U.S. SECURITIES AND EXCHANGE COMMISSION 
Washington, D.C. 20549 FORM 10-K x
 ANNUAL
 REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the fiscal year ended June 30, 2010o
 TRANSITION
 REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934For the
 transition period from _______________ to _______________Commission
 File Number 001-10320 Tempco, Inc.(Name of small business issuer in its charter) Nevada
 
 13-3465289(State or other jurisdiction of incorporation of organization)
 
 (I.R.S. Employer Identification No.)7625 East Via Del Reposo Scottsdale, AZ
 
 85258(Address of principal executive offices)
 
 Zip Code  (480) 272-8745(Issuers telephone number) Securities
registered under Section 12(b) of the Exchange Act: None Securities
registered under Section 12(g) of the Exchange Act: Title of Each Class
 
 Name of Each Exchange on Which RegisteredCommon Stock, $.005 par value
 
 OTC BB Indicate by
check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act. o Yes x No Indicate by
check mark if the registrant is not required to file reports pursuant to
Section 13 or Section 15(d) of the Act. o Yes x No 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. x Yes o No Indicate by
check mark whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of
Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or
for such shorter period that the registrant was required to submit and post
such files). o Yes o No Indicate by
check mark if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K (§ 229.405 of this chapter) is not contained herein, and will
not 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-K
or any amendment to this Form 10-K. o Indicate by
check mark whether the registrant is a large accelerated filer, an accelerated
filer, a non-accelerated filer, or a smaller reporting company. See the
definitions of large accelerated filer, accelerated filer and smaller
reporting company in Rule 12b-2 of the Exchange Act. Large
 accelerated filer
 o
 
 Accelerated
 filer
 oNon-accelerated
 filer
 o
 (Do not
 check if a smaller reporting company)
 Smaller
 reporting company
 x Indicate by
check mark whether the registrant is a shell company (as defined in Rule 12b-2
of the Act). x Yes o No State the
aggregate market value of the voting and non-voting common equity held by non-affiliates
computed by reference to the price at which the common equity was last sold, or
the average bid and asked price of such common equity, as of the last business
day of the registrants most recently completed second fiscal quarter.
$2,069,336. At October 10,
2010, the issuer had outstanding 11,490,016 shares of Common Stock, par value
$.005 per share. DOCUMENTS INCORPORATED BY REFERENCE None   PART I

Forward-Looking Information

The statements
contained in this Annual Report on Form 10-K that are not historical fact are
forward-looking statements (as such term is defined in the Private Securities
Litigation Reform Act of 1995), 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 forward-looking statements contained herein are
based on current expectations that involve a number of risks and uncertainties.
These statements can be identified by the use of forward-looking terminology
such as believes, expects, may, will, should, or anticipates, or
the negative thereof or other variations thereon or comparable terminology, or
by discussions of strategy that involve risks and uncertainties. The Company
wishes to caution the reader that its forward-looking statements that are not
historical facts are only predictions. No assurances can be given that the
future results indicated, whether expressed or implied, will be achieved. While
sometimes presented with numerical specificity, these projections and other
forward-looking statements are based upon a variety of assumptions relating to
the business of the Company, which, although considered reasonable by the
Company, may not be realized. Because of the number and range of assumptions
underlying the Companys projections and forward-looking statements, many of
which are subject to significant uncertainties and contingencies that are
beyond the reasonable control of the Company, some of the assumptions
inevitably will not materialize, and unanticipated events and circumstances may
occur subsequent to the date of this report. These forward-looking statements
are based on current expectations and the Company assumes no obligation to
update this information. Therefore, the actual experience of the Company and
the results achieved during the period covered by any particular projections or
forward-looking statements may differ substantially from those projected.
Consequently, the inclusion of projections and other forward-looking statements
should not be regarded as a representation by the Company or any other person
that these estimates and projections will be realized. The Companys actual
results may vary materially. There can be no assurance that any of these
expectations will be realized or that any of the forward-looking statements
contained herein will prove to be accurate.

Item 1. Description of Business.

General

Tempco, Inc.
is a Nevada corporation. We were originally incorporated in 1988 as Richard
Barrie Fragrances, Inc., a Nevada Corporation. From March 1996 through February
2000, we operated under the name FBR Capital Corp. In February 2000 we changed
our name to Vitrix, Inc. which we operated as until November, 2003, when we
changed our name to Time America, Inc. In May 2007, we changed our name to
NETtime Solutions, Inc. In February, 2008, in connection with the sale of
substantially all of our operating assets, we changed the name of the Company
from NetTime Solutions, Inc. to Tempco, Inc. and became a shell company. We
have no business plan except to seek to acquire or merge with an operating
company. Our sole assets are $114,779 in cash and prepaid expenses of $9,824.

Current Business Strategy

In February
2008 we sold all of our operating assets, and since that time the Company has
had no ongoing operations. The Board has determined to maintain the Company as
a public shell corporation, which will seek suitable business combination
opportunities. The Board believes that a business combination with an operating
company has the potential to create greater value for the Companys
stockholders than a liquidation or similar distribution.

Research and Development

We have not
engaged in any material product research and development, nor do we anticipate
having any in the next fiscal year.

Acquisitions of Plant and Equipment

We do not
anticipate any material acquisitions of plant and equipment in the next fiscal
year.

Employees

The Company
presently has no employees apart from our Officers and Directors. We expect no
significant changes in the number of our employees other than such changes, if
any, incident to a business combination.

1

Effect of Status as a Shell Company

Because we are
a shell company as defined under the Rules of the Securities and Exchange
Commission, we are disqualified from using a short form of registration
statement (S-8) for the issuance of employee stock options. Furthermore,
holders of restricted securities issued while we were or are a shell company
may not re-sell them pursuant to SEC Rule 144 for a period of one year after we
cease to be a shell and have filed the necessary report with the SEC to that
effect.

Item 1A. Risk Factors

We are a
smaller reporting company as defined by Regulation S-K and as such, are not
required to provide the information contained in this item pursuant to
Regulation S-K.

Item IB. Unresolved Staff Comments

Not
applicable.

Item 2. Description of Property.

We do not own
any real property. The Companys corporate headquarters are located in the
offices of a shareholder, located in Scottsdale, Arizona. The Company is not
obligated under the terms of that lease, which has monthly rental payments of
$1,000, on a month to month basis.

Item 3. Legal Proceedings.

We are from
time to time involved in legal proceedings arising from the normal course of
business. As of the date of this report, we were not currently involved in any
legal proceedings.

Item 4. Removed and Reserved

PART II

Item 5. Market For Registrants Common
Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

Market for Common Stock

Our common
stock is quoted on the Over-The-Counter Bulletin Board maintained by the NASD
under the symbol TEMO.OB. The high and low bid prices of our common stock as
reported for the periods presented, by fiscal quarter (i.e. 1st
Quarter = July 1 through September 30), were as follows. The quotations reflect
inter-dealer prices, without retail markup, mark-down or commission and may not
represent actual transactions.

High
 
 LowFiscal Year
 Ended:  June 30,
 2009First
 Quarter
 $
 0.15
 
 $
 0.07Second
 Quarter
 
 0.25
 
 
 0.09Third
 Quarter
 
 0.30
 
 
 0.09Fourth
 Quarter
 
 0.30
 
 
 0.1Fiscal Year
 Ended:  June 30,
 2010First
 Quarter
 $
 0.35
 
 $
 0.15Second
 Quarter
 
 0.30
 
 
 0.07Third
 Quarter
 
 0.55
 
 
 0.07Fourth
 Quarter
 
 0.33
 
 
 0.152

Holders

As of
September 13, there were approximately 80 holders of record of our common
stock. This does not include beneficial owners holding stock in street name.

