UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                  FORM 10-KSB/A
              ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
                         SECURITIES EXCHANGE ACT OF 1934
                   FOR THE FISCAL YEAR ENDED DECEMBER 31, 2006

                          Commission File No. 001-28911

                      NATIONAL HEALTHCARE TECHNOLOGY, INC.
                      ------------------------------------
                 (NAME OF SMALL BUSINESS ISSUER IN ITS CHARTER)

                Colorado                                   91-1869677
     ------------------------------                    ------------------
        (STATE OR JURISDICTION OF                       (I.R.S. EMPLOYER
     INCORPORATION OR ORGANIZATION)                    IDENTIFICATION NO.)


                        1660 Union Street, Suite 200, San
                                 Diego, CA 92101
                    (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)

                                  619/398-8470
                           (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:  Common Stock,  $0.001 par
value

Check whether the issuer is not required to file reports  pursuant to Section 13
or 15 (d) of the Exchange Act.|_|

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 |_|

<PAGE>



Check if there is no disclosure of delinquent  filers in response to Item 405 of
Regulation S-B 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|

Indicate by check mark whether the  registrant is a shell company (as defined in
Rule 12b-2 under the Exchange Act). Yes |X| No |_|

The issuer's revenues for its most recent fiscal year were $0.00

As of April 11,  2007,  the  aggregate  market value of the common stock held by
non-affiliates  based on the closing sale price of Common Stock was  $7,328,787.
For the purposes of the foregoing  calculation  only, all  directors,  executive
officers,  related  parties  and  holders  of more  than 10% of the  issued  and
outstanding common stock of the registrant have been deemed affiliates.

As of April  11,  2007,  the  issuer  had  81,517,759  shares  of  common  stock
outstanding.  Documents  incorporated  by  reference:  none  Transitional  Small
Business Disclosure Format (check one): Yes |_| No |X|


                                     PART I

Item 1. Description of Business

Business Development

On July 19, 2005, National Healthcare Technology,  Inc., a Colorado corporation,
(the  "Company",  "us" or "we")  completed  the  acquisition  of  Special  Stone
Surfaces,  Es3, Inc., a Nevada  corporation  ("Es3") pursuant to the terms of an
Exchange  Agreement (the "Exchange  Agreement") by and among the Company,  Crown
Partners,  Inc., a Nevada corporation and at such time, the largest  stockholder
of the Company  ("Crown  Partners"),  Es3, and certain  stockholders of Es3 (the
"Es3  Stockholders").  The transactions  effected by the Exchange Agreement have
been  accounted  for as a  reverse  merger.  As a  result  of  the  transactions
contemplated by the Exchange Agreement,  we had one active operating subsidiary,
Es3.  Es3 was formed on January  27,  2005 and began  operations  in March 2005.
Effective  October 1, 2005, we transferred  all of the capital stock of Es3 that
we acquired  under the  Exchange  Agreement to Liquid  Stone  Partners  ("Liquid
Stone") in exchange for Liquid Stone assuming all known and unknown  liabilities
of Es3.


                                       -2-

<PAGE>

Business of Issuer

Upon the close of the  acquisition  of Es3 by the Company on July 19,  2005,  we
intended to use the public markets to secure  additional  working capital and to
make acquisitions using either common stock or cash. A significant  component of
the  intermediate  term growth  strategy was the  acquisition and integration of
companies  in related  building  materials  fields.  However,  with little or no
investor  interest in Es3 and its  products  we were unable to secure  necessary
working  capital  through  the public  market to develop a  commercially  viable
market for our products.

On April 3, 2006, our Board of Director's approved a change of direction for the
Company,  from the business of manufacturing  and distributing  decorative stone
veneers and finishes, to the business of oil and gas exploration and production,
mineral lease purchasing and all activities associated with acquiring, operating
and  maintaining  the  assets  of  such  operations.  Pursuant  to an  agreement
effective  retroactively  to October 1, 2005, we transferred  all of the capital
stock of Es3 that we  acquired  under the  Exchange  Agreement  to Liquid  Stone
Partners  ("Liquid  Stone") in exchange for Liquid Stone  assuming all known and
unknown liabilities of Es3.

In  furtherance  of  this  change  of  direction,  we  entered  into  consulting
agreements with third parties to provide business management services and advice
as it relates to our future.  These  services  shall  include the  drafting  and
preparation of business  plans,  operating  budgets,  cash flow  projections and
other business management services as we move into the oil and gas business.  As
an initial  step into the oil and gas  business,  in April 2006,  we executed an
assignment  of an oil and gas lease under which we intend to exploit  underlying
oil and gas reserves. We currently have two full time employees.

                                       -3-

<PAGE>

The Company is in the  development  stage as defined in  Statement  of Financial
Accounting Standards No. 7.

Item 2. Properties.

On March 1, 2005,  the Company  entered into a lease  commitment  for office and
warehouse  space in San Diego,  California  which expires  February 1, 2009. The
terms of the lease provide for monthly rental payments of $3,367 through January
2006  and  increasing  3% each  year  beginning  February  1,  2007.  The  lease
obligation was assumed by Liquid Stone in conjunction  with the sale of Es3. The
Company  currently has an office at 1660 Union Street,  Suite 200, San Diego, CA
92101,  which it maintains under  arrangement  with the landlord at no cost. The
Company also shares an office space with a shareholder  at 9595 Wilshire  Blvd.,
Suite 510, Beverly Hills, CA 90212 at no cost to the Company. As of December 31,
2006, the Company had no future rental commitments.

Item 3. Legal Proceedings.

We are not a party to any material  pending legal  proceeding and no such action
by or, to the best of our knowledge, against us have been threatened.

Item 4. Submission of Matters to a Vote of Security Holders

None.


                                     PART II

Item 5. Market for Registrant's Common Equity and Related Shareholder Matters.
Market information:  Our common stock is quoted on the  over-the-counter  market
and quoted on the National Association of Securities Dealers Electronic Bulletin
Board  ("OTC  Bulletin  Board")  under the symbol  "NHCT".  The high and low bid
prices for the common stock, as reported by the National Quotation Bureau, Inc.,
are  indicated for the periods  described  below.  Such prices are  inter-dealer
prices without retail markups, markdowns or commissions, and may not necessarily
represent actual transactions.


                                       -4-

<PAGE>


           Fiscal Year Ending December 2005                HIGH    LOW
           ===========================================   ======= ======
           Quarter Ending March 31, 2005                    3.15   2.50
           -------------------------------------------   ------- ------
           Quarter Ending June 30, 2005                     3.00   1.50
           -------------------------------------------   ------- ------
           Quarter Ending September 30, 2005                2.50   2.05
           -------------------------------------------   ------- ------
           Quarter Ending December 31, 2006                 2.25   1.50
           -------------------------------------------   ------- ------

           Fiscal Year Ending December 2006               HIGH    LOW
           ===========================================   ======= ======
           Quarter Ending March 31, 2006                    3.00   2.35
           -------------------------------------------   ------- ------
           Quarter Ending June 30, 2006                     1.25   1.25
           -------------------------------------------   ------- ------
           Quarter Ending September 30, 2006                0.28   0.28
           -------------------------------------------   ------- ------
           Quarter Ending December 31, 2006                 0.04   0.04
           ===========================================   ======= ======


Holders

As of December 31, 2006, there were approximately 142 shareholders of record (in
street name) of our common stock.

Dividends

We have not declared nor paid cash dividends or made  distributions in the past,
and we do not anticipate  that we will pay cash dividends or make  distributions
in the  foreseeable  future.  We currently  intend to retain and reinvest future
earnings, if any, to finance and expand our operations.

Recent Sales of Unregistered Securities

During the fiscal year ended December 31, 2006, we issued  securities  using the
exemptions  available  under the Securities  Act of 1933 including  unregistered
sales made  pursuant to Section 4(2) of the  Securities  Act of 1933:  we issued
25,135,000  shares to  employees,  affiliates  and  consultants  during 2006. We
issued  3,800,000  shares  to  officers  and  directors  as part  of  employment
contracts, we issued 3,799,000 shares under the Company's 2006-1 Consultants and
Employees Services Plan for various consulting and services contracts, we issued
17,536,000  of shares to  various  consultants  and  affiliates  for  strategic,
management  and oil and gas  industry  related  consulting.  See the  Management
Discussuin and Analysis for a further breakdown of the share issuance.


                                       -5-

<PAGE>


Item 6. Management's Discussion and Analysis or Plan of Operation.

This report contains  forward looking  statements  within the meaning of Section
27A of the  Securities Act of 1933, as amended and Section 21E of the Securities
Exchange  Act of 1934,  as  amended.  When used in this Form  10-KSB,  the words
"anticipate",  "estimate",  "expect",  "project"  and  similar  expressions  are
intended to identify forward-looking  statements. Such statements are subject to
certain risks,  uncertainties and assumptions including the possibility that the
Company's proposed plan of operation will fail to generate  projected  revenues.
Should  one or more of  these  risks or  uncertainties  materialize,  or  should
underlying assumptions prove incorrect,  actual results may vary materially from
those  anticipated,  estimated or projected.  The Company's actual results could
differ  materially from those set forth on the forward  looking  statements as a
result of the risks set forth in the Company's  filings with the  Securities and
Exchange Commission, general economic conditions, and changes in the assumptions
used in making such forward looking statements.

General

On April 3, 2006, our Board of Directors  approved a change of direction for the
Company,  from the business of manufacturing  and distributing  decorative stone
veneers and finishes, to the business of oil and gas exploration and production,
mineral lease purchasing and all activities associated with acquiring, operating
and maintaining the assets of such operations.  The Board of Directors  believes
that by changing the  direction to the oil and gas markets we have  improved our
prospects  for  success due to both the current  and  expected  future  positive
market  conditions.  We expect to exploit these from our close  association from
Summitt Oil and Gas, and other third party consultants.

Additionally,  in April 2006 we executed an  assignment  of an oil and gas lease
under  which we  acquired  the  rights to drill and  otherwise  exploit  certain
underlying oil and gas reserves which we acquired for 677,000  restricted shares
of our common stock and an agreement to pay a 3% royalty on the value of the oil
removed or produced and on net proceeds  from all gas sold. To date no royalties
have bee accrued or paid.

Results  for the year  ended  December  31,  2006 and the  period  January 27 to
December 31, 2005

For the year ended December 31, 2006, the Company had $0 revenue, vs. revenue of
$0 during the period January 27, to December 31, 2005.

For the year ended  December 31, 2006,  the Company had a net operating  loss of
$38,201,584,  vs. a net operating loss of $807,600 during the period January 27,
to December 31, 2005. The increase in the loss is  attributable to the change in
the direction of the business and the fees incurred. Professional fees increased
$22,425,592  to  $22,890,896  predominately  related  to oil and gas  consulting
services.  Other general and administrative  expenses  increased  $15,076,620 to
$15,254,688  predominately  due to  compensation  costs of recruiting and hiring
officers and directors.  Of the expenses above  $35,732,250 was paid through the
issuance of stock. The expense, admittedly high, is necessary as we are building
a new  company.  The  price  of  entry  into  the oil and  gas  industry  is not
inexpensive  and  accordingly we needed to retain known experts and  consultants
that will assist us in reviewing and analyzing  transactions  and other industry
data.

For the year ended  December 31, 2006, the Company had a net loss of $37,986,584
vs.  $807,600  during the period January 27, to December 31, 2005. The change in
other income is $215,000 due to the settlement of debt.

Plan of Operation
In  conjunction  with our change of direction,  in April 2006, we entered into a
consulting  agreement  with Summitt Oil and Gas,  Inc.  ("Summitt"),  as well as
other third parties, to provide business management  services,  and advice as it
relates to the future of the company.  This service  shall  include the drafting
and preparation of business plans,  operating budgets, cash flow projections and
other business  management services as we venture into the oil and gas business.
In April 2006 we executed an  assignment  of an oil and gas lease under which we
acquired 100% of the leasehold  rights to drill and otherwise  exploit 160 acres
of  certain  underlying  oil and gas  reserves  located in the County of Custer,
Oklahoma,  which we acquired from Summitt for 677,000  restricted  shares of our
common stock and agreed to pay Summitt a royalty equal to 3% of the value of all
oil  produced and removed  under the lease and the net  proceeds  received by us
from the sale of all gas and  casinghead  gasoline  produced  and sold under the
lease.  The leasehold  interest is not developed and  accordingly  not currently
producing oil or gas. Upon receiving the necessary capitalization,  we intend to
explore the development of this field.  The shares were valued at $406,200.  The
Company  recorded  the asset at the  historical  cost of $56,000 to the  related
party and recorded  $350,200 as a deemed  dividend to the related  party.  As of
December 31, 2006 the Company impaired the balance of the lease of $46,667.

                                      -6-
<PAGE>

In April  2006,  we entered  into a  consulting  agreement  with  BlueFin,  Inc.
("BlueFin"). BlueFin has been retained to provide business development, investor
relations   services,   and   introductions   to  qualified   funding   sources,
introductions to oil and gas business  prospects and introductions to accredited
investors.  By leveraging  BlueFin's  resources the Company  anticipates that it
will be able to find  sources of capital to fund its  operations  in the oil and
gas business.

In April 2006, we also entered into an agreement  with  Monterosa  Group Limited
("Monterosa").  Monterosa  has  been  retained  to  provide  services  including
operation  administration,   transaction  processing  and  management,   systems
development,  staff recruitment,  acquisition  transaction support services, and
other  business  management  services as the Company  moves into the oil and gas
business.

In April 2006,  we also engaged  Camden  Holdings,  Inc.  ("Camden"),  an entity
experienced  in the energy  sector that will assist the Company in locating  oil
and gas  opportunities  for us.  Camden's  services  include  the  drafting  and
preparation of business  plans,  operating  budgets,  cash flow  projections and
other business  management services as we venture into the oil and gas business.
We have  also been  able to  leverage  our  relationship  with  Camden to obtain
short-term  financing  as needed.  Camden has also agreed to advance sums to the
Company to assist in funding its operations over the short-term.  As of December
31, 2006, Camden has advanced the Company the sum of $613,400.

In April 2006, we also engaged Design, Inc. ("Design"), an entity experienced in
the energy  sector that will assist the Company in  financing  the  transactions
introduced by Camden and our other consultants.

In July,  2006,  the Company  entered into a Consulting  Agreement with Catalyst
Consulting  Partners,  LLC to  provide  the  Company  with  business  consulting
services in exchange for the issuance of 518,000 shares of the Company's  common
stock. These shares were issued during the quarter ended September 30, 2006.
In September, 2006, the Company entered into a Consulting Agreement with Summitt
Ventures  Inc.  ("SVI")  for six  months  which  required  the  Company to issue
2,70,000 of its common  stock to SVI for  services to be provided to the Company
including business management  services and related services.  These shares were
issued in September, 2006.

In September,  2006,  the Company  entered into a Services  Agreement with Rhone
Alternative  Marketing  Partners  ("RAMP)  for  marketing  and public  relations
services  in exchange  for the  issuance of  1,000,000  shares of the  Company's
common stock.  These shares were issued  during the quarter ended  September 30,
2006.

During the quarter ended  September 30, 2006,  the Company  compensated  certain
third party  individuals  who provided  services to the  Company.  In August and
September, 2006, 600,000 shares were issued for services. In September, 2006, an
additional  740,000  shares were issued to  consultants  for services  under the
Company's 2006-1  Consultants and Employees Services Plan. This Plan was adopted
in September,  2006 and reserved  3,800,000 shares of the Company's common stock
to consultants and employees,  which shares were registered in September,  2006.
During the quarter ended December 31, 2006,  3,799,000  shares were issued under
the Plan.

