U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                               __________________
                                   Form 10K-SB

                  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

For Fiscal year ended December 31, 1999        Commission File Number   1-15261

                            IR Operating Corporation
                 (Name of Small Business Issuer in its charter)



        DELAWARE                                              11-2165149
(State or other jurisdiction of                             (I.R.S. Employer
 incorporation or organization)                           Identification No.)

 112 Main Street, Webster, MA                                    01570
(Address of principal executive offices)                      (Zip Code)


                                 (888) 444-4762
               (Registrants telephone number, including area code)

           Securities registered pursuant to Section 12(b) of the Act:
                                      None

           Securities registered pursuant to Section 12(g) of the Act:
                                      None

     Indicate  by check mark  whether the  registrant  (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days.

                                Yes _X__ No _____

     Indicate  the  number  of  shares  outstanding  of each of the  registrants
classes of stock of the latest practibcable date.

          Class                                   Outstanding at March 20, 2000
  Common Stock, $.001 par value                          5,033,128

     The aggregate  market value of voting stock held by  non-affiliates  of the
Registrant was approximately $7,379,4600 as of March 20, 2000

                      Documents Incorporated by Reference:

                              See Index to Exhibits


<PAGE>

  Part I.

  Item 1.   Business.

       (a) Business Development

     The Company was originally named Atlantic Medical Corporation which was the
surviving  corporation  of a Delaware  statutory  merger with Rusco  Development
Corporation,  a  New  York  corporation,  in  January  1972  and  the  surviving
corporation  of an  acquisition  of  Fox  Group  Enterprises,  Inc.  a  Delaware
corporation  which  took  place on March  29,  1999.  Although  in the form of a
merger, the Fox transaction was, in substance, an acquisition of Atlantic by Fox
Group  Enterprises.  After the  merger  with Fox  Group  Enterprises,  Inc.  the
corporation was named I-ROCK Industries,  Inc. In April 1999 the Company changed
its name to IR Operating Corporation.

     Since its acquisition of Fox Group  Enterprises,  the Company has conducted
no  business  operations  except  for  organizational  activities.  Prior to the
acquisition  of Fox Group the Issuer  has been an  inactive  company.  It had no
material  assets,  no  business,  no sales or revenue.  The Issuer was seeking a
merger partner that could bring in substantial  assets to the  corporation.  The
Issuer  acquired Fox Group  Enterprises,  Inc. on March 29, 1999.  The Fox Group
Enterprises,  Inc.  at the time of the merger  had  signed  letters of intent to
acquire the  technology,  the patents and certain assets that were for producing
plastic pallets and other plastic profile shapes, from recycled material,  using
a process known as the I-ROCK Process. On April 30, 1999, the issuer allowed the
letters of intent for the I-ROCK Process to expire because the technology  would
require additional  development  before it could be commercialized.  The patents
were subsequently  acquired in September 1999. To exploit the patents the Issuer
may need to raise  additional  capital  that will be used to operate  the Issuer
during the start up phase.

     A copy of the Company's most recent annual report,  which includes  audited
financial  statements,  will be  provided  to any  shareholder  requesting  such
material, in writing, to the Secretary of the Company.

       (b)    Business of Issuer.

       General

     The Company generally has been inactive.  The Company is seeking to acquire
suitable  business  opportunities  or technologies  within the recycling  field.
During the quarter ended September 30, 1999, the Company  acquired  ownership of
two patents  through the  acquisition  of a debt owed by the former owner of the
patents,  and then  foreclosing  on the debt,  for a process known as the I-ROCK
Process.  This process is a cold extrusion  process for converting waste plastic
into profile shapes that can be used for a variety of applications.  The Company
has signed a lease for an existing  plant site which is located in Bradley,  IL.
The Company was able to  negotiate  favorable  terms for leasing the plant site.
The Company is currently  negotiating  with the State of Illinois and the County
of Kankakee,  IL, to lease the equipment,  that is installed in the leased plant
site and  designed for the I-ROCK  Process,  which is owned by the state and the
county. The Company believes that it will be able to negotiate a favorable lease
for the equipment with both the state and the county.

