fair value
determinations.
Stock Based Compensation: Stock-based awards are accounted for using the fair
value method in accordance with ASC 718, Share-Based Payments. Our primary type of
share-based compensation consists of stock options. We use the Black-Scholes option
pricing model in valuing options. The inputs for the valuation analysis of the options
include the market value of the Companys common stock, the estimated volatility of
the Companys common stock, the exercise price of the warrants and the risk free
interest rate.
Accounting For Obligations And Instruments Potentially To Be Settled In The
Companys Own Stock: We account for obligations and instruments potentially
to be settled in the Companys stock in accordance with FASB ASC 815, Accounting
for Derivative Financial Instruments.This issue addresses the initial balance sheet
classification and measurement of contracts that are indexed to, and potentially settled
in, the Companys own stock.
Fair Value of Financial Instruments: As defined in ASC 820-10, Fair Value
Measurements and Disclosures (ASC 820-10), fair value is based on the price
that would be received to sell an asset or pay to transfer a liability in an orderly
transaction between market participants at the measurement date. In order to increase
consistency and comparability in fair value measurements, ASC 820-10 establishes a fair
value hierarchy that prioritizes observable and unobservable inputs used to measure fair
value into three broad levels, which are described below:

Level 1: Quoted prices (unadjusted) in active markets that are accessible at the
measurement date for assets or liabilities. The fair value hierarchy gives the highest
priority to Level 1 inputs.

Level 2: Other inputs that are observable, directly or indirectly, such as quoted
prices for similar assets and liabilities or market corroborated inputs.

Level 3: Unobservable inputs are used when little or no market data is available, which
requires the Company to develop its own assumptions about how market participants would
value the assets or liabilities. The fair value hierarchy gives the lowest priority to
Level 3 inputs.

In determining fair value, the Company utilizes valuation techniques in its assessment
that maximize the use of observable inputs and minimize the use of unobservable inputs. **Fair Value Measurements at December 31, 2012**Quoted Prices
    in Active
    
    Significant
    Other
    
    SignificantMarkets for
    Identical Assets
    
    Observable
    Inputs
    
    Unobservable
    InputsTotal
    
    (Level 1)
    
    (Level 2)
    
    (Level 3)None
    $
    -
    $
    -
    $
    -
    $
    -Total
    assets at fair value
    $
    -
    $
    -
    $
    -
    $
    -

**Fair Value Measurements at December 31, 2011**Quoted Prices
    in Active
    
    Significant
    Other
    
    SignificantMarkets for
    Identical Assets
    
    Observable
    Inputs
    
    Unobservable
    InputsTotal
    
    (Level 1)
    
    (Level 2)
    
    (Level 3)None
    $
    -
    $
    -
    $
    -
    $
    -Total
    assets at fair value
    $
    -
    $
    -
    $
    -
    $
    -Earnings per Common Share: We compute net income (loss) per share in
accordance with ASC 260, Earning per Share. ASC 260 requires presentation of both
basic and diluted earnings per share (EPS) on the face of the income statement. Basic EPS
is computed by dividing net income (loss) available to common shareholders (numerator) by
the weighted average number of shares outstanding (denominator) during the period. Diluted
EPS gives effect to all dilutive potential common shares outstanding during the period
using the treasury stock method and convertible preferred stock using the if-converted
method. In computing Diluted EPS, the average stock price for the period is used in
determining the number of shares assumed to be purchased from the exercise of stock
options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is
anti dilutive.
Income Taxes: We have adopted ASC 740, Accounting for Income Taxes.Pursuant
to ASC 740, we are required to compute tax asset benefits for net operating losses carried
forward. The potential benefits of net operating losses have not been recognized in these
financial statements because the Company cannot be assured it is more likely than not it
will utilize the net operating losses carried forward in future years.

We must make certain estimates and judgments in determining income tax expense for
financial statement purposes. These estimates and judgments occur in the calculation of
certain tax assets and liabilities, which arise from differences in the timing of
recognition of revenue and expense for tax and financial statement purposes.

Deferred tax assets and liabilities are determined based on the differences between
financial reporting and the tax basis of assets and liabilities using the tax rates and
laws in effect when the differences are expected to reverse. ASC 740 provides for the
recognition of deferred tax assets if realization of such assets is more likely than not
to occur. Realization of our net deferred tax assets is dependent upon our generating
sufficient taxable income in future years in appropriate tax jurisdictions to realize
benefit from the reversal of temporary differences and from net operating loss, or NOL,
carryforwards. We have determined it more likely than not that these timing differences
will not materialize and have provided a valuation allowance against substantially all of
our net deferred tax asset. Management will continue to evaluate the realizability of the
deferred tax asset and its related valuation allowance. If our assessment of the deferred
tax assets or the corresponding valuation allowance were to change, we would record the
related adjustment to income during the period in which we make the determination. Our tax
rate may also vary based on our results and the mix of income or loss in domestic and
foreign tax jurisdictions in which we operate.

In addition, the calculation of our tax liabilities involves dealing with uncertainties
in the application of complex tax regulations. We recognize liabilities for anticipated
tax audit issues in the U.S. and other tax jurisdictions based on our estimate of whether,
and to the extent to which, additional taxes will be due. If we ultimately determine that
payment of these amounts is unnecessary, we will reverse the liability and recognize a tax
benefit during the period in which we determine that the liability is no longer necessary.
We will record an additional charge in our provision for taxes in the period in which we
determine that the recorded tax liability is less than we expect the ultimate assessment
to be.

ASC 740 which requires recognition of estimated income taxes payable or refundable on
income tax returns for the current year and for the estimated future tax effect
attributable to temporary differences and carry-forwards. Measurement of deferred income
tax is based on enacted tax laws including tax rates, with the measurement of deferred
income tax assets being reduced by available tax benefits not expected to be realized.
Uncertain Tax Positions


The Financial Accounting Standards Board issued Interpretation No. 48, Accounting
for Uncertainty in Income Taxes  an interpretation of FASB Statement No. 109,
Accounting for Income Taxes (FIN No. 48) which was effective for the
Company on January 1, 2007.  FIN No. 48 addresses the determination of whether
tax benefits claimed or expected to be claimed on a tax return should be recorded in the
financial statements.  Under FIN No. 48, the Company may recognize the tax
benefit from an uncertain tax position only if it is more likely than not that the tax
position will be sustained on examination by the taxing authorities based on the technical
merits of the position.  The tax benefits recognized in the financial statements
from such position should be measured based on the largest benefit that has a greater than
fifty percent likelihood of being realized upon ultimate settlement.  FIN No. 48
also provides guidance on derecognition, classification, interest and penalties,
accounting in interim periods and disclosure requirements.

Our federal and state income tax returns are open for fiscal years ending on or after
December 31, 2007. We are not under examination by any jurisdiction for any tax year. At
December 31, 2012 we had no material unrecognized tax benefits and no adjustments to
liabilities or operations were required under FIN 48. **ITEM 7A.
QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK** Back to Table of Contents We have not entered
into, and do not expect to enter into, financial instruments for trading or hedging
purposes.




ITEM
8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATABack to Table of Contents Report
    of Independent Registered Public Accounting Firm
    17Report
    of Independent Registered Public Accounting Firm
    18Financial Statements:Balance Sheets as of
    December 31, 2012 and December 31, 2011
    19Statements of
    Operations for the Years Ended December 31, 2012 and 2011, and From Inception (March
    7,2008) to December 31, 2012
    20Statements
    of Changes in Stockholders' Equity for the Years Ended December 31, 2012 and 2011, and
    From Inception (March 7,2008) to December 31, 2012
    21Statements of Cash
    Flows for the the Years Ended December 31, 2012 and 2011, and From Inception (March
    7,2008) to December 31, 2012
    22Notes to Financial
    Statements
    23




REPORT OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRMBack to
Table of Contents To the Board of Directors
Dynamic Applications Corp.

Ramat Gan, Israel

We have audited the accompanying balance sheet of Dynamic Applications Corp. (A
Development Stage Company) as of December 31, 2012 and the related statements of
operations, stockholders deficit and cash flows for the year then ended and for the
period from inception (March 7, 2008) until December 31, 2012. These financial statements
are the responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audit. The financial statements of
Dynamic Applications Corp. as of December 31, 2011, were audited by other auditors whose
report dated November 16, 2012 expressed an unqualified opinion on those statements.

