**U.S.
      SECURITIES AND EXCHANGE COMMISSION**


**WASHINGTON,
      D.C.  20549**





**FORM
      10-KSB**





**(Mark
      One)**


**[X]      ANNUAL
      REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934**





**For
      Fiscal Year Ended: September 30, 2007**





**or**





**[  ]       TRANSITION
      REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934**





For
      the
      transition period from __________ To __________








Commission
      file number 0-730





Penn-Pacific
      Corp.


(Name
      of
      small business issuer in its charter)





**Nevada**
            
            **95-3227748**State
                or other jurisdiction of incorporation or organization
            
            (I.R.S.
                Employer Identification No.)





3325
      Griffin Road, #200, Ft. Lauderdale, FL 33323


(Address
      of principal executive offices)     (Zip
      code)




Issuer's
      telephone
      number                     (866) 387-6583





Indicate
      by Check Mark Whether the Registrant is a Shell Company (as Defined by Rule
      12B-2 of the Exchange Act). Yes x; No o





Securities
      registered under Section 12(b) of the Act:


NONE





Securities
      registered under Section 12(g) of the Act:


Common
      Stock, par value $.00001


(Title
      of
      class)





Check
      whether the issuer (1) filed all
      reports required to be filed by Section 13 or 15(d) of the Exchange Act during
      the past 12 months (or for such shorter period that the registrant was required
      to file such reports), and (2) has been subject to such filing requirements
      for
      the past 90 days.   Yes x  No o





Check
      if there is no disclosure of
      delinquent filers pursuant to Item 405 of Regulation S-B is not contained in
      this form, and no disclosure will be contained, to the best of registrant's
      knowledge, in definitive proxy or information statements incorporated by
      reference in Part III of this Form 10-KSB or any amendment to this form 10-KSB.
      x





At
      November 16, 2007 the aggregate
      market value of all shares of voting stock held by non-affiliates was
      $0.  In determining this figure, the Registrant has assumed that all
      directors and executive officers are affiliates.  Such assumption
      shall not be deemed conclusive for any other purpose.  The number of
      shares outstanding of each class of the Registrant’s common stock, as of
      November 16, 2007 was as follows:  Common Stock $.00001 par value,
      1,668,698 shares.





Total
      revenues for fiscal year ended September 30, 2007: $0





At
      November 16, 2007  the number of shares of common stock outstanding
      was 1,668,698.








DOCUMENTS
      INCORPORATED BY REFERENCE





If
      the following documents are
      incorporated by reference, briefly describe them and identify the part of the
      Form 10-KSB (e.g., Part I, Part II, etc.) into which the document is
      incorporated:  (1) any annual report to security holders; (2) any
      proxy or information statement; and (3) any prospectus filed pursuant to Rule
      424(b) or (c) of the Securities Act of 1933 ("Securities
      Act"):  NONE





Transitional
      Small Business Disclosure
      Format (check one):  Yes o ; NO x


2


TABLE
      OF CONTENTS





Item
                Number and Caption
            PagePART
                IItem
                1.
            Description
                of Business
            4Item
                2.
            Description
                of Property
            6Item
                3.
            Legal
                Proceedings
            7Item
                4.
            Submission
                of Matters to a Vote of Security
                Holders
            7PART
                IIItem
                5.
            Market
                for Common Equity and Related Stockholder
                Matters
            7Item
                6.
            Management's
                Discussion and Analysis or Plan of
                Operations
            8Item
                7.
            Financial
                Statements
            11Item
                8.
            Changes
                in and Disagreements With Accountants on Accounting and
                Financial Disclosure
            12Item
                8A.
            Controls
                and Procedures
            12Item
                8B.
            Other
                Information
            12PART
                IIIItem
                9.
            Directors,
                Executive Officers, Promoters and Control Persons;
                Compliance with Section 16(a) of the Exchange Act
            13Item
                10.
            Executive
                Compensation
            14Item
                11.
            Security
                Ownership of Certain Beneficial Owners and
                Management
            15Item
                12.
            Certain
                Relationships and Related
                Transactions
            16Item
                13.
            Exhibits
                and Reports on Form 8-K
            16Item
                14.
            Principal
                Accountant Fees and Services
            17





3


**PART
      I**







**ITEM
      1. DESCRIPTION OF BUSINESS**








**General**





The
      Company is currently in
      the process of looking for business opportunities to acquire or merge
      with.  In seeking a business opportunity to merge with or acquire,
      management is reviewing various business plans.  Management has not
      limited their review of plans or exploration of acquisitions to any particular
      industry or service sector.  Though there appears to be a large number
      of companies seeking to merge with an existing public company, the management
      has not yet identified a business to complete such a transaction with and the
      Company has not entered into any binding agreements for an acquisition or
      merger.   There is no guarantee that management will be
      successful in finding such an opportunity.





**History**





The
      Company was incorporated under the
      laws of the state of Delaware on May 18, 1971.  From 1979 to 1991 the
      primary business of Penn Pacific and its subsidiaries was the acquisition,
      exploration, development, production and operation of oil and gas
      properties.  Penn Pacific has been inactive since 1991.  The
      Company filed a voluntary petition of reorganization under Chapter 11 of the
      United States Bankruptcy Code on January 27, 1994.  On January 13,
      1997, the Company emerged from bankruptcy pursuant to a final decree of the
      United States Bankruptcy Court for the Northern District of
      Oklahoma.  The Company is in the development stage since January 13,
      1997 and has not commenced planned principal operations.





The
      primary activity of the Company has
      involved and will involve seeking merger or acquisition candidates with whom
      it
      can either merge or acquire.  The Company has not selected any company
      for acquisition or merger and does not intend to limit potential acquisitions
      candidates to any particular field or industry, but does retain the right to
      limit acquisition or merger candidates, if it so chooses, to a particular field
      or industry.  The Company’s plans are in the conceptual stage
      only.





The
      proposed business activities
      described herein classify the Company as a “blank check” or “shell company”
whose sole purpose at this time is to locate and consummate a merger or
      acquisition.  Many states have enacted statutes, rules and regulations
      limiting the sale of securities of “blank check” companies in their respective
      jurisdictions.  Management does not believe it will undertake any
      efforts to cause a trading market to develop in the Company’s securities until
      such time as the Company has successfully implemented its business plan
      described herein.  However, if the Company intends to facilitate the
      eventual creation of a public trading market in its outstanding securities,
      it
      must consider that the Company’s securities, when available for trading, will be
      subject to a Securities and Exchange Commission rule that imposes special sales
      practice requirements upon


4


broker-dealers
      who sell such securities to persons other than established customers or
      accredited investors.  For purposes of the rule, the phrase
“accredited investors” means, in general terms, institutions with assets in
      excess of $5,000,000, or individuals having a net worth in excess of $1,000,000
      or having an annual income that exceeds $200,000 (or that, when combined with
      a
      spouse’s income, exceeds $300,000).  For transactions covered by the
      rule, the broker-dealer must make a special suitability determination for the
      purchaser and receive the purchaser’s written agreement to the transaction prior
      to the sale.  Consequently, the rule may affect the ability of
      broker-dealers to sell the Company’s securities and also may affect the ability
      of purchasers to sell their securities in any market that might develop
      therefore.