                                      2
<PAGE>


     Since acquiring the patent rights for the I-ROCK  Process,  the Company has
agreed to license  the  technology  to a company in New  Jersey.  The New Jersey
company will have the right to  manufacture  products  using the I-ROCK  Process
technology.  The Company will receive future compensation in the form of license
payments,  commencing when the licensee reaches certain  performance levels, and
royalty  payments  based on sales  volume.  The Company will  provide  technical
support for which it will be compensated for its direct costs.

     The Company  also plans to continue  searching  for  suitable  technologies
and/or companies to acquire.

     It is  anticipated  that  the  Company's  CEO and  directors  will  receive
reasonable  salaries  for  services  as  executive  officers at such time as the
Company  commences  business  operations.  (See  Part III,  Item 11,  "Executive
Compensation.")  These  individuals  will  devote such time and effort as may be
necessary to participate in the day-to-day  management of the Company. (See Part
III, Item 9. "Directors, Executive Officers, Promoters and Control Persons).

No Operating History,  Revenues or Earnings.

     As of the date hereof, the Company has no operations and, accordingly,  has
no operating  revenues or earnings.  Since its  inception,  most of the time and
resources  of IR's  management  have  been  spent  in  organizing  the  Company,
obtaining  interim  financing  and  developing a business  plan.  The  Company's
success  is  dependent   upon  its   locating   additional   suitable   business
opportunities and/or  technologies,  obtaining additional financing for intended
operations  from  placement  of its equity or debt or from third  party  funding
sources.  There is no assurance  that IR will be able to locate a other business
opportunities or obtain additional debt or equity financing from any source. The
Company,  during the  development  stage of its  operations,  can be expected to
sustain substantial operating expenses without generating any operating revenues
or the operating  revenues generated can be expected to be insufficient to cover
expenses.   Thus,  for  the  foreseeable  future,  unless  the  Company  attains
profitable  operations,  which  is  not  anticipated,  the  Company's  financial
statements  will show an increasing net operating  loss.  (See Part I, Item 1. "
Business.")

Minimal Assets, Working Capital and Net Worth.

     As of December 31, 1999,  the  Company's  had total assets in the amount of
$102,249  consisting,  principally  of purchased  patents and  trademarks.  As a
result of its minimal assets and reported  losses,  as of December 31, 1999, the
Company has negative net worth.  Further,  IR had a working  capital  deficit of
approximately  $383,000 at December 31, 1999. There can be no assurance that the
Company's financial condition will improve.  The Company is expected to continue
to have  minimal  working  capital or a working  capital  deficit as a result of
current  liabilities.  Since the  acquisition of the Fox Group,  the Company has
been  financed  through  loans from Murray Fox,  President & CEO,  for which the
Company has issued promissory notes in the amount of $328,000.

                                      3
<PAGE>


Need for Additional Capital-Going Concern Qualification Expressed by Auditor.

     While the  Company is  looking  for  business  other  opportunities  and/or
technologies the ongoing expenses will be minimal. However, to grow, the Company
will need to raise  additional  equity and/or debt financing.  IR's  independent
certified   public   accountant  has  expressed   this  as  a  "going   concern"
qualification. The Company does not anticipate the receipt of operating revenues
until  management  successfully  implements  its  business  plan,  which  is not
assured.  Further,  IR may incur significant  unanticipated  expenditures  which
deplete its  capital at a more rapid rate  because of among  other  things,  the
current  state of its  business,  its  limited  personnel  and other  resources.
Because of these and other  factors,  management is presently  unable to predict
what  additional  costs might be incurred by the Company.  IR has no  identified
sources of funds, and there can be no assurance that resources will be available
to the Company when needed.

Dependence on Management

     The possible success of the Company is expected to be largely  dependent on
the continued  services of Murray Fox. Murray Fox,  Anthony Conte and David Katz
are  expected to devote only such time and effort to the business and affairs of
the Company as may be necessary to perform their  responsibilities  as executive
officers of IR. The loss of the  services of Murray Fox would  adversely  affect
the conduct of the  Company's  business and its  prospects  for the future.  The
Company presently holds no key-man life insurance on the life of Murray Fox, and
has an employment agreement with Murray Fox.