                                      -7-
<PAGE>

We believe  that by changing  our  direction  to the oil and gas markets we have
improved our prospects  for success due to both the current and expected  future
positive  market  conditions  which we  expect  to  exploit  initially  from the
valuable contacts,  industry  expertise and business  opportunities we expect to
derive from Summitt,  an industry  experienced  consulting  resource,  and other
third party consultants.

Additionally,  we intend to  reincorporate  the Company to a Nevada  corporation
("Reincorporation").  The business purpose of the Reincorporation is to allow us
to avail  ourselves to Nevada  corporate law.  Nevada is a recognized  leader in
adopting and implementing  comprehensive,  flexible corporate laws responsive to
the legal and  business  needs of  corporations  organized  under its laws.  The
Nevada Revised  Statutes is an enabling  statute that is frequently  revised and
updated to accommodate changing business needs.

Additionally,  consistent  with the change of our direction into the oil and gas
business,  we will also change the Company name to a name in line with a company
in the oil and gas business.

We anticipate that we will have to raise  additional  capital to fund operations
over the next 12 months.  To the extent that we are required to raise additional
funds to acquire properties,  and to cover costs of operations,  we intend to do
so through  additional public or private offerings of debt or equity securities,
including  a drilling  fund to raise  $5,000,000.  There are no  commitments  or
arrangements  for  other  offerings  in  place,  no  guaranties  that  any  such
financings would be forthcoming,  or as to the terms of any such financings. Any
future financing may involve substantial dilution to existing investors. We have
also been  relying on our common stock to pay third  parties for services  which
has resulted substantial dilution to existing investors.

Estimated Funding Required During the Next Twelve Months:

-------------------------------------- --------------- --- ---------------------
Prospect Development & Seismic              $1,000,000  to    $5,000,000
-------------------------------------- --------------- --- ---------------------
Drilling & Development                      $2,500,000  to    $5,000,000
-------------------------------------- --------------- --- ---------------------
Offering Costs & Expenses                      $50,000  to       $50,000
-------------------------------------- --------------- --- ---------------------
General Corporate Expenses                    $100,000  to      $150,000
-------------------------------------- --------------- --- ---------------------
Working Capital                               $700,000  to    $1,000,000
-------------------------------------- --------------- --- ---------------------
    Total                                   $4,350,000  to   $11,200,000
-------------------------------------- --------------- --- ---------------------


                                      -8-
<PAGE>

The minimum  expenditures  noted above will allow us to commence with acquiring,
exploring and developing properties as well as commence drilling operations.  In
the event that we are able to raise further funds, we will primarily expend such
funds on further  prospect  development  and  seismic  studies  and then to fund
further  drilling  operations  Consistent  with  this  change  of our  business,
effective  October  1,  2005 we sold all of the  capital  stock of Es3 to Liquid
Stone  Partners.   A  partner  holding  a  minority  interest  in  Liquid  Stone
Partnerships is also a director of the Company.  We currently have one full-time
employee.  We will  primarily rely on outside  consultants  and do not currently
foresee any significant changes in the number of our employees.

Risk Factors

Risks related to the Company

Need for additional financing.
--------------------------------------------------------------------------------

We currently do not have sufficient  capital reserves to satisfy our obligations
and continue operations through the end of 2006, and therefore have an immediate
need for capital.  While we are exploring various capital raising avenues, there
can be no  assurance  that we will be able to obtain the  sufficient  short-term
capital  needed to  sustain  operations.  The full and  timely  development  and
implementation of our business plan and growth strategy will require significant
resources.  We may  not be able to  obtain  the  working  capital  necessary  to
implement our growth strategy.  Furthermore, our growth strategy may not produce
material revenue even if successfully  funded.  Management  intends to explore a
number of  options  to secure  alternative  sources of  capital,  including  the
issuance of secured debt, volumetric production payments,  subordinated debt, or
additional  equity,  including  preferred  equity  securities  or  other  equity
securities.  We might not succeed, however, in raising additional equity capital
or in negotiating and obtaining additional and acceptable financing when we need
it.  Our  ability  to  obtain  additional  capital  will  also  depend on market
conditions,  national and global economies and other factors beyond our control.
Even if we are able to obtain the  short-term  capital  necessary to sustain our
operations,  if  adequate  capital  is  not  available  or is not  available  on
acceptable terms at a time when we needed it, our ability to close acquisitions,
execute  our  growth  plans,  develop  or  enhance  our  services  or respond to
competitive  pressures will be significantly  impaired.  There are no assurances
that  we  will  be  able  to  implement  or  capitalize  on  various   financing
alternatives or otherwise obtain required working capital, the need for which is
substantial given our operating loss history.

We have a limited operating history.
--------------------------------------------------------------------------------

 We are a development  stage company with a limited  operating  history,  and we
face all the risks common to  companies  in their early  stages of  development,
including  undercapitalization  and uncertainty of funding sources, high initial
expenditure  levels and uncertain  revenue streams,  an unproven business model,
and difficulties in managing  growth.  Our prospects must be considered in light
of the  risks,  expenses,  delays and  difficulties  frequently  encountered  in
establishing a new business.  Any  forward-looking  statements in this report do
not reflect any adjustments that might result from the outcome of these types of
uncertainty.  Since inception, we have incurred significant losses. No assurance
can be given that we will be successful.

                                       -9-

<PAGE>



We may incur  unforeseen  costs and we may need to raise  capital in addition to
that required by our business plan.
--------------------------------------------------------------------------------

We are  currently  operating  at a loss and  intend to  increase  our  operating
expenses  significantly as we begin our acquisitions and oil and gas production.
Additionally,  we may encounter  unforeseen  costs that could also require us to
seek additional capital. There can be no assurance that we will be able to raise
sufficient  additional  capital on acceptable  terms,  if at all. Any additional
financing may result in significant dilution to our existing stockholders.

Maintaining  any  reserves  and revenue we may acquire in the future  depends on
successful development and acquisitions.
--------------------------------------------------------------------------------

In  general,  the  volume of  production  from oil and  natural  gas  properties
declines  as  reserves  are  depleted,  with the rate of  decline  depending  on
reservoir characteristics. Except to the extent we acquire properties containing
proved  reserves or conduct  successful  development  activities,  or both,  our
proved reserves that we may acquire will decline. Our future oil and natural gas
production is, therefore,  highly dependent upon our level of success in finding
or acquiring additional reserves.

We are subject to substantial operating risks
--------------------------------------------------------------------------------

 The oil and natural gas business  involves  certain  operating  hazards such as
well blowouts,  mechanical  failures,  explosions,  uncontrollable flows of oil,
natural  gas  or  well  fluids,  fires,   formations  with  abnormal  pressures,
hurricanes, pollution, releases of toxic gas and other environmental hazards and
risks.  We could suffer  substantial  losses as a result of any of these events.
While we intend to carry  general  liability,  control of well,  and  operator's
extra expense  coverage  typical in our  industry,  we will not be fully insured
against all risks incident to our business, such as acts of God.

We may not  always  be the  operator  of some of our  wells.  As a  result,  our
operating  risks for those wells and our ability to influence the operations for
these wells will be less  subject to our  control.  Operators of these wells may
act in ways that are not in our best interests.

We are dependent upon third party and related party consultants
--------------------------------------------------------------------------------

Our key personnel have experience in the business of renewable  energy,  but not
in the oil and gas industry. We are therefore highly dependent upon the industry
expertise  and business  opportunities  we expect to derive from Summitt Oil and
Gas, Inc., an industry experienced  consulting  resource,  as well as with other
industry  experienced  consulting  resources.  These consultants may act in ways
that are not in our best interests.

                                      -10-

<PAGE>


Our operations have significant capital requirements.
--------------------------------------------------------------------------------

We expect to experience substantial working capital needs as we begin our active
development  and  acquisition  programs.  Even  if we are  able  to  obtain  the
short-term  capital necessary to maintain our operations,  additional  financing
will be required in the future to fund our growth and operations.  No assurances
can be given as to the  availability or terms of any such  additional  financing
that may be required or that financing  will continue to be available  under new
credit facilities.  In the event such capital resources are not available to us,
our drilling and other activities would be curtailed.

We may have  difficulty  managing  future growth and the related  demands on our
resources and may have difficulty in achieving future growth.

We expect to  experience  rapid  growth  through  acquisitions  and  development
activity for the foreseeable  future.  Any future growth may place a significant
strain on our financial,  technical,  operational and administrative  resources.
Our ability to grow will depend upon a number of factors,  including our ability
to identify and acquire new development or acquisition prospects, our ability to
develop  existing  properties,  our  ability to  continue  to retain and attract
skilled  personnel,  hydrocarbon  prices and access to capital.  There can be no
assurance that we will be successful in achieving  growth or any other aspect of
our business strategy.

We face strong competition from larger oil and natural gas companies.

Our  competitors  include  major  integrated  oil and natural gas  companies and
numerous independent oil and natural gas companies, individuals and drilling and
income programs. Many of our competitors are large,  well-established  companies
with  substantially  larger operating staffs and greater capital  resources than
us. We may not be able to  successfully  conduct our  operations,  evaluate  and
select   suitable   properties  and  consummate   transactions  in  this  highly
competitive environment.  Specifically,  these larger competitors may be able to
pay more for development  projects and productive oil and natural gas properties
and may be able to define,  evaluate,  bid for and purchase a greater  number of
properties  and  prospects  than our  financial or human  resources  permit.  In
addition, such companies may be able to expend greater resources on the existing
and changing technologies that we believe are and will be increasingly important
to attaining success in the industry.

Our acquisition program may be unsuccessful, particularly in light of our recent
formation and limited history of acquisitions.
--------------------------------------------------------------------------------

Our personnel have had significant acquisition experience outside of the oil and
gas  industry.  However,  we  may  not  be in as  good a  position  as our  more
experienced  competitors  to execute a successful  acquisition  program or close
additional  future  transactions.   The  successful   acquisition  of  producing
properties  requires  an  assessment  of  recoverable  reserves,  future oil and
natural  gas  prices,   operating  costs,  potential   environmental  and  other
liabilities  and  other  factors.  Such  assessments,  even  when  performed  by
experienced  personnel,  are necessarily  inexact and their accuracy  inherently
uncertain.  Our review of subject  properties,  which generally includes on-site
inspections  and the review of reports filed with various  regulatory  entities,
will  not  reveal  all  existing  or  potential   problems,   deficiencies   and
capabilities.  We may not always perform  inspections on every well, and may not
be able to observe structural and environmental  problems even when we undertake
an inspection. Even when problems are identified, the seller may be unwilling or
unable to provide effective  contractual  protection against all or part of such
problems.  There can be no assurances that any acquisition of property interests
by us will be successful and, if  unsuccessful,  that such failure will not have
an adverse effect on our future results of operations and financial condition.

                                      -11-

<PAGE>


We cannot market our production without the assistance of third parties.

The  marketability of our production  depends upon the proximity of our reserves
to, and the capacity of, facilities and third party services,  including oil and
natural gas gathering systems,  pipelines,  trucking or terminal facilities, and
processing  facilities.  The unavailability or lack of capacity of such services
and  facilities  could result in the shut-in of producing  wells or the delay or
discontinuance  of  development  plans for  properties.  A  shut-in  or delay or
discontinuance  could  adversely  affect our financial  condition.  In addition,
federal  and  state   regulation   of  oil  and  natural  gas   production   and
transportation  affect our ability to produce and market our oil and natural gas
on a profitable basis.

Risks Relating to the Oil and Gas Industry

Oil and Gas Drilling,  re-completions and re-working are speculative  activities
and involve numerous risks and substantial and uncertain costs.

Our growth will be materially  dependent upon the success of our future drilling
and development program.  Drilling for oil and gas and re-working existing wells
involve numerous risks,  including the risk that no commercially  productive oil
or natural gas reservoirs will be encountered. The cost of drilling,  completing
and operating wells is substantial and uncertain, and drilling operations may be
curtailed,  delayed or cancelled as a result of a variety of factors  beyond our
control, including unexpected drilling conditions, pressure or irregularities in
formations,   equipment  failures  or  accidents,  adverse  weather  conditions,
compliance  with  governmental  requirements  and  shortages  or  delays  in the
availability  of drilling rigs or crews and the delivery of equipment.  Although
we  believe  that our  focus on  re-developing  existing  oil and gas  field and
advanced  drilling  technology should increase the probability of success of our
wells and should reduce average  finding costs through  elimination of prospects
that might  otherwise be drilled using other  traditional  methods,  drilling or
reworking  remains a speculative  activity.  Even when fully  utilized,  lateral
drilling does not  predetermine if hydrocarbons  will in fact be present in such
structures  if they are  drilled.  Our  future  drilling  activities  may not be
successful and, if unsuccessful, such failure will have an adverse effect on our
future results of operations and financial condition.  There can be no assurance
that our overall drilling success rate or our drilling success rate for activity
within a particular  geographic  area will not decline.  Although we may discuss
drilling prospects that we have identified or budgeted for, we may ultimately

not lease or drill these prospects within the expected time frame, or at all. We
may identify and develop prospects through a number of methods, some of which do
not include  horizontal  drilling.  The drilling and results for these prospects
may be  particularly  uncertain Our drilling  schedule may vary from our capital
budget. The final determination with respect to the drilling of any scheduled or
budgeted  wells will be  dependent  on a number of factors,  including,  but not
limited to: (i) the results of previous development efforts and the acquisition,
review  and  analysis  of data;  (ii) the  availability  of  sufficient  capital
resources to us and the other  participants  for the drilling of the  prospects;
(iii) the approval of the prospects by other  participants after additional data
has  been  compiled;  (iv)  economic  and  industry  conditions  at the  time of
drilling,  including  prevailing and anticipated  prices for oil and natural gas
and the availability of drilling rigs and crews; (v) our financial resources and
results; (vi) the availability of leases and permits on reasonable terms for the
prospects;  and (vii) the success of our  drilling  technology.  There can be no
assurance  that these projects can be  successfully  developed or that the wells
discussed will, if drilled,  encounter reservoirs of commercially productive oil
or natural gas.  There are numerous  uncertainties  in estimating  quantities of
proved reserves, including many factors beyond our control.

                                      -12-

<PAGE>



Reliance on technological development and possible technological obsolescence.

Our business is dependent upon utilization of changing technology.  As a result,
our  ability  to adapt to  evolving  technologies,  obtain  new  technology  and
maintain  technological  advantages will be important to our future success.  We
believe that our ability to utilize state of the art  technologies  will give us
an advantage over many of our competitors.  This advantage, however, is based in
part upon technologies  developed by others,  and we may not be able to maintain
this advantage.  As new technologies  develop, we may be placed at a competitive
disadvantage,  and  competitive  pressures  may force us to  implement  such new
technologies at substantial cost. There can be no assurance that we will be able
to successfully utilize, or expend the financial resources necessary to acquire,
new technology,  or that others will not either achieve technological  expertise
comparable to or exceeding that of our Company or that others will not implement
new  technologies  before us. One or more of the technologies we end up adopting
or implementing may, in the future, become obsolete. In such case, our business,
financial  condition  and results of operations  could be  materially  adversely
affected. If we are unable to utilize the most advanced  commercially  available
technology, our business, financial condition and results of operations could be
materially and adversely affected.