**Operating
      Losses**





The
      Company has incurred net losses
      from operations of approximately $20,275 and $2,340 for the  years
      ended September 31, 2007 and 2006, respectively.  Such operating
      losses reflect developmental and other administrative costs for 2007 and
      2006.  The Company expects to incur losses in the near future until
      profitability is achieved.  The Company’s operations are subject to
      numerous risks associated with establishing any new business, including
      unforeseen expenses, delays and complications.  There can be no
      assurance that the Company will achieve or sustain profitable operations or
      that
      it will be able to remain in business.





**Future
      Capital Needs and Uncertainty of Additional Funding**





Revenues
      are not yet sufficient
      to support the Company’s operating expenses and are not expected to reach such
      levels until it has completed an acquisition.  Since the Company’s
      formation, it has funded its operations and capital expenditures primarily
      through private placements of debt and equity securities.  The Company
      expects that it will be required to seek additional financing in the
      future.  There can be no assurance that such financing will be
      available at all or available on terms acceptable to the Company.





**Government
      Regulation**





The
      Company is subject to all pertinent
      Federal, State, and Local laws governing its business.  The Company is
      subject to licensing and regulation by a number of authorities in its State
      or
      municipality.  These may include health, safety, and fire
      regulations.  The Company’s operations are also subject to Federal and
      State minimum wage laws governing such matters as working conditions, overtime
      and tip credits.





**Risk
      of Low-priced Stocks**





Rules
      15g-1 through 15g-9 promulgated
      under the Securities Exchange Act of 1934 (the “Exchange Act”) impose sales
      practice and disclosure requirements on certain brokers and dealers who engage
      in certain transactions involving “a penny stock.”


5


Currently,
      the Company’s Common Stock
      is considered a penny stock for purposes of the Exchange Act.  The
      additional sales practice and disclosure requirements imposed on certain brokers
      and dealers could impede the sale of the Company’s Common Stock in the secondary
      market.  In addition, the market liquidity for the Company’s
      securities may be severely adversely affected, with concomitant adverse effects
      on the price of the Company’s securities.





Under
      the penny stock regulations, a
      broker or dealer selling penny stock to anyone other than an established
      customer or “accredited investor” (generally, an individual with net worth in
      excess of $1,000,000 or annual incomes exceeding $200,000, or $300,000 together
      with his or her spouse) must make a special suitability determination for the
      purchaser and must receive the purchaser’s written consent to the transaction
      prior to sale, unless the broker or dealer or the transaction is otherwise
      exempt.  In addition, the penny stock regulations require the broker
      or dealer to deliver, prior to any transaction involving a penny stock, a
      disclosure schedule prepared by the Securities and Exchange Commission (the
      “SEC”) relating to the penny stock market, unless the broker or dealer or the
      transaction is otherwise exempt.  A broker or dealer is also required
      to disclose commissions payable to the broker or dealer and the registered
      representative and current quotations for the Securities.  In
      addition, a broker or dealer is required to send monthly statements disclosing
      recent price information with respect to the penny stock held in a customer’s
      account and information with respect to the limited market in penny
      stocks.





**Competition**





The
      Company expects to encounter
      substantial competition in its efforts to locate attractive opportunities,
      primarily from business development companies, venture capital partnerships
      and
      corporations, venture capital affiliates of large industrial and financial
      companies, small investment companies, and wealthy individuals.  Many
      of these entities will have significantly greater experience, resources and
      managerial capabilities than the Company and will therefore be in a better
      position than the Company to obtain access to attractive business
      opportunities.





**Employees**





The
      Company’s only employee at the
      present time is its sole officer and director, who will devote as much time
      as
      he determines is necessary to carry out the affairs of the Company.








**ITEM
      2. DESCRIPTION OF PROPERTY**







The
      Company has a working agreement
      with the Company president to share use of 600 square feet of office space,
      telephones and secretarial services supplied on a gratis basis.


6







**ITEM
        3. LEGAL PROCEEDINGS**


No
      material legal proceedings to which
      the Company (or its director and officer in his capacity as such) is party
      or to
      which property of the Company is subject is pending and no such material
      proceeding is known by management of the Company to be
      contemplated.











ITEM
      4.
      SUBMISSION OF MATTERS TO AVOTE
      OF
      SECURITY HOLDERS







No
      matters were subject to a vote of
      security holders during the year.





**PART
      II**











**ITEM
      5. MARKET FOR COMMON EQUITY AND RELATED
      STOCKHOLDER MATTERS**











**MARKET
      INFORMATION**





The
      quotations provided reflect
      inter-dealer prices, without retail mark-up, mark-down or commission and may
      not
      represent actual transactions.





HIGH
      BIDLOW BID


(To
      the
      best knowledge of


management,
      there was no


trading
      of shares for fiscal


2007
      and
      2006)





The
      number of shareholders of record of
      the Company's common stock as of June 26, 2007 was approximately
      6,473.





The
      Company has never declared or paid
      any cash dividends.  It is the present policy of the Company to retain
      earnings to finance the growth and development of the business and, therefore,
      the Company does not anticipate paying dividends on its Common Stock in the
      foreseeable future.





Recent
      Sales of Unregistered
      Securities.  On October 29, 2007 the Company issued 500,000 shares of
      common stock in exchange for $15,000 of accounts payable.


7







**ITEM
      6. MANAGEMENT’S DISCUSSION AND****ANALYSIS
      OR PLAN OF OPERATIONS**







**Plan
      of Operations -**The following discussion should be read in conjunction
      with the Financial Statements and notes thereto.





The
      Company intends to seek,
      investigate and, if such investigation warrants, acquire an interest in one
      or
      more business opportunities presented to it by persons or firms who or which
      desire to seek perceived advantages of a publicly held
      corporation.  At this time, the Company has no plan, proposal,
      agreement, understanding or arrangement to acquire or merge with any specific
      business or company, and the Company has not identified any specific business
      or
      company for investigation and evaluation.  No person has had any
      material discussions with any other company with respect to any acquisition
      of
      that company.





The
      Company will not restrict its
      search to any specific business, industry or geographical location, and the
      Company may participate in a business venture of virtually any kind or
      nature.  The discussion of the proposed business under this caption
      and throughout is purposefully general and is not meant to be restrictive of
      the
      Company’s virtually unlimited discretion to search for and enter into potential
      business opportunities.