Ability to Grow Dependent upon Acquisitions

     The Company expects to grow through acquiring other business  opportunities
and/or  technologies.  There is no  assurance  that the Company  will be able to
locate suitable business  opportunities or technologies or that the Company will
be able to acquire any business or technology that has been identified.

Absence of Public Market for Shares

     The  Company's  shares  of  Common  Stock  are  registered  with  the  U.S.
Securities  and Exchange  Commission  under the Act.  There is no active  public
market for the shares of Common Stock and no assurance that one will develop.

Potential Sale of Restricted Shares

     Of its  outstanding  shares,  the  Company has issued  7,441,700  shares of
common stock to persons  affiliated with Fox Group pursuant to an exemption from
registration  provided by Rule 4(2) and  Regulation D promulgated  under Section
3(b) of the Act. These shares are "restricted  securities".  Rule 144 of the Act
provides, in essence, that holders of restricted securities, for a period of one
year after the  acquisition  thereof  from the  Company or an  affiliate  of the
Company,  may,  every  three  months,  sell to a  market  maker  or in  ordinary
brokerage  transactions  an amount  equal to one percent of the  Company's  then
outstanding  securities.  Non-affiliates  of the  Company  who  hold  restricted
securities for a period of two years may sell their securities without regard to
volume limitations or other restrictions.  Resales of the free trading shares of
Common Stock by  "affiliates,  control  persons and/or  underwriters"  of IR, as
those terms are defined in the Act,  will be subject to the volume  limitations,
described in paragraph  (e) of Rule 144. Any transfer or resale of the shares of
IR's Common Stock will be subject,  in addition to the Federal  securities laws,
to the "blue sky" laws of each state in which such  transfer  or resale  occurs.
The shareholders of the Fox Group who received shares, returned to the Company's
treasury a total of 3,827,204 shares effective September 29, 1999, in accordance
with the escrow  agreement.  Therefore  now a total of  3,574,496  shares of the
Company's Common Stock will be available for resale under Rule 144 commencing on
March  30,  2000.  Sales of shares of  Common  Stock  under  Rule 144 may have a
depressive  effect on the market price of the Company's  Common Stock,  should a
public  market  develop  for such  stock.  Such sales also might  impede  future
financing by the Company.

                                      4
<PAGE>

No  Dividends

     While  payments of dividends on the Common Stock rests with the  discretion
of the Board of Directors,  there can be no assurance that dividends can or will
ever be paid.  Payment of  dividends is  contingent  upon,  among other  things,
future  earnings,  if any, and the financial  condition of the Company,  capital
requirements,  general business conditions and other factors which cannot now be
predicted. It is highly unlikely that cash dividends on the Common Stock will be
paid by the Company in the foreseeable future.

No Cumulative  Voting

     The election of directors and other questions will be decided by a majority
vote. Since cumulative voting is not permitted, investors who purchase shares of
the  Company's  Common  Stock  may not  have the  power  to elect  even a single
director and, as a practical  matter,  the current  management  will continue to
effectively control the Company.

Control by  Present  Shareholders

     The present  shareholders of the Company's  Common Stock will, by virtue of
their percentage share ownership and the lack of cumulative  voting,  be able to
elect the entire  Board of  Directors,  establish  the  Company's  policies  and
generally direct its affairs.  Accordingly,  persons  investing in the Company's
Common Stock will have no significant voice in Company management, and cannot be
assured of ever having representation on the Board of Directors.  (See Part III,
Item 12. "Security Ownership of Certain Beneficial Owners and Management.")

Possible  Adverse  Effect of Penny Stock  Regulations  on Liquidity of Common
  Stock in any  Secondary  Market