Oil and  natural  gas  prices  are highly  volatile  in  general  and low prices
negatively affect our financial results.
--------------------------------------------------------------------------------

Our revenue, profitability, cash flow, future growth and ability to borrow funds
or obtain additional  capital,  as well as the carrying value of our properties,
are substantially dependent upon prevailing prices of oil and natural gas. Lower
oil and  natural  gas prices  also may reduce the amount of oil and  natural gas
that we can produce economically.  Historically, the markets for oil and natural
gas have been  volatile,  and such markets are likely to continue to be volatile
in the future. Prices for oil and natural gas are subject to wide fluctuation in
response to  relatively  minor  changes in the supply of and demand for oil and
natural gas,  market  uncertainty  and a variety of additional  factors that are
beyond our control.  These factors include the level of consumer product demand,
weather conditions, domestic and foreign governmental regulations, the price and
availability of alternative fuels,  political conditions,  the foreign supply of
oil and  natural  gas,  the  price  of  foreign  imports  and  overall  economic
conditions  It is  impossible  to  predict  future  oil and  natural  gas  price
movements with certainty.  Declines in oil and natural gas prices may materially
adversely affect our financial condition,  liquidity, ability to finance planned
capital expenditures and results of operations.

                                      -13-

<PAGE>


Government  regulation  and  liability for  environmental  matters may adversely
affect our business and results of operations.
--------------------------------------------------------------------------------

Oil and natural gas operations are subject to extensive federal, state and local
government regulations,  which may be changed from time to time. Matters subject
to regulation include discharge permits for drilling operations, drilling bonds,
reports concerning operations,  the spacing of wells, unitization and pooling of
properties  and taxation.  From time to time,  regulatory  agencies have imposed
price controls and  limitations on production by restricting the rate of flow of
oil and natural gas wells below actual production  capacity in order to conserve
supplies of oil and natural  gas.  There are  federal,  state and local laws and
regulations primarily relating to protection of human health and the environment
applicable to the development, production, handling, storage, transportation and
disposal of oil and natural gas,  by-products  thereof and other  substances and
materials produced or used in connection with oil and natural gas operations. In
addition,  we may be liable for environmental  damages caused by previous owners
of  property  we  purchase  or  lease  As a  result,  we may  incur  substantial
liabilities to third parties or  governmental  entities.  We are also subject to
changing and extensive tax laws,  the effects of which cannot be predicted.  The
implementation  of new, or the  modification  of existing,  laws or  regulations
could have a material adverse effect on us.

Risks Associated with Our Stock

Our stock price has been and may continue to be very volatile.

Our common stock is thinly  traded and the market price has been,  and is likely
to continue to be, highly  volatile.  During the 12 months prior to December 31,
2006,  our stock price as traded on the OTC Bulletin Board has ranged from $3.05
to $0.03.  The  variance  in our share  price makes it  extremely  difficult  to
forecast  with any  certainty the stock price at which you may be able to buy or
sell shares of our common stock.  The market price for our common stock could be
subject to wide fluctuations due to factors beyond our control,  such as: actual
or anticipated  variations in our results of operations,  naked short selling of
our common stock and stock price  manipulation,  changes or  fluctuations in the
commodity  prices of oil and natural gas,  general  conditions and trends in the
oil and gas industry, general economic, political and market conditions.

Use of our common stock to pay for third party  services  could  dilute  current
investors.
--------------------------------------------------------------------------------

We are highly dependent upon the industry  expertise and business  opportunities
we expect to derive from industry experienced consulting resources.  In the past
we have used our  common  stock to pay for the  services  of these  third  party
consultants.  As of April 11,  2006,  we have  issued  33,335,000  shares of our
common  stock  to said  consultants.  Further  issuances  in  exchange  for such
services will dilute current investors.  Future sales of our common stock in the
public market could adversely affect the price of our common stock.

                                      -14-

<PAGE>

Sales of  substantial  amounts of common stock in the public market that are not
currently freely tradable,  or even the potential for these sales, could have an
adverse  effect on the market  price for the shares of our common  stock.  These
shares include approximately 28.2 million shares held by founders, investors and
service providers, and 1,800,000 warrants at April 11, 2006. Unregistered shares
may not be sold except in compliance  with Rule 144  promulgated  by the SEC, or
some other exemption from  registration.  Rule 144 does not prohibit the sale of
these shares but does place conditions and  restrictions on their resale,  which
must be complied with before they can be resold.

A summary of the warrant  activity for the period ended  December 31, 2006 is as
follows:

<TABLE>
<CAPTION>
-------------------------------------- ----------------------- ----------------------- ----------------------
                                       Warrants Outstanding    Weighted Average        Aggregate Intrinsic
                                                               Exercise Price          Value
-------------------------------------- ----------------------- ----------------------- ----------------------
<S>                                    <C>                      <C>                   <C>
Outstanding, December 31, 2005         1,800,000               $0.67                   $-
Granted                                600,000                  2.63                    -
Forfeited / Canceled                   600,000                  2.63                    -
Exercised                              -                        -                       -
Outstanding, December 31, 2006         1,800,000               $0.67                   $-
-------------------------------------- ----------------------- ----------------------- ----------------------

The weighted average remaining  contractual life of warrants outstanding is 3.10
years at December 31, 2006.

<CAPTION>

-------------------------------------------------------------------------------------------------------------
Outstanding Warrants                                               Exercisable Warrants
----------------------- --------------------- -------------------- --------------------- --------------------
Range of Exercise       Number                Average Remaining    Average Exercise      Number
Price                                         Contractual Life     Price
<C>                     <C>                   <C>                  <C>                   <C>
$0.67                   1,800,000             3.10                 $0.67                 1,800,000
----------------------- --------------------- -------------------- --------------------- --------------------


The Company  estimated the fair value of each stock warrant at the grant date by
using the Black-Scholes option-pricing mode.

The  weighted-average  assumptions used in estimating the fair value of warrants
granted  during the year ended  December 31, 2006, and the period ended December
31,  2005  along  with the  weighted-average  grant  date fair  values,  were as
follows.

<CAPTION>

------------------------------------- ----------------------------------- -----------------------------------
                                      2006                                2005
------------------------------------- ----------------------------------- -----------------------------------
<S>                                   <C>                                 <C>
Expected volatility                   80.0%                               0.1%
Expected life in years                5 years                             5 years
Risk free interest rate               5.07%                               3.38%
Dividend yield                        0%                                  0%
------------------------------------- ----------------------------------- -----------------------------------
</TABLE>

During the period  ended  December 31,  2006,  the Company  granted two warrants
which  expire  five years from date of grant and are  convertible  into  300,000
shares of common stock at an exercise  price of $2.63 per share to each of Brian
Harcourt and Ross-Lyndon  James in accordance with their  respective  Management
Employment   Agreements   executed  by  and  between   them  and  the   Company,
respectively. The warrants were granted on April 5, 2006 and vest 6 months after
grant.  Both Mr.  Harcourt  and Mr.  James  resigned  in July 24, 2006 and their
warrants were forfeited.

Future sales of our common stock in the public market could limit our ability to
raise capital.
--------------------------------------------------------------------------------

Sales of  substantial  amounts of our common  stock  pursuant to Rule 144,  upon
exercise or  conversion  of  derivative  securities  or  otherwise,  or even the
potential of these sales, could also affect our ability to raise capital through
the sale of equity securities.

The  Company  has never paid cash  dividends  on its  common  stock and does not
intend to do so in the foreseeable future.
--------------------------------------------------------------------------------

Present  management  and directors may control the election of our directors and
all other matters submitted to the stockholders for approval.

Our  executive  officers  and  directors,  in the  aggregate,  beneficially  own
approximately 0.0% of our outstanding  common stock.  Summitt Oil & Gas, Inc. is
our  single  largest  shareholder  owning  52.94% of our  common  stock.  Boston
Equities  Corporation holds 10.68% of our common stock and is our second largest
shareholder. Accordingly, this concentration of ownership may have the effect of
delaying,  deferring or preventing a change in control of the Company,  impede a
merger,  consolidation,  takeover or other  business  combination  involving the
Company  or  discourage  a  potential  acquirer  from  making a tender  offer or
otherwise attempting to obtain control of the Company,  which in turn could have
an adverse effect on the market price of our common stock.

                                      -15-
<PAGE>

"Penny stock"  regulations may impose certain  restrictions on  marketability of
securities.
--------------------------------------------------------------------------------

The SEC adopted  regulations,  which  generally  define  "penny  stock" to be an
equity security that has a market price of less than $5.00 per share. Our common
stock may be subject to rules that impose additional sales practice requirements
on  broker-dealers  who sell these  securities to persons other than established
customers and  accredited  investors  (generally  those with assets in excess of
$1,000,000, or annual incomes exceeding $200,000 or $300,000 together with their
spouse).  For transactions covered by these rules, the broker-dealer must make a
special suitability  determination for the purchase of these securities and have
received the purchaser's prior written consent to the transaction.

Additionally, for any transaction,  other than exempt transactions,  involving a
penny stock, the rules require the delivery, prior to the transaction, of a risk
disclosure  document mandated by the SEC relating to the penny stock market. The
broker-dealer   also  must  disclose  the   commissions   payable  to  both  the
broker-dealer  and the  registered  representative,  current  quotations for the
securities and, if the broker-dealer is the sole market-maker, the broker-dealer
must  disclose  this  fact and the  broker-dealer's  presumed  control  over the
market.  Finally,  monthly  statements  must be  sent  disclosing  recent  price
information  for the penny  stock held in the  account  and  information  on the
limited  market in penny  stocks.  Consequently,  the  "penny  stock"  rules may
restrict the ability of  broker-dealers  to sell our common stock and may affect
the ability to sell our common stock in the secondary market.

The market for our Company's  securities is limited and may not provide adequate
liquidity.
--------------------------------------------------------------------------------

 Our common stock is currently  traded on the OTC Bulletin  Board  ("OTCBB"),  a
regulated  quotation service that displays  real-time quotes,  last-sale prices,
and volume information in  over-the-counter  equity securities.  As a result, an
investor may find it more difficult to dispose of, or obtain accurate quotations
as to the price of, our  securities  than if the  securities  were traded on the
Nasdaq Stock market, or another national exchange. There are a limited number of
active market makers of our common stock. In order to trade shares of our common
stock you must use one of these market  makers unless you trade your shares in a
private  transaction.  In the twelve  months  prior to  December  31, 2006 , the
actual  trading  volume ranged from a low of no shares of common stock to a high
of 1,000,000  shares of common stock.  On most days,  this trading  volume means
there is limited liquidity in our shares of common stock.  Selling our shares is
more difficult because smaller quantities of shares are bought and sold and news
media  coverage about us is limited.  These factors result in a limited  trading
market for our common stock and therefore  holders of our Company's stock may be
unable to sell shares purchased should they desire to do so.

Item 7. Financial Statements.

The report of  independent  auditors and financial  statements  are set forth in
this report beginning on Page F-1.

                                      -16-

<PAGE>


Item  8.  Changes  in and  Disagreements  with  Accountants  on  Accounting  and
Financial Disclosure.

There  were no  disagreements  with  accountants  on  accounting  and  financial
disclosure during the relevant period.

Item 8A. Controls and Procedures

 Our Chief  Executive  Officer and Chief  Financial  Officer have  evaluated the
effectiveness of our disclosure controls and procedures (as such term is defined
in Rules 13a-15 and 15d-15 under the Securities Exchange Act of 1934, as amended
(the  "Exchange  Act")) as of the end of the period ended December 31, 2006 (the
"Evaluation  Date").  During the course of the audit for our year ended December
31, 2005 in May, 2006, our auditor  discovered  numerous errors in our financial
statements  in our financial  statements in our quarterly  report for the period
ended  September 30, 2005 as disclosed in our Form 8-K/A filed on June 14, 2006.
As a result of these  errors,  and others,  we restated  our Form 10-QSB for the
quarter ended September 30, 2005, and will restate the financial  statements for
the period ended June 30, 2005, in our Form 8-K/A filed on January 24, 2006. Our
conclusion to restate our Form 10-QSB for the quarter  ended  September 30, 2005
and Form 8-K/A filed on January 24,  2006,  resulted in the Company  recognizing
that its  controls  and  procedures  were not  effective  as of the period ended
December  31, 2006 and  constituted  material  weaknesses  which began after the
close  of the  Exchange  Agreement  on or  about  July 16,  2005.  The  material
weaknesses  were  primarily  the  result  of our  having  no  controller  and no
qualified  personnel  and  as a  result,  transactions  were  omitted,  recorded
incorrectly, or recorded without support.

Limitations on the Effectiveness of Internal Controls

Disclosure controls and procedures are designed to provide reasonable  assurance
of any entity achieving its disclosure  objectives.  Our chief executive officer
and chief  financial  officer have concluded  that our  disclosure  controls and
procedures were not effective as the fiscal year ended December 31, 2006 and the
Company has since implemented  disclosure controls and procedures to ensure that
the Company has the proper disclosure  controls and procedures to keep this from
happening  again.  The  likelihood of achieving  such  objectives is affected by
limitations  inherent in disclosure  controls and procedures.  These include the
fact that human judgment in decision-making can be faulty and that breakdowns in
internal  control can occur  because of human  failures such as simple errors or
mistakes or intentional circumvention of the established process.

In May,  2006,  we  remediated  the material  weakness in internal  control over
financial  reporting by having our Chief  Executive  Officer and Chief Financial
Officer  review  in  detail  all  adjustments  affecting  the  issuances  of our
securities and we retained an outside consultant to make accounting entries.


                                      -17-


<PAGE>


                                    PART III

Item 9. Directors, Executive Officers, Promoters and Control Persons; Compliance
 with  Section  16(a) of the  Exchange  Act.  Identification  of  Directors  and
Executive  Officers of the Company Our current officers and directors consist of
the following persons:

        NAME                         AGE      OFFICE                  SINCE

       --------------------         ------   -------------------      -----
       Linda Contreras               26       Director                 2007


The  Director  named  above  will  serve  until the next  annual  meeting of our
shareholders.  Thereafter,  Directors  will be elected for one-year terms at the
annual shareholders' meeting. Officers will hold their positions at the pleasure
of the Board of Directors.  There is no arrangement or understanding between the
Directors and Officers of the Company and any other person pursuant to which any
Director  or Officer  was or is to be  selected  as a Director or Officer of the
Company.

There is no family relationship between or among any Officer and Director.

We have no audit  committee.  We have a compensation  committee that administers
our 2006 Employee Stock Option Plan that we adopted in April 2006. The following
is a brief account of the business  experience during at the least the last five
years of the  directors  and  executive  officers,  indicating  their  principal
occupations  and  employment  during that  period,  and the names and  principal
businesses of the  organizations  in which such  occupations and employment were
carried out. Linda  Contreras was appointed our sole Director on April 12, 2007.
She has been  working for the past year as the Research &  Acquisitions  Officer
for Summitt Oil & Gas in Beverly Hills, California. She has led the acquisitions
team in the  evaluation of offerings in oil and gas  development  programs,  and
provides  economic  analysis of all  proposed  acquisitions,  divestitures,  and
drilling  activities.  Ms. Contreras  received her Bachelor of Arts in Political
Science from the University of California at Berkeley in 2003.

Sam Plunkett was our sole Director  from March 14, 2007 to April 12, 2007,  when
he  resigned.  Since  2003  he has  been  working  in  Beverly  Hills  as a solo
practitioner handling all aspects of general practice,  including family law and
civil  court  trials.  From 2002 to 2003 he  worked as a legal  clerk for a sole
practitioner in Santa Monica from 2002 to 2003.