The
      Company may obtain funds in one or
      more private placements to finance the operation of any acquired business,
      if
      necessary.  Persons purchasing securities in these placements and
      other shareholders will likely not have the opportunity to participate in the
      decision relating to any acquisition.  The Company’s proposed business
      is sometimes referred to as a “blind pool” because any investors will entrust
      their investment monies to the Company’s management before they have a chance to
      analyze any ultimate use to which their money may be
      put.  Consequently, the Company’s potential success is heavily
      dependent on the Company’s management, which will have unlimited discretion in
      searching for and entering into a business opportunity.  The sole
      officer and director of the Company likely has had no experience in any proposed
      business of the Company.  There can be no assurance that the Company
      will be able to raise any funds in private placement.





**Results
      of Operations -**The Company filed a voluntary petition of
      reorganization under Chapter 11 of the United States Bankruptcy Code on January
      27, 1994.  On January 13, 1997, the Company emerged from bankruptcy
      pursuant to a final decree of the United States Bankruptcy Court for the
      Northern District of Oklahoma.  During the period from January 13,
      1997 through September 30, 2007, the Company has engaged in no significant
      operations other than organizational activities and preparation for registration
      of its securities under the Securities Exchange Act of 1934.  No
      revenues were received by the Company during this period.





For
      the current fiscal year, the
      Company anticipates incurring a loss as a result of organizational expenses,
      expenses associated with registration under the Securities Exchange
      Act


8


of
      1934,
      and expenses associated with locating and evaluating acquisition
      candidates.  The Company anticipates that until a business combination
      is completed with an acquisition candidate, it will not generate revenues other
      than interest income, and may continue to operate at a loss after completing
      a
      business combination, depending upon the performance of the acquired
      business.





**Liquidity
      and Financial Resources**





The
      Company remains in the development
      stage and, since inception, has experienced no significant change in liquidity
      or capital resources or stockholder’s equity.  The Company’s balance
      sheet as of September 30, 2007, reflects a current asset value of $0, and a
      total asset value of $0.





The
      Company will carry out its plan of
      business as discussed above.  The Company cannot predict to what
      extent its liquidity and capital resources will be diminished prior to the
      consummation of a business combination or whether its capital will be further
      depleted by the operating losses (if any) of the business entity which the
      Company may eventually acquire.





**Federal
      Income Tax Aspects of Investment in the Company**





The
      discussion contained herein has
      been prepared by the Company and is based on existing law as contained in the
      Code, amended United States Treasury Regulations (“Treasury Regulations”),
      administrative rulings and court decisions as of the date of this Annual Report.
      No assurance can be given that future legislative enactments, administrative
      rulings or court decisions will not modify the legal basis for statements
      contained in this discussion.  Any such development may be applied
      retroactively to transactions completed prior to the date thereof, and could
      contain provisions having an adverse affect upon the Company and the holders
      of
      the Common Stock.  In addition, several of the issues dealt with in
      this report are the subjects of proposed and temporary Treasury
      Regulations.  No assurance can be given that these regulations will be
      finally adopted in their present form.





**Critical
      Accounting Policies** -The preparation of financial statements in
      conformity with accounting principles generally accepted in the United States
      of
      America requires management to make estimates and assumptions that affect the
      reported amounts of assets and liabilities and the disclosure of contingent
      assets and liabilities of the date of the financial statements and the reported
      amounts of revenues and expenses during the reporting period.  Note 2
      to the Consolidated Financial Statements describes the significant accounting
      policies and methods used in the preparation of the Consolidated Financial
      Statements. Estimates are used for, but not limited to, contingencies and
      taxes.  Actual results could differ materially from those estimates.
      The following critical accounting policies are impacted significantly by
      judgments, assumptions, and estimates used in the preparation of the
      Consolidated Financial Statements.


9


We
      are subject to various loss
      contingencies arising in the ordinary course of business.  We consider
      the likelihood of loss or impairment of an asset or the incurrence of a
      liability, as well as our ability to reasonably estimate the amount of loss
      in
      determining loss contingencies.  An estimated loss contingency is
      accrued when management concludes that it is probable that an asset has been
      impaired or a liability has been incurred and the amount of the loss can be
      reasonably estimated.  We regularly evaluate current information
      available to us to determine whether such accruals should be
      adjusted.





We
      recognize deferred tax assets
      (future tax benefits) and liabilities for the expected future tax consequences
      of temporary differences between the book carrying amounts and the tax basis
      of
      assets and liabilities.  The deferred tax assets and liabilities
      represent the expected future tax return consequences of those differences,
      which are expected to be either deductible or taxable when the assets and
      liabilities are recovered or settled.  Future tax benefits have been
      fully offset by a 100% valuation allowance as management is unable to determine
      that it is more likely than not that this deferred tax asset will be
      realized.





**Recently
      Enacted and Proposed Regulatory Changes** - Recently enacted and proposed
      changes in the laws and regulations affecting public companies, including the
      provisions of the Sarbanes-Oxley Act of 2002 and rules proposed by the SEC
      and
      NASDAQ could cause us to incur increased costs as we evaluate the implications
      of new rules and respond to new requirements. The new rules could make it more
      difficult for us to obtain certain types of insurance, including directors
      and
      officers liability insurance, and we may be forced to accept reduced policy
      limits and coverage or incur substantially higher costs to obtain the same
      or
      similar coverage. The impact of these events could also make it more difficult
      for us to attract and retain qualified persons to serve on the Company's board
      of directors, or as executive officers. We are presently evaluating and
      monitoring developments with respect to these new and proposed rules, and we
      cannot predict or estimate the amount of the additional costs we may incur
      or
      the timing of such costs.





In
      September 2006, the FASB issued SFAS
      No. 157, "Accounting for Fair Value Measurements." SFAS No. 157 defines fair
      value, and establishes a framework for measuring fair value in generally
      accepted accounting principles and expandsdisclosure about fair value
      measurements. SFAS No. 157 is effective for the Company for financial statements
      issued subsequent to November 15, 2007. The Company does not expect the new
      standard to have any material impact on the financial position and results
      of
      operations.





In
      February 2007, the FASB issued SFAS
      No. 159, "The Fair Value Option for Financial Assets and Financial Liabilities"
      ("SFAS 159"). SFAS 159 provides companies with an option to report selected
      financial assets and liabilities at fair value. The objective of SFAS 159 is
      to
      reduce both complexity in accounting for financial instruments and the
      volatility in earnings caused by measuring related assets and liabilities
      differently. Generally accepted accounting principles have required different
      measurement attributes for different assets and liabilities that can create
      artificial volatility in earnings. The FASB has indicated it believes that
      SFAS
      159 helps to mitigate this type of accounting-induced volatility by enabling
      companies to report related assets and liabilities at fair


10


value,
      which would likely reduce the need for companies to comply with detailed rules
      for hedge accounting. SFAS 159 also establishes presentation and disclosure
      requirements designed to facilitate comparisons between companies that choose
      different measurement attributes for similar types of assets and
      liabilities.  SFAS 159 does not eliminate disclosure requirements
      included in other accounting standards, including requirements for disclosures
      about fair value measurements included in SFAS 157 and SFAS No. 107,
      "Disclosures about Fair Value of Financial Instruments." SFAS 159 is effective
      for the Company as of the beginning of fiscal year 2008. The adoption of this
      pronouncement is not expected to have an impact on the Company's financial
      position, results of operations or cash flows.