Dividend Policy

To date, we have
not paid any cash dividends and our present policy is to retain earnings, if
any for use in our business.

Equity Compensation Plan Information

The following
table sets forth information regarding the number of shares of our common stock
that may be issued pursuant to our equity compensation plans or arrangements as
of the end of fiscal 2010.

Plan Category
 
 Number of Securities To Be Issued Upon
 Exercise of Outstanding Options, Warrants and Rights
 
 Weighted-Average Exercise Price of Outstanding
 Options, Warrants and Rights
 
 Number of Securities Remaining Available
 For Future Issuance Under Equity Compensation Plans (Excluding Securities
 Reflected in First Column)Equity compensation plans approved by
 security holders
 
 
 None  (1
 )
 $
 
 
 
 600,000  (2
 )Equity compensation plans not approved by
 security holders
 
 
 3,452,287  (3
 )
 $
 0.40
 
 
 TOTAL
 
 
 3,452,287
 
 $
 0.40
 
 
 600,000(1)
 Represents
 shares of common stock that may be issued pursuant to outstanding options
 granted under our 1999 Equity Compensation Plan.(2)
 Represents
 shares of common stock that may be issued pursuant to options available for
 future grant under our 1999 Equity Compensation Plan.(3)
 Represents
 (a) an aggregate of 2,572,287 shares of common stock underlying non-statutory
 stock options approved by the Companys board of directors and granted to
 directors and employees of the Company (the Options). The options have
 vesting schedules ranging from immediate vesting to four year vesting and
 have an exercise price equal to the closing bid price of the common stock on
 the date of grant and a term of eight to ten years; and (b) an aggregate of
 880,000 shares of common stock purchasable upon exercise of warrants issued
 to various parties in connection with debt and equity offerings and for
 services rendered by contractors.Recent Sales of Unregistered Securities

Set forth
below is information regarding securities sold by us within the past three
fiscal years which were not registered under the Securities Act.

In March 2008,
we commenced a private placement which closed in April, 2008 pursuant to which
we received net proceeds of $225,000 upon issuance of 2,500,000 shares of our
common stock. The shares were sold to accredited investors, as such term is
defined in the rules promulgated under the Securities Act, for a purchase price
of $.10 per share, with a minimum purchase of 50,000 shares. In relation to the
private placement, we paid Source Capital $25,000, and issued a warrant
entitling the holder to purchase 250,000 shares of common stock, at any time
through April 14, 2013, at a price of $0.12 per share.

3

In May 2010,
we issued 100,000 shares of common stock for cash in relation to the exercise
of a stock option. We received proceeds from the exercise of $9,000.

No
underwriters were involved in the foregoing sales of securities. The securities
described in the foregoing paragraphs were issued in reliance upon the
exemption from the registration requirements of the Securities Act under
Section 4(2) of the Securities Act and Rule 506 of Regulation D promulgated
thereunder relating to sales by an issuer not involving any public offering.
The purchasers of our securities represented to us in connection with their
purchase that they were accredited investors and were acquiring the shares for
investment and not distribution, that they could bear the risks of the
investment and could hold the securities for an indefinite period of time. The
purchasers received written disclosures that the securities had not been
registered under the Securities Act and that any resale must be made pursuant
to an effective registration statement or an available exemption from such
registration requirement. We did not engage in any general solicitation or
advertising in connection with the sales. Unless otherwise indicated, the
proceeds from the private offering were used for general working capital needs.

Item 6. Selected Financial Data

We are a
smaller reporting company as defined by Regulation S-K and as such, are not
required to provide the information contained in this item pursuant to
Regulation S-K.

Item 7. Managements Discussion and Analysis
and Plan of Operation.

The following
discussion and analysis provides information that management believes is
relevant to an assessment and understanding of our results of operations and
financial condition for the periods presented. The following selected financial
information is derived from our historical consolidated financial statements
and should be read in conjunction with such consolidated financial statements
and notes thereto set forth elsewhere herein and the Forward-Looking
Statements explanation included herein.

Plan of Operation

The Companys
current business objective is to locate suitable business combination
opportunities. The Company does not currently engage in any business activities
that provide cash flow. As of June 30, 2010, we have approximately $114,000 in
cash and cash equivalents. We do not believe this will be sufficient to fund
the costs of investigating and analyzing a suitable business combination or to
fund general and administrative expenses for the next 12 months. We will have
to seek additional funds in order to continue our operations for the next
twelve months or until such time as we are able to complete a suitable business
combination.

During the
next 12 months we anticipate incurring costs related to:

(i)
 Filing of
 Exchange Act reports;(ii)
 Officer and
 directors salaries and rent; and(iii)
 Consummating
 an acquisition.We believe we
will be able to meet these costs through use of existing cash and cash
equivalents or additional amounts, as necessary, to be loaned by or invested in
us by our stockholders, management or other investors. However, no assurance
can be given that we will be able to raise additional capital, when needed or
at all, or that such capital, if available, will be on acceptable terms. In the
absence of obtaining additional financing, the Company may be unable to fund its
operations. Accordingly, the Companys financial condition could require that
the Company seek the protection of applicable reorganization laws in order to
avoid or delay actions by third parties, which could materially adversely
affect, interrupt or cause the cessation of the Companys operations. As a
result, the Companys independent registered public accounting firm has issued
going concern opinions on the consolidated financial statements of the Company
for the fiscal years ended June 30, 2010 and 2009.

4

Prior to
consummating a business combination transaction, we do not anticipate:

(i)
 Any
 expenditures for research and development;(ii)
 Any
 expenditures or cash receipts for the purchase or sale of any property plant
 or equipment; or(iii)
 Any
 significant change in the number of employees.Revenue

Since February
2008 we have been in the development stage, and accordingly, there are no
revenues reflected in our financial statements for the years ended June 30,
2010 or 2009.

General and Administrative Expenses

For the years
ended June 30, 2010 and 2009 we have recorded general and administrative
expenses of $113,280 and $260,352, respectively. Our general and administrative
expenses in the current year consist primarily of officers salaries, legal and
accounting fees, and other costs associated with maintaining the company as a
publicly traded entity. The decrease in the current year is due to a decrease
in professional fees, and a decrease in stock-based compensation. There was no
stock based compensation expense in the current year as the options which gave
rise to the expense had been fully vested and recorded to expense during at
June 30, 2009. From February 5, 2008 (the date of reentering the development
stage) through June 30, 2010, we have recorded general and administrative
expenses of $451,250.

Net Income

For the years
ended June 30, 2010 and 2009, we have reflected net loss of $112,730 and
$250,984, respectively. From February 5, 2008 (the date of reentering the development
stage) through June 30, 2010, we have reflected net loss of $428,333.

Off-balance sheet arrangements

We have no
off-balance sheet arrangements that have or are reasonably likely to have a
current or future effect on our financial condition, changes in our financial
condition, revenues or expenses, results of operations, liquidity, capital
expenditures or capital resources that is material to investors.

Item 8. Financial Statements.

The financial
statements and schedules are included herewith commencing on page F-1.