We conducted our audit in accordance with standards of the Public Company Accounting
Oversight Board (United States). Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements are free of
material misstatement. The Company is not required to have, nor were we engaged to
perform, an audit of its internal control over financial reporting. Our audit included
consideration of internal control over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Company's internal control over
financial reporting. Accordingly, we express no such opinion. An audit includes examining,
on a test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis for our
opinion.

In our opinion, the financial statements referred to above present fairly, in all
material respects, the financial position of Dynamic Applications Corp. as of December 31,
2012 and the results of its operations and cash flows for the period described above in
conformity with accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming that the Company will
continue as a going concern. As discussed in Note 6 to the financial statements, the
Company suffered a net loss from operations and has a net capital deficiency, which raises
substantial doubt about its ability to continue as a going concern. Managements
plans regarding those matters are also described in Note 6. The financial statements do
not include any adjustments that might result from the outcome of this uncertainty.

/s/ M&K CPAS, PLLC

www.mkacpas.com

Houston, Texas
April 15, 2013




REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM Back to Table of Contents Michael F. Cronin
Certified Public AccountantOrlando, FL 32708


Board of Directors and Shareholders
Dynamic Applications Corp.

Ramat Gan, Israel

I have audited the accompanying balance sheets of Dynamic Applications Corp. (a
development stage company) as of December 31, 2011 and 2010 and the related statements of
operations, stockholders' deficiency and cash flows from inception (March 7, 2008) and for
the years then ended. The financial statements are the responsibility of management. My
responsibility is to express an opinion on these financial statements based on my audits.

I conducted my audits in accordance with the standards of the Public Company Accounting
Oversight Board (United States). Those standards require that I plan and
perform the audits to obtain reasonable assurance about whether the financial statements
are free of material misstatement. The company is not required to have, nor was I engaged
to perform, an audit of its internal control over financial reporting. My audit included
consideration of internal control over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Company's internal control over
financial reporting. Accordingly, I express no such opinion. An audit includes examining,
on a test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall financial
statement presentation. I believe that my audits provide a reasonable basis for my
opinion.
In my opinion, the financial statements referred to above present fairly, in all material
respects, the financial position of Dynamic Applications Corp. (a development stage
company) as of December 31, 2011 and 2012 and the results of its operations, its cash
flows and changes in stockholders' deficiency from inception (March 7, 2008) and for the
years then ended in conformity with accounting principles generally accepted in the United
States.

The accompanying financial statements have been prepared assuming that the Company will
continue as a going concern. The Company has incurred a $78,000 loss from operations.
 The Company may not have adequate readily available resources to fund operations
through 2012. This raises substantial doubt about the Companys ability to continue
as a going concern. The financial statements do not include any adjustments that might
result from the outcome of this uncertainty.

November 16, 2012 /s/ Michael F. CroninMichael F. CroninCertified Public Accountant, NY, FL




Dynamic Applications Corp.(A
    Development Stage Company)**Balance Sheets**Back to Table of ContentsDecember 31, 2012
    
    December 31,
    2011ASSETSCurrent assets:Cash
    $
    8,101
    $
    7,927Total current assets
    
    8,101
    
    7,927**Total Assets**
    $
    8,101
    $
    7,927LIABILITIES
    AND STOCKHOLDERS' DEFICITCurrent liabilities:Accounts payable -
    trade
    $
    -
    $
    280Accrued interest
    
    9,458
    
    1,809Advances payable to
    related parties
    
    28,436
    
    28,436Current portion of
    convertible notes payable net of discount
    
    50,470
    
    -Total current liabilities
    
    88,364
    
    30,525Long-term debtConvertible notes payable, net
    of discount
    
    -
    
    12,055Stockholders' deficit:Preferred stock,
    $0.00001 par value; 20,000,000 shares authorized; no shares issued and outstanding
    
    -
    
    -Common stock,
    $0.00001 par value; 500,000,000 shares authorized; and15,829,450 and 15,449,450 issued and outstanding at December 31, 2012 and 2011,
    respectively
    
    158
    
    154Additional paid in
    capital
    
    424,474
    
    393,476Common stock
    subscriptions receivable
    
    -
    
    (10,801)Deficit accumulated
    during development stage
    
    (504,895)
    
    (417,482)Total
    stockholders' deficit
    
    (80,263)
    
    (34,653)**Total Liabilities and Stockholders' Deficit**
    $
    8,101
    $
    7,927The
    accompanying notes to the financial statements are integral part of these financial
    statements.




Dynamic
    Applications Corp.(A
    Development Stage Company)Statements of OperationsFor
    the Years Ended December 31, 2012 and 2011 and From Inception (March 7, 2008) to December
    31, 2012Back to Table of ContentsFor the period
    fromFor the year
    
    For the year
    
    Inceptionended
    
    ended
    
    (March 7, 2008)December 31, 2012
    
    December 31, 2011
    
    to December 31, 2012**Revenues**
    $
    -
    $
    -
    $
    -ExpensesGeneral and
    administrative
    
    41,350
    
    64,633
    
    394,955Research and
    development
    
    -
    
    -
    
    45,000Loss from operations
    
    (41,350)
    
    (64,633)
    
    (439,955)******Other income
    (expense):**Loss on
    foreign currency transactions
    
    -
    
    -
    
    (5,014)Interest
    expense
    
    (7,648)
    
    (1,808)
    
    (9,456)Amortization
    of debt discount
    
    (38,415)
    
    (12,055)
    
    (50,470)Total costs and expenses
    
    (46,063)
    
    (13,863)
    
    (64,940)Net loss before income
    taxes
    
    (87,413)
    
    (78,496)
    
    (504,895)Income tax
    
    -
    
    -
    
    -**Net loss**
    $
    (87,413)
    $
    (78,496)
    $
    (504,895)**Basic and diluted
    per share amounts:**Basic and diluted net
    loss
    $
    (0.01)
    $
    (0.02)**Weighted average
    shares outstanding (basic and diluted)**
    
    15,827,756
    
    5,143,587The
    accompanying notes to the financial statements are integral part of these financial
    statements.




Dynamic Applications Corp.(A Development Stage Company)**Statement
    of Changes in Stockholders' Equity (Deficit)**For the Years Ended December 31, 2012 and 2011 and From Inception (March 7,
    2008) to December 31, 2012Back to Table of Contents**Additional**
    
    
    
    **Deficit**
    
    **Total****Common**
    
    **Paid-in**
    
    **Subscription**
    
    **Accumulated During**
    
    **Stockholders'****Shares**
    
    **Amount**
    
    **Capital**
    
    **Receivable**
    
    **Development
    Stage**
    
    **Equity
    (Deficit)**Inception
    (March 7, 2008)
    -
    $
    -
    $
    -
    $
    -
    $
    -
    $
    -Stock issued for cash
    750,000
    
    8
    
    240,292
    
    -
    
    -
    
    240,300Net loss
    -
    
    -
    
    -
    
    -
    
    (89,785)
    
    (89,785)Balance
    at December 31, 2008
    750,000
    $
    8
    $
    240,292
    $
    -
    $
    (89,785)
    $
    (150,515)Stock issued for cash
    114,450
    
    1
    
    52,149
    
    -
    
    -
    
    52,150Stock issued for services
    5,000
    
    -
    
    15,000
    
    -
    
    -
    
    15,000Net loss
    -
    
    -
    
    -
    
    -
    
    (246,097)
    
    (246,097)Balance
    at December 31, 2009
    869,450
    $
    9
    $
    307,441
    
    -
    $
    (335,882)
    $
    (28,432)Net loss
    -
    
    -
    
    -
    
    -
    
    (3,100)
    
    (3,100)Balance
    at December 31, 2010
    869,450
    $
    9
    $
    307,441
    $
    -
    $
    (338,985)
    $
    (31,535)Stock issued for cash
    14,580,000
    
    146
    
    46,035
    
    (10,801)
    
    -
    
    35,380Impact of beneficial conversion feature
    -
    
    -
    
    40,000
    
    -
    
    -
    
    40,000Net loss
    -
    
    -
    
    -
    
    -
    
    (78,497)
    
    (78,497)Balance at
    December 31, 2011
    15,449,450
    $
    154
    $
    393,476
    
    (10,801)
    $
    (417,482)
    $
    (34,653)Stock issued for cash
    380,000
    
    4
    
    1,198
    
    10,801
    
    -
    
    12,003Impact of beneficial conversion feature
    -
    
    -
    
    29,800
    
    -
    
    -
    
    29,800Net loss
    -
    
    -
    
    -
    
    -
    
    (87,413)
    
    (87,413)Balance
    at December 31, 2012
    15,829,450
    $
    158
    $
    424,474
    $
    -
    $
    (504,895)
    $
    (80,263)The accompanying notes to the financial statements are integral part of these
    financial statements.