**Forward
      Looking Statement**





This
      Management’s Discussion and
      Analysis of Financial Condition and Results of Operations includes a number
      of
      forward-looking statements that reflect Management’s current views with respect
      to future events and financial performance. Those statements include statements
      regarding the intent, belief or current expectations of the Company and members
      of its management team as well as the assumptions on which such statements
      are
      based.  Prospective investors are cautioned that any such
      forward-looking statements are not guarantees of future performance and involve
      risk and uncertainties, and that actual results may differ materially from
      those
      contemplated by such forward-looking statements. Readers are urged to carefully
      review and consider the various disclosures made by the Company in this report
      and in the Company’s other reports filed with the Securities and Exchange
      Commission. Important factors currently known to Management could cause actual
      results to differ materially from those in forward-looking
      statements.  The Company undertakes no obligation to update or revise
      forward-looking statements to reflect changed assumptions, the occurrence of
      unanticipated events or changes in the future operating results over
      time.  The Company believes that its assumptions are based upon
      reasonable data derived from and known about its business and operations and
      the
      business and operations of the Company.  No assurances are made that
      actual results of operations or the results of the Company’s future activities
      will not differ materially from its assumptions.











**ITEM
      7. FINANCIAL STATEMENTS**







The
      financial statements of the Company
      and supplementary data are included beginning immediately preceding the
      signature page to this report.  See Item 13 for a list of the
      financial statements and financial statement schedules
      included.


11








**ITEM  8.
      CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS****ON
      ACCOUNTING AND FINANCIAL DISCLOSURE**











There
      are not and have not been any
      disagreements between the Company and its accountants on any matter of
      accounting principles, practices or financial statements
      disclosure.








**ITEM
      8A.  CONTROLS AND
      PROCEDURES**











Based
      on an evaluation under the
      supervision and the participation of the Company’s management as of a date
      within the end of the period covered by this Annual Report on Form 10-KSB,
      the
      Company’s chief executive officer and chief financial officer has concluded that
      the Company’s disclosure controls and procedures (as defined in Rules
      13a-14(c)  and 15d-14(c) under the Securities Exchange Act of 1934, as
      amended (the”Exchange Act”) are effective to ensure that information required to
      be disclosed by the Company in reports that it files or submits under the
      Exchange Act is recorded, processed, summarized and reported within the time
      periods specified in Securities and Exchange Commission rules and
      forms.





There
      were no significant changes in
      the Company’s internal controls or in other factors that could significantly
      affect these controls subsequent to the date of their
      evaluation.  There were no significant deficiencies or material
      weaknesses, and therefore there were no corrective actions
      taken.  However, the design of any system of controls is based in part
      upon certain assumptions about the likelihood of future events and there is
      no
      certainty that any design will succeed in achieving its stated goal under all
      potential future considerations, regardless of how remote.





Internal
      Controls Over Financial Reporting





There
      have not been any changes in the
      Company’s internal controls over financial reporting (as such term is defined in
      Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the Company’s most
      recent fiscal year that have materially affected, or are reasonably likely
      to
      materially affect, the Company’s internal controls over financial
      reporting.











**ITEM
      8B.  OTHER INFORMATION**







None.


12


**PART
      III**







**ITEM
      9. DIRECTORS EXECUTIVE OFFICERS, PROMOTERS AND****CONTROL
      PERSONS; COMPLIANCE WITH SECTION 16(a) OFTHE
      EXCHANGE ACT**







**Executive
      Officers and Directors**





The
      members of the Board of Directors of the Company serve until the next annual
      meeting of stockholders, or until their successors have been
      elected.  The officers serve at the pleasure of the Board of
      Directors.  The following table sets forth the name, age, and position
      of each executive officer and director of the Company:




**Director's   Name**
            **Age**
            **Office**
            **Term
                Expires**Rose
                Fischer
            48
            President
                and Director
            next
                annual meeting




Rose
      Fischer, President/Director, with
      an associate degree in accounting, has been Director and Operations Facilitator
      for Optimum Source International, Ltd. (“OSI”) for the past five years, which
      includes finalization and implementation of all electronic
      commerce.  Prior to OSI, Ms. Fischer’s experience was as a financial
      consultant with a privately held firm since 1985.





**Conflicts
      of Interest**





Certain
      conflicts of interest existed
      at September 30, 2007 and may continue to exist between the Company and its
      sole
      officer and director due to the fact that he has other business interests to
      which she devotes her primary attention.  Each officer and director
      may continue to do so notwithstanding the fact that management time should
      be
      devoted to the business of the Company.





Certain
      conflicts of interest may exist
      between the Company and its management, and conflicts may develop in the
      future.  The Company has not established policies or procedures for
      the resolution of current or potential conflicts of interests between the
      Company, its officers and directors or affiliated entities.  There can
      be no assurance that management will resolve all conflicts of interest in favor
      of the Company, and failure by management to conduct the Company's business
      in
      the Company's best interest may result in liability to the
      management.  The officers and directors are accountable to the Company
      as fiduciaries, which means that they are required to exercise good faith and
      integrity in handling the Company's affairs. Shareholders who believe that
      the
      Company has been harmed by failure of an officer or director to appropriately
      resolve any conflict of interest may, subject to applicable rule of civil
      procedure, be able to bring a class action or derivative suit to enforce their
      rights and the Company's rights.


13


**Compliance
      with Section 16(a) of the Exchange Act**





Based
      solely upon a review of forms 3,
      4, and 5 and amendments thereto, furnished to the Company during or respecting
      its last fiscal year, no director, officer, beneficial owner of more than 10%
      of
      any class of equity securities of the Company or any other person known to
      be
      subject to Section 16 of the Exchange Act of 1934, as amended, failed to file
      on
      a timely basis reports required by Section 16(a) of the Exchange Act for the
      last fiscal year.





**Audit
      Committee Financial Expert**





The
      Company’s board of directors does
      not have an “audit committee financial expert,” within the meaning of such
      phrase under applicable regulations of the Securities and Exchange Commission,
      serving on its audit committee.  The board of directors believes that
      all members of its audit committee are financially literate and experienced
      in
      business matters, and that one or more members of the audit committee are
      capable of (i) understanding generally accepted accounting principles (“GAAP”)
      and financial statements, (ii) assessing the general application of GAAP
      principles in connection with our accounting for estimates, accruals and
      reserves, (iii) analyzing and evaluating our financial statements, (iv)
      understanding our internal controls and procedures for financial reporting;
      and
      (v) understanding audit committee functions, all of which are attributes of
      an
      audit committee financial expert.  However, the board of directors
      believes that there is not any audit committee members who has obtained these
      attributes through the experience specified in the SEC’s definition of “audit
      committee financial expert.”  Further, like many small companies, it
      is difficult for the Company to attract and retain board members who qualify
      as
“audit committee financial experts, “ and competition for these individuals is
      significant.  The board believes that its current audit committee is
      able to fulfill its role under SEC regulations despite not having a designated
      “audit committee financial expert.”