Reports of
 Independent Registered Public Accounting Firms
 F-1Consolidated
 Balance Sheet
 F-3Consolidated
 Statements of Operations
 F-4Consolidated
 Statements of Changes in Stockholders Equity (Deficit)
 F-5Consolidated
 Statements of Cash Flows
 F-6Notes to
 Consolidated Financial Statements
 F-7Item 9. Changes In And Disagreements With
Accountants On Accounting And Financial Disclosure.

None

5

Item 9A. Controls and Procedures.

Evaluation of Disclosure Controls and
Procedures

In accordance
with Rule 13a-15(b) of the Securities Exchange Act of 1934 as amended (the
Exchange Act), as of the end of the period covered by this Annual Report on Form 10-K, the Companys
management evaluated, with the participation of the Companys principal
executive and financial officer, the effectiveness of the design and operation
of the Companys disclosure controls and procedures (as defined in Rule
13a-15(e) or Rule 15d-15(e) under the Exchange Act). Based on the evaluation of
these disclosure controls and procedures, the Companys chairman of the board
and chief executive and financial officer has concluded that the disclosure
controls and procedures were effective as of the date of such evaluation to
ensure that material information relating to the Company, including its
consolidated subsidiaries, was made known to them by others within those
entities, particularly during the period in which this Annual Report on Form 10-Kwas being
prepared.

Managements Report on Internal Control Over
Financial Reporting

Management of
the Company is responsible for establishing and maintaining adequate internal
control over financial reporting. The Companys internal control over financial
reporting has been designed to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements
for external purposes in accordance with generally accepted accounting
principles generally accepted in the United States of America.

Because of its
inherent limitations, internal control over financial reporting may not prevent
or detect misstatements. Therefore, even those systems determined to be
effective can provide only reasonable assurance with respect to financial
statement preparation and presentation. 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
assessed the effectiveness of the Companys internal control over financial
reporting at June 30, 2010. 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 that assessment under those
criteria, management has determined that, at June 30, 2010, the Companys
internal control over financial reporting was effective.

This annual
report does not include an attestation report of our registered public
accounting firm regarding internal control over financial reporting.
Managements report was not subject to attestation by our registered public
accounting firm pursuant to rules of the SEC that permit us to provide only
managements report in this annual report.

Changes in Internal Control over Financial
Reporting.

There have not
been changes in our internal control over financial reporting (as such term is
defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the
fourth quarter of fiscal 2010 that have materially affected, or are reasonably
likely to materially affect, our internal control over financial reporting.

Item 9B. Other Information.

Subsequent Events

On July 29,
2010 the Company filed a Definitive Proxy Statement, whereby authorized capital
of the Company would be increased to 500,000,000 shares of common stock.
Additionally, the Board of Directors of the Company would be authorized to
change the name of the Company, without further shareholder approval, as deemed
necessary to better reflect the Companys identity.

PART III

Item 10. Directors, Executive Officers,
Promoters and Control Persons; Compliance With Section 16(a) of the Exchange
Act.

Information
regarding our directors and executive officer is provided below:

6

STANLEY L.
SCHLOZ, age 67, has been a Director, President and Treasurer since February 4,
2008. Mr. Schloz retired from Motorola in 1998 after a 32-year career in
positions advancing from engineering through senior business management. As
Director, Tactical Systems Operations of the Space and Systems Technology Group
he was responsible for the strategic direction and performance of the
electronic fuse business with over $150,000,000 in annual sales, serving US and
foreign governments, along with prime contractors. His organization consisted
of over 400 program management, engineering, marketing, and manufacturing
associates. Mr. Schloz has been engaged in business management consulting since
July 2000. He holds the degree of Bachelor of Science in Electrical Engineering
from Iowa State University and has done advanced business studies at Arizona
State University.

FRED BURSTEIN,
age 74, has been a Director and Vice President of the company since February 4,
2008. Since 1960, Mr. Burstein has been a lawyer practicing law in Minneapolis,
Minnesota.

ANTHONY
SILVERMAN, age 67, became a Director on February 4, 2008 and resigned as a
member of our Board of Directors effective September 30, 2009. He continues to assist and
advise us in connection with our financing efforts, is the holder, together
with his affiliates, of 1,882,640 shares of our common stock. Because of these
continuing relationships Mr. Silverman may be considered to be an affiliate
of the Company.

Mr. Silverman
manages his personal investments. He was Founder, Chairman and CEO of Paradise
Valley Securities, a registered securities broker-dealer, from 1987 to 1999.
For most of his 30-year career in the securities business, Mr. Silverman
concentrated in transactions for the financing of micro-cap and small-cap
companies. Mr. Silverman has led financings aggregating over $500 million for
close to 100 companies, including diverse industries such as airlines, food
products, telecommunications, retail, media and life sciences.

Compliance with Section 16(a) of the
Securities Exchange Act of 1934

Section 16(a)
of the Securities Exchange Act of 1934, as amended, requires our directors and
executive officers, as well as persons beneficially owning more than 10% of our
outstanding common stock, to file reports of ownership and changes in ownership
with the Securities and Exchange Commission (the SEC) within specified time
periods. Such officers, directors and shareholders are also required to furnish
us with copies of all Section 16(a) forms they file.

Based solely
on its review of such forms received by us, or written representations from
certain reporting persons, we believe that all Section 16(a) filing
requirements applicable to our officers, directors and 10% shareholders were
complied with during the fiscal year ended June 30, 2010.

Item 11. Executive Compensation.

The following
table summarizes all compensation paid to our Chief Executive Officer for each
of the fiscal years ended June 30, 2010 and 2009. We did not have any other
executive officers whose total annual salary and bonus exceeded $100,000 for
the periods presented.

SUMMARY COMPENSATION TABLE

Name and Principal Position
 
 Year
 
 Salary ($)
 
 Bonus ($)
 
 Stock Awards ($)(1)Stanley L. Schloz,
 
 
 2010
 
 $
 18,000
 
 $
 
 
 $
 Chief Executive and Financial Officer
 
 
 2009
 
 $
 18,000
 
 $
 
 
 $
 7

SUMMARY
COMPENSATION TABLE
(continued)

Name and
 
 
 
 
 Option Awards
 
 Nonequity incentive plan compensation
 
 Non-qualified deferred compensation earnings
 
 All other Compensation
 
 TotalPrincipal
 Position
 
 
 Year
 
 ($)(2)
 
 ($)
 
 ($)
 
 ($)
 
 ($)Stanley L. Schloz,
 
 
 2010
 
 $
 
 
 
 
 
 
 
 
 
 
 
 $
 18,000Chief Executive and Financial Officer
 
 
 2009
 
 
 24,342
 
 $
 
 
 $
 
 
 $
 
 
 $
 42,342(1)
 Reflects the dollar amount recognized for financial statement
 reporting purposes in accordance with SFAS 123(R). Amounts are calculated
 using the closing stock price of each award on the date of grant.(2)
 Reflects dollar amount expensed by us during applicable fiscal years
 for financial statement reporting purposes pursuant to SFAS 123(R). SFAS
 123(R) requires us to determine the overall value of the options as of the
 date of grant based upon the Black-Scholes method of valuation, and to then
 expense that value over the service period over which the options become
 exercisable (vest). See the assumptions made in the valuation of the stock
 options in the footnotes of our consolidated financial statements.Item 12. Security Ownership Of Certain
Beneficial Owners And Management and Related Stockholder Matters.