Dynamic Applications Corp.(A Development Stage Company)Statements of Cash FlowsFor the Years Ended December 31, 2012 and 2011 and From Inception (March 7,
    2008) to December 31, 2012Back to Table
    of ContentsFor the period
    fromFor the year
    ended
    
    For the year
    ended
    
    Inception (March
    7, 2008)December 31, 2012
    
    December 31, 2011
    
    to December 31, 2012Cash
    flows from operating activities:Net loss
    $
    (87,413)
    $
    (78,496)
    $
    (504,895)Adjustments to reconcile
    net loss to net cash used in operating activities:Amortization
    of debt discount
    
    38,415
    
    12,055
    
    50,470Common stock
    issued for services
    
    -
    
    -
    
    15,000Changes in net assets and
    liabilities:(Increase)
    decrease in current assets
    
    -
    
    -
    
    -Increase
    (decrease) in accounts payable and accrued expenses
    
    7,369
    
    (1,016)
    
    9,457Cash used in operating
    activities
    
    (41,629)
    
    (67,457)
    
    (429,968)Cash flow from
    financing activities:Proceeds
    from issuance of common stock
    
    12,003
    
    35,380
    
    339,833Proceeds of
    debt borrowings
    
    29,800
    
    40,000
    
    69,800Related
    party advances
    
    -
    
    -
    
    28,436Cash provided by
    financing activities
    
    41,803
    
    75,380
    
    438,069Change in cash
    
    174
    
    7,923
    
    8,101Cash - beginning of
    period
    
    7,927
    
    4
    
    -Cash - end of period
    $
    8,101
    $
    7,927
    $
    8,101Supplement cash flow
    information:Non-cashn transactions:Debt discount
    $
    29,800
    $
    40,000
    $
    69,800The
    accompanying notes to the financial statements are integral part of these financial
    statements.




Dynamic Applications
Corp.Notes to
Financial StatementsDecember 31, 2012Back
to Table of Contents The Company Organizational Background: Dynamic Applications Corp. (Dynamic
Applications or the Company) is a Delaware corporation in the
development stage and has not commenced operations. The Company was incorporated under the
laws of the State of Delaware on March 7, 2008. The business plan of the Company is to
develop a commercial application of the design in a patent of a Electromagnetic
percussion device which is a device intended to provide an electromagnetic
percussion hammer. The Company also intends to enhance the existing prototype, obtain
approval of its patent application, and manufacture and market the product and/or seek
third party entities interested in licensing the rights to manufacture and market the
device. The accompanying financial statements of Dynamic Applications were prepared from
the accounts of the Company under the accrual basis of accounting.
Basis of Presentation: The accompanying financial statements have been prepared
in conformity with accounting principles generally accepted in the United States of
America, which contemplate continuation of the Company as a going concern. The Company has
not established any source of revenue to cover its operating costs, and as such, has
incurred an operating loss since inception. Further, as of December 31, 2012, the cash
resources of the Company were insufficient to meet its current business plan, and the
Company had negative working capital. These and other factors raise substantial doubt
about the Companys ability to continue as a going concern. The accompanying
financial statements do not include any adjustments to reflect the possible future effects
on the recoverability and classification of assets or the amounts and classification of
liabilities that may result from the possible inability of the Company to continue as a
going concern.
Significant Accounting Policies
Use of Estimates: The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates and
assumptions that affect reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statement and the reported
amounts of revenues and expenses during the reporting period. Actual results could differ
from the estimates.
Cash and Cash Equivalents: For financial statement presentation purposes, the
Company considers those short-term, highly liquid investments with original maturities of
three months or less to be cash or cash equivalents. There were no cash or cash
equivalents as of December 31, 2012 or 2011.
Property and Equipment New property and equipment are recorded at cost.
Property and equipment included in the bankruptcy proceedings and transferred to the
Trustee had been valued at liquidation value. Depreciation is computed using the
straight-line method over the estimated useful lives of the assets, generally 5 years.

Expenditures for renewals and betterments are capitalized. Expenditures for minor
items, repairs and maintenance are charged to operations as incurred. Gain or loss upon
sale or retirement due to obsolescence is reflected in the operating results in the period
the event takes place.
Development Stage Enterprise The Company has been in the development stage
since inception.
Valuation of Long-Lived Assets: We review the recoverability of our long-lived
assets including equipment, goodwill and other intangible assets, when events or changes
in circumstances occur that indicate that the carrying value of the asset may not be
recoverable. The assessment of possible impairment is based on our ability to recover the
carrying value of the asset from the expected future pre-tax cash flows (undiscounted and
without interest charges) of the related operations. If these cash flows are less than the
carrying value of such asset, an impairment loss is recognized for the difference between
estimated fair value and carrying value. Our primary measure of fair value is based on
discounted cash flows. The measurement of impairment requires management to make estimates
of these cash flows related to long-lived assets, as well as other fair value
determinations.
Stock Based Compensation: Stock-based awards are accounted for using the fair
value method in accordance with ASC 718, Share-Based Payments. Our primary type of
share-based compensation consists of stock options. We use the Black-Scholes option
pricing model in valuing options. The inputs for the valuation analysis of the options
include the market value of the Companys common stock, the estimated volatility of
the Companys common stock, the exercise price of the warrants and the risk free
interest rate.
Accounting For Obligations And Instruments Potentially To Be Settled In The
Companys Own Stock: We account for obligations and instruments potentially
to be settled in the Companys stock in accordance with FASB ASC 815, Accounting for
Derivative Financial Instruments. This issue addresses the initial balance sheet
classification and measurement of contracts that are indexed to, and potentially settled
in, the Companys own stock.
Fair Value of Financial Instruments: FASB ASC 825, Financial
Instruments, requires entities to disclose the fair value of financial instruments,
both assets and liabilities recognized and not recognized on the balance sheet, for which
it is practicable to estimate fair value. FASB ASC 825 defines fair value of a financial
instrument as the amount at which the instrument could be exchanged in a current
transaction between willing parties. At December 31, 2012 and 2011, the carrying
value of certain financial instruments (cash and cash equivalents, accounts payable and
accrued expenses.) approximates fair value due to the short-term nature of the instruments
or interest rates, which are comparable with current rates.
Fair value measurements: The Company measures fair value under a framework that
utilizes a fair value hierarchy that prioritizes the inputs to valuation techniques used
to measure fair value. The hierarchy gives the highest priority to unadjusted quoted
prices in active markets for identical assets or liabilities (level 1 measurements) and
the lowest priority to unobservable inputs (level 3 measurements). The three levels of
inputs which prioritize the inputs used in measuring fair value are:

Level 1: Inputs to the valuation methodology are unadjusted quoted prices for identical
assets or liabilities in active markets that the Company has the ability to access.

Level 2: Inputs to the valuation methodology include: - Quoted prices for similar assets or liabilities in active markets;
- Quoted prices for identical or similar assets or liabilities in inactive markets;
- Inputs other than quoted prices that are observable for the asset or liability;
- Inputs that are derived principally from or corroborated by observable market data by
correlation or other means. If the asset or liability has a specified (contractual) term, the level 2 input must be
observable for substantially the full term of the asset or liability.

Level 3: Inputs to the valuation methodology are unobservable and significant to the
fair value measurement.