On or about  March  1,  2006,  in the U.S.  Bankruptcy  Court  for the  Southern
District of California,  an involuntary  petition for bankruptcy under chapter 7
under the  United  States  Bankruptcy  Code was filed  against  Boston  Equities
Corporation,  our largest shareholder holding approximately 25.90% of our issued
and outstanding  common stock.  After such filing,  Boston Equities  Corporation
converted the case from chapter 7 to chapter 11.

Compliance with Section 16(a) of the Exchange Act

Section  16(a) of the  Securities  Exchange Act of 1934  requires the  Company's
directors  and  executive  officers,  and  persons  who own  more  than 10% of a
registered class of the Company's equity  securities to file with the Securities
and Exchange  Commission  initial reports of ownership and reports of changes in
ownership of Common Stock and other equity securities of the Company.  Officers,
directors and greater than 10%  shareholders  are required by SEC regulations to
furnish the Company with copies of all Section 16(a) forms they file.

To our  knowledge,  based  solely on its  review of the  copies of such  reports
furnished to the company and written  representations that no other reports were
required  during the fiscal year ended  December  31,  2006 , all Section  16(a)
filing requirements  applicable to its officers,  directors and greater than 10%
beneficial owners were complied with.

                                      -19-

<PAGE>

Code of Ethics

Code of Ethics  for the Chief  Executive  Officer  and the  Principal  Financial
Officer

 Our  Board of  Directors  has  adopted  the Code of  Ethical  and  Professional
Standards of National Healthcare  Technology,  Inc. and Affiliated Entities Code
of Business  Conduct  and Ethics  that  applies to its  officers  and  employees
effective on April 11, 2007, a copy of which is filed as an exhibit  hereto.  We
will  provide  any person  without  charge,  a copy of our code of ethics,  upon
receiving a written request in writing addressed to the Company at the Company's
address, attention: Secretary.

Item 10. Executive Compensation.

During fiscal 2006 we paid a total of $12,716,173- in executive  compensation of
which  $256,173 was regular  compensation  and  $12,460,000,  was through  stock
issuances (a total of 8,800,000 shares).  The table below shows the compensation
split:

<TABLE>
<CAPTION>
------------------------- ----------------------- ----------------------- -----------------------
                            Cash compensation        Stock issuances        Total Compensation
------------------------- ----------------------- ----------------------- -----------------------
<S>                                      <C>                  <C>                     <C>
Ross Lyndon James                        $91,250              $6,190,000              $6,281,250
------------------------- ----------------------- ----------------------- -----------------------
Brian Harcourt                            96,250               6,190,000               6,281,250
------------------------- ----------------------- ----------------------- -----------------------
Sam Petrossian                            68,673                  80,000                 148,673
------------------------- ----------------------- ----------------------- -----------------------
                                        $256,173             $12,460,000             $12,716,173
------------------------- ----------------------- ----------------------- -----------------------
</TABLE>

Employment Agreements
The following  transaction took place between the Company and Ross-Lyndon James,
the  Company's  Chief  Executive  Officer and  Director:  On April 3, 2006,  the
Company entered into an employment agreement with Ross Lyndon James who has been
serving as the Company's  President  without  compensation and written agreement
since being appointed to such office by the Board of Directors of the Company in
June 2005. Mr. Lyndon James had also served without  compensation  as a director
of the Company.  Under the terms of the  agreement,  Mr.  Lyndon James  received
compensation  equal to twenty five thousand dollars  ($25,000) per month payable
monthly in  advance.  He was also  granted one million  eight  hundred  thousand
(1,800,000)  restricted  shares of common stock upon execution of the employment
agreement  as a signing  bonus,  as well as a  termination  grant of two million
(2,000,000)  shares of  restricted  common  stock.  All shares  have  piggy-back
registration rights. Additionally,  the Company agreed to grant him a warrant to
acquire  three hundred  thousand  (300,000)  restricted  shares of the Company's
common stock. The exercise price is to be based on the bid price of the stock on
the date of the  agreement.  The  warrants  expire  five years after the date of
grant.  Additionally,  Mr. Lyndon James will be entitled to  participate  in any
stock option program offered by the Company to its employees.  In July 24, 2006,
Mr. Lyndon James resigned as the Company's Chief Executive Officer and Director.
On the  resignation  of the Director,  the Company  forfeited the warrants.  The
Company recorded shares to be issued of $2,500,000 for the termination shares

On April 3, 2006,  the Company  entered into an employment  agreement with Brian
Harcourt who has been serving as an officer of the Company without  compensation
and  written  agreement  since  being  appointed  to such office by the Board of
Directors  of the Company in June 2005.  Mr.  Harcourt  has also served  without
compensation as a director of the Company. Under the terms of the agreement, Mr.
Harcourt  will  receive  compensation  equal to  twenty  five  thousand  dollars
($25,000) per month payable monthly in advance.  He was also granted one million
eight  hundred  thousand  (1,800,000)  restricted  shares of common  stock  upon
execution  of  the  employment  agreement  as a  signing  bonus,  as  well  as a
termination  grant of two million  (2,000,000)  restricted  shares of the common
stock. All shares have piggy back registration rights. Additionally, the Company
agreed  to grant him a warrant  to  acquire  three  hundred  thousand  (300,000)
restricted  shares of the Company's  common stock.  The exercise  price is to be
based on the bid price of the stock on the date of the  agreement.  The warrants
expire five years after the date of grant.  Additionally,  Mr.  Harcourt will be
entitled to participate  in any stock option  program  offered by the Company to
its employees.  In July 24, 2006, Mr.  Harcourt  resigned as the Company's Chief
Financial Officer and Director. On the resignation of the Director,  the Company
forfeited the warrants.  The Company  recorded shares to be issued of $2,500,000
for the termination shares.


                                      -20-
<PAGE>

Stock Option Plan

The Company adopted an Incentive Stock Option Plan for non-employee directors on
October 1, 1998.  We have not awarded any options  under this Plan.  No director
receives or accrues any compensation  for his services as a director,  including
committee participation and/or special assignments.

On April 3, 2006, our Board of Directors authorized and approved the adoption of
the 2006 Stock  Option  Plan  effective  April 3, 2006 (the "2006  Stock  Option
Plan").

The 2006 Stock Option Plan is  administered  by the duly appointed  compensation
committee.   Our  compensation  committed  consists  of  Rosamaria  DeSimone,  a
consultant  to the  Company,  and Brian  Harcourt.  The 2006 Stock  Option  Plan
provides  authorization to grant stock options of up to 2,500,000 shares. At the
time a stock option is granted  under the Stock Option  Plan,  the  compensation
committee  shall fix and determine the exercise  price at which shares of common
stock of the Company may be acquired and vesting period thereof.

In the event an optionee ceases to be employed by or to provide  services to the
Company for reasons other than cause, retirement, disability or death, any stock
option that is vested and held by such  optionee  generally  may be  exercisable
within  up to ninety  (90)  calendar  days  after  the  effective  date that his
position ceases, and after such 90-day period any unexercised stock option shall
expire. In the event an optionee ceases to be employed by or to provide services
to the Company for reasons of retirement,  disability or death, any stock option
that is vested and held by such optionee  generally may be exercisable within up
to one-year  after the effective date that his position  ceases,  and after such
one-year period any unexercised stock option shall expire.

No stock options  granted under the 2006 Stock Option Plan will be  transferable
by the optionee,  and each stock option will be exercisable  during the lifetime
of the optionee  subject to the option  period of ten (10) years or  limitations
described  above.  Any stock option held by an optionee at the time of his death
may be exercised  by his estate  within one (1) year of his death or such longer
period as the compensation committee may determine.

Upon  exercise of the options,  the optionee will deliver  consideration  in the
amount of the exercise price  multiplied by the number of shares to be issued as
a  result  of  the  exercise;  provided,  however,  the  compensation  committee
reserves,  at any and all times, the right, in its sole and absolute discretion,
to establish,  decline to approve or terminate any program or procedures for the
exercise of stock options by means of a cashless exercise.


                                      -21-

<PAGE>

Compensation of Directors

Directors  are  entitled  to  reimbursement  for  reasonable  travel  and  other
out-of-pocket  expenses incurred in connection with attendance at meeting of the
Board of Directors.

We have no written employment agreements with our directors.

Item 11. Security Ownership of Certain Beneficial Owners and Management

There were 81,517,759 shares of our common stock issued and outstanding on April
11,  2007.  The  following  tabulates  holdings of shares of the Company by each
person who, subject to the above, at the date of this Report, holds of record or
is known by  Management to own  beneficially  more than five percent (5%) of our
common stock and, in addition, by all of our directors and officers individually
and as a group.

---------------------------------------- -------------------- ------------------
NAME AND ADDRESS                         NUMBER OF SHARES       PERCENT
                                         OWNED BENEFICIALLY     OF SHARES OWNED
---------------------------------------- -------------------- ------------------
Boston Equities Corporation(2)(2)        9,007,503                10.68%
 1660 Union Street
San Diego, CA 90802
---------------------------------------- -------------------- -----------------
Summitt Oil & Gas(1)                     41,833,721                52.94%
9595 Wilshire Boulevard Suite 510
Beverly Hills, CA 90212
 ---------------------------------------- --------------------------------------
ALL DIRECTORS AND EXECUTIVE OFFICERS     0                0.00%

AS A GROUP (THREE PERSONS)(5)


(*) Denotes Officer or Director;
(1) Boston Equities Corporation and Summitt Oil & Gas are related parties;
(2) Does not include 1,200,000 shares vested under warrants held by Liquid Stone
Manufacturing, Inc. and Stone Mountain Finishes, Inc., related parties to Boston
Equities Corporation and William Courtney.

Changes in Control

There are no  arrangements  known by us,  including  any pledge by any person of
securities  of the Company,  the  operation  of which may at a  subsequent  date
result in a change of control of the Company.


                                      -21-
<PAGE>

Item 12. Certain Relationships and Related Transactions.

During the year the  following  transactions  occurred  between  the Company and
certain related parties:

A.       Ross-Lyndon James

The following  transaction took place between the Company and Ross-Lyndon James,
the  Company's  Chief  Executive  Officer and  Director:  On April 3, 2006,  the
Company entered into an employment agreement with Ross Lyndon James who has been
serving as the Company's  President  without  compensation and written agreement
since being appointed to such office by the Board of Directors of the Company in
June 2005. Mr. Lyndon James had also served without  compensation  as a director
of the Company.  Under the terms of the  agreement,  Mr.  Lyndon James  received
compensation  equal to twenty five thousand dollars  ($25,000) per month payable
monthly in  advance.  He was also  granted one million  eight  hundred  thousand
(1,800,000)  restricted  shares of common stock upon execution of the employment
agreement  as a signing  bonus,  as well as a  termination  grant of two million
(2,000,000)  shares of  restricted  common  stock.  All shares  have  piggy-back
registration rights. Additionally,  the Company agreed to grant him a warrant to
acquire  three hundred  thousand  (300,000)  restricted  shares of the Company's
common stock. The exercise price is to be based on the bid price of the stock on
the date of the  agreement.  The  warrants  expire  five years after the date of
grant.  Additionally,  Mr. Lyndon James will be entitled to  participate  in any
stock option program offered by the Company to its employees.  In July 24, 2006,
Mr. Lyndon James resigned as the Company's Chief Executive Officer and Director.
On the  resignation  of the Director,  the Company  forfeited the warrants.  The
Company recorded shares to be issued of $2,500,000 for the termination shares.

B.       Brian Harcourt

The following transaction took place between the Company and Brian Harcourt, the
Company's  Chief  Financial  Officer and Director  and parties  related to Brian
Harcourt:

On April 3, 2006,  the Company  entered into an employment  agreement with Brian
Harcourt who has been serving as an officer of the Company without  compensation
and  written  agreement  since  being  appointed  to such office by the Board of
Directors  of the Company in June 2005.  Mr.  Harcourt  has also served  without
compensation as a director of the Company. Under the terms of the agreement, Mr.
Harcourt  will  receive  compensation  equal to  twenty  five  thousand  dollars
($25,000) per month payable monthly in advance.  He was also granted one million
eight  hundred  thousand  (1,800,000)  restricted  shares of common  stock  upon
execution  of  the  employment  agreement  as a  signing  bonus,  as  well  as a
termination  grant of two million  (2,000,000)  restricted  shares of the common
stock. All shares have piggy back registration rights. Additionally, the Company
agreed  to grant him a warrant  to  acquire  three  hundred  thousand  (300,000)
restricted  shares of the Company's  common stock.  The exercise  price is to be
based on the bid price of the stock on the date of the  agreement.  The warrants
expire five years after the date of grant.  Additionally,  Mr.  Harcourt will be
entitled to participate  in any stock option  program  offered by the Company to
its employees.  In July 24, 2006, Mr.  Harcourt  resigned as the Company's Chief
Financial Officer and Director. On the resignation of the Director,  the Company
forfeited the warrants.  The Company  recorded shares to be issued of $2,500,000
for the termination shares.

On April 5, 2006,  the Company  entered into a consulting  agreement  with First
Credit Holding Ltd ("First Credit") to provide business  management services and
advice as it relates to the Company's future.  Under the terms of the agreement,
the  Company  agreed to pay First  Credit a fee of three  million  five  hundred
thousand   (3,500,000)   restricted   shares  of  common   stock.   The  fee  is
non-refundable and considered earned when the shares are delivered.  The company
is amortizing the expense over the period of the services.  Brian Harcourt,  one
of our directors,  is the controlling shareholder of First Credit. The shares of
stock were issued in April 2006.

C.       Boston Equities Corporation

The following  transaction  took place  between the Company and parties  sharing
common  ownership or control with Boston  Equities  Corporation,  a shareholder,
which owns  approximately  25% of the  Company's  outstanding  and issued common
stock:

On April 3, 2006, the Company  entered into a consulting  agreement with Summitt
Oil and Gas, Inc.  ("Summit") to provide business management services and advice
as it relates to the future of the  company.  Under the terms of the  Agreement,
the Company  shall pay Summitt a fee of two hundred and fifty  thousand  dollars
($250,000)  in  cash  plus  one  million  eight  hundred  thousand   (1,800,000)
restricted  of  the  Company's  common  stock.  The  fee is  non-refundable  and
considered earned when the shares are delivered. The agreement is for six months
expiring in October,  2006. The Company has fully  amortized the expense for the
cash and shares paid for the period ended December 31, 2006.

                                      -22-
<PAGE>

On April 4, 2006, the Company entered into an assignment of an oil and gas lease
with Summitt.  Under the  agreement in exchange for the leasehold  rights in 160
acres in the County of Custer,  Oklahoma,  the Company has agreed to pay Summitt
consideration  of  seventy-seven  thousand  (677,000)  restricted  shares of the
Company's common stock. The shares of stock have been issued on August 22, 2006.
Additionally,  there is excepted from the assignment and conveyance and reserved
and retained in Summitt an  overriding  royalty  equal to 3% of the value of all
oil  produced  and  removed  under the lease and the net  proceeds  received  by
Assignee  from the sale of all gas and casing head  gasoline  produced  and sold
under the lease.

On April 25, 2006, the Company entered into a short term bridge financing in the
form of a  promissory  note to  Camden  Holdings,  Inc.  in the  amount of three
hundred and fifty thousand dollars ($350,000) to be used as working capital. The
Note was due on August 25, 2006.  No interest is payable on the note. On June 8,
2006,  the Company  entered into a short term bridge  financing in the form of a
promissory note to Camden Holdings,  Inc. in the amount of one hundred and fifty
thousand dollars  ($150,000) to be used as working capital.  The Note was due on
December 31, 2006 and has been  extended to December  31,  2007.  No interest is
payable on the note.  At  December  31,  2006,  the  advances  outstanding  were
$613,400.