**ITEM
      10. EXECUTIVE COMPENSATION**







None
      of the executive officer’s annual
      salary and bonus exceeded $60,000 during any of the Company’s last two fiscal
      years.





There
      are currently no agreements with
      members of management as to employment or compensation.





There
      is currently no compensation paid
      to non-employment directors.


14





**ITEM
      11. SECURITY OWNERSHIP OF BENEFICIAL OWNERS****AND
      MANAGEMENT**







**Principal
      Shareholders**





The
      table below sets forth information
      as to each person owning of record or who was known by the Company to own
      beneficially more than 5% of the 1,168,698 shares of issued and outstanding
      Common Stock, including options to acquire stock of the Company as of September
      30, 2007 and information as to the ownership of the Company's Stock by each
      of
      its directors and executive officers and by the directors and executive officers
      as a group.  Except as otherwise indicated, all shares are owned
      directly, and the persons named in the table have sole voting and investment
      power with respect to shares shown as beneficially owned by them.


****


****







**Name
                and Address****of
                Beneficial Owners****Directors**
            **Nature
                of Ownership**
            **#
                of** **Shares Owned**
            **Percent****Principal
              Shareholders**John
                Allison
            Common
            71,500
            6.12Alpha
                Beta LLC
            Common
            90,945
            7.78Celex-Nevada
            Common
            97,750
            8.36Wayne
                H. Creasy
            Common
            66,063
            5.65Cede
                & Co.
            Common
            179,085
            15.32Optima
                International
            Common
            205,305
            17.58George
                White
            Common
            70,500
            6.03




**All
              Executive Officers and Directors as a Group(1 person)****Direct**
            **11,860**
            **1.015%****Options**
            **None**
            **None****Total**
            **11,860**
            **1.015%**





15








**ITEM
      12. CERTAIN RELATIONSHIPS AND RELATED
      TRANSACTIONS**







As
      of September 30, 2007 and 2006 all
      activities of the Company have been conducted by corporate officers from either
      their homes or business offices.  Currently, there are no outstanding
      debts owed by the company for the use of these facilities and there are no
      commitments for future use of the facilities.











**ITEM
      13. EXHIBITS, AND REPORTS ON FORM
      8-K**







(a.)           The
      following documents are filed as part of this report.





**1.     Financial
                Statements**
            **Page**Report
                of Independent Registered Public
                Accountants
            F
                - 1Balance
                SheetsSeptember
                30, 2007 and 2006
            F
                - 2Statements
                of Operations for theYears
                Ended September 30, 2007 and
                2006
            F
                - 3Statement
                of Stockholders' EquitySince
                January 13, 1997 (inception) to September 30,
                2007
            F
                - 4Statements
                of Cash Flows for theYears
                Ended September 30, 2007 and
                2006
            F
                - 5Notes
                to Financial Statements
            F
                - 6





**2.**
            **Financial
                Statement Schedules**





The
      following financial statement
      schedules required by Regulation S-X are included herein.





All
      schedules are omitted because they
      are not applicable or the required information is shown in the financial
      statements or notes thereto.


16


**3.**
            **(a)
                Exhibits**





The
      following documents are filed
      herewith or have been included as exhibits to previous filings with the
      Commission and are incorporated herein by this reference:




Exhibit
                  No.
              
              Exhibit3
              
              Articles
                  of Incorporation (1)3.2
              
              Bylaws
                  (1)3.1
              
              Amended
                  Articles of Incorporation (1)31
              
              Certification
                  of Principal Executive
                  Officer and Principal Financial Officer Pursuant to 18 U.S.C Section
                  1350
                  as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of
                  2002.32
              
              Certification
                  of Principal Financial
                  Officer and Principal Financial Officer Pursuant to 18 U.S.C Section
                  1350
                  as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of
                  2002.


(b)
            Reports
                on Form 8-K.  No reports on Form 8-K were filed during the
                period covered by this Form 10-KSB.





(1)           Incorporated
      herein by reference.







**ITEM
      14. PRINCIPAL ACCOUNTANT FEES AND
      SERVICES**







The
      following is a summary of the fees
      billed to us by Robison, Hill & Company for professional services rendered
      for the years ended September 30, 2007 and 2006:





Service
            
            2007
            
            
            2006Audit
                Fees
            
            $
            5,000
            
            
            $
            4,100Audit-Related
                Fees
            
            
            -
            
            
            
            -Tax
                Fees
            
            
            -
            
            
            
            -All
                Other Fees
            
            
            -
            
            
            
            -Total
            
            $
            5,000
            
            
            $
            4,100


**Audit
      Fees**- Consists of fees billed for professional services rendered for
      the audits of our financial statements, reviews of our interim financial
      statements included in quarterly reports, services performed in connection
      with
      filings with the Securities & Exchange Commission and related comfort
      letters and other services that are normally provided by Robison, Hill &
Company in connection with statutory and regulatory filings or
      engagements.


17


**Tax
      Fees** - Consists of fees billed for professional services for tax
      compliance, tax advice and tax planning.  These services include
      assistance regarding federal, state and local tax compliance and consultation
      in
      connection with various transactions and acquisitions.





Audit
      Committee Pre-Approval of Audit and Permissible Non-Audit Services of
      IndependentAuditors





The
      Audit Committee, is to pre-approve
      all audit and non-audit services provided by the independent
      auditors.  These services may include audit services, audit related
      services, tax services and other services as allowed by law or
      regulation.  Pre-approval is generally provided for up to one year and
      any pre-approval is detailed as to the particular service or category of
      services and is generally subject to a specifically approved
      amount.  The independent auditors and management are required to
      periodically report to the Audit Committee regarding the extent of services
      provided by the independent auditors in accordance with this pre-approval and
      the fees incurred to date.  The Audit Committee may also pre-approve
      particular services on a case-by-case basis.


18

















**PENN-PACIFIC
      CORP.**


**(A
      Development Stage Company)**





**-:-**





**INDEPENDENT
      REGISTERED PUBLIC ACCOUNTANTS’ REPORT**





**SEPTEMBER
      30, 2007 and 2006**


























CONTENTS




**Page**Report
                  of Independent Registered Public
                  Accountants
              F
                  - 1Balance
                  SheetsSeptember
                  30, 2007 and 2006
              F
                  - 2Statements
                  of Operations for theYears
                  Ended September 30, 2007 and
                  2006
              F
                  - 3Statement
                  of Stockholders' EquitySince
                  January 13, 1997 (inception) to September 30,
                  2007
              F
                  - 4Statements
                  of Cash Flows for theYears
                  Ended September 30, 2007 and
                  2006
              F
                  - 5Notes
                  to Financial Statements
              F
                  - 6












































REPORT
      OF INDEPENDENT REGISTERED PUBLIC
      ACCOUNTANTS





Penn-Pacific
      Corp.