The following table sets forth certain information, as of September 13,
2010 concerning the beneficial ownership of shares of Common Stock of the
Company by (i) each person known by the Company to beneficially own more than
5% of the Companys Common Stock; (ii) each Director; (iii) the Companys Chief
Executive Officer; and (iv) all directors and executive officers of the Company
as a group. To the knowledge of the Company, all persons listed in the table
have sole voting and investment power with respect to their shares, except to
the extent that authority is shared with their respective spouse under
applicable law.

Shares Beneficially Owned (1)Name and Address of Beneficial Owner
 
 Number
 
 Percent of ClassLaurus
 Capital Management (2)(3)
 
 
 1,081,923
 
 
 9.4
 %Anthony
 Silverman (2)
 
 
 1,886,640
 
 
 16.4
 %Stanley L
 Schloz (2)(4)
 
 
 698,139
 
 
 6.1
 %Fred
 Burstein (2)(5)
 
 
 719,304
 
 
 6.3
 %(1)
 A person is deemed to be the beneficial owner of securities that can
 be acquired within 60 days from the date set forth above through the exercise
 of any option, warrant or right. Shares of common stock subject to options,
 warrants or rights that are currently exercisable or exercisable within 60
 days are deemed outstanding for computing the percentage of the person
 holding such options, warrants or rights, but are not deemed outstanding for
 computing the percentage of any other person. The amounts and percentages are
 based upon 11,490,016 shares of common stock outstanding as of September 13,
 2010.(2)
 The address of each of the beneficial owners is as follows: Stanley
 L. Schloz, 10050 E. Sonoran Vista Circle, Scottsdale, Arizona 85255; Fred
 Burstein, 510 First Avenue North, Suite 600, Minneapolis, Minnesota 55403;
 Anthony Silverman, 7625 E. Via Del Reposo, Scottsdale, Arizona 85258; Laurus
 Capital Management, LLC, 825 Third Avenue, 14th Floor, New York,
 New York 10022.(3)
 Includes 630,000 shares of common stock underlying warrants that were
 exercisable on September 13, 2010 or within 60 days thereafter.8

(4)
 Includes 500,000 shares of common stock underlying stock options that
 were exercisable on September 13, 2010, or within 60 days thereafter.(5)
 Includes 600,000 shares of common stock underlying stock options that
 were exercisable on September 13, 2010, or within 60 days thereafter.Item 13. Certain Relationships And Related
Transactions, and Director Independence.

Except as set forth below, the Company did not have any transactions
during fiscal years 2010 and 2009 with any director, director nominee,
executive officer, security holder known to the Company to own of record or
beneficially more than 5% of the Companys common stock, or any member of the
immediate family of any of the foregoing persons, in which the amount involved
exceeded $120,000.

Two of our directors receive monthly compensation in the amount of
$1,500 per month for the services they provide to the Company.

A former
director receives monthly compensation in the amount of $1,000 as consideration
for rent.

A director exercised an option to purchase 100,000 shares of common
stock of the company for $9,000.

Director Independence

Our directors, during the fiscal year ended June 30, 2010 were Stanley
L. Schloz and Fred Burstein. Mr. Schloz is also our President and Chief
Executive and Financial Officer and is therefore not considered independent.
While the OTC Bulletin Board does not prescribe independence requirements for
board members, the Company believes the remainder of its Board members are
independent within the meaning of the listing standards of the NADAQ Stock
Market.

Independent director means a person other than an executive officer
or employee of the company or any other individual having a relationship which,
in the opinion of the issuers board of directors, would interfere with the
exercise of independent judgment in carrying out the responsibilities of a
director. The following persons shall not be considered independent:

(A) a
director who is, or at any time during the past three years was, employed by
the company;

(B) a
director who accepted or who has a Family Member who accepted any compensation
from the company in excess of $100,000 during any period of twelve consecutive
months within the three years preceding the determination of independence,
other than the following:

(i)
 compensation for board or board committee service;(ii)
 compensation paid to a Family Member who is an employee (other than
 an executive officer) of the company;or(iii)
 benefits under a tax-qualified retirement plan, or non-discretionary
 compensation.Provided,
however, that in addition to the requirements contained in this paragraph (B),
audit committee members are also subject to additional, more stringent
requirements under Rule 4350(d).

(C) a
director who is a Family Member of an individual who is, or at any time during
the past three years was, employed by the company as an executive officer;

(D) a
director who is, or has a Family Member who is, a partner in, or a controlling
shareholder or an executive officer of, any organization to which the company
made, or from which the company received, payments for property or services in
the current or any of the past three fiscal years that exceed 5% of the
recipients consolidated gross revenues for that year, or $200,000, whichever
is more, other than the following:

(i)
 payments arising solely from investments in the companys securities;
 or9

(ii)
 payments under non-discretionary charitable contribution matching
 programs.(E) a
director of the issuer who is, or has a Family Member who is, employed as an
executive officer of another entity where at any time during the past three
years any of the executive officers of the issuer serve on the compensation
committee of such other entity; or

(F) a
director who is, or has a Family Member who is, a current partner of the
companys outside auditor, or was a partner or employee of the companys
outside auditor who worked on the companys audit at any time during any of the
past three years.

(G) in the
case of an investment company, in lieu of paragraphs (A)(F), a director who is
an interested person of the company as defined in Section 2(a)(19) of the
Investment Company Act of 1940, other than in his or her capacity as a member
of the board of directors or any board committee.

Item 14. Principal Accountant Fees and
Services.

The following table sets forth fees billed to us by our auditors during
the fiscal years ended June 30, 2010 and 2009 for: (i) services rendered for
the audit of our annual financial statements and the review of our quarterly
financial statements, (ii) services by our auditors that are reasonably related
to the performance of the audit or review of our financial statements and that
are not reported as Audit Fees, (iii) services rendered in connection with tax
compliance, tax advice and tax planning, and (iv) all other fees for services
rendered. All other fees consist primarily of fees incurred to review our
registration statement filings, proxy statements, and 8-Ks related to the
asset sales.

June 30, 2010
 
 June 30, 2009(i)
 Audit Fees
 
 $
 10,000
 
 $
 15,000(ii)
 Audit
 Related Fees
 
 
 
 
 
 (iii)
 Tax Fees
 
 
 
 
 $
 2,500(iv)
 All Other
 Fees
 
 
 
 
 $
 8,490Audit Committee Pre-Approval Policies and
Procedures

The entire board of directors acts as the Companys Audit Committee.
The Audit Committee does not have a financial expert serving on its committee
at this time due to the size and nature of the Company. The Company intends to
seek such an expert at such time as it ceases to be a shell.

All audit and non-audit services are pre-approved by the Audit
Committee, which consists of the members of the board of directors which
considers, among other things, the possible effect of the performance of such
services on the auditors independence. The Audit Committee pre-approves the
annual engagement of the principal independent registered public accounting
firm, including the performance of the annual audit and quarterly reviews for
the subsequent fiscal year, and pre-approves specific engagements for tax
services performed by such firm. The Audit Committee has also established
pre-approval policies and procedures for certain enumerated audit and audit
related services performed pursuant to the annual engagement agreement,
including such firms attendance at and participation at Board and committee
meetings; services associated with SEC registration statements approved by the
Board of Directors; review of periodic reports and other documents filed with
the SEC or other documents issued in connection with securities offerings, such
as comfort letters and consents; assistance in responding to any SEC comments
letters; and consultations with such firm as to the accounting or disclosure
treatment of transactions or events and the actual or potential impact of final
or proposed rules, standards or interpretations by the SEC, Public Company
Accounting Oversight Board (PCAOB), Financial Accounting Standards Board
(FASB), or other regulatory or standard-setting bodies. The Audit Committee is
informed of each service performed pursuant to its pre-approval policies and
procedures. The Audit Committee has considered the role of Seale and Beers CPAs
in providing services to us for the fiscal years ended June 30, 2010 and 2009
and has concluded that such services are compatible with such firms
independence.