Item 13. Exhibits and Reports on Form 8-K

Exhibits


----  ----- --------------------------------------------------------------------
      10.4  Consulting  Agreement dated April 3, 2006 by and between Summitt Oil
            and Gas,  Inc.  and Company  (previously  filed as an exhibit to our
            Form 8K,  file no.  00128911,  on April 5,  2006,  and  incorporated
            herein by reference).
----  ----- --------------------------------------------------------------------
      10.5  Management  Employment  Agreement dated April 3, 2006 by and between
            Ross Lyndon James and the Company (previously filed as an exhibit to
            our Form 8K, file no.  00128911,  on April 5, 2006, and incorporated
            herein by reference).
----  ----- --------------------------------------------------------------------
      10.6  Management  Employment  Agreement dated April 3, 2006 by and between
            Brian  Harcourt and the Company  (previously  filed as an exhibit to
            our Form 8K, file no.  00128911,  on April 5, 2006, and incorporated
            herein by reference).
----  ----- --------------------------------------------------------------------
      10.7  2006 Employee Stock Option Plan  (previously  filed as an exhibit to
            the  Company's  Form 8K, file no.  00128911,  on April 5, 2006,  and
            incorporated herein by reference).
----  ----- --------------------------------------------------------------------
      10.8  Consulting  Agreement  by and between us and Camden  Holdings,  Inc.
            dated  January 8, 2006  (previously  filed as an exhibit to our Form
            10KSB/A, file no. 00128911, on June 8, 2006, and incorporated herein
            by reference).
----  ----- --------------------------------------------------------------------
      10.9  Consulting  Agreement  by and  between  us and  Design,  Inc.  dated
            January 8, 2006 (previously filed as an exhibit to our Form 10KSB/A,
            file no.  00128911,  on June 8,  2006,  and  incorporated  herein by
            reference).
----  ----- --------------------------------------------------------------------
      10.10 Stock Purchase  Agreement between us and Liquid Stone Partners dated
            April 4, 2006  (previously  filed as an exhibit to our Form 10KSB/A,
            file no.  00128911,  on June 8,  2006,  and  incorporated  herein by
            reference).
----  ----- --------------------------------------------------------------------
      10.11 Amended  Assignment  of  leasehold  rights  between  us and  Summitt
            Holdings,  Inc. dated April 4, 2006 (previously  filed as an exhibit
            to our  Form  10KSB/A,  file  no.  00128911,  on June 8,  2006,  and
            incorporated herein by reference).
----  ----- --------------------------------------------------------------------
      10.12 Consulting  Agreement  between us and Credit  First  Holdings,  Inc.
            dated  April  5,  2006(previously  filed as an  exhibit  to our Form
            10KSB/A, file no. 00128911, on June 8, 2006, and incorporated herein
            by reference).


                                      -23-
<PAGE>


----  ----- --------------------------------------------------------------------
      10.13 Promissory note executed by us to repay Camden Holdings,  Inc. dated
            April 25, 2006 (previously  filed as an exhibit to our Form 10KSB/A,
            file no.  00128911,  on June 8,  2006,  and  incorporated  herein by
            reference).
----  ----- --------------------------------------------------------------------
      10.14 Promissory note executed by us to repay Camden Holdings,  Inc. dated
            June 8, 2006 (previously filed and incorporated herein by reference)
----  ----- --------------------------------------------------------------------
      10.16 Consolidated note and security agreement with Camden Holdings,  Inc.
            dated  January 5, 2007  (previously  filed as an exhibit to our form
            8K, file no. 0128911 and incorporated herein by reference)
----  ----- --------------------------------------------------------------------
      10.17 Consulting agreement with Camden Holdings,Inc. dated January 5, 2007
            (previously filed as an exhibit to our form 8K, file no. 0128911 and
            incorporated herein by reference)
----  ----- --------------------------------------------------------------------
      10.18 Consolidated  note and  security  agreement  with Summitt Oil & Gas,
            Inc., Inc. dated January 5, 2007 (previously  filed as an exhibit to
            our form 8K, file no. 0128911 and incorporated herein by reference)
----  ----- --------------------------------------------------------------------
      10.18 Consulting  agreement  with  Summitt  Oil & Gas,  Inc.,  Inc.  dated
            January 5, 2007 (previously filed as an exhibit to our form 8K, file
            no. 0128911 and incorporated herein by reference)
----  ----- --------------------------------------------------------------------
31    31.1  Certification by Sam Plunkett,  Chief Executive Officer, as required
            under Section 302 of SarbannesOxley Act of 2002, attached hereto.
----  ----- --------------------------------------------------------------------
      31.2  Certification by Sam Plunkett,  Chief Financial Officer, as required
            under  Section  302 of the  SarbannesOxley  Act  of  2002,  attached
            hereto.
----  ----- --------------------------------------------------------------------
32    32.1  Certification as required under Section 906 of SarbannesOxley Act of
            2002, attached hereto.



(b) Reports on Form 8-K:


Item 14. Principal Accountant Fees and Services.

Audit Fees:  The  aggregate  fees  billed for the last fiscal year for  services
rendered by our principal  accountant for the audit of our financial  statements
and review of financial  statements  included in our form 10QSB's for the fiscal
years ended December 31, 2006 and 2005 were $29,500 and $39,560 respectively.

Audit Related Fees: $ -0-

Tax Fees: $ -0-

All Other Fees: $ -0-


                                      -24-

<PAGE>



                                   SIGNATURES

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

                                           National Healthcare Technology, Inc.

                                           By: /s/ Linda Contreeras
                                           -------------------------------
                                                   Linda Contreras,
                                                   Chief Executive Officer

                                           Dated: August 17, 2007


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

                                          /s/ Linda Contreras

                                          Linda Contreras,
                                          CEO, CFO, Director




                                      -25-



<PAGE>

                      NATIONAL HEALTHCARE TECHNOLOGY, INC.

                          (A DEVELOPMENT STAGE COMPANY)

                        CONSOLIDATED FINANCIAL STATEMENTS

                                DECEMBER 31, 2006









                                       F-1

<PAGE>


                      NATIONAL HEALTHCARE TECHNOLOGY, INC.

                          (A DEVELOPMENT STAGE COMPANY)

                        CONSOLIDATED FINANCIAL STATEMENTS

                                DECEMBER 31, 2006

                                    CONTENTS

 Report of Independent Registered Public Accounting Firm                     F-3

Consolidated Balance Sheet (restated)                                        F-4

Consolidated Statement of Operations (restated)                              F-5

Consolidated Statement of Changes in Shareholders' Deficit (restated)        F-6

Consolidated Statement of Cash Flows (restated)                              F-7

Notes to Consolidated Financial Statements (restated)                 F-8 - F-19




                                       F-2


<PAGE>


             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


The Board of Directors and Stockholders
National Healthcare Technology, Inc.

We  have  audited  the  accompanying   balance  sheets  of  National  Healthcare
Technology,  Inc.  as of  December  31,  2006,  and the  related  statements  of
operations,  stockholders'  deficit,  and cash flows for the year ended December
31, 2006.  These financial  statements are the  responsibility  of the Company's
management.  Our  responsibility  is to express  an  opinion on these  financial
statements based on our audit.

We conducted  our audit in accordance  with the standards of the Public  Company
Accounting  Oversight Board (United  States).  Those standards  required that we
plan and  perform the audit 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
audit provides a reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects,  the financial position of the Company as of December 31,
2006,  and the results of its  operations  and its cash flows for the year ended
December 31, 2006, 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 2 to the
financial statements,  the Company had incurred cumulative losses of $38,064,384
and net  losses of  $36,906,584  for the year ended  December  31,  2006.  These
factors  raise  substantial  doubt  about its  ability  to  continue  as a going
concern.  Management's plans concerning these matters are also described in Note
2.  The  accompanying  consolidated  financial  statements  do not  include  any
adjustments that might result from the outcome of this uncertainty.

As stated in Note 10, the Financial  Statements  for the year ended December 31,
2006 have been restated.

/s/ Kabani & Company, Inc.
--------------------------

Los Angeles, California

 February 15, 2007 except for Note 10 which is as of August 11, 2007


                                       F-3

<PAGE>

                      NATIONAL HEALTHCARE TECHNOLOGY, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                           CONSOLIDATED BALANCE SHEET
                                DECEMBER 31, 2006
                                   (RESTATED)
                                     ASSETS
Assets 0



                      LIABILITIES AND STOCKHOLDERS' DEFICIT
                                 Current assets:


                             Cash                                  $         61
                                                                   ------------



                         Total Assets                              $         61
                                                                   ============

           LIABILITIES AND STOCKHOLDERS' DEFICIT
                   Current liabilities:


                       Accounts payable                            $    328,730
                      Accrued expenses                                1,319,525
                     Shares to be issued                              5,000,000
                  Notes payable to affiliate                            613,400
                                                                   ------------
                  Total Current Liabilities                           7,261,655

                  Stockholders' Deficit
Common Stock, $.001 par value, 100,000,000 shares authorized,
  41,517,759 issued and outstanding as of December 31, 2006              41,518
                  Additional paid in capital                         38,395,022
                      Prepaid consulting                             (7,633,750)
                     Accumulated deficit                            (38,064,384)
                                                                   ------------
                 Total stockholders' deficit                         (7,261,594)
                                                                   ------------



         Total liabilities and stockholders' deficit               $         61
                                                                   ============


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


                                       F-4


<PAGE>

                      NATIONAL HEALTHCARE TECHNOLOGY, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                      CONSOLIDATED STATEMENT OF OPERATIONS
         FOR THE YEARS ENDED DECEMBER 31, 2006 AND FROM JANUARY 27, 2005
           (INCEPTION) TO DECEMBER 31, 2006 AND THE CUMMULATIVE PERIOD
             FROM JANUARY 27, 2005 (INCEPTION) TO DECEMBER 31, 2006,

<TABLE>
<CAPTION>

                                                                                                           Period from
                                                                                 Period from January     January 27, 2005
                                                                Year Ended             27, 2005           (inception) to
                                                             December 31, 2006       (inception) to     December 31, 2006
                                                                (RESTATED)         December 31, 2005       (RESTATED)

<S>                                                            <C>                   <C>                   <C>
 NET REVENUE                                                   $         --          $         --          $         --
                                                               ------------          ------------          ------------

OPERATING EXPENSES

        Professional fees                                        21,810,896               465,304            22,276,200

        Technology license royalties                                     --               160,417               160,417

        Depreciation, amortization and impairment                    56,000                 3,811                59,811

        Other general and administrative                         15,254,688               178,068            15,432,756
                                                               ------------          ------------          ------------
        Total operating expenses
                                                                 37,121,584               807,600            37,929,184
                                                               ------------          ------------          ------------


NET OPERATING LOSS                                              (37,121,584)             (807,600)          (37,929,184)


        Gain on settlement of debt                                  215,000                    --               215,000
                                                               ------------          ------------          ------------

 NET LOSS                                                      $(36,906,584)         $   (807,600)         $(37,714,181)
                                                               ============          ============          ============


 LOSS PER SHARE - BASIC & DILUTED                              $      (1.13)         $      (0.06)         $      (1.63)
                                                               ============          ============          ============

 WEIGHTED AVERAGE SHARES OUTSTANDING - BASIC & DILUTED           32,695,891            14,579,683            23,124,816
                                                               ============          ============          ============

</TABLE>

Weighted average number of dilutive securities has not been taken since the
effect of dilutive securities would be anti-dilutive.


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

                                       F-5

<PAGE>

                      NATIONAL HEALTHCARE TECHNOLOGY, INC.
                         (A DEVELOPMENT STAGE COMPANY)
                       STATEMENTS OF STOCKHOLDERS' EQUITY
FOR THE CUMULATIVE PERIOD FROM JANUARY 27, 2005 (INCEPTION) TO DECEMBER 31, 2006
                                   (RESTATED)

<TABLE>
<CAPTION>

                                              Shares     Common stock    Additional     Prepaid       Deficit         Total
                                                           amount         paid in      consulting   accumulated    stockholder's
                                                                          capital                    during the   equity/(deficit)
                                                                                                     development
                                                                                                        stage
<S>                                          <C>               <C>       <C>            <C>           <C>             <C>
Balance, January 27, 2005 (inception)      $         --  $         --  $         --   $         --   $         --   $         --

Founder's stock issued                        8,380,000         8,380        (8,380)            --             --             --
Stock issued for debt                           800,000           800       399,200             --             --        400,000
Shares issued for license agreement           8,618,750         8,619        (8,619)            --             --             --
Effect of reverse merger                      1,384,009         1,384      (201,384)            --             --       (200,000)
Divestiture of subsidiary to related party           --            --       544,340             --             --        544,340
Net loss for the year                                --            --            --             --       (807,600)      (807,600)

Balance, December 31, 2005                   19,182,759        19,183       725,157             --       (807,600)       (63,260)

Shares issued for employment                  4,550,000         4,550     8,482,950             --             --      8,487,500
Shares issued for services                   17,108,000        17,108    28,781,392     (7,633,750)            --     21,164,750
Shares issued for lease agreement               677,000           677       405,523             --       (350,200)        56,000
Net loss for the year                                --            --            --             --    (36,846,584)   (36,906,584)

Balance, December 31, 2006                   41,517,759  $     41,518  $ 38,395,022   $ (7,633,750)  $(38,004,384)  $ (7,261,594)

</TABLE>



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

                                       F-6


<PAGE>

                      NATIONAL HEALTHCARE TECHNOLOGY, INC.
                          (A DEVELOPMENT STAGE COMPANY)
                             STATEMENT OF CASH FLOWS
                    FOR THE YEAR ENDED DECEMBER 31, 2006 AND
                THE PERIODS FROM JANUARY 27, 2005 (INCEPTION) TO
                  DECEMBER 31, 2005 AND THE CUMMULATIVE PERIOD
             FROM JANUARY 27, 2005 (INCEPTION) TO DECEMBER 31, 2006

<TABLE>
<CAPTION>

                                                                                Year Ended          Period from      Period from
                                                                                December 31,         January 27,     January 27,
                                                                                   2006                 2005            2005
                                                                                                    (inception)      (inception)
                                                                                                      through          through
                                                                                                    December 31,     December 31,
                                                                                                       2005              2006
                                   CASH FLOWS FROM OPERATING ACTIVITIES         (RESTATED)                            (RESTATED)

<S>                                                                             <C>                   <C>             <C>
                                                               Net loss         (36,906,584)          (807,600)       (37,714,184)

Adjustments to reconcile net loss to cash used by operating activities:
                                                           Depreciation
                                                                                         --              3,811              3,811
                         Amortization on investment in custer leasehold               9,333                 --              9,333
                           Impairment on investment in custer leasehold              46,667                 --             46,667
                                              Stock issued for services          29,652,250                 --         29,652,250
                                                    Shares to be issued           5,000,000                 --          5,000,000
          Changes in certain assets and liabilities, net of divestiture
                                                  Increase in Inventory                  --            (29,102)           (29,102)
                                               Increase in Other assets                  --             (2,087)            (2,087)
                                           Increase in Accrued expenses           1,319,525                 --          1,319,525
                      Increase in Accounts payable and accrued expenses             265,470            144,990            410,460
                               CASH FLOWS USED IN OPERATING ACTIVITIES:            (613,339)          (689,988)        (1,303,327)