(A
      Development Stage Company)








We
      have audited the accompanying
      balance sheets of Penn-Pacific Corp. (a development stage company) as of
      September 30, 2007 and 2006, and the related statements of operations, and
      cash
      flows for the two years ended September 30, 2007 and the cumulative since
      January 13, 1997 (inception of the development stage) to September 30, 2007,
      and
      the statement of  stockholders’ equity from January 13, 1997
      (inception of the development stage) to September 30, 2007.  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 audits.





We
      conducted our audit in accordance
      with the 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 also includes examining, on a test basis, evidence supporting the amounts
      and disclosures in the financial statements, assessing the accounting principles
      used and significant estimates made by management, as well as evaluating the
      overall financial statement presentation.  We believe that our audits
      provide 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 Penn-Pacific Corp.  (a development stage
      company) as of September 30, 2007 and 2006, and the results of its operations
      and its cash flows for the years ended September 30, 2007 and 2006and the
      cumulative January 13, 1997 (inception of the development stage) to September
      30, 2007 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 1 to the financial statements, the Company has suffered
      recurring losses from operations and has a net capital deficiency that raise
      substantial doubt about its ability to continue as a going
      concern.  Management’s plans in regard to these matters are also
      described in Note 1.  The financial statements do not include any
      adjustments that might result from the outcome of this uncertainty.





/s/
      Robison, Hill &
Co.


Certified
      Public
      Accountants





Salt
      Lake
      City, Utah


November
      19, 2007


F
          -
          1


PENN-PACIFIC
      CORP.


(A
      Development Stage Company)


BALANCE
      SHEETS








September
                30,2007
            
            
            2006Assets:
            
            $
            -
            
            
            $
            -Liabilities:Accounts
                Payable
            
            
            20,000
            
            
            
            -Advances
                from shareholder
            
            
            48,188
            
            
            
            47,913Total
                Liabilities
            
            
            68,188
            
            
            
            47,913Stockholders'
                Equity:Preferred
                Stock, Par value $.0001Series
                A, Authorized 10,000,000 shares, None issued
            
            
            -
            
            
            
            -Series
                B, authorized 9,990,000 shares, None issued
            
            
            -
            
            
            
            -Series
                C, Authorized 10,000 shares, None issued
            
            
            -
            
            
            
            -Common
                Stock, Par value $.00001Authorized
                500,000,000 shares,Issued
                1,168,698 Shares at September 30, 2007 and 2006
            
            
            12
            
            
            
            12Paid-In
                Capital
            
            
            35,811,071
            
            
            
            35,811,071Retained
                Deficit
            
            
            (35,735,362
            )
            
            
            (35,735,362
            )Deficit
                Accumulated During theDevelopment
                Stage
            
            
            (143,909
            )
            
            
            (123,634
            )Total
                Stockholders' Equity
            
            
            (68,188
            )
            
            
            (47,913
            )Total
                Liabilities andStockholders'
                Equity
            
            $
            -
            
            
            $
            -










The
      accompanying notes are an integral part of these financial
      statements.


F
          -
          2




PENN-PACIFIC
      CORP.


(A
      Development Stage Company)


STATEMENTS
      OF OPERATIONS











CumulativesinceJanuary
                13,1997For
                the year ended
            
            
            inception
                ofSeptember
                30,
            
            
            development2007
            
            
            2006
            
            
            stageRevenues:
            
            $
            -
            
            
            $
            -
            
            
            $
            -Expenses:
            
            
            20,275
            
            
            
            2,340
            
            
            
            143,909Net
                Loss
            
            $
            (20,275
            )
            
            $
            (2,340
            )
            
            $
            (143,909
            )Basic
                & Diluted loss per share
            
            $
            (0.02
            )
            
            $
            -Weighted
                AverageShares
                Outstanding
            
            
            1,168,698
            
            
            
            1,168,698













The
      accompanying notes are an integral part of these financial
      statements.


F
          -
          3





PENN-PACIFIC
      CORP.


(A
      Development Stage Company)


STATEMENT
      OF STOCKHOLDERS' EQUITY


SINCE
      JANUARY 13, 1997 (INCEPTION OF DEVELOPMENT STAGE) TO


SEPTEMBER
      30, 2007


DeficitAccumulatedSinceJanuary
                13,1997inception
                ofCommon
                Stock
            
            
            Paid-In
            
            
            Retained
            
            
            DevelopmentShares
            
            
            Par
                Value
            
            
            Capital
            
            
            Deficit
            
            
            StageBalance
                at October 1, 1996
            
            
            951,533
            
            
            $
            10
            
            
            $
            35,789,356
            
            
            $
            (35,735,362
            )
            
            $
            -Net
                Loss
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            (61,855
            )Balance
                at September 30, 1997
            
            
            951,533
            
            
            
            10
            
            
            
            35,789,356
            
            
            
            (35,735,362
            )
            
            
            (61,855
            )November
                4, 1997 Issuance of Stock for Services and paymentof
                Accounts Payable
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -Net
                Loss
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            (15,431
            )Balance
                at September 30, 1998
            
            
            951,533
            
            
            
            10
            
            
            
            35,789,356
            
            
            
            (35,735,362
            )
            
            
            (77,286
            )Capital
                contributed by shareholder
            
            
            -
            
            
            
            -
            
            
            
            
            
            
            
            -
            
            
            
            -Net
                Loss
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            (12,804
            )Balance
                at September 30, 1999
            
            
            951,533
            
            
            
            10
            
            
            
            35,789,356
            
            
            
            (35,735,362
            )
            
            
            (90,090
            )Stock
                Issued for services
            
            
            205,305
            
            
            
            2
            
            
            
            20,529Stock
                Issued for expenses
            
            
            11,860
            
            
            
            -
            
            
            
            1,186
            
            
            
            -
            
            
            
            -Net
                Loss
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            (10,457
            )Balance
                at September 30, 2000
            
            
            1,168,698
            
            
            
            12
            
            
            
            35,811,071
            
            
            
            (35,735,362
            )
            
            
            (100,547
            )Net
                Loss
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            (5,300
            )Balance
                at September 30, 2001
            
            
            1,168,698
            
            
            
            12
            
            
            
            35,811,071
            
            
            
            (35,735,362
            )
            
            
            (105,847
            )Net
                Loss
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            (950
            )Balance
                at September 30, 2002
            
            
            1,168,698
            
            
            