The assets or liabilitys fair value measurement level within the fair value
hierarchy is based on the lowest level of any input that is significant to the fair value
measurement. Valuation techniques used need to maximize the use of observable inputs and
minimize the use of unobservable inputs.

The following table presents assets that were measured and recognize at fair value on
December 31, 2012 and the year then ended on a recurring basis: **December 31,
    2012**Description of asset;
    
    (Level 1)
    
    (Level 2)
    
    (Level 3)
    
    Realized LossNone
    $
    -
    $
    -
    $
    -
    $
    -  **December 31, 2011**Description of asset;
    
    (Level 1)
    
    (Level 2)
    
    (Level 3)
    
    Realized LossNone
    $
    -
    $
    -
    $
    -
    $
    - When the Company changes its valuation inputs for measuring financial assets and
liabilities at fair value, either due to changes in current market conditions or other
factors, it may need to transfer those assets or liabilities to another level in the
hierarchy based on the new inputs used. The Company recognizes these transfers at the end
of the reporting period that the transfers occur. For the fiscal periods ended December
31, 2011 and 2011, there were no significant transfers of financial assets or financial
liabilities between the hierarchy levels.
Earnings per Common Share: We compute net income (loss) per share in accordance
with ASC 260, Earning per Share. ASC 260 requires presentation of both basic and diluted
earnings per share (EPS) on the face of the income statement. Basic EPS is computed by
dividing net income (loss) available to common shareholders (numerator) by the weighted
average number of shares outstanding (denominator) during the period. Diluted EPS gives
effect to all dilutive potential common shares outstanding during the period using the
treasury stock method and convertible preferred stock using the if-converted method. In
computing Diluted EPS, the average stock price for the period is used in determining the
number of shares assumed to be purchased from the exercise of stock options or warrants.
Diluted EPS excludes all dilutive potential shares if their effect is anti dilutive. All
per share disclosures retroactively reflect shares outstanding or issuable as though the
reverse split had occurred January 1, 2010.
Income Taxes: We have adopted ASC 740, Accounting for Income Taxes. Pursuant to
ASC 740, we are required to compute tax asset benefits for net operating losses carried
forward. The potential benefits of net operating losses have not been recognized in these
financial statements because the Company cannot be assured it is more likely than not it
will utilize the net operating losses carried forward in future years.

We must make certain estimates and judgments in determining income tax expense for
financial statement purposes. These estimates and judgments occur in the calculation of
certain tax assets and liabilities, which arise from differences in the timing of
recognition of revenue and expense for tax and financial statement purposes.

Deferred tax assets and liabilities are determined based on the differences between
financial reporting and the tax basis of assets and liabilities using the tax rates and
laws in effect when the differences are expected to reverse. ASC 740 provides for the
recognition of deferred tax assets if realization of such assets is more likely than not
to occur. Realization of our net deferred tax assets is dependent upon our generating
sufficient taxable income in future years in appropriate tax jurisdictions to realize
benefit from the reversal of temporary differences and from net operating loss, or NOL,
carryforwards. We have determined it more likely than not that these timing differences
will not materialize and have provided a valuation allowance against substantially all of
our net deferred tax asset.

Management will continue to evaluate the realizability of the deferred tax asset and
its related valuation allowance. If our assessment of the deferred tax assets or the
corresponding valuation allowance were to change, we would record the related adjustment
to income during the period in which we make the determination. Our tax rate may also vary
based on our results and the mix of income or loss in domestic and foreign tax
jurisdictions in which we operate.

In addition, the calculation of our tax liabilities involves dealing with uncertainties
in the application of complex tax regulations. We recognize liabilities for anticipated
tax audit issues in the U.S. and other tax jurisdictions based on our estimate of whether,
and to the extent to which, additional taxes will be due. If we ultimately determine that
payment of these amounts is unnecessary, we will reverse the liability and recognize a tax
benefit during the period in which we determine that the liability is no longer necessary.
We will record an additional charge in our provision for taxes in the period in which we
determine that the recorded tax liability is less than we expect the ultimate assessment
to be.

ASC 740 which requires recognition of estimated income taxes payable or refundable on
income tax returns for the current year and for the estimated future tax effect
attributable to temporary differences and carry-forwards. Measurement of deferred income
tax is based on enacted tax laws including tax rates, with the measurement of deferred
income tax assets being reduced by available tax benefits not expected to be realized.
Uncertain Tax Positions


The Financial Accounting Standards Board issued Interpretation No. 48, Accounting
for Uncertainty in Income Taxes  an interpretation of FASB Statement No. 109,
Accounting for Income Taxes (FIN No. 48) which was effective for the
Company on January 1, 2007.  FIN No. 48 addresses the determination of whether
tax benefits claimed or expected to be claimed on a tax return should be recorded in the
financial statements.  Under FIN No. 48, the Company may recognize the tax
benefit from an uncertain tax position only if it is more likely than not that the tax
position will be sustained on examination by the taxing authorities based on the technical
merits of the position.  The tax benefits recognized in the financial statements
from such position should be measured based on the largest benefit that has a greater than
fifty percent likelihood of being realized upon ultimate settlement.  FIN No. 48
also provides guidance on derecognition, classification, interest and penalties,
accounting in interim periods and disclosure requirements.

Our federal and state income tax returns are open for fiscal years ending on or after
December 31, 2007. We are not under examination by any jurisdiction for any tax year. At
December 31, 2012 we had no material unrecognized tax benefits and no adjustments to
liabilities or operations were required under FIN 48.
Recent Accounting Pronouncements


We qualify as an emerging growth company under the 2012 JOBS Act. Section
107 of the JOBS Act provides that an emerging growth company can take advantage of the
extended transition period provided in Section 7(a)(2)(B) of the Securities Act for
complying with new or revised accounting standards. As an emerging growth company, we can
delay the adoption of certain accounting standards until those standards would otherwise
apply to private companies. We have elected to take advantage of the benefits of this
extended transition period.

In October 2012, the Financial Accounting Standards Board (FASB) issued
Accounting Standards Update (ASU) 2012-04, Technical Corrections and
Improvements in Accounting Standards Update No. 2012-04. The amendments in this
update cover a wide range of Topics in the Accounting Standards Codification. These
amendments include technical corrections and improvements to the Accounting Standards
Codification and conforming amendments related to fair value measurements. The amendments
in this update will be effective for fiscal periods beginning after December 15, 2012. The
adoption of ASU 2012-04 is not expected to have a material impact on our financial
position or results of operations.

In August 2012, the FASB issued ASU 2012-03, Technical Amendments
and Corrections to SEC Sections: Amendments to SEC Paragraphs Pursuant to SEC Staff
Accounting Bulletin (SAB) No. 114, Technical Amendments Pursuant to SEC Release No.
33-9250, and Corrections Related to FASB Accounting Standards Update 2010-22 (SEC
Update) in Accounting Standards Update No. 2012-03. This update amends various SEC
paragraphs pursuant to the issuance of SAB No. 114. The adoption of ASU 2012-03 is not
expected to have a material impact on our financial position or results of operations.

In July 2012, the FASB issued ASU 2012-02, Intangibles 
Goodwill and Other (Topic 350): Testing Indefinite-Lived Intangible Assets for
Impairment in Accounting Standards Update No. 2012-02. This update amends ASU
2011-08, Intangibles  Goodwill and Other (Topic 350): Testing Indefinite-Lived
Intangible Assets for Impairment and permits an entity first to assess qualitative factors
to determine whether it is more likely than not that an indefinite-lived intangible asset
is impaired as a basis for determining whether it is necessary to perform the quantitative
impairment test in accordance with Subtopic 350-30, Intangibles - Goodwill and Other -
General Intangibles Other than Goodwill. The amendments are effective for annual and
interim impairment tests performed for fiscal years beginning after September 15, 2012.
Early adoption is permitted, including for annual and interim impairment tests performed
as of a date before July 27, 2012, if a public entitys financial statements for the
most recent annual or interim period have not yet been issued or, for nonpublic entities,
have not yet been made available for issuance. The adoption of ASU 2012-02 is not expected
to have a material impact on our financial position or results of operations.