Item 15. Exhibits.

The exhibits as indexed immediately following the signature page of
this Report are included as part of this Form 10-K.

10

SIGNATURES

In
accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934, the
Registrant caused this Report to be signed on its behalf by the undersigned,
thereunto duly authorized.

TEMPCO, INC./s/ Stanley
 L. Schloz,Stanley L.
 Schloz, President and Chief Executive and Financial Officer(Principal
 Executive Officer)Dated: October 13, 2010In
accordance with 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 dates indicated.

Signatures
 
 Title
 
 Date/s/ Stanley
 L. Schloz
 
 President,
 CEO, CFO and Director
 
 October 13, 2010Stanley L.
 Schloz
 
 (Principal
 Executive and Financial Officer)/s/ Fred
 Burstein
 
 Director
 
 October 13, 2010Fred
 Burstein11

EXHIBIT INDEX

Exhibit Number
 
 Description
 
 By Reference 
 from Document
 
 No. In Document3.1
 
 Registrants
 Articles of Incorporation
 
 A
 
 3.13.1.1
 
 Registrants
 Amendment to its Articles of Incorporation, dated November 7, 1988
 
 A
 
 3.1.13.1.2
 
 Registrants
 Amendment to its Articles of Incorporation, dated June25, 1991
 
 B
 
 3.1.23.1.3
 
 Registrants
 Certificate of Reverse Stock Split, dated February 15, 1994
 
 C
 
 3.1.33.1.4
 
 Registrants
 Certificate of Designation of Series A Preferred Stock, dated June 27, 1996
 
 D
 
 3.1.43.1.5
 
 Registrants
 Amendment to Articles of Incorporation, dated June 25, 1996
 
 D
 
 3.1.53.1.6
 
 Registrants
 Certificate of Designation of Series B Preferred Stock, dated March 31, 1999
 
 E
 
 3.1.63.1.7
 
 Registrants
 Amendment to Articles of Incorporation, dated October 7, 1999.
 
 F
 
 3.13.1.8
 
 Certificate
 of Correction to Certificate of Amendment to Articles of Incorporation of
 Vitrix, Inc., dated June 16, 2005
 
 H
 
 3.1.83.1.9
 
 Registrants
 Amendment to Articles of Incorporation, dated April 20, 2007
 
 J
 
 3.13.1.10
 
 Registrants
 Amendment to Articles of Incorporation, dated February4, 2008
 
 L
 
 99.13.1.11
 
 Registrants
 Amendment to Articles of Incorporation, dated June __,2009
 
 *
 
 3.2
 
 Amended
 Bylaws of the Registrant
 
 C
 
 3.24.1
 
 Registrants
 Form of Common Stock Certificate
 
 A
 
 4.110.1
 
 1999 Equity
 Compensation Plan
 
 E
 
 10.710.2
 
 Registration
 Rights Agreement, dated March 22, 2004, among Time America, Inc. and Laurus
 Master Fund, Ltd.
 
 G
 
 10.610.3
 
 Common Stock
 Purchase Warrant, dated January 3, 2006, issued to Laurus Master Fund, Ltd.
 
 I
 
 10.410.4
 
 Registration
 Rights Agreement, dated January 3, 2006, between Time America, Inc., a Nevada
 corporation, and Laurus Master Fund, Ltd.
 
 I
 
 10.512

Exhibit Number
 
 Description
 
 By Reference 
 from Document
 
 No. In Document10.5
 
 Asset
 Purchase Agreement, dated February 4, 2008, between NETtime Solutions, Inc.
 (Nevada) and NETtime Solutions, LLC(Arizona)
 
 K
 
 9922
 
 Matter
 submitted to vote of securities holders
 
 M
 
 31
 
 Certification
 pursuant to Rules 13a-14(a) and 15d-14(a)(5) of the Securities Exchange Act
 of 1934
 
 *
 
 32
 
 Certification
 pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
 Sarbanes-Oxley Act of 2002
 
 *
 
 *
 Filed
 herewith.A.
 Form S-18
 Registration Statement No. 33-25704-NY.B.
 Form 10-K
 Annual Report of the Registrant for the fiscal year ended June 30, 1991.C.
 Form 10-KSB
 Annual Report of the Registrant for the fiscal year ended June 30, 1994.D.
 Form 8-K
 Current Report reporting event on June 28, 1996.E.
 Form 10-KSB
 Annual Report of the Registrant for the fiscal year ended June 30, 1999.F.
 Form 10-QSB
 Quarterly Report of the Registrant for the fiscal quarter ended September 30,
 1999.G.
 Form 8-K
 Current Report reporting event on March 22, 2004.H.
 Form 10-KSB
 Annual Report of the Registrant for the fiscal year ended June 30, 2005.2I.
 Form 10-QSB
 Quarterly Report of the Registrant for the quarter ended December 31, 2005.J.
 Form 8-K
 Current Report reporting event on May 10, 2007.K.
 Form 8-K
 Current Report reporting event on February 8, 2008L.
 Form 8-K/A
 Current Report reporting event on February 15, 2008M.
 Form DEF-14A
 Other Definitive Proxy Statement13

TEMPCO, INC. AND SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)
FINANCIAL STATEMENTS FOR THE
YEARS ENDED JUNE 30, 2010 AND 2009


SEALE AND BEERS, CPAs
PCAOB & CPAB REGISTERED AUDITORS
www.sealebeers.com

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors
Tempco, Inc.
(A Development Stage Company)

We have audited the accompanying consolidated balance sheets of Tempco, Inc. (A Development Stage Company) as of June 30, 2010 and 2009, and the related consolidated statements of operations, stockholders equity (deficit) and cash flows for the years ended June 30, 2010 and 2009, and since reentering development stage on February 5, 2008 through June 30, 2010. These consolidated 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 audits in accordance with standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement.  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 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 Tempco, Inc. (A Development Stage Company) as of June 30, 2010 and 2009, and the related consolidated statements of operations, stockholders equity (deficit) and cash flows for the years ended June 30, 2010 and 2009, and since reentering development stage on February 5, 2008 through June 30, 2010, 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 7 to the consolidated financial statements, the Company does not engage in any business activities that provide cash flow and has accumulated a total deficit of $11,589,162, which raises substantial doubt about its ability to continue as a going concern.  Managements plans concerning these matters are also described in Note 7.  The financial statements do not include any adjustments that might result from the outcome of this uncertainty.