            12
            
            
            
            35,811,071
            
            
            
            (35,735,362
            )
            
            
            (106,797
            )Net
                Loss
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -Balance
                at September 30, 2003
            
            
            1,168,698
            
            
            
            12
            
            
            
            35,811,071
            
            
            
            (35,735,362
            )
            
            
            (106,797
            )Net
                Loss
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            (1,972
            )Balance
                at September 30, 2004
            
            
            1,168,698
            
            
            
            12
            
            
            
            35,811,071
            
            
            
            (35,735,362
            )
            
            
            (108,769
            )Net
                Loss
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            (12,525
            )Balance
                at September 30, 2005
            
            
            1,168,698
            
            
            
            12
            
            
            
            35,811,071
            
            
            
            (35,735,362
            )
            
            
            (121,294
            )Net
                Loss
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            (2,340
            )Balance
                at September 30, 2006
            
            
            1,168,698
            
            
            
            12
            
            
            
            35,811,071
            
            
            
            (35,735,362
            )
            
            
            (123,634
            )Net
                Loss
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            (20,275
            )Balance
                at September 30, 2007
            
            
            1,168,698
            
            
            $
            12
            
            
            $
            35,811,071
            
            
            $
            (35,735,362
            )
            
            $
            (143,909
            )


The
      accompanying notes are an integral part of these financial
      statements.


F
          -
          4




PENN-PACIFIC
      CORP.


(A
      Development Stage Company)


STATEMENTS
      OF CASH FLOWS


Cumulativesince
                January 13, 1997For
                the year ended
            
            
            Inception
                ofSeptember
                30,
            
            
            Development2007
            
            
            2006
            
            
            StageCASH
                FLOWS FROM OPERATINGACTIVITIES:Net
                Loss
            
            $
            (20,275
            )
            
            $
            (2,340
            )
            
            $
            (143,909
            )Common
                Stock issued for expenses
            
            
            -
            
            
            
            -
            
            
            
            21,717Increase
                (Decrease) in Accounts Payable
            
            
            20,000
            
            
            
            (12,525
            )
            
            
            20,000Increase
                (Decrease) in Advancesfrom
                shareholder
            
            
            275
            
            
            
            14,865
            
            
            
            48,188Increase
                (Decrease) in Accrued Expenses
            
            
            -
            
            
            
            -
            
            
            
            54,004Net
                Cash Used in operating activities
            
            
            -
            
            
            
            -
            
            
            
            -CASH
                FLOWS FROM INVESTINGACTIVITIES:Net
                cash provided by investing activities
            
            
            -
            
            
            
            -
            
            
            
            -CASH
                FLOWS FROM FINANCINGACTIVITIES:Net
                Cash Provided byFinancing
                Activities
            
            
            -
            
            
            
            -
            
            
            
            -Net
                (Decrease) Increase inCash
                and Cash Equivalents
            
            
            -
            
            
            
            -
            
            
            
            -Cash
                and Cash Equivalentsat
                Beginning of Period
            
            
            -
            
            
            
            -
            
            
            
            -Cash
                and Cash Equivalentsat
                End of Period
            
            $
            -
            
            
            $
            -
            
            
            $
            -SUPPLEMENTAL
                DISCLOSURE OF CASH FLOW INFORMATION:Cash
                paid during the year for:Interest
            
            $
            -
            
            
            $
            -
            
            
            $
            -Franchise
                and income taxes
            
            $
            -
            
            
            $
            -
            
            
            $
            -SUPPLEMENTAL
                DISCLOSURE OF NON-CASH INVESTING AND FINANCINGACTIVITIES:
                None


The
      accompanying notes are an integral part of these financial
      statements.


F
          -
          5




PENN
      -PACIFIC CORP.


(A
      Development Stage Company)


NOTES
      TO FINANCIAL STATEMENTS


FOR
      THE YEARS ENDED SEPTEMBER 30, 2007 and 2006





NOTE
      1
      - NATURE OF OPERATIONS AND GOING CONCERN





The
      accompanying  financial
      statements have been prepared on the basis of accounting principles applicable
      to a “going concern”, which assume that the Company will continue in operation
      for at least one year and will be able to realize its assets and discharge
      its
      liabilities in the normal course of operations.





Several
      conditions and events cast
      doubt about the Company’s ability to continue as a “going
      concern.”  The Company has incurred net losses of approximately
      $20,275 and $2,340 for the year ended September 30, 2007 and 2006 respectively,
      has a liquidity problem, and requires additional financing in order to finance
      its business activities on an ongoing basis.  The Company is actively
      pursuing alternative financing and has had discussions with various third
      parties, although no firm commitments have been obtained.  The
      Company’s future capital requirements will depend on numerous factors including,
      but not limited to, continued progress in finding a merger candidate and the
      pursuit of business opportunities.





These
      financial statements do not
      reflect adjustments that would be necessary if the Company were unable to
      continue as a “going concern”.  While management believes that the
      actions already taken or planned, will mitigate the adverse conditions and
      events which raise doubt about the validity of the “going concern” assumption
      used in preparing these financial statements, there can be no assurance that
      these actions will be successful.  If the Company were unable to
      continue as a “going concern,” then substantial adjustments would be necessary
      to the carrying values of assets, the reported amounts of its liabilities,
      the
      reported revenues and expenses, and the balance sheet classifications
      used.





Organization
      and Basis of Presentation





The
      Company was incorporated under the
      laws of the state of Delaware on May 18, 1971. On April 8, 2006 a Plan and
      Articles of Merger between Penn-Pacific Corp. (Delaware) and Penn-Pacific Corp.
      (Nevada) was filed in the State of Nevada whereby the Company was re-domiciled
      in the State of Nevada.  From 1979 to 1991 the primary business of
      Penn Pacific and its subsidiaries was the acquisition, exploration, development,
      production and operation of oil and gas properties.  Penn Pacific has
      been inactive since 1991.  The Company filed a voluntary petition of
      reorganization under Chapter 11 of the United States Bankruptcy Code on January
      27, 1994.  On January 13, 1997, the Company emerged from bankruptcy
      pursuant to a final decree of the United States Bankruptcy Court for the
      Northern District of Oklahoma.  The Company is in the development
      stage since January 13, 1997 and has not commenced planned principal
      operations.


F
          -
          6


PENN
      -PACIFIC CORP.


(A
      Development Stage Company)


NOTES
      TO FINANCIAL STATEMENTS


FOR
      THE YEARS ENDED SEPTEMBER 30, 2007 and 2006


(Continued)





NOTE
      1
      - NATURE OF OPERATIONS AND GOING CONCERN (continued)





Nature
      of Business





The
      Company has no products or services
      as of September 30, 2007.  The Company intends to acquire interests in
      various business opportunities, which in the opinion of management will provide
      a profit to the Company.