In December 2011, the FASB issued ASU 2011-12, Deferral of the
Effective Date for Amendments to the Presentation of Reclassifications of Items out of
Accumulated Other Comprehensive Income in Accounting Standards Update No. 2011-05.
This update defers the requirement to present items that are reclassified from accumulated
other comprehensive income to net income in both the statement of income where net income
is presented and the statement where other comprehensive income is presented. The adoption
of ASU 2011-12 is not expected to have a material impact on our financial position or
results of operations.

In December 2011, the FASB issued ASU No. 2011-11 Balance Sheet:
Disclosures about Offsetting Assets and Liabilities (ASU 2011-11). This
Update requires an entity to disclose information about offsetting and related
arrangements to enable users of its financial statements to understand the effect of those
arrangements on its financial position. The objective of this disclosure is to facilitate
comparison between those entities that prepare their financial statements on the basis of
U.S. GAAP and those entities that prepare their financial statements on the basis of IFRS.
The amended guidance is effective for annual reporting periods beginning on or after
January 1, 2013, and interim periods within those annual periods. The Company is currently
evaluating the impact, if any, that the adoption of this pronouncement may have on its
results of operations or financial position.

Management does not anticipate that the adoption of these standards will have a
material impact on the financial statements.
1.  Stockholders Equity
Common Stock


On February 5, 2009, the Company implemented a 3 for 1 forward stock split on its
issued and outstanding shares of common stock to the holders of record as of February 5,
2009. As a result of the split, each holder of record on the record date automatically
received two additional shares of the Companys common stock. After the split, the
number of shares of common stock issued and outstanding were 86,145,000 (861,450 post most
recent 1 for 100 reverse stock split) shares.

On October 19, 2012, we filed a Certificate of Amendment to our Certificate of
Incorporation with the State of Delaware to change the authorized capital stock to
520,000,000 shares consisting of 500,000,000 shares of common stock, par value $0.00001
and 20,000,000 shares of preferred stock, par value $0.00001. The certificate of amendment
also authorized a reverse split of common stock at the ratio of 1:100. The accompanying
financial statements and related notes thereto have been adjusted accordingly to reflect
this forward stock split and the reverse split in 2012. All per share disclosures
retroactively reflect shares outstanding or issuable as though the reverse split had
occurred at inception.

On March 17, 2008, the Company issued 9,000,000 (90,000 post most recent 1 for 100
reverse stock split) shares of its common stock to two individuals who are Directors and
officers for proceeds of $300.

The Company has completed a capital formation activity in accordance with a
Registration Statement on Form S-1 submitted to the SEC to register and sell in a
self-directed offering 6,000,000 (60,000 post most recent 1 for 100 reverse stock split)
shares of newly issued common stock at an offering price of $0.04 per share ($4.00
adjusted for most recent 1 for 100 reverse stock split) for proceeds of $80,000. The
Registration Statement on Form S-1 was filed with the SEC on May 6, 2008 and declared
effective on May 15, 2008. The Company had incurred $20,000 of deferred offering costs
related to this capital formation activity.

As of December 10, 2008 the Company raised $200,000 and issued 60,000,000 (600,000 post
most recent 1 for 100 reverse stock split) shares of its common stock pursuant to a
private placement offering of 84,000,000 (840,000 post most recent 1 for 100 reverse stock
split) shares, at a purchase price of $0.01 per share ($1.00 adjusted for most recent 1
for 100 reverse stock split). The Company received proceeds of $200,000. The Company
incurred $20,000 of deferred offering costs related to this capital formation activity.

On January 28, 2009 the Company raised $37,150 and issued 111,450 shares of its common
stock pursuant to a private placement offering.

On September 16, 2009, the Company raised $15,000 and issued 3,000 shares of its common
stock pursuant to a private placement offering, at a purchase price of $5.00 per share.

On October 13, 2009 Dynamic Applications Corp. entered into an amendment to the
Executive Employment Agreement between the Company and Mr. Asher Zwebner, the Company's
chief financial officer. Under the Amendment, Mr. Zwebner's term of employment was
extended until October 31, 2010 and in lieu of the existing employment compensation set
forth in the employment agreement, Mr. Zwebner received 5,000 shares of common stock in
the Company. The shares were valued at the trading price on the day that the shares were
issued less 40% discount for restricted trading.

On August 23, 2011, the Company raised $3,487 and issued 1,100,000 shares of its common
stock pursuant to a private placement offering, at a purchase price of $0.00317 per share.

On September 8, 2011, the Company amended its Certificate of Incorporation to increase
the authorized share and to change the par value to $0.00001.

On September 27, 2011, the Company raised $26,844 and issued 8,480,000 shares of its
common stock pursuant to a private placement offering, at a purchase price of $0.00317 per
share .

On December 21, 2011, the Company raised $15,850 (of which $10,801 was receivable at
December 31, 2011) and issued 5,000,000 shares of its common stock pursuant to a private
placement offering, at a purchase price of $0.00317 per share.

On January 9, 2012, the Company raised $1,202 and issued 380,000 shares of its common
stock pursuant to a private placement offering, at a purchase price of $0.00317 per share.

On October 19, 2012, we filed a Certificate of Amendment to our Certificate of
Incorporation with the State of Delaware to change the authorized capital stock to
520,000,000 shares consisting of 500,000,000 shares of common stock, par value $0.00001
and 20,000,000 shares of preferred stock, par value $0.00001. The certificate of amendment
also authorized a reverse split of common stock at the ration of 1:100. All per share
disclosures retroactively reflect shares outstanding or issuable as though the reverse
split had occurred January 1, 2008.
2. Related Party transactions not disclosed elsewhere
Due Related Parties: As of December 31, 2012, a total or $28,436 was owed to Asher
Zwebner, CFO and a director, and represented accrued but unpaid compensation for services
during the period from 2008 to 2009. The amount owed is not formalized by a written
agreement, does not carry a specific due date and is non-interest bearing.
3. Convertible Notes


In August, 2011 we issued a $40,000 convertible promissory note. The note, which has a
maturity date of December 31, 2013, bears interest at 15% per annum until paid or
converted. The note is convertible at the option of the holder at any time and from time
to time, on or after June 30, 2013, into our common stock at a fixed conversion price of
$0.01 per share.

The convertible debt security was issued with a non-detachable conversion feature. We
evaluate and account for such securities in accordance with ASC 470-20, Debt
 Debt with Conversion and Other Options. The note was considered to have
an embedded beneficial conversion feature because the effective conversion price was less
than the quoted market price at the time of the issuance. This resulted in a discount to
the carrying amount of the note equal to: - the difference between the effective conversion rate and the market price of our
common stock on the date of issuance; multiplied by - the number of shares into which the notes are convertible. The initial beneficial conversion feature of $40,000 was recorded separately based on
the intrinsic value method.

The value of the beneficial conversion feature was recorded as a discount to the note
which was amortized over the term of the note using the effective interest method.
Amortization of $12,055 of the discount arising from the beneficial conversion feature of
was included in interest expense during the fiscal period ended December 31, 2011 and
$27,945 in 2012.

During 2012 the Company signed a series of seven promissory notes with unrelated
parties for an aggregate of $29,800. The notes bear interest at 15% per annum and are due
approximately one year from the date of issuance. The notes have conversion rights that
allow the holder of the note to convert the principal balance into the Companys
common stock at any time after June 30, 2013 at the lender's sole discretion at $0.01 per
share.

In accordance with ASC 470, the Company has analyzed the beneficial nature of the
conversion terms and determined that a beneficial conversion feature (BCF) exists. The
Company calculated the value of the BCF using the intrinsic method as stipulated in ASC
470. The BCF has been recorded as a discount to the notes payable and to Additional
Paid-in Capital. As of December 31, 2012, the aggregate balance of convertible notes
payable is $10,470 net of unamortized discounts of $19,330.

For the period ended December 31, 2012 the Company has recognized $1,632 in interest
expense related to these notes and has amortized $10,470 of the beneficial conversion
features which has also been recorded as interest expense. The aggregate carrying value of
these notes is as follows: **December 31, 2012**Face amount of the notes
    $29,800Less unamortized discount
    (19,330)Carrying Value
    $10,470
 As of December 31, 2012, the Company is not in default on any of its debt
covenants.