                                  CASH FLOWS FROM INVESTING ACTIVITIES:
                                                   Capital expenditures                  --            (38,952)           (38,952)
                                CASH FLOWS USED IN INVESTING ACTIVITIES        $         --       $    (38,952)      $    (38,952)

                                   CASH FLOWS FROM FINANCING ACTIVITIES
                         Proceeds from convertible note - related party                  --            400,000            400,000
                                                 Related party advances             613,400            328,940            942,340
                            CASH FLOWS PROVIDED BY FINANCING ACTIVITIES        $    613,400       $    728,940       $  1,342,340

                                 NET INCREASE IN CASH &CASH EQUIVALENTS        $         61       $         --       $         61
                            CASH &CASH EQUIVALENTS, BEGINNING OF PERIOD        $         --       $         --       $         --
                                  CASH &CASH EQUIVALENTS, END OF PERIOD        $         61       $         --       $         61

                                    SUPPLEMENTAL CASH FLOW INFORMATION:
                                                          Interest paid        $         --       $         --       $         --
                                                      Income taxes paid        $         --       $         --       $         --
                          Net liabilities assumed with recapitalization        $         --       $         --       $    200,000
                             Divestiture of subsidiary to related party        $         --       $         --       $    544,340
                                           Common stock issued for debt        $         --       $         --       $    400,000
            Common stock issued for acquiring Custer Leasehold (677,000
                                                         shares issued)        $    406,200       $         --       $    406,200

</TABLE>


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

                                       F-7

<PAGE>

                      NATIONAL HEALTHCARE TECHNOLOGY, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2006

1. Summary of Significant Accounting Policies

A. Organization and General Description of Business

National  Healthcare  Technology,  Inc. ("We" or "the Company") was incorporated
under the laws of the State of Colorado,  on July 6, 2005. On July 19, 2005, the
Company,  completed the  acquisition  of Special Stone  Surfaces,  Es3,  Inc., a
Nevada  Corporation  ("Es3") pursuant to the terms of an Exchange Agreement (the
"Exchange Agreement") by and among the Company,  Crown Partners,  Inc., a Nevada
corporation  and at such time, the largest  stockholder  of the Company  ("Crown
Partners"), Es3, and certain stockholders of Es3 (the "Es3 Stockholders"). Under
the terms of the Exchange Agreement, the Company acquired all of the outstanding
capital  stock of Es3 in exchange for the issuance of  19,182,759  shares of the
Company's  common  stock to the Es3  Stockholders,  Crown  Partners  and certain
consultants  The  transactions  effected  by the  Exchange  Agreement  have been
accounted for as a reverse  merger.  This reverse  merger  transaction  has been
accounted for as a recapitalization  of Es3, as Es3 is the accounting  acquirer,
effective July 19, 2005. As a result,  the historical  equity of the Company has
been restated on a basis consistent with the recapitalization.  In addition, the
Company changed its accounting  year-end from September 30 to December 31, which
is Es3's accounting year-end.

Accordingly the financial  statements contained in report include the operations
of the  Company  in its new line of  business.  As a result of the  transactions
contemplated  by the Exchange  Agreement,  the Company had one active  operating
subsidiary--Es3.  Es3 was formed in January 2005 and began  operations  in March
2005 in the business of  manufacturing  and  distributing  a range of decorative
stone veneers and finishes based on proprietary  Liquid Stone  Coatings(TM)  and
Authentic Stone Veneers(TM).  Effective October 1, 2005, the Company sold all of
its shares in Es3.

On April 3, 2006 the Board of Directors  approved a change of direction  for the
Company,  from the business of Manufacturing  and distributing  decorative stone
veneers and finishes, to the business of oil and gas exploration and production,
mineral lease purchasing and all activities associated with acquiring, operating
and maintaining the assets of such operations.

B. Basis of Presentation and Organization

The consolidated  financial statements of the Company for the periods January 1,
2006 to December 31, 2006 and from January 27, 2005 (Inception) through December
31, 2006 have been prepared in accordance  with  generally  accepted  accounting
principles.  The consolidated  financial  statements include the accounts of the
Company  and its wholly  owned  subsidiary,  Es3,  through  October 1, 2005 (the
effective  date  of  disposition).  All  inter-company  transactions  have  been
eliminated.

C. Use of Estimates

The preparation of financial  statements in conformity  with generally  accepted
accounting principles requires management to make estimates and assumptions that
affect the reported  amounts of assets and  liabilities  and the  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.  Estimates and assumptions are
reviewed  periodically  and  the  effects  of  revisions  are  reflected  in the
financial statements in the period they are determined.



                                       F-8

<PAGE>

                      NATIONAL HEALTHCARE TECHNOLOGY, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2006

D. Cash and Cash Equivalents

Cash  and cash  equivalents  include  cash in hand  and  cash in time  deposits,
certificates  of deposit and all highly  liquid debt  instruments  with original
maturities of three months or less.

E. Long-Lived Assets

Effective January 1, 2002, the Company adopted Statement of Financial Accounting
Standards  No. 144,  "Accounting  for the  Impairment  or Disposal of Long-Lived
Assets" ("SFAS 144"), which addresses financial accounting and reporting for the
impairment  or  disposal  of  long-lived  assets and  supersedes  SFAS No.  121,
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to
be Disposed Of," and the accounting and reporting  provisions of APB Opinion No.
30,  "Reporting  the  Results of  Operations  for a  Disposal  of a Segment of a
Business." The Company  periodically  evaluates the carrying value of long-lived
assets  to be held and used in  accordance  with  SFAS  144.  SFAS 144  requires
impairment  losses to be recorded on long-lived  assets used in operations  when
indicators of impairment are present and the  undiscounted  cash flows estimated
to be generated by those assets are less than the assets' carrying  amounts.  In
that  event,  a loss is  recognized  based on the  amount by which the  carrying
amount  exceeds  the  fair  market  value  of the  long-lived  assets.  Loss  on
long-lived  assets to be disposed of is determined in a similar  manner,  except
that fair  market  values are  reduced  for the cost of  disposal.  Based on its
review,  the Company  believes  that, as of December 31, 2006, the investment in
Custer oil & well lease of $56,000 was impaired and recorded an impairment  loss
of $46,667.

F. Fair Value of Financial Instruments

Statement of financial accounting standard No. 107, Disclosures about fair value
of financial  instruments,  requires that the Company  disclose  estimated  fair
values of financial instruments. The carrying amounts reported in the statements
of financial position for current assets and current  liabilities  qualifying as
financial instruments are a reasonable estimate of fair value.

G. Technology License and Royalties

The   Company's   former   principal    business   activity   focused   on   the
commercialization  of  distributing  decorative  coatings  that  can be  used to
resemble stone, which the Company licensed from related parties.  Minimum annual
royalties for these  arrangements  were accrued in 2005 on the Company's balance
sheet till disposal of the subsidiary.

The Company's  current  principal  activity  focuses on oil and gas exploration.
During  2006 the  Company  acquired  the rights to drill and  otherwise  exploit
certain  underlying  reserves and agreed to pay a 3% royalty on the value of the
oil removed or produced and on the net proceeds from all gas sold. To date there
are no applicable  accruals on the Company's  balance sheet as there has been no
production or proceeds related to the acquired rights.

H. Stock-Based Compensation

The Company adopted SFAS No. 123 (Revised 2004),  Share Based Payment ("SFAS No.
123R"),  under the  modified-prospective  transition  method on January 1, 2006.
SFAS No. 123R  requires  companies to measure and recognize the cost of employee
services  received in exchange for an award of equity  instruments  based on the
grant-date   fair-  value.   Share-based   compensation   recognized  under  the
modified-prospective  transition  method of SFAS No. 123R  includes  share-based
compensation  based on the grant-date  fair value  determined in accordance with
the  original   provisions  of  SFAS  No.  123,   Accounting   for   Stock-Based
Compensation,  for all share-based  payments granted prior to and not yet vested
as of  January  1, 2006 and  share-based  compensation  based on the  grant-date
fair-value  determined  in  accordance  with SFAS No.  123R for all  share-based
payments  granted after January 1, 2006. SFAS No. 123R eliminates the ability to
account for the award of these  instruments  under the  intrinsic  value  method
prescribed by Accounting Principles Board ("APB") Opinion No. 25, Accounting for
Stock Issued to Employees, and allowed under the original provisions of SFAS No.
123.  Prior to the adoption of SFAS No. 123R,  the Company  accounted  for stock
option plans using the intrinsic  value method in accordance with the provisions
of APB Opinion No. 25 and related interpretations.


                                       F-9

<PAGE>

                      NATIONAL HEALTHCARE TECHNOLOGY, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2006

I. Income Taxes

The  Company  accounts  for its  income  taxes  using the  Financial  Accounting
Standards  Board   Statements  of  Financial   Accounting   Standards  No.  109,
"Accounting  for Income Taxes," which requires the  establishment  of a deferred
tax asset or  liability  for the  recognition  of future  deductible  or taxable
amounts and operating loss and tax credit carry  forwards.  Deferred tax expense
or  benefit  is  recognized  as a  result  of  timing  differences  between  the
recognition of assets and liabilities for book and tax purposes during the year.

Deferred  tax  assets and  liabilities  are  measured  using  enacted  tax rates
expected  to apply to  taxable  income  in the  years in which  those  temporary
differences  are expected to be  recovered  or settled.  Deferred tax assets are
recognized  for deductible  temporary  differences  and operating  loss, and tax
credit  carry  forwards.  A valuation  allowance is  established  to reduce that
deferred tax asset if it is "more likely than not" that the related tax benefits
will not be realized.

J. Basic and Diluted Net Earnings (loss) per Share

The  Company  adopted  the  provisions  of SFAS No.  128,  "Earnings  Per Share"
("EPS"). SFAS No. 128 provides for the calculation of basic and diluted earnings
per share.  Basic EPS includes no dilution and is computed by dividing income or
loss available to common  shareholders by the weighted  average number of common
shares  outstanding for the period.  Diluted EPS reflects the potential dilution
of securities that could share in the earnings or losses of the entity.  For the
periods January 1, 2006 to December 31, 2006 and from inception through December
31, 2006 , basic and diluted  loss per share are the same since the  calculation
of diluted per share amounts would result in an anti-dilutive calculation.

K. Recent Accounting Pronouncements

In February  2006,  FASB issued SFAS No.  155,  "Accounting  for Certain  Hybrid
Financial  Instruments".  SFAS  No.  155  amends  SFAS No 133,  "Accounting  for
Derivative  Instruments and Hedging  Activities",  and SFAF No. 140, "Accounting
for  Transfers  and  Servicing  of  Financial  Assets  and   Extinguishments  of
Liabilities".  SFAS No. 155,  permits fair value re-  measurement for any hybrid
financial  instrument that contains an embedded  derivative that otherwise would
require  bifurcation,  clarifies which  interest-only  strips and principal-only
strips are not  subject  to the  requirements  of SFAS No.  133,  establishes  a
requirement  to evaluate  interest in securitized  financial  assets to identify
interests  that  are  freestanding  derivatives  or that  are  hybrid  financial
instruments that contain an embedded derivative requiring bifurcation, clarifies
that concentrations of credit risk in the form of subordination are not embedded
derivatives,  and  amends  SFAS No.  140 to  eliminate  the  prohibition  on the
qualifying special-purpose entity from holding a derivative financial instrument
that pertains to a beneficial  interest other than another derivative  financial
instrument.  This statement is effective for all financial  instruments acquired
or issued  after the  beginning  of the Company' s first fiscal year that begins
after September 15, 2006.

In March 2006 FASB  issued  SFAS 156  `Accounting  for  Servicing  of  Financial
Assets' this Statement  amends FASB Statement No. 140,  Accounting for Transfers
and  Servicing of Financial  Assets and  Extinguishments  of  Liabilities,  with
respect  to the  accounting  for  separately  recognized  servicing  assets  and
servicing  liabilities.  This  Statement:

   1. Requires an entity to recognize a servicing  asset or servicing  liability
      each time it  undertakes  an  obligation  to service a financial  asset by
      entering into a servicing contract.

   2. Requires  all  separately   recognized   servicing  assets  and  servicing
      liabilities to be initially measured at fair value, if practicable.

   3. Permits  an  entity  to  choose   `Amortization   method'  or  Fair  value
      measurement  method'  for each class of  separately  recognized  servicing
      assets and servicing liabilities:

   4. At  its  initial  adoption,   permits  a  one-time   reclassification   of
      available-for-sale  securities  to trading  securities  by  entities  with
      recognized  servicing rights,  without calling into question the treatment
      of other available-for-sale  securities under Statement 115, provided that
      the  available-for-sale  securities  are  identified  in  some  manner  as
      offsetting  the entity' s exposure  to changes in fair value of  servicing
      assets or  servicing  liabilities  that a service  elects to  subsequently
      measure at fair value.

   5. Requires   separate   presentation  of  servicing   assets  and  servicing
      liabilities  subsequently  measured  at fair  value  in the  statement  of
      financial   position  and  additional   disclosures   for  all  separately
      recognized servicing assets and servicing liabilities.



                                      F-10

<PAGE>

                      NATIONAL HEALTHCARE TECHNOLOGY, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2006

This  Statement is effective as of the  beginning of the Company' s first fiscal
year that  begins  after  September  15,  2006.  Management  believes  that this
statement  will not have a  significant  impact  on the  consolidated  financial
statements.

In  September  2006,  FASB  issued  SFAS 157  `Fair  Value  Measurements'.  This
Statement  defines fair value,  establishes a framework for measuring fair value
in generally accepted  accounting  principles  (GAAP),  and expands  disclosures
about fair value  measurements.  This Statement  applies under other  accounting
pronouncements that require or permit fair value measurements,  the Board having
previously  concluded in those accounting  pronouncements that fair value is the
relevant measurement attribute. Accordingly, this Statement does not require any
new fair value measurements. However, for some entities, the application of this
Statement  will  change  current  practice.  This  Statement  is  effective  for
financial  statements issued for fiscal years beginning after November 15, 2007,
and interim  periods  within those fiscal  years.  The  management  is currently
evaluating the effect of this pronouncement on financial statements.

In  September  2006,  FASB issued SFAS 158  `Employers'  Accounting  for Defined
Benefit Pension and Other Postretirement  Plans--an amendment of FASB Statements
No. 87, 88, 106,  and 132(R)' This  Statement  improves  financial  reporting by
requiring an employer to recognize the over-funded or  under-funded  status of a
defined  benefit  postretirement  plan (other than a  multiemployer  plan) as an
asset or  liability  in its  statement  of  financial  position and to recognize
changes in that  funded  status in the year in which the changes  occur  through
comprehensive  income of a business entity or changes in unrestricted net assets
of  a  not-for-profit  organization.  This  Statement  also  improves  financial
reporting by requiring an employer to measure the funded  status of a plan as of
the  date  of  its  year-end  statement  of  financial  position,  with  limited
exceptions.  An employer with publicly  traded equity  securities is required to
initially  recognize the funded status of a defined benefit  postretirement plan
and to provide the required  disclosures as of the end of the fiscal year ending
after December 15, 2006. An employer without  publicly traded equity  securities
is required to recognize the funded status of a defined  benefit  postretirement
plan and to provide the  required  disclosures  as of the end of the fiscal year
ending after June 15, 2007.  However, an employer without publicly traded equity
securities  is required to disclose the  following  information  in the notes to
financial  statements  for a fiscal year ending after  December  15,  2006,  but
before June 16, 2007,  unless it has applied the recognition  provisions of this
Statement in preparing  those financial  statements.  The requirement to measure
plan assets and  benefit  obligations  as of the date of the  employer' s fiscal
year-end  statement of financial  position is effective  for fiscal years ending
after December 15, 2008.  The  management is currently  evaluating the effect of
this pronouncement on financial statements.