NOTE
      2
      - SUMMARY OF ACCOUNTING POLICIES





This
      summary of accounting policies for
      Penn-Pacific Corp.  (a development stage company) is presented to
      assist in understanding the Company's financial statements.  The
      accounting policies conform to generally accepted accounting principles and
      have
      been consistently applied in the preparation of the financial
      statements.





Cash
      and Cash Equivalents





For
      purposes of the statement of cash
      flows, the Company considers all highly liquid debt instruments purchased with
      a
      maturity of three months or less to be cash equivalents to the extent the funds
      are not being held for investment purposes.





Pervasiveness
      of Estimates





The
      preparation of financial statements
      in conformity with generally accepted accounting principles required management
      to make estimates and assumptions that affect the reported amounts of assets
      and
      liabilities and disclosure of contingent assets and liabilities at the date
      of
      the financial statements and the reported amounts of revenues and expenses
      during the reporting period.  Actual results could differ from those
      estimates.





Concentration
      of Credit Risk





The
      Company has no significant
      off-balance-sheet concentrations of credit risk such as foreign exchange
      contracts, options contracts or other foreign hedging
      arrangements.


F
          -
          7





PENN
      -PACIFIC CORP.


(A
      Development Stage Company)


NOTES
      TO FINANCIAL STATEMENTS


FOR
      THE YEARS ENDED SEPTEMBER 30, 2007 and 2006


(Continued)





NOTE
      2
      - SUMMARY OF ACCOUNTING POLICIES (Continued)





Recent
      Accounting Standards





In
      September 2006, the FASB issued SFAS
      No. 157, "Accounting for Fair Value Measurements." SFAS No. 157 defines fair
      value, and establishes a framework for measuring fair value in generally
      accepted accounting principles and expandsdisclosure about fair value
      measurements. SFAS No. 157 is effective for the Company for financial statements
      issued subsequent to November 15, 2007. The Company does not expect the new
      standard to have any material impact on the financial position and results
      of
      operations.





In
      February 2007, the FASB issued SFAS
      No. 159, "The Fair Value Option for Financial Assets and Financial Liabilities"
      ("SFAS 159"). SFAS 159 provides companies with an option to report selected
      financial assets and liabilities at fair value. The objective of SFAS 159 is
      to
      reduce both complexity in accounting for financial instruments and the
      volatility in earnings caused by measuring related assets and liabilities
      differently. Generally accepted accounting principles have required different
      measurement attributes for different assets and liabilities that can create
      artificial volatility in earnings. The FASB has indicated it believes that
      SFAS
      159 helps to mitigate this type of accounting-induced volatility by enabling
      companies to report related assets and liabilities at fair value, which would
      likely reduce the need for companies to comply with detailed rules for hedge
      accounting. SFAS 159 also establishes presentation and disclosure requirements
      designed to facilitate comparisons between companies that choose different
      measurement attributes for similar types of assets and
      liabilities.  SFAS 159 does not eliminate disclosure requirements
      included in other accounting standards, including requirements for disclosures
      about fair value measurements included in SFAS 157 and SFAS No. 107,
      "Disclosures about Fair Value of Financial Instruments." SFAS 159 is effective
      for the Company as of the beginning of fiscal year 2008. The adoption of this
      pronouncement is not expected to have an impact on the Company's financial
      position, results of operations or cash flows.


F
          -
          8





PENN
      -PACIFIC CORP.


(A
      Development Stage Company)


NOTES
      TO FINANCIAL STATEMENTS


FOR
      THE YEARS ENDED SEPTEMBER 30, 2007 and 2006


(Continued)





NOTE
      2
      - SUMMARY OF ACCOUNTING POLICIES (Continued)





Loss
      per Share





The
      reconciliations of the numerators
      and denominators of the basic loss per share computations are as
      follows:


Income
            
            
            Shares
            
            
            Per-Share(Numerator)
            
            
            (Denominator)
            
            
            AmountFor
                the year ended September 30, 2007**Basic
                Loss per Share**Loss
                to common shareholders
            
            $
            (20,275
            )
            
            
            1,168,698
            
            
            $
            (0.02
            )For
                the year ended September 30, 2006**Basic
                Loss per Share**Loss
                to common shareholders
            
            $
            (2,340
            )
            
            
            1,168,698
            
            
            $
            -


The
      effect of outstanding common stock equivalents would be anti-dilutive for
      September 30, 2007 and 2006 and are thus not considered.  There are no
      common stock equivalents outstanding  at September 30, 2007 and
      2006.





NOTE
      3
      - INCOME TAXES





As
      of September 30, 2007, the Company
      had a net operating loss carryforward for income tax reporting purposes of
      approximately $143,000 that may be offset against future taxable income through
      2026.  Current tax laws limit the amount of loss available to be
      offset against future taxable income when a substantial change in ownership
      occurs.  Therefore, the amount available to offset future taxable
      income may be limited.  No tax benefit has been reported in the
      financial statements, because the Company believes there is a 50% or greater
      chance the carryforwards will expire unused.  Accordingly, the
      potential tax benefits of the loss carryforwards are offset by a valuation
      allowance of the same amount.





NOTE
      4
      - DEVELOPMENT STAGE COMPANY





The
      Company has not begun principal
      operations and as is common with a development stage company, the Company has
      had recurring losses during its development stage.  The Company's
      financial statements are prepared using generally accepted accounting principles
      applicable to a going concern which contemplates the realization of assets
      and
      liquidation of liabilities in the normal


F
          -
          9


PENN
      -PACIFIC CORP.


(A
      Development Stage Company)


NOTES
      TO FINANCIAL STATEMENTS


FOR
      THE YEARS ENDED SEPTEMBER 30, 2007 and 2006


(Continued)





NOTE
      4
      - DEVELOPMENT STAGE COMPANY (continued)





course
      of
      business.  However, the Company does not have
      significant  cash or other material assets, nor does it have an
      established source of revenues sufficient to cover its operating costs and
      to
      allow it to continue as a going concern.  In the interim, shareholders
      of the Company have committed to meeting its minimal operating
      expenses.





NOTE
      5
      - CHANGES IN COMMON AND PREFERRED STOCK





On
      October 29, 2007 the Company issued
      500,000 share of common stock in exchange for $15,000 in accounts
      payable.


F
          -
          10










Pursuant
      to the requirements of section
      13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant
      has duly caused this report to be signed on it behalf by the undersigned,
      thereunto duly authorized.




**PENN-PACIFIC
      CORP.**




Dated:
                  November 19, 2007
                
                By  /S/     Rose
                    Fischer
                  Rose
                    Fischer
                  President








Pursuant
      to the requirements of the
      Securities Exchange Act of 1934, as amended, this report has been signed below
      by the following persons on behalf of the Registrant and in the capacities
      indicated on this 19th day of November, 2007.





Signatures
      & Title




/S/     Rose
          Fischer
 Rose
        Fischer


President,
        Director


(Principal
      Executive Officer)