**4. Income Taxes**

We have adopted ASC 740 which provides for the recognition of a deferred tax asset
based upon the value the loss carry-forwards will have to reduce future income taxes and
management's estimate of the probability of the realization of these tax benefits. Our net
operating loss carryovers incurred prior to 2008 considered available to reduce future
income taxes were reduced or eliminated through our recent change of control (I.R.C.
Section 382(a)) and the continuity of business limitation of I.R.C. Section 382(c).

We have a current operating loss carry-forward of $ 453,999 resulting in deferred tax
assets of $158,900. We have determined it more likely than not that these timing
differences will not materialize and have provided a valuation allowance against
substantially all our net deferred tax asset.

Future utilization of currently generated federal and state NOL and tax credit carry
forwards may be subject to a substantial annual limitation due to the ownership change
limitations provided by the Internal Revenue Code of 1986, as amended and similar state
provisions. The annual limitation may result in the expiration of NOL and tax credit carry
forwards before full utilization. **December 31, 2012**
    **December 31, 2011**Individual
    components giving rise to the deferred tax assets are as follows::Future
    tax benefit arising from net operating loss carryovers
    $158,900
    $141,750Less
    valuation allowance
    (158,900)
    (141,750)Net
    deferred
    $ -
    $ -
 The Company is not under examination by any jurisdiction for any tax year. Our federal
and state income tax returns are open for fiscal years ending on or after December 31,
2008.
5. Commitments


The Company is not a party to any leases and does not have any commitments.
6. Development Stage Activities and Going Concern


The Company has been in the development stage since inception. The accompanying
financial statements have been prepared in conformity with accounting principles generally
accepted in the United States of America, which contemplate continuation of the Company as
a going concern. The Company has not established any source of revenue to cover its
operating costs, and as such, has incurred an operating loss since inception. Further, as
of December 31, 2012, the cash resources of the Company were insufficient to meet its
current business plan. These and other factors raise substantial doubt about the Company's
ability to continue as a going concern. The accompanying financial statements do not
include any adjustments to reflect the possible future effects on the recoverability and
classification of asset or the amounts and classification of liabilities that may result
from the possible inability of the Company to continue as a going concern.
7. Subsequent Events:


On January 15, 2013, the Company entered into a consulting agreement with Gennady
Nickelshur to serve as the Company's chief scientific advisor ("CSO"). The
agreement with Mr. Nickelshpur provides for cash compensation based upon an hourly rate
and the grant to the CSO of options pursuant to an ESOP to be adopted by the board of
directors. The terms of the ESOP have yet to be determined.

On March 5, 2013, the Company and GUMI Tel Aviv Ltd, a major, privately-held Israeli
technology company ("GUMI"), entered into development/manufacturing/marketing
agreement ("GUMI Agreement"). GUMI is engaged in the manufacture, import/export,
marketing and install industrial equipment and designing technical solutions to major
Israeli customers, including, among others, the Israeli Defense Forces (IDF), El-Al
Airlines, major Israeli Aerospace companies, as well as foreign industrial customers.
Further, GUMI recently entered into a Joint Venture with a large Indian industrial company
to build a factory in India to manufacture specially designed pipes for the aviation
industry. GUMI has eight operating subsidiaries, approximately 200 full-time employees,
more than 100 sub-contractors, and is among Israel's largest manufacturers and
distributors of industrial equipment.

Pursuant to the GUMI Agreement, GUMI agreed to: (i) complete the development of the
Prototype of the Patented Device; (ii) manufacture the commercial model(s) of the Patented
device; and (iii) market the commercial model(s) of the Patented Device.

In consideration for developing the Prototype and manufacturing and
marketing/distributing commercial models of the Patented Device as well as incurring all
related costs and expenses in connection therewith, the Company shall compensate GUMI as
follows: (i) upon the execution of the GUMI Agreement, the Company granted GUMI warrants
(the "Warrants") exercisable to purchase 200,000 shares of the Company's common
stock ("Warrant Shares") at an exercise price of USD$0.05 per share (the
"Exercise Price"); (ii) upon completion of the Prototype, granting GUMI
additional Warrants to purchase 200,000 additional Warrant Shares at the Exercise Price;
and (iii) upon completion of a Commercial Device ready for manufacture and sale, granting
GUMI additional Warrants to purchase 200,000 additional Warrant Shares at the Exercise
Price. The Warrants shall expire 3 years from the date of each grant and shall be subject
to adjustment in the event of any recapitalization of the Company's capital stock.

In addition to the consideration represented by the grant of Warrants, the Agreement
further provides that following commencement of sale of the Commercial Device and until
such time that GUMI has recouped all costs and expenses that it has incurred and paid in
connection with the completion of development of the Prototype and the manufacture of the
Commercial Device ("Date of Recoupment"), one hundred (100%) percent of the net
sales revenues shall be paid and distributed to GUMI. On and after the Date of Recoupment,
net sales revenues shall be paid sixty-five (65%) percent to GUMI and thirty-five (35%)
percent to the Company.




ITEM
9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSUREBack
to Table of Contents On April 10, 2013, the Company filed a current report on Form 8-K with disclosure
regarding a change in accountants from Michael F. Cronin, CPAs to M&K, CPAS, PLLC,
effective February 3, 2013. The prior accountant submitted his letter of resignation and
concurred with the disclosure in the Form 8-K, a copy of which was attached as Exhibit 16. ITEM 9A. CONTROLS AND PROCEDURESBack to Table of Contents Evaluation of Disclosure Controls and Procedures
Evaluation of disclosure controls and procedures. As of December 31, 2012, the
Company's chief executive officer/chief financial officer conducted an evaluation
regarding the effectiveness of the Company's disclosure controls and procedures (as
defined in Rules 13a-15(e) or 15d-15(e) under the  Exchange Act. Based upon the
evaluation of these controls and procedures, our chief executive officer/chief financial
officer concluded that our disclosure controls and procedures were not effective as of the
end of the fiscal year 2012.
Managements Annual Report on Internal Control Over Financial Reporting


Management is responsible for establishing and maintaining adequate internal control
over financial reporting and for the assessment of the effectiveness of those internal
controls. As defined by the SEC, internal control over financial reporting is a process
designed by our principal executive officer and principal financial officer, to provide
reasonable assurance regarding the reliability of financial reporting and the preparation
of the financial statements in accordance with U.S. generally accepted accounting
principles.

Because of its inherent limitations, internal control over financial reporting may not
prevent or detect misstatements. Also, projections of any evaluation of effectiveness to
future periods are subject to the risk that controls may become inadequate because of
changes in conditions, or that the degree of compliance with the policies or procedures
may deteriorate.

Management has assessed the effectiveness of our internal control over financial
reporting as of December 31, 2012. In making this assessment, management used the criteria
set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO)
in Internal Control-Integrated Framework. Based on our assessment and those criteria, we
have concluded that our internal control over financial reporting had material weaknesses
including lack of sufficient internal accounting personnel in order to ensure complete
documentation of complex transactions and adequate financial reporting during the year
ended December 31, 2012. Management has identified corrective actions for the weakness and
has begun implementation during the second quarter of 2013.

This annual report does not include an attestation report of the companys
registered public accounting firm regarding internal control over financial reporting.
Managements report was not subject to attestation by the Companys registered
public accounting firm pursuant to temporary rules of the Securities and Exchange
Commission that permit the Company to provide only Managements report in this annual
report.
Changes in Internal Control Over Financial Reporting


There were no changes in our internal control over financial reporting or in other
factors identified in connection with the evaluation required by paragraph (d) of Exchange
Act Rules 13a-15 or 15d-15 that occurred during the fourth quarter ended December 31, 2012
that have materially affected, or are reasonably likely to materially affect, our internal
control over financial reporting. **ITEM 9B. OTHER INFORMATION**Back to
Table of Contents None.