 In February 2007, FASB issued FASB Statement No. 159, The Fair Value Option for
Financial  Assets and  Financial  Liabilities.  FAS 159 is effective  for fiscal
years beginning after November 15, 2007. Early adoption is permitted  subject to
specific  requirements outlined in the new Statement.  Therefore,  calendar-year
companies  may be able to adopt FAS 159 for their first  quarter 2007  financial
statements.

 The new Statement  allows entities to choose,  at specified  election dates, to
measure  eligible  financial  assets and  liabilities at fair value that are not
otherwise  required to be measured at fair value.  If a company  elects the fair
value  option  for an  eligible  item,  changes  in that  item's  fair  value in
subsequent  reporting  periods must be recognized in current  earnings.  FAS 159
also  establishes  presentation  and  disclosure  requirements  designed to draw
comparison  between  entities that elect  different  measurement  attributes for
similar assets and liabilities.

                                      F-11

<PAGE>



                      NATIONAL HEALTHCARE TECHNOLOGY, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2006

L. Reclassifications

Certain 2005 amounts have been reclassified to conform to the 2006 presentation.

2. Going Concern

The  accompanying  financial  statements  have been prepared in conformity  with
generally accepted accounting principles,  which contemplate the continuation of
the Company as a going  concern.  The Company  reported a cumulative net loss of
$38,064,384 and had a stockholder's deficit of $7,261,594 at December 31, 2006.

 In  view  of the  matters  described,  there  is  substantial  doubt  as to the
Company's ability to continue as a going concern without a significant  infusion
of capital.  The Company acquired all of the outstanding capital stock of Es3 in
July 2005 and subsequently  divested its ownership effective October 1, 2005. At
December  31,  2006,  the  Company  had no  operations.  In view of the  matters
described, there is substantial doubt as to the Company's ability to continue as
a going  concern  without a  significant  infusion of  capital.  There can be no
assurance that  management  will be successful in  implementing  its plans.  The
financial  statements do not include any adjustments  that might result from the
outcome of this uncertainty.

We anticipate that we will have to raise  additional  capital to fund operations
over the next 12 months.  To the extent that we are required to raise additional
funds to acquire properties,  and to cover costs of operations,  we intend to do
so through  additional public or private offerings of debt or equity securities.
There are no  commitments  or  arrangements  for other  offerings  in place,  no
guaranties that any such financings would be forthcoming,  or as to the terms of
any such financings.  Any future financing may involve  substantial  dilution to
existing  investors  We have also been  relying on our common stock to pay third
parties  for  services  which has  resulted  substantial  dilution  to  existing
investors.

3. Income Taxes
 Deferred  income taxes are reported  using the liability  method.  Deferred tax
assets are  recognized  for deductible  temporary  differences  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 bases.  Deferred tax assets are reduced by a valuation
allowance  when, in the opinion of  management,  it is more likely than not that
some portion or all of the  deferred  tax assets will not be realized.  Deferred
tax assets and  liabilities  are adjusted for the effects of changes in tax laws
and rates on the date of enactment.  Current year and  accumulated  deferred tax
benefit  at the  effective  Federal  income  tax rate of 34% is  $12,548,239,and
$274,584  respectively  and a valuation  allowance  has been set up for the full
amount because of the  unlikelihood  that the  accumulated  deferred tax benefit
will be realized in the future.

At December 31, 2006, the Company had available  federal and state net operating
loss carryforwards amounting to approximately  $38,064,384 that are available to
offset  future  federal  and state  taxable  income  and that  expire in various
periods  through 2026 for federal tax purposes and 2013 for state tax  purposes.
No benefit has been  recorded for the loss  carryforwards,  and  utilization  in
future years may be limited under  Sections 382 and 383 of the Internal  Revenue
Code  if  significant  ownership  changes  have  occurred  or  from  future  tax
legislation changes


INCOME TAX

Net deferred tax asset                                  $       12,548,239
Less valuation allowance                                       (12,548,239)
                                                        -------------------
Net deferred tax asset                                  $                -
                                                        ===================



                                      F-12

<PAGE>



                      NATIONAL HEALTHCARE TECHNOLOGY, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2006

The following is a reconciliation  of the provision for income taxes at the U.S.
federal  income  tax rate to the  income  taxes  reflected  in the  Consolidated
Statements of Operations:

                                                    December 31   December 31
                                                        2006         2005
                                                        ------------------
Tax expense (credit) at statutory rate-federal          (34)%        (34)%
State tax expense net of federal tax                     (6)          (6)
Valuation allowance                                      40            40
                                                        ------------------
Tax expense at actual rate                                -            -
                                                        ==================


4. Disposition of Es3

 Effective  October 1, 2005, the Company  conveyed at no cost all of the capital
stock of Es3 to Liquid Stone  Partners  under an agreement by which Liquid Stone
Partners  agreed to assume all of the known and unknown  liabilities of Es3. One
of the  directors  of the  Company  is an owner of Liquid  Stone  partners.  The
transaction  was  accounted for as a conveyance to a related party and therefore
the Company recorded the excess of Es3's liabilities over its assets at the date
of the  disposition  in the amount of  $544,340 to  additional  paid in capital.
There are no assets or  liabilities  related to Es3 on the balance  sheet of the
Company as of December 31, 2006 or 2005.


5.  Accrued Expenses

As of December 31, 2006, the accrued expenses comprise of the following:

Accrued payroll taxes             $   1,277,025
Accrued dispute settlement               13,000
Accrued audit fee                        29,500
                                  --------------
                                  $   1,319,525


6. Equity Transactions

The Company is  authorized to issue  100,000,000  shares of common shares with a
par value of $.001 per share.  These shares have full voting rights.  There were
41,517,759 issued and outstanding as of December 31, 2006.


A. Issuance of Common Stock

In February 2005, the Company issued  8,380,000  shares of  unregistered  common
stock at par value of $0.001 to  founding  stockholders  without  consideration,
including 6,250,000 shares to Boston Equities Corporation (a related party).



                                      F-13

<PAGE>

                      NATIONAL HEALTHCARE TECHNOLOGY, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2006


In June 2005, the Company issued 800,000 shares of unregistered  common stock at
par value of $0.001 in exchange for the debt  arising out of monies  advanced to
the Company in the amount of $400,000 by Boston Equities Corporation pursuant to
a convertible  debt agreement  dated March 1, 2005. The terms of the convertible
debt agreement allowed Boston Equities Corporation to convert its debt to shares
of common stock at $.50 per share.

In June  2005,  the  Company's  issued  an  aggregate  of  8,618,750  shares  of
unregistered  common at par value of $0.001 stock to the shareholders of Aronite
Industries,   Inc.  ("Aronite")  in  connection  with  the  license  of  certain
trademarks from Aronite.  Certain  officers,  directors and  shareholders of the
Company are former or current  officers,  directors and shareholders of Aronite.
Aronite and the Company are under common control and, therefore, the transaction
was recorded at Aronite's basis, which was zero.

In July  2005,  in  accordance  with the terms of the  Exchange  Agreement,  the
Company  issued 400,000  shares of registered  common stock to two  consultants,
d.b.a.  WB  International,  Inc. in  accordance  with the terms of the  Exchange
Agreement.

In July 2005,  the  Company  issued for no  consideration  78,571  shares of its
unregistered  common stock at par value of $0.001 to the former  shareholders of
National Healthcare  Technologies,  Inc. and an additional 905,438 shares of its
unregistered  common  stock at par value of $0.001 to Crown  Partners,  a former
major shareholder of National Healthcare  Technologies,  Inc. in accordance with
the terms of the Exchange Agreement.

In April 2006, the Company issued 1,800,000  shares of its  unregistered  common
stock to its  Chief  Executive  Officer  and  Director,  Ross-Lyndon  James,  in
accordance with the terms of the Management  Employment  Agreement.  The shares,
which vested upon issuance, were recorded at the fair market value of $3,690,000
on the date of issuance.

In April 2006, the Company issued 1,800,000  shares of its  unregistered  common
stock to its Chief Financial Officer and Director, Brian Harcourt, in accordance
with the terms of the Management Employment Agreement.  The shares, which vested
upon issuance,  were recorded at the fair market value of $3,690,000 on the date
of issuance.

In April 2006,  in  accordance  with the terms of a  Consulting  Agreement,  the
Company issued  3,500,000  shares of the Company's  common stock to Credit First
Holding Limited, a related party, for consulting services.  The Company recorded
the  shares  at the  fair  market  value of  $7,175,000.  The  expense  is being
amortized over the period of the consulting  agreement as the services are being
performed.  During  the year  ended  December  31,  2006 the  Company  amortized
$1,793,750 as consulting expense.

In April 2006,  in  accordance  with the terms of a  Consulting  Agreement,  the
Company issued 700,000 shares of the Company's  common stock to Monterosa  Group
Limited for  consulting  services.  The Company  recorded the shares at the fair
market value of  $1,435,000.  The expense is being  amortized over the period of
the consulting  agreement as the services are being  performed.  During the year
ended December 31, 2006 the Company amortized  $358,750 as consulting expense In
April 2006, in accordance with the terms of a Consulting Agreement,  the Company
issued 2,800,000 shares of the Company's common stock to Design, Inc., a related
party,  for consulting  services.  The Company  recorded the expense at the fair
market value of shares of $6,440,000.

In April 2006,  in  accordance  with the terms of a  Consulting  Agreement,  the
Company  issued  2,500,000  shares  of the  Company's  common  stock  to  Camden
Holdings,  Inc., a related party, for consulting services.  The Company recorded
the expense at the fair market value of shares of $5,750,000.

In April 2006,  in  accordance  with the terms of a  Consulting  Agreement,  the
Company issued  1,800,000  shares of the Company's  common stock to Summit Oil &
Gas, a related party,  for consulting  services The Company recorded the expense
at the fair market value of shares of $3,690,000

In April 2006,  in  accordance  with the terms of a  Consulting  Agreement,  the
Company issued 700,000 shares of the Company's common stock to Bluefin,  LLC for
consulting services. The Company recorded the shares at the fair market value of
$1,435,000.  The expense is being  amortized  over the period of the  consulting
agreement as the services are being  performed.  During the year ended  December
31, 2006 the Company amortized $358,750 as consulting expense

On June 16, 2006,  we issued  375,000  shares each to John  McDermit and John E.
Havens,  who  served on our  advisory  board.  The  shares,  which  vested  upon
issuance,  were recorded at the fair market value on the date of issuance, for a
total of $1,027,500.

In August,  2006,  in  accordance  with an agreement  between the  parties,  the
Company issued 677,000 shares of the Company's common stock to Summitt Oil & Gas
to acquire certain lease rights. The shares were valued at $406,200. The Company
recorded the asset at the  historical  cost of $56,000 to the related  party and
recorded $350,200 as a deemed dividend to the related party.

                                      F-14
<PAGE>

                      NATIONAL HEALTHCARE TECHNOLOGY, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2006

In September, 2006, pursuant to the terms of a Consulting Agreement, the Company
issued  2,700,000  shares of its  common  stock to Summitt  Ventures,  under the
Company's 2006-1 Consultant and Employee Services Plan. The Company recorded the
expense at the fair market value of shares of $1,680,000.

In August,  2006, in accordance  with the terms of a Consulting  Agreement,  the
Company issued 209,000 shares of its common stock to Catalyst  Consulting,  Inc.
In September, 2006, pursuant to the terms of a Consulting Agreement, the Company
issued an additional 209,000 shares of its common stock to Catalyst  Consulting,
Inc.,  under the Company's 2006-1  Consultant and Employee  Services Plan. These
shares issuances represent prepaid consulting services for the period of July 1,
2006 through  December 31,  2006.  The Company  recorded the expense at the fair
market value of shares of $209,000.

On August 17, 2006, in accordance with the terms of a Consulting Agreement,  the
Company issued 500,000 shares of its common stock to Ramp International, Inc. In
September,  2006, pursuant to the terms of a Consulting  Agreement,  the Company
issued 500,000 shares of its common stock to Ramp International, Inc., under the
Company's  2006-1  Consultant and Employee  Services  Plan.  This share issuance
represents  prepaid  consulting  expense for the period from  September  2, 2006
through  February 2, 2007 with this expense to be amortized over 18 months.  The
agreement was based on fair market value totaling $500,000 of which $400,000 was
amortized  during the year ended December 31, 2006. The Company also owed Ramp a
cash  payment of $215,000  which was waived off by Ramp as of December 31, 2006,
so this amount has been recorded as a gain on settlement of debt.

On August 17, 2006, in accordance with the terms of a Consulting Agreement,  the
Company issued  100,000  shares of its common stock to Jon Konheim.  The Company
recorded the expense at the fair market value of shares of $60,000.

In August  2006 in  accordance  with the terms of a  Consulting  Agreement,  the
Company  issued  100,000  shares of its  common  stock to Linda  Contreras.  The
Company recorded the expense at the fair market value of shares of $120,000

The Company issued  200,000 shares of its common stock to its former  president,
Samuel Petrossian, in September, 2006 as compensation for services,  pursuant to
an employment agreement.  Mr. Petrossian resigned in November, 2006. The Company
recorded the expense at the fair market value of shares of $80,000.

In  September,  2006,  the Company  adopted the 2006-1  Consultant  and Employee
Services  Plan  wherein the Company  registered  3,800,000  shares of its common
stock for issuance to consultants and employees of the Company.

In September, 2006, pursuant to the terms of a Consulting Agreement, the Company
issued  190,000  shares of its common stock to Frank Layton under the  Company's
2006-1  Consultant and Employee  Services Plan. The Company recorded the expense
at the fair market value of shares of $76,000.

In September, 2006, pursuant to the terms of a Consulting Agreement, the Company
issued  150,000  shares,  of its  common  stock to  Linda  Contreras  under  the
Company's 2006-1  Consultant and Employee Services Plan.The Company recorded the
expense at the fair market value of shares of $60,000.

In September, 2006, pursuant to the terms of a Consulting Agreement, the Company
issued  400,000  shares  of its  common  stock to  Raymond  Robinson  under  the
Company's 2006-1 Consultant and Employee Services Plan. The Company recorded the
expense at the fair market value of shares of $160,000.

In October,  2006, pursuant to the terms of a Consulting Agreement,  the Company
issued 50,000 shares of its common stock to Claudia J. Zaman,  attorney.,  under
the Company's 2006-1 Consultant and Employee Services Plan. The Company recorded
the expense at the fair market value of shares of $8,500.

B. Warrants

In February  2005,  the Company issued a warrant to acquire up to 600,000 shares
of  unregistered  common  stock at an exercise  price of $0.60 per share to W.B.
International, Inc., in exchange for consulting services. All shares vested upon
grant. The warrant expires 5 years from the date of issuance.

 In June 2005,  the Company  issued a warrant to acquire up to 600,000 shares of
unregistered  common  stock at an  exercise  price of $0.70 per share to each of
Liquid  Stone  Manufacturing,   Inc.  and  Stone  Mountain  Finishes,   Inc.  in
consideration of certain license  agreements.  All shares vested upon grant. The
warrants expire 5 years from the date of issuance.

In June 2005,  the  Company  issued a warrant to an  employee  to purchase up to
100,000 shares of the company's  restricted common stock at an exercise price of
$0.70 per share The shares  vested  monthly  over three years and have a 10 year
option  period.  The employee was  terminated  in February 2006 and the warrants
were forfeited.