     In the event a market develops in the Company's  shares, of which there can
be no assurance,  then if a secondary  trading market  develops in the shares of
Common  Stock of the  Company,  of which there can be no  assurance,  the Common
Stock is expected to come within the meaning of the term "penny  stock" under 17
CFR 240.3a51-1 because such shares are issued by a small company; are low-priced
(under  five  dollars);  and are not  traded on NASDAQ  or on a  national  stock
exchange. The Securities and Exchange Commission has established risk disclosure
requirements for  broker-dealers  participating  in penny stock  transactions as
part of a system of disclosure and regulatory oversight for the operation of the
penny stock  market.  Rule 15g-9 under the  Securities  Exchange Act of 1934, as
amended,   obligates  a   broker-dealer   to  satisfy   special  sales  practice
requirements,  including a requirement  that it make an  individualized  written
suitability  determination of the purchaser and receive the purchaser's  written
consent prior to the transaction.  Further, the Securities  Enforcement Remedies
and  Penny  Stock  Reform  Act of  1990  require  a  broker-dealer,  prior  to a
transaction  in a  penny  stock,  to  deliver  a  standardized  risk  disclosure
instrument  that  provides  information  about penny stocks and the risks in the
penny  stock  market.  Additionally,  the  customer  must  be  provided  by  the
broker-dealer  with current bid and offer  quotations  for the penny stock,  the
compensation  of the  broker-dealer  and the  salesperson in the transaction and
monthly account  statements showing the market value of each penny stock held in
the customer's account.  For so long as the Company's Common Stock is considered
penny  stock,  the penny  stock  regulations  can be expected to have an adverse
effect on the  liquidity of the Common Stock in the  secondary  market,  if any,
which develops.

                                      5
<PAGE>

Forward-Looking Statements

     This Form 10-KSB includes  "forward-looking  statements" within the meaning
of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities  Exchange  Act of  1934,  as  amended.  All  statements,  other  than
statements of historical  facts,  included or  incorporated by reference in this
Form 10-KSB which address  activities,  events or developments which the Company
expects or anticipates will or may occur in the future, including such things as
future capital expenditures (including the amount and nature thereof),  business
strategy,  expansion and growth of the Company's  business and  operations,  and
other such matters are forward-looking statements. These statements are based on
certain  assumptions and analyses made by the Company in light of its experience
and its perception of historical trends,  current conditions and expected future
developments  as well as  other  factors  it  believes  are  appropriate  in the
circumstances. However, whether actual results or developments will conform with
the Company's  expectations  and predictions is subject to a number of risks and
uncertainties,  general  economic market and business  conditions;  the business
opportunities  (or lack  thereof)  that may be  presented  to and pursued by the
Company;  changes in laws or regulation;  and other  factors,  most of which are
beyond the  control of the  Company.  Consequently,  all of the  forward-looking
statements made in this Form 10-KSB are qualified by these cautionary statements
and  there  can  be  no  assurance  that  the  actual  results  or  developments
anticipated by the Company will be realized or, even if substantially  realized,
that they will have the expected consequence to or effects on the Company or its
business or  operations.  The Company  assumes no obligations to update any such
forward-looking statements.

Item 2.  Properties

     The Company's executive offices are located at 112 Main Street, Webster, MA
01570. It telephone number is  (888)444-4762.  The Company pays no rent for this
space.

     The Company has signed a lease for 51,132  square  feet of  production  and
warehouse space located at 180 East Ninth Street in Bradley,  IL. The lease with
an initial  term of 12 months  calls for an annual  rent  approximating  $72,000
including real estate taxes and  insurance.  The Company has the option to renew
the  lease at the end of the  first  year for a period  of five  years at higher
lease rates.

Item 3.  Legal Proceedings.

     The Company and its  President,  Murray Fox, are party to a replevin  legal
proceeding brought by the County of Kankakee,  Illinois, in the Circuit Court of
the Twenty First Judicial Circuit Kankakee County,  case number 99L166,  to take
possession  of certain  assets that were  bought by a third  party using  monies
loaned to the third party by Kankakee County.  The defendants in addition to the
Company and Murray Fox are MTAE, Inc.,  Stacey D. Smith,  Kenneth Kirby,  Robert
Fischer,  Gary Estepp,  Innovative Recycling  Corporation,  I.R.C.C. of Bradley,
L.L.C.,  Area Job  Development  Corp.,  and the State of Illinois  Department of
Commerce and  Community  Affairs The Company does not have  possession of any of
the assets that are the subject of this action.

     There are no other legal  proceedings to which the Company is a party or to
which  any  of  its  property  is  subject  which  are  pending,  threatened  or
contemplated or any unsatisfied judgments against the Company.

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

     No matters were  submitted to a vote of the security  holders during fiscal
year ending December 31, 1999.