/s/ Seale and Beers, CPAs

Seale and Beers, CPAs
Las Vegas, Nevada
October 11, 2010


50 S. Jones Blvd. Suite 202 Las Vegas, NV 89107 Phone: (888)727-8251 Fax: (888)782-2351


F-1

TEMPCO, INC. AND SUBSIDIARIES 
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED BALANCE SHEETS

ASSETS
 
 June 30, 2010
 
 June 30, 2009Current assets:Cash and cash equivalents
 
 $
 114,779
 
 $
 213,943Prepaid expenses
 
 
 9,824
 
 
 10,355Total current assets
 
 
 124,603
 
 
 224,298Total assets
 
 $
 124,603
 
 $
 224,298LIABILITIES
 AND STOCKHOLDERS EQUITY (DEFICIT)Current Liabilities:Accounts payable
 
 $
 3,638
 
 $
 Accrued liabilities
 
 
 397
 
 
 Total current liabilities
 
 
 4,035
 
 
 Commitments and Contingencies:
 
 
 
 
 
 Stockholders equity (deficit):Common stock, $.005 par value 50,000,000 authorized; 11,490,016 and
 11,390,881 shares outstanding, net of nil and 6,478,693 treasury shares
 
 
 89,845
 
 
 89,349Additional paid in capital
 
 
 11,619,885
 
 
 12,453,732Accumulated deficit prior to reentering the development stage
 
 
 (11,160,829
 )
 
 (11,160,829
 )Deficit accumulated in the development stage
 
 
 (428,333
 )
 
 (315,603
 )Treasury stock, at cost (6,478,693 shares)
 
 
 
 
 
 (842,351
 )Total stockholders equity (deficit)
 
 
 120,568
 
 
 224,298Total liabilities and stockholders equity (deficit)
 
 $
 124,603
 
 $
 224,298The Accompanying Notes are an Integral Part 
of the Consolidated Financial Statements

F-2

TEMPCO, INC. AND SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED STATEMENTS OF OPERATIONS

Cumulative SinceYear Ended


 
 ReenteringJune 30,
 
 Development Stage on2010
 
 2009
 
 February
 5, 2008Costs and expensesGeneral and administrative
 
 $
 77,280
 
 $
 175,668
 
 $
 293,930Directors fees
 
 
 36,000
 
 
 84,684
 
 
 157,320Operating loss
 
 
 (113,280
 )
 
 (260,352
 )
 
 (451,250
 )Other income (expense)Interest expense
 
 
 
 
 
 (219
 )
 
 (424
 )Interest income
 
 
 600
 
 
 9,637
 
 
 23,441Total other income
 
 
 600
 
 
 9,418
 
 
 23,017Net loss from continuing operations
 
 
 (112,680
 )
 
 (250,934
 )
 
 (428,233
 )Provision for income taxes
 
 
 50
 
 
 50
 
 
 100Net loss
 
 $
 (112,730
 )
 $
 (250,984
 )
 $
 (428,333
 )Basic and diluted net loss per common share:
 
 $
 (0.01
 )
 $
 (0.02
 )Basic and diluted weighted average common shares outstanding
 
 
 11,418,124
 
 
 11,403,654The Accompanying Notes are an Integral Part 
of the Consolidated Financial Statements

F-3

TEMPCO, INC. AND SUBSIDIARIES 
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED STATEMENTS STOCKHOLDERS EQUITY (DEFICIT)

Common Stock
 
 Treasury Stock
 
 Additional Paid in
 
 Accumulated 
 Deficit 
 Prior to rentering Development
 
 Deficit Accumulated Since Reentering the Development Stage
 on February 5,Shares
 
 Amount
 
 Shares
 
 Amount
 
 Capital
 
 Stage
 
 2008
 
 TotalBalance at June 30, 2007
 
 
 15,030,481
 
 
 75,153
 
 
 
 
 
 
 
 
 9,889,188
 
 
 (11,799,579
 )
 
 
 
 
 (1,835,238
 )Stock based compensation
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 62,347
 
 
 
 
 
 
 
 
 62,347Reclassification of restricted shares to equity
 
 
 351,923
 
 
 1,760
 
 
 
 
 
 
 
 
 205,875
 
 
 
 
 
 
 
 
 207,635Shares surrendered in relation to Asset Sale
 
 
 
 
 
 
 
 
 (6,478,693
 )
 
 (842,351
 )
 
 
 
 
 
 
 
 
 
 
 (842,351
 )Contributed capital adjustment related to Asset Sale
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 2,022,904
 
 
 
 
 
 
 
 
 2,022,904Sale of common stock in April 2008 Private Placement at $.10 per
 share, net of fees
 
 
 2,500,000
 
 
 12,500
 
 
 
 
 
 
 
 
 212,500
 
 
 
 
 
 
 
 
 225,000Net income (loss)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 638,750
 
 
 (64,619
 )
 
 574,131Balance at June 30, 2008
 
 
 17,882,404
 
 
 89,413
 
 
 (6,478,693
 )
 
 (842,351
 )
 
 12,392,814
 
 
 (11,160,829
 )
 
 (64,619
 )
 
 414,428Stock based compensation
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 60,854
 
 
 
 
 
 
 
 
 60,854Shares surrendered
 
 
 (12,830
 )
 
 (64
 )
 
 
 
 
 
 
 
 64
 
 
 
 
 
 
 
 
 Net loss
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 (250,984
 )
 
 (250,984
 )Balance at June 30, 2009
 
 
 17,869,574
 
 
 89,349
 
 
 (6,478,693
 )
 
 (842,351
 )
 
 12,453,732
 
 
 (11,160,829
 )
 
 (315,603
 )
 
 224,298Shares issued for option exercise
 
 
 100,000
 
 
 500
 
 
 
 
 
 
 
 
 8,500
 
 
 
 
 
 
 
 
 9,000Correction of shares outstanding
 
 
 (865
 )
 
 (4
 )
 
 
 
 
 
 
 
 4
 
 
 
 
 
 
 
 
 Cancellation of Treasury Shares
 
 
 (6,478,693
 )
 
 
 
 
 6,478,693
 
 
 842,351
 
 
 (842,351
 )
 
 
 
 
 
 
 
 Net loss
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 (112,730
 )
 
 (112,730
 )Balance at June 30, 2010
 
 
 11,490,016
 
 $
 89,845
 
 
 
 
 
 
 
 $
 11,619,885
 
 $
 (11,160,829
 )
 $
 (428,333
 )
 $
 120,568The Accompanying Notes are an Integral Part 
of the Consolidated Financial Statements

F-4

TEMPCO, INC. AND SUBSIDIARIES 
(A DEVELOPMENT STAGE COMPANY) 
CONSOLIDATED STATEMENTS OF CASH FLOWS

Year Ended June 30,
 
 Cumulative Since Reentering the Development
 Stage on2009
 
 2009
 
 February 5, 2008Operating activitiesNet loss
 
 $
 (112,730
 )
 $
 (250,984
 )
 
 (428,333
 )Adjustments
 to reconcile net loss to net cash
 provided (used) by operating activities:Loss on settlement of notes receivable
 
 
 
 
 
 69,750
 
 
 69,750Accrued interest receivable
 
 
 
 
 
 (14,750
 )
 
 (14,750
 )Stock based compensation
 
 
 
 
 
 60,854
 
 
 87,900Changes in
 Assets and Liabilities:Prepaid expenses
 
 
 531
 
 
 (796
 )
 
 (22,823
 )Accrued interest receivable
 
 
 
 
 
 7,250
 
 
 Accounts payable
 
 
 3,638
 
 
 (9,224
 )
 
 3,638Accrued liabilities
 
 
 397
 
 
 
 
 
 397Net cash used by operating activities
 
 
 (108,164
 )
 
 (137,900
 )
 
 (304,221
 )Investing activitiesCollection of note receivable
 
 
 
 
 
 145,000
 
 
 145,000Net cash provided by investing activities
 
 
 
 
 