                                      F-15
<PAGE>
                      NATIONAL HEALTHCARE TECHNOLOGY, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2006


 A summary of the warrant  activity for the period ended December 31, 2006 is as
follows:

<TABLE>
<CAPTION>

-------------------------------------- ----------------------- ----------------------- ----------------------
                                       Warrants Outstanding    Weighted Average        Aggregate Intrinsic
                                                               Exercise Price          Value
-------------------------------------- ----------------------- ----------------------- ----------------------
<S>                                   <C>                     <C>                     <C>
 Outstanding, December 31, 2006        1,800,000               $0.67                   $-
 Granted                               600,000                  2.63                    -
 Forfeited / Canceled                  600,000                  2.63                    -
 Exercised                             -                        -                       -
 Outstanding, December 31, 2006        1,800,000               $0.67                   $-
-------------------------------------- ----------------------- ----------------------- ----------------------

The weighted average remaining  contractual life of warrants outstanding is 3.10
years at December 31, 2006.

<CAPTION>

--------------------------------------------- -------------------- ------------------------------------------
  Outstanding Warrants                                             Exercisable Warrants
----------------------- --------------------- -------------------- --------------------- --------------------
Range of Exercise       Number                Average  Remaining   Average Exercise      Number
Price                                         Contractual Life     Price
<C>                     <C>                   <C>                  <C>                   <C>
$0.67                   1,800,000             310                  $0.67                 1,800,000
----------------------- --------------------- -------------------- --------------------- --------------------

The Company  estimated the fair value of each stock warrant at the grant date by
using the Black-Scholes option-pricing mode.

The  weighted-average  assumptions used in estimating the fair value of warrants
granted  during the year ended  December 31, 2006, and the period ended December
31,  2006  along  with the  weighted-average  grant  date fair  values,  were as
follows.

<CAPTION>
------------------------------------- ----------------------------------- -----------------------------------
                                      2006                                2005
------------------------------------- ----------------------------------- -----------------------------------
<S>                                   <C>                                 <C>
 Expected volatility                  80.0%                               0.1%
 Expected life in years               5 years                             5 years
 Risk free interest rate              5.07%                               3.38%
 Dividend yield                       0%                                  0%
------------------------------------- ----------------------------------- -----------------------------------
</TABLE>

During the period  ended  December 31,  2006,  the Company  granted two warrants
which  expire  five years from date of grant and are  convertible  into  300,000
shares of common stock at an exercise  price of $2.63 per share to each of Brian
Harcourt and Ross-Lyndon  James in accordance with their  respective  Management
Employment   Agreements   executed  by  and  between   them  and  the   Company,
respectively. The warrants were granted on April 5, 2006 and vest 6 months after
grant.  Both Mr.  Harcourt  and Mr.  James  resigned  in July 24, 2006 and their
warrants were forfeited.

C. Employee Options

 On April 3, 2006, the Board of Directors of the Company authorized and approved
the adoption of the 2006 Stock Option Plan effective April 3, 2006 (the "Plan").
The Plan is administered by the duly appointed compensation committee.  The Plan
is authorized to grant stock options of up to 2,500,000  shares of the Company's
common  stock.  At the time a stock  option  is  granted  under  the  Plan,  the
compensation  committee  shall fix and determine the exercise  price and vesting
schedules  at which such shares of c ommon stock of the Company may be acquired.
As of December 31 , 2006, no options to purchase the Company's common stock have
been granted under the Plan.

There were no options outstanding at December 31, 2006.

 In  September,  2006,  the Board of  Directors  of the Company  authorized  and
approved  the  adoption of the 2006-1  Consultants  and  Employees  Service Plan
effective  September 7, 2006 (the "Consultants  Plan"). The Plan is administered
by the duly appointed  compensation  committee.  The Plan is authorized to grant
stock  options and make stock awards of up to 3,800,000  shares of the Company's
common  stock.  At the time a stock  option  is  granted  under  the  Plan,  the
compensation  committee  shall fix and determine the exercise  price and vesting
schedules  at which such shares of common  stock of the Company may be acquired.
The Consultants Plan was registered on September 15, 2006 and as of December 31,
2006 a total  of  3,799,000  shares  had  been  issued  and  granted  under  the
Consultants Plan.

                                      F-16


<PAGE>
                      NATIONAL HEALTHCARE TECHNOLOGY, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2006

7. Related Party Transactions

During the year the  following  transactions  occurred  between  the Company and
certain related parties:

A.       Ross-Lyndon James

The following  transaction took place between the Company and Ross-Lyndon James,
the  Company's  Chief  Executive  Officer and  Director:  On April 3, 2006,  the
Company entered into an employment agreement with Ross Lyndon James who has been
serving as the Company's  President  without  compensation and written agreement
since being appointed to such office by the Board of Directors of the Company in
June 2005. Mr. Lyndon James had also served without  compensation  as a director
of the Company.  Under the terms of the  agreement,  Mr.  Lyndon James  received
compensation  equal to twenty five thousand dollars  ($25,000) per month payable
monthly in  advance.  He was also  granted one million  eight  hundred  thousand
(1,800,000)  restricted  shares of common stock upon execution of the employment
agreement  as a signing  bonus,  as well as a  termination  grant of two million
(2,000,000)  shares of  restricted  common  stock.  All shares  have  piggy-back
registration rights. Additionally,  the Company agreed to grant him a warrant to
acquire  three hundred  thousand  (300,000)  restricted  shares of the Company's
common stock. The exercise price is to be based on the bid price of the stock on
the date of the  agreement.  The  warrants  expire  five years after the date of
grant.  Additionally,  Mr. Lyndon James will be entitled to  participate  in any
stock option program offered by the Company to its employees.  In July 24, 2006,
Mr. Lyndon James resigned as the Company's Chief Executive Officer and Director.
On the  resignation  of the Director,  the Company  forfeited the warrants.  The
Company recorded shares to be issued of $2,500,000 for the termination shares.

B.       Brian Harcourt

The following transaction took place between the Company and Brian Harcourt, the
Company's  Chief  Financial  Officer and Director  and parties  related to Brian
Harcourt:

On April 3, 2006,  the Company  entered into an employment  agreement with Brian
Harcourt who has been serving as an officer of the Company without  compensation
and  written  agreement  since  being  appointed  to such office by the Board of
Directors  of the Company in June 2005.  Mr.  Harcourt  has also served  without
compensation as a director of the Company. Under the terms of the agreement, Mr.
Harcourt  will  receive  compensation  equal to  twenty  five  thousand  dollars
($25,000) per month payable monthly in advance.  He was also granted one million
eight  hundred  thousand  (1,800,000)  restricted  shares of common  stock  upon
execution  of  the  employment  agreement  as a  signing  bonus,  as  well  as a
termination  grant of two million  (2,000,000)  restricted  shares of the common
stock. All shares have piggy back registration rights. Additionally, the Company
agreed  to grant him a warrant  to  acquire  three  hundred  thousand  (300,000)
restricted  shares of the Company's  common stock.  The exercise  price is to be
based on the bid price of the stock on the date of the  agreement.  The warrants
expire five years after the date of grant.  Additionally,  Mr.  Harcourt will be
entitled to participate  in any stock option  program  offered by the Company to
its employees.  In July 24, 2006, Mr.  Harcourt  resigned as the Company's Chief
Financial Officer and Director. On the resignation of the Director,  the Company
forfeited the warrants.  The Company  recorded shares to be issued of $2,500,000
for the termination shares.

On April 5, 2006,  the Company  entered into a consulting  agreement  with First
Credit Holding Ltd ("First Credit") to provide business  management services and
advice as it relates to the Company's future.  Under the terms of the agreement,
the  Company  agreed to pay First  Credit a fee of three  million  five  hundred
thousand   (3,500,000)   restricted   shares  of  common   stock.   The  fee  is
non-refundable and considered earned when the shares are delivered.  The company
is amortizing the expense over the period of the services.  Brian Harcourt,  one
of our directors,  is the controlling shareholder of First Credit. The shares of
stock were issued in April 2006.

C.       Boston Equities Corporation

The following  transaction  took place  between the Company and parties  sharing
common  ownership or control with Boston  Equities  Corporation,  a shareholder,
which owns  approximately  25% of the  Company's  outstanding  and issued common
stock:

On April 3, 2006, the Company  entered into a consulting  agreement with Summitt
Oil and Gas, Inc.  ("Summit") to provide business management services and advice
as it relates to the future of the  company.  Under the terms of the  Agreement,
the Company  shall pay Summitt a fee of two hundred and fifty  thousand  dollars
($250,000)  in  cash  plus  one  million  eight  hundred  thousand   (1,800,000)
restricted  of  the  Company's  common  stock.  The  fee is  non-refundable  and
considered earned when the shares are delivered. The agreement is for six months
expiring in October,  2006. The Company has fully  amortized the expense for the
cash and shares paid for the period ended December 31, 2006.

                                      F-17

<PAGE>

                      NATIONAL HEALTHCARE TECHNOLOGY, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2006

On April 4, 2006, the Company entered into an assignment of an oil and gas lease
with Summitt.  Under the  agreement in exchange for the leasehold  rights in 160
acres in the County of Custer,  Oklahoma,  the Company has agreed to pay Summitt
consideration  of  seventy-seven  thousand  (677,000)  restricted  shares of the
Company's common stock. The shares of stock have been issued on August 22, 2006.
Additionally,  there is excepted from the assignment and conveyance and reserved
and retained in Summitt an  overriding  royalty  equal to 3% of the value of all
oil  produced  and  removed  under the lease and the net  proceeds  received  by
Assignee  from the sale of all gas and casing head  gasoline  produced  and sold
under the lease.

On April 25, 2006, the Company entered into a short term bridge financing in the
form of a  promissory  note to  Camden  Holdings,  Inc.  in the  amount of three
hundred and fifty thousand dollars ($350,000) to be used as working capital. The
Note was due on August 25, 2006.  No interest is payable on the note. On June 8,
2006,  the Company  entered into a short term bridge  financing in the form of a
promissory note to Camden Holdings,  Inc. in the amount of one hundred and fifty
thousand dollars  ($150,000) to be used as working capital.  The Note was due on
December 31, 2006 and has been  extended to December  31,  2007.  No interest is
payable on the note.  At  December  31,  2006,  the  advances  outstanding  were
$613,400.

8. Commitments and Contingencies

A. Legal

On  December  19,  2006,  Empire  Relations  Group  Inc.   ("Empire")  filed  an
arbitration claim against the Company in connection with a consulting  agreement
entered  into by and between the Company and Empire on September  28,  2006.  An
arbitration  award in the amount of $13,000  was issued  against  the Company on
March 9, 2007,  which also provided for interest at the rate of nine percent per
annum,  commencing 30 days after the date of the award and continuing until paid
in full. The amount has been accrued in the accompanying financials..

The Company is periodically involved in legal actions and claims that arise as a
result of events that occur in the normal course of  operations.  The Company is
not  currently  aware of any other formal legal  proceedings  or claims that the
Company believes will have, individually or in the aggregate, a material adverse
effect on the Company's financial position or results of operations.

B. Operating Leases

On March 1, 2005,  the Company'  entered into a lease  commitment for office and
warehouse space in San Diego,  California  which expires  February 1, 2009. This
lease was  disposed of with the sale of Es3 in 2005 and  therefore  there are no
future lease  obligations.  Rent expense for the periods ended December 31, 2006
and 2005 were $0 and $26,078 respectively.


9. Subsequent Events (Unaudited)

A. Officer and Directors

On March 14, 2007 the Company  appointed  Sam  Plunkett as the sole  Officer and
Director.  On April 12, 2007, he resigned as Officer and Director.  He served in
the position without compensation.

On April 12, 2007 the Company  appointed Linda Contreras as the sole officer and
Director. She is serving in the position without compensation.

B. Summitt Oil

On January 11, 2007, the Company  entered into a Consolidated  Note and Security
Agreement  with Summitt Oil & Gas,  Inc.  ("Summitt"),  also an affiliate of the
Company, wherein the Company memorialized its obligation to pay Summitt $350,000
by December  31, 2007 for monies owed to Summitt.  The Company also gave Summitt
the  right to  convert  all or part of this debt  into  shares of the  Company's
common stock at $.01 per share,  which right Summitt has exercised.  As a result
of this conversion,  S ummitt is being issued 35,000,000 shares of the Company's
common stock, in restricted  form, and the Company has  extinguished the debt of
$350,000 owed to Summitt.  Additionally,  the Company  entered into a consulting
agreement with Summitt  wherein the Company  agreed to pay Summitt  $450,000 and
issue Summitt five million shares of the Company's  common stock,  in restricted
form, in consideration for Summitt's services through December 31, 2007.

 In March,  2007, the Company issued 40,000,000  restricted shares of its common
stock to Summitt  Oil and Gas,  an  affiliate  of the  Company in  exchange  for
$350,000 of debt and the consulting  services agreement entered into between the
Company & Summitt Oil & Gas.


                                      F-18
<PAGE>

                      NATIONAL HEALTHCARE TECHNOLOGY, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                DECEMBER 31, 2006

C. Camden Holdings

On January 11,  2007,  the  Company  entered  into  certain  agreements  with an
affiliate of the Company, Camden Holdings, Inc. ("Camden").  The first agreement
was a Consolidated  Note and Security  Agreement  wherein the Company and Camden
memorialized the terms of their agreement regarding monies advanced by Camden to
the Company.  Pursuant to this Agreement, the Company agreed to repay Camden the
sum of $650,000  plus  interest at ten percent  (10%) per annum by December  31,
2007.  Additionally,  Camden has the right to  convert  all or part of this debt
into shares of the  Company's  common stock at $.01 per share.  The Company also
entered into a consulting  agreement  with Camden  wherein the Company agreed to
pay Camden the sum of $450,000  for its services to the Company  until  December
31, 2007.

10. Restatement

         Subsequent to the issuance of the Company's  financial  statements  for
         the year ended December 31, 2006, the Company  determined  that certain
         transactions and presentation in the financial  statements had not been
         accounted   for  properly  in  the  Company's   financial   statements.
         Specifically, the issuance of shares pursuant to a consulting agreement
         was recorded twice and expensed due to wrong certification by the stock
         transfer agent. The company has restated its financial statements as of
         December 31, 2006 for that correction.

The Company has restated its financial  statements  for these  adjustments as of
December 31, 2006.

The effect of the correction of the error is as follows:

                                                     AS
                                                 PREVIOUSLY            AS
                                                  REPORTED          RESTATED
                                               --------------     --------------

                     BALANCE SHEET
                                                     As of December 31, 2006
                                               ---------------------------------
Stockholder's Equity:
      Additional paid-in capital                $ 39,472,222       $ 38,395,022
      Accumulated deficit                       $(39,144,384)      $(38,064,384)

                STATEMENT OF OPERATIONS:

                                               For the period from inception to
                                                       December 31, 2006
                                               ---------------------------------
      Professional fee                          $ 23,356,200       $ 22,276,200
      Total operating expenses                  $ 39,009,184       $ 37,929,184

      Net operating loss                        $ 39,009,184       $ 37,929,184
      Net loss                                  $ 38,794,184       $ 37,714,184

   STATEMENT OF CASH FLOWS:
                                               For the period from inception to
                                                       December 31, 2006
                                               ---------------------------------
NET LOSS                                        $ 38,794,184       $ 37,714,184
CASH FLOWS FROM OPERATING ACTIVITIES
      Adjustments to reconcile net loss to
       cash used by operating activities:
      Stock issued for services                 $ 30,732,250       $ 29,652,250


                                      F-19