PART III ITEM
10. DIRECTORS AND
EXECUTIVE OFFICERS OF THE REGISTRANT AND CORPORATE GOVERNANCEBack to Table of Contents Our directors was elected to serve until the next annual meeting of shareholders and
until his respective successors will have been elected and will have qualified. The
following table sets forth the name, age and position held with respect to our present
director and executive officer: **Name**
    
    **Age**
    
    **Title**
    
    **Date Became Executive
    Officer**Eli Gonem
    
    62
    
    Chairman
    
    02/02/2009Ori Goore
    
    39
    
    CEO and Director
    
    02/02/2009Asher Zwebner
    
    47
    
    CFo and Director
    
    11/01/2008 Eli Gonen, age 62, was the President and Chief Executive Officer of Azorim Tourism,
f/k/a Sheraton Moriah Israel from 1999 through 2008, which is a Tel Aviv Stock Exchange
listed company engaged in the hotel management business, with twelve hotels under
management throughout Israel. Previously between 1992-1996 Mr. Gonen served as the CEO for
the Israeli Ministry of Tourism. Currently Mr. Gonen owns and operates Terra Holdings, a
business entrepreneurship company engaged in the business of hotel investment and
management in Israel. He also serves as a director for Israel Discount
Bank.  Mr. Gonen has an Advanced Studies degree from the University of Berkley
and an M.B.A. from Hebrew University.
Ori Goore, age 39, has been our president and a director since 2008. From July 2007
until July 2010 he served as the Deputy Chief Executive Officer at Carmel Beach Resort 89
Ltd., an affiliate of Delek Real Estate Group, which is engaged in the business of real
estate development and management. From October 2006 through July 2007 Mr. Goore was the
senior economic advisor to the Chief Executive Officer at Delek Real Estate Group. From
October 2002 through January 2006 he was the economic advisor to the Chief Financial
Officer at Israeli Ports, Assets and Development Company Ltd., whose a quasi-governmental
organization engaged in the management and development of Israel's port facilities. Mr.
Goore has an L.L.M. from the Hebrew University and a M.B.A. from Arison School for
Business Management.
Asher Zwebner, age 47, has been the Chief Financial Officer since November 2008.
Since January 2010, Mr. Zwebner is the CEO and CFO of Adama Technologies Corp. (ADAC), a
reporting company engaged in the business of mineral exploration through its ownership of
shares of mining companies. Mr. Zwebner was CFO for Progaming Platforms Corp. (PPTF), a
reporting company, from August 2012 to December 2012, which is engaged in the business of
development of an online gaming platform which it intends to license to third parties
online game service providers in the United States. He also served as the CFO of Suspect
Detection Systems, Inc. (SDSS), formerly a reporting company, from August 2007 to December
2010 and as its CEO from October 2007 until January 2010, SDSS is engaged in the business
of development and application of proprietary technologies for law enforcement and border
control. From January 2008 to August 2010, he was the CFO for Computer Vision Systems
Laboratories Corp. (CVSL), a reporting company engaged in the publishing and advertising
industry. Mr. Zwebner served Majic Wheels Corp., a reporting company organized with the
plan of entering into the waste management industry, as interim CEO from January 2009 to
July 2010, as CFO from its inception in March 2007 until his resignation on July 23, 2010.
From August 2008 to January 2009, Mr. Zwebner was the CFO of PowerRaise Inc. (PORS), a
company that ceased reporting in 2009 and had been organized for the purpose of developing
and marketing an internet commerce platform to enable schools to raise funds by collecting
commissions from online shopping by the parents Mr. Zwebner is a
CPA in Israel and the United States, and received a BS Degree in Accounting and Finance
from Touro College in 1988.  

All executive officers are elected by the Board and hold office until the next annual
meeting of stockholders and until their successors are elected and qualify.

Messrs. Gonen, Goore and Zwebner, each of whom serve as members of the Company's board
of directors, have many years of experience in business management and finance, as
described more fully above. Notwithstanding the foregoing, none of our directors have any
experience whatsoever in the technical, engineering, patent development, or related fields
and may not be deemed to have sufficient qualifications to act as sole management as the
Company proceeds with its plan of operation regarding developing, manufacturing and
marketing our Patented Device. As a result, during 2013, the board of director has plans
to expand its membership to add additional directors and/or executive officers with
technical experience.
Chief Scientific Advisor


On January 15, 2013, as a result of the limited technical experience of the Company's
board of directors and executive officers, the Company entered into an agreement with
Gennady Nickelshpur to serve as its chief scientific advisor. Mr. Nickelshpur's services
agreement is attached as exhibit 10.3 to this annual report. Mr. Nickelshpur holds a
Masters Degree in Mechanical Engineering from the Institute of Railway Engineering, Gomel,
Russia, has been Chief Engineer for S. V. SE. Ltd, Raanana, Israel from 1999 to 2006 prior
to which he served as Project Engineer involved in the patent development, patent
protection and managing patent application processes. From 2007 to 2008, Mr. Nickelshpur
was employed at the patent law firm of Ehrlich & Fenster, Mr. Nickelshpur has
specialized knowledge of hydraulic and pneumatic engineering. The Company expects that Mr.
Nickelshpur will work closely with GUMI in its development and manufacturing efforts.

The Company intends to seek additional qualified personnel to support Mr. Nickelshpur
as he pursues efforts to complete the prototype and thereafter commercially exploit the
Company's Patented Device. The Company's plan includes forming a scientific advisory board
composed of Mr. Nickelshpur and other specialists when and if its resources will permit.
Director Independence


In determining whether or not our directors are considered independent the Company used
the definition of independence as defined in NASDAQ Rule 4200. Based on that definition we
believe that our directors independent.
NASDAQ Rule 4200


The  NASDAQ Rule 4200, which sets forth several tests to determine whether a
director of a listed company is independent. Rule 4200 provides that a director would not
be considered independent if the director or an immediate family member accepted any
compensation from the listed company in excess of $120,000 during any period of 12
consecutive months within the three years preceding the determination of independence
(excluding compensation for board or board committee service, compensation paid to an
immediate family member as a non-executive employee, benefits paid under a tax-qualified
retirement plan and non-discretionary compensation).
Directors Term of Office


Our director was elected to serve until the next annual meeting of shareholders and
until his respective successors will have been elected and will have qualified.
Board Meetings


During the year ended December 31, 2012, the board of directors had six board meetings.
Audit Committee and Financial Expert, Compensation Committee, Nominations Committee


We do not have any of the above mentioned standing committees because our corporate
financial affairs and corporate governance are simple in nature at this stage of
development and each financial transaction is approved by our sole officer or director.
Board Leadership Structure


The Company does not combine the principal executive officer and board chairman
positions. The Company believes that this board leadership structure is the most
appropriate for the Company, notwithstanding its status as a development stage company
with only limited operation. The challenges faced by the Company at this stage 
obtaining financing, securing arrangements for the development, manufacture and
implementing a marketing and sales plan  are most efficiently dealt with by having
more than one person involved with both the operational aspects as well as the strategic
aspects of the Companys business.
Code of Ethics


We do not currently have a Code of Ethics applicable to our principal executive
officers; however, the Company plans to implement such a code in the fourth quarter of
2013.
Potential Conflicts of Interest


Since we do not have an audit or compensation committee comprised of independent
Directors, the functions that would have been performed by such committees are performed
by our Board of Directors. Thus, there is a potential conflict of interest in that our
Directors have the authority to determine issues concerning management compensation, in
essence their own, and audit issues that may affect management decisions. We are not aware
of any other conflicts of interest with any of our Executives or Directors.
Boards Role in Risk Oversight


The Board assesses on an ongoing basis the risks faced by the Company. These risks
include financial, technological, competitive, and operational risks. In addition, since
the Company does not have an Audit Committee, the Board is also responsible for the
assessment and oversight of the Companys financial risk exposures.
Involvement in Certain Legal Proceedings


We are not aware of any material legal proceedings that have occurred within the past
ten years concerning any Director or control person which involved a criminal conviction,
a pending criminal proceeding, a pending or concluded administrative or civil proceeding
limiting one's participation in the securities or banking industries, or a finding of
securities or commodities law violations.
Section 16(a) Compliance