 145,000
 
 
 145,000Financing activities:Repayment of debt
 
 
 
 
 
 (5,435
 )
 
 Proceeds from sale of common stock
 
 
 
 
 
 
 
 
 225,000Proceeds from exercise of options and
 warrants
 
 
 9,000
 
 
 
 
 
 9,000Net cash provided (used) by financing activities
 
 
 9,000
 
 
 (5,435
 )
 
 234,000Net change
 in cash and cash equivalents
 
 
 (99,164
 )
 
 1,665
 
 
 74,779Cash and
 cash equivalents at beginning of period
 
 
 213,943
 
 
 212,278
 
 
 40,000Cash and cash
 equivalents at end of year
 
 $
 114,779
 
 $
 213,943
 
 $
 114,779Supplemental
 disclosures:Cash paid for income taxes
 
 $
 50
 
 $
 50
 
 $
 50Cash paid for interest
 
 $
 
 
 $
 219
 
 $
 424Non-cash
 investing and financing activities
 
 $
 
 
 $
 
 
 $
 The Accompanying Notes are an Integral Part 
of the Consolidated Financial Statements

F-5

TEMPCO, INC. AND SUBSIDIARIES 
(A DEVELOPMENT STAGE COMPANY) 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

Note 1  Organization, Basis of Presentation
and Description of Business

Tempco, Inc. was incorporated in Nevada in June 1988 as Richard Barrie
Fragrances, Inc. Over the years, the Company changed its name several times,
most NETtime Solutions, Inc. in January 2007 to Tempco, Inc. on February 4,
2008 to Tempco, Inc. The consolidated financial statements include the accounts
of Tempco, Inc. and its wholly-owned subsidiaries (collectively, the
Company), NETtime Solutions, Inc. an Arizona corporation, and Net Edge
Devices, LLC, an Arizona Limited Liability Company. All intercompany accounts
and transactions have been eliminated in consolidation.

As Time America, Inc. and NETtime Solutions, Inc. the Company operated
as a time and attendance software company. In February, 2008 the time
attendance software business was sold (the 2008 Asset Sale), and the Company
is currently researching other business opportunities. Due to the 2008 Asset Sale,
the Company has reentered the development stage and following this sale, the
Company has limited operations and therefore the Company is considered a
development stage company. The Company intends to locate and combine with an
existing company that is profitable or which, in managements view, has growth
potential, irrespective of the industry in which it is engaged. A combination
may be structured as a merger, consolidation, exchange of the Companys common
stock for stock or assets or any other form.

Pending negotiation and consummation of a combination the Company
anticipates that it will have, aside from carrying on its search for a
combination partner, no business activities, and, thus, will have no source of
revenue. The Company believes that the cash on hand at June 30, 2010 is not
sufficient to fund its operations until the earlier of a combination or a
period of one year. If necessary to continue as a going concern, pending
consummation of a transaction, the Company intends to either seek additional
equity or debt financing. No assurances can be given that such equity or debt
financing will be available, nor can there be any assurance that a combination
transaction will be consummated. Should the Company be required to incur any
significant liabilities prior to a combination transaction, including those
associated with the current minimal level of general and administrative
expenses, it may not be able to satisfy those liabilities in the event it was
unable to obtain additional equity or debt financing.

Reclassifications

Certain prior year balances have been reclassified to conform with
current year presentation. These changes have no effect on previously reported
net loss.

Note 2  Summary of Significant Accounting
Policies

Principles of Consolidation:

The consolidated financial statements include the accounts of Tempco,
Inc. and its wholly-owned subsidiaries (collectively, the Company), NETtime
Solutions, Inc. an Arizona corporation, and Net Edge Devices, LLC, an Arizona
Limited Liability Company. All intercompany accounts and transactions have been
eliminated in consolidation.

Use of Estimates

The preparation of financial statements in conformity with generally
accepted accounting principles in the United States of America requires 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 or revenues and expenses
during the period. Actual results could differ from those estimates.
Significant estimates include deferred income taxes and fair value of
stock-based compensation. It is at least reasonably possible a material change
in these estimates may occur in the near term.

Advertising Expense

Advertising costs are expensed when incurred. For the years ended June
30, 2010 and June 30, 2009 we did not incur any advertising costs.

F-6



TEMPCO, INC. AND SUBSIDIARIES 
(A DEVELOPMENT STAGE COMPANY) 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

Cash and Cash Equivalents:

Cash and cash equivalents are considered to be all highly liquid
investments purchased with an initial maturity of three months or less.

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. The Company maintains the majority of its cash
balances with one financial institution. At times, such balances may be in
excess of any insured limits.

Deferred Income Taxes

Deferred income taxes are provided on an asset and liability method,
whereby deferred tax assets are recognized for deductible temporary differences
and operating loss and tax credit carryforwards and deferred tax liabilities
are recognized for taxable temporary differences. Temporary differences are the
differences between the reported amounts of assets and liabilities and their
tax basis. Deferred tax assets are reduced by a valuation allowance when, in
the opinion of management, there is uncertainty of the utilization of these
assets in future periods. Deferred tax assets and liabilities are adjusted for
the effects of changes in tax laws and rates on the date of enactment.

Income (Loss) Per Share:

Diluted income (loss) per share is computed based on the weighted
average number of shares of common stock and dilutive securities outstanding
during the period. Potentially dilutive securities are options and warrants
that are exercisable into common stock. Dilutive securities are not included in
the weighted average number of shares when inclusion would increase the income
per share or decrease the loss per share. At June 30, 2010 and 2009, there were
options and warrants outstanding to purchase 3,572,287 and 3,692,944,
respectively, shares of the Companys common stock. At June 30, 2010 and 2009,
there were no potentially dilutive securities included in the calculation as
their effect was anti-dilutive.

Recent Accounting Pronouncements

The Company has implemented all new relevant accounting pronouncements
that are in effect. These pronouncements did not have any material impact on
the financial statements unless otherwise disclosed, and the Company does not
believe that there are any other new accounting pronouncements that have been
issued that might have a material impact on its financial position or results
of operations.

Revenue Recognition

Revenue is recognized when title and risk of loss has been transferred
to customer and collectability is reasonably assured. At June 30, 2010 and 2009
we did not have any revenues.

Note 3  Income Taxes

As of June 30, 2010 and 2009 deferred tax assets consist of the
following:

2010
 
 2009Federal loss carryforwards
 
 $
 2,409,000
 
 $
 2,373,000State loss carryforwards
 
 
 183,000
 
 
 271,000Other
 
 
 21,000
 
 
 21,0002,613,000
 
 
 2,665,000Less: valuation allowances
 
 
 (2,613,000
 )
 
 (2,665,000
 )$
 
 
 $
 F-7

TEMPCO, INC. AND SUBSIDIARIES 
(A DEVELOPMENT STAGE COMPANY) 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

The Company has established a valuation allowance equal to the full
amount of the deferred tax assets primarily because of uncertainty in the
utilization of net operating loss carryforwards.