Section 16(a) of the Securities and Exchange Act of 1934 requires the
Registrant's directors and executive officers, and persons who own beneficially more than
ten percent (10%) of the Registrant's Common Stock, to file reports of ownership and
changes of ownership with the Securities and Exchange Commission. Copies of all filed
reports are required to be furnished to the Registrant pursuant to Section 16(a). Based
solely on the reports received by the Registrant and on written representations from
reporting persons, the Registrant was informed that its officers and directors and ten
percent (10%) shareholders has not filed reports required to be filed under Section 16(a). ITEM 11. EXECUTIVE
COMPENSATIONBack
to Table of Contents The following table
sets forth information concerning the total compensation that we have paid or that has
accrued on behalf of our chief executive officer and other executive officers during the
fiscal years ending December 31, 2012, 2011and 2010. **Summary Compensation Table****Long
    Term****Annual
    Compensation**
    **Compensation
    Awards****Other**
    **Restricted**
    **Securities****Annual**
    **Stock**
    **Underlying**
    **All Other****Salary**
    **Bonus**
    **Compensation**
    **Award(s)**
    **Options**
    **Compensation****Name and
    Principal Position**
    
    **Year**
    **($)**
    **($)**
    **($)**
    **($)**
    **($)**
    **($)**Ori Goore, CEO and Director (1)
    
    2012
    0
    0
    0
    0
    0
    02011
    0
    0
    0
    0
    0
    02010
    0
    0
    0
    0
    0
    0Asher Zwebner, CFO and director
    (2)
    
    2012
    0
    0
    0
    0
    0
    02011
    24,000
    0
    0
    375,000
    0
    02010
    24,000
    0
    0
    125,000
    0
    0(1) Mr. Goore became the Company's CEO
    and director in February 2009 and has not received any compensation for serving as CEO and
    director.
    (2) Mr. Zwebner became the Company's CFO and director in November 2008 and has not
    received any cash compensation for serving as CFO and director. On October 13, 2009, the
    Company entered into an amended employment agreement with Mr. Zwebner. Under the
    amendment, Mr. Zwebner's term of employment was extended until October 31, 2010 and in
    lieu of the existing employment compensation set forth in the initial employment
    agreement, Mr. Zwebner will be entitled to receive 500,000 shares of common stock in the
    Company. This restricted stock vests in 12 equal monthly installments at the end of
    each month beginning in October 1, 2009 for so long as Mr. Zwebner has not been terminated
    or ceases employment with the Company. The Company has no employment agreement with its CEO. ITEM
12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
SHAREHOLDER MATTERSBack to Table of Contents The table below discloses any person (including any "group")
who is known to the Registrant to be the beneficial owner of more than five (5%) percent
of the Registrant's common stock securities and the beneficial ownership of Registrant's
director and executive officer. As of November 15, 2012, the Registrant had 15,829,450
shares of common stock issued and outstanding. **Name of Beneficial Owner**
    ****
    **Common Stock Beneficially Owned**
    ****
    **Percentage of Common Stock  Owned**Jacky
    Shenker
    
    8,000,000
    
    50.54%78 Uziel Street, Jerusalem, IsraelLevi
    Krasney
    
    1,300,000
    
    8.21%8 Paamoni, Tel Aviv, IsraelAmir Uziel
    
    1,300,000
    
    8.21%9 Hakormim Street, Misgav, Tel AvivElimelech
    Krasney
    
    1,300,000
    
    8.21%43 Yehuda Hamakabi Street, Tel Aviv, IsraelRuth Katz
    
    1,300,000
    
    8.21%26 Kadish Luz Street, Jerusalem, IsraelGuil
    Mediouni
    
    1,300,000
    
    8.21%14 Netaaim Street, Rishon Letzion, IsraelEli Gonen,
    Chairman
    
    80,000
    
    0.51%16/2 Hazamir Street, Mevaseret Zion, IsraelOri Goore,
    Ceo and Director
    
    80,000
    
    0.51%36/1 Yaholom Street, Modi"In, IsraelAsher
    Zwebner, CFO and Director
    
    0
    
    0.00%216 Jaffa Street, Jerusalem, IsraelDirector
    and Officer (3 person)
    
    160,000
    
    1.02% (1) Applicable
percentage ownership is based on76,994,799shares of common
stock outstanding as of March 31, 2013. Beneficial ownership is determined in accordance
with the rules of the Securities and Exchange Commission and generally includes voting or
investment power with respect to securities. Shares of common stock that are currently
exercisable or exercisable within 60 days of March 31, 2013 are deemed to be beneficially
owned by the person holding such securities for the purpose of computing the percentage of
ownership of such person, but are not treated as outstanding for the purpose of
computing the percentage ownership of any other person. ITEM
13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTORS INDEPENDENCEBack to Table of Contents Related Party Common Stock Transactions During the Most Recent Two Fiscal Years 9/29/2011
    Common Stock
    40,000
    Gonen, Eli - related party - Chairman
    $0.00317 per share in cash pursuant to Section 4(2)9/29/2011
    Common Stock
    40,000
    Goore, Ori - related party - CEO, Director
    $0.00317 per share in cash pursuant to Section 4(2)1/10/2012
    Common Stock
    40,000
    Goore, Ori - related party - CEO, Director
    $0.00317
    per share in cash pursuant to Section 4(2)1/10/2012
    Common Stock
    40,000
    Gonen, Eli - related party - Chairman
    $0.00317
    per share in cash pursuant to Section 4(2) Related Party Transaction As of December 31, 2012, a total or $28,436 was owed to Asher Zwebner,
CFO and a director, and represented accrued but unpaid compensation for services during
the period from 2008 to 2009. The amount owed advances is not formalized by a written
agreement, does not carry a specific due date and is non-interest bearing. ITEM 14. PRINCIPAL
ACCOUNTING FEES AND SERVICESBack to Table of Contents The Registrant's Board of Directors has appointed M&K CPAS, PLLC
(MK")  as independent public accountant for the fiscal year ended December
31, 2012. The Company's financial statements for the year ended December 31, 2011 were
audited by Michael F. Cronin, CPA ("MFC").

Principal Accounting Fees
The following table presents the fees for professional audit services rendered by MK
and MFC for the audit of the Registrant's annual financial statements for the years
ended December 31, 2012 and 2011, and fees billed for other services rendered by MK
and MFC during those periods. Year Ended
    
    Year EndedDecember 31, 2012
    
    December 31, 2011Audit
    fees (1)
    $
    3,475
    $
    4,500Audit-related fees (2)
    
    ---
    
    ---Tax
    fees (3)
    
    ---
    
    ---All other fees
    
    
    ---
    
    ---(1) Audit fees consist of
    audit and review services, consents and review of documents filed with the SEC.(2) Audit-related fees
    consist of assistance and discussion concerning financial accounting and reporting
    standards and other accounting issues.(3) Tax fees consist of
    preparation of federal and state tax returns, review of quarterly estimated tax payments,
    and consultation concerning tax compliance issues.ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULESBack to Table of Contents

(a) The following documents are filed as exhibits to
this report on Form 10-K or incorporated by reference herein. Any document incorporated by
reference is identified by a parenthetical reference to the SEC filing that included such
document.

Exhibit
    Description of Exhibit3.1a
    Certificate of Incorporation,
    filed with the Company's Form 10 on November 21, 2012.3.1b
    Certificate of Amendment to
    Articles of Incorporation, dated September 8, 2011, filed herewith.3.1c
    Articles of Incorporation, as
    amended, filed with the Company's Form 10 on November 21, 2012 as Exhibit 3.1b.3.2
    Bylaws, filed with the Company's
    Form 10 on November 21, 2012.10.1
    Patent Transfer and Sale
    Agreement with Appelfeld Zer Fisher, filed with the Company's Form 10 on November 21,
    2012.10.2
    Convertible Note, as amended,
    between the Company and Shefer Trust, filed with the Company's Form 10 on November 21,
    2012.10.3
    Agreement with GUMI Tel Aviv Ltd
    dated March 5, 2013, filed with the Company's Form 8-K on March 7, 2013.SIGNATURES

Pursuant to the
requirements of the Securities Exchange Act of 1934, this report has been signed below by
the following persons on behalf of the registrant and in the capacities and on the date
indicated.
Date: April 15, 2013

Dynamic Applications Corp.By: Ori Goore, CEO and Director/s/ Ori GooreDynamic Applications Corp.By: Asher Zwebner, CFO and Director/s/ Asher Zwebner