As a result of stock ownership changes, the Companys ability to
utilize net operating losses in the future could be limited, in whole or part,
under Internal Revenue Code Section 382. The Company was treated as an
S-Corporation for income tax purposes through May 13, 1997. As of June 30, 2010
the Companys federal and state net operating loss carryforwards were
approximately $7,527,000 and $2,283,600, respectively, and expire through 2030
as follows:

Expiration
 
 June 30,
 
 Federal
 Net Operating Loss Carryforwards
 
 Expiration
 
 June 30,
 
 State
 Net Operating Loss Carryforwards2021
 
 $
 1,920,274
 
 
 2011
 
 $
 1,919,9182022
 
 
 687,018
 
 
 2014
 
 
 250,9842023
 
 
 179,972
 
 
 2015
 
 
 112,7302024
 
 
 1,135,7962025
 
 
 1,335,0572026
 
 
 1,905,2602029
 
 
 250,9842030
 
 
 112,730$
 7,527,091
 
 
 
 
 $
 2,283,632The Companys tax expense differed from the statutory rate primarily
due to the $36,000 change in the deferred tax asset valuation allowance.

Note 4  Stockholders Equity

The Company has 50,000,000 shares of Common Stock authorized, of which
11,490,811 shares are issued and outstanding. There are also authorized
10,000,000 shares of preferred stock, none of which are issued and outstanding.

The Company cancelled 6,478,693 shares of common stock which had
previously been classified as treasury shares.

Stock Options:

On July 13, 1999, the Board of Directors authorized the 1999 Equity Compensation
Plan. The plan allows for the award of incentive stock options, non-statutory
stock options or restricted stock awards to certain employees, directors,
consultants and independent contractors. The Company has reserved an aggregate
of 600,000 shares of common stock for distribution under the plan. Incentive
stock options granted under the plan may be granted to employees only, and may
not have an exercise price less than the fair market value of the common stock
on the date of grant. Options may be exercised on a one-for-one basis, with a
maximum term of ten years from the date of grant. Incentive stock options
granted to employees generally vest annually over a four year period.

During fiscal year 2008, the Company issued options to purchase 1,500,000 shares of its common stock for services and Director’s fees. The options vested over a period of 13 months. Included in Directors expense at June 30, 2009 was $48,684 related to the aforementioned options.

F-8

TEMPCO, INC. AND SUBSIDIARIES 
(A DEVELOPMENT STAGE COMPANY) 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

The fair value of option grants is estimated as of the date of grant
utilizing the Black-Scholes option-pricing model. There have not been any stock
options issued since the fiscal year ended June 2008. The assumptions used at
the time of the most recent issuances were as follows:

Expected volatility
 
 
 106
 %Risk-free interest rate
 
 
 2
 %Expected dividends
 
 
 0
 %Expected lives (in years)
 
 
 3The weighted average fair value at date of grant for options granted
during the year ended June 30, 2008 approximated $.06.

A summary of the activity of options under the plan and non-statutory
options granted outside the plan follows:

Number
 of Options
 
 Weighted
 Average Exercise PriceOutstanding
 at June 30, 2009
 
 
 2,692,287
 
 $
 1.07Granted
 
 
 
 
 
 Exercised
 
 
 (100,000
 )
 
 0.09Expired
 
 
 (20,000
 )
 
 2.20Forfeited
 
 
 
 
 
 Outstanding at June 30,
 2010
 
 
 2,572,287
 
 $
 0.29During the year ended June 30, 2010, the Company received proceeds of $9,000 from the exercise of an option.

Additional information about outstanding options to purchase the
Companys common stock as of June 30, 2010 is as follows:

Options
 Outstanding
 
 Options
 ExercisableExercise
 
 Price
 
 Number
 
 of 
 Shares
 
 Weighted
 Average Remaining Contractual Life (Years)
 
 Weighted
 Average Exercise 
 Price
 
 Aggregate
 Intrinsic 
 Value
 
 Number
 of Shares
 
 Weighted
 Average Remaining Contractual Life (Years)
 
 Weighted
 Average Exercise 
 Price
 
 Aggregate
 Intrinsic 
 Value$
 0.91-$0.60
 
 
 514,520
 
 
 3.43
 
 $
 0.76
 
 $
 
 
 
 514,520
 
 
 5.43
 
 $
 0.76
 
 $
 $
 0.51-$0.40
 
 
 385,000
 
 
 4.71
 
 $
 0.46
 
 $
 
 
 
 385,000
 
 
 4.71
 
 $
 0.46
 
 $
 $
 0.32-$0.30
 
 
 120,000
 
 
 2.32
 
 $
 0.31
 
 $
 
 
 
 120,000
 
 
 2.32
 
 $
 0.31
 
 $
 $
 0.16-$0.13
 
 
 152,767
 
 
 7.04
 
 $
 0.15
 
 $
 22,370
 
 
 152,767
 
 
 7.04
 
 $
 0.15
 
 $
 22,370$
 0.09
 
 
 1,400,000
 
 
 5.66
 
 $
 0.09
 
 $
 294,000
 
 
 1,400,000
 
 
 5.66
 
 $
 0.09
 
 $
 294,0002,572,287
 
 
 
 
 
 
 
 
 
 
 
 2,572,287During the year ended June 30, 2010 the Company did not
recognize compensation as all stock options under the Plan had previously
vested.

F-9

TEMPCO, INC. AND SUBSIDIARIES 
(A DEVELOPMENT STAGE COMPANY) 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

Non-Employee Stock Options and Warrants:

As of June 30, 2010 the Company has warrants outstanding that were
issued primarily in connections with prior financing arrangements. Activity
relative to these warrants for the year ended June 30, 2010 is as follows:

Number
 of Shares
 
 Weighted
 Average Exercise PriceWarrants outstanding -
 beginning of year
 
 
 880,000
 
 $
 0.72Granted
 
 
 
 
 
 Expired
 
 
 
 
 
 Warrants outstanding - end
 of year
 
 
 880,000All the warrants outstanding as of June 30, 2010 are exercisable and
have weighted average remaining life of 1.89 years.

Note 5  Related Party Transactions

The Company leases office space from a related party in Scottsdale,
Arizona on a month to month basis. Monthly rent expense on the lease is $1,000.
For the years ended June 30, 2010 and 2009, rent expense was $12,000 per year
in relation to the related party lease.

The Company has agreements with its two Directors
whereby they receive compensation in the amount of $1,500 per month. For the
years ended June 30, 2010 and 2009, the Company has recognized directors fee
expense in the amounts of $36,000 and $84,684, respectively. The expense for the
year ended June 30, 2009 included $48,684 of stock based compensation expense
related to stock options issued during fiscal 2008.

Note 6  Prepaid Expenses

Prepaid expenses at June 30, 2010 and 2009 represent the unamortized
balance of an insurance policy.

Note 7  Going Concern

At June 30, 2010 the Company does not engage in any business activities
that provide cash flow. As of June 30, 2010, we have approximately $114,700 in
cash and cash equivalents. We do not believe this will be sufficient to fund
the costs of investigating and analyzing a suitable business combination or to
fund general and administrative expenses for the next 12 months. We will have
to seek additional funds. No assurance can be given that we will be able to
raise additional capital, when needed or at all, or that such capital, if
available, will be on acceptable terms. The financial statements do not contain
any adjustments that might result from these uncertainties.

Note 8  Subsequent Events

We have adopted authoritative guidance related to Subsequent Events
and have evaluated for disclosure subsequent events that have occurred after
June 30, 2010.

The Company filed a Proxy Statement with the Securities and Exchange
Commission on July 29, 2010. Pending shareholder approval, the Companys
authorized capital would be increased from 50,000,000 shares of common stock to
200,000,000. Additionally, the Board of Directors would be authorized to change
the name of the Company from Tempco, Inc. to another name they determined would
better reflect the identity of the Company.

F-10