                                      6
<PAGE>




Item 5.  Market Price of and Dividends on the Registrant's Common Equity and
            Other Shareholder Matters

         (a) Market Information.

     The Company's common stock is traded on the National Quotation Bureau (NQB)
Electronic Quotation Systems under the trading symbol IROC.

     The  following  table shows the high and low sales  price for each  quarter
within the last two  complete  fiscal  years as well as the  subsequent  interim
quarters:


         Quarter Ended                 High                  Low
         --------------------        --------              -------

         March 31, 1997                  *                     *

         June 30, 1997                 2-3/4                 1/2

         September 30, 1997            1-1/8                 1-1/8

         December 31, 1997             1-1/8                 1-1/8



         March 31, 1998                18                    2-1/4

         June 30, 1998                 2-1/4                 2-1/4

         September 30, 1998            9                     2-1/4

         December 31, 1998             7-7/8                 6-3/4



         March 31, 1999                7-1/32                29/128

         June 30, 1999                 5                     1/4

         September 30, 1999            0.90                  0.875

         December 31, 1999             .090                  1.10


     (b) Holders.

     As of December 31, 1999, the Company had  approximately 330 shareholders of
record of its outstanding shares of Common Stock.

     (c) Dividends.

     The Company has never paid or declared  any  dividends  on its Common Stock
and does not anticipate paying cash dividends in the foreseeable future.

Recent Sales of Unregistered Securities

     On March 29,  1999,  7,441,700  shares of common  stock were  issued to the
shareholders of Fox Group  Enterprises,  Inc. in connection with the acquisition
of Fox Group by the Company.

     On March 29, 1999, the Company issued 1,062,230 shares of stock to fourteen
(14)  individuals  in  consideration  for work done on the  merger.  The Company
claimed the exemption from registration in connection with each of the offerings
provided  under Section 3(b) of the Act and Rule 504 of Regulation D promulgated
thereunder.

                                      7
<PAGE>



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

Plan of Operations

     Since 1981,  the Company has  conducted no business  operations  except for
organizational  activities and looking for a merger partner. For the period from
acquisition of Fox Group (March 29, 1999) through December 31, 1999, the Company
had no income from operations and operating expenses aggregating  $633,218.  The
Company is  actively  working to find  suitable  business  opportunities  and/or
technologies.  The Company is  concentrating  its efforts in the  recycling  and
environmental business segments.

     The Company may have to raise  additional  funds from outside  investors to
fund the  various  business  opportunities.  Management  intends to explore  all
available  alternatives  for debt and/or  equity  financing,  including  but not
limited to private and public securities  offerings.  Even before an acquisition
the Company  expects  that the cash on hand will not be  sufficient  to meet its
operating  needs for the next 12 months  and will have to obtain  further  loans
from stockholders. Accordingly, management expects that it will be necessary for
IR to raise  additional  funds when IR is ready to make an  acquisition or begin
operations related to the I-ROCK Process patents.

     In addition,  at least initially,  the Company intends to operate out of an
office provided by Murray Fox. Thus, it is not anticipated that IR will lease or
purchase office space or computer equipment in the foreseeable future. IR may in
the future establish its own facilities and/or acquire computer equipment if the
necessary capital becomes available;  however, the Company's financial condition
does not permit  management  to  consider  the  acquisition  of office  space or
equipment at this time.

Financial Condition, Capital Resources and Liquidity

     At December 31, 1999, the Company had assets totaling  $102,249 and accrued
expenses of $89,467  attributable to accrued officer's  salaries,  accrued legal
expenses,  organization  expenses and  professional  fees.  Since the  Company's
inception, it has received $328,000 in cash in the form of loans from Murray Fox
which are secured by promissory  notes issued by the Company.  Murray Fox is not
obligated to advance further funds to the Company.

     IR's  working  capital is  presently  minimal and there can be no assurance
that the Company's financial condition will improve.  The Company is expected to
continue  to have  minimal  working  capital or a working  capital  deficit as a
result its lack of  revenue.  The  ability of the Company to continue as a going
concern  is  dependent  upon  its  ability  to  acquire  a  viable  business  or
technology.

Net Operating Losses

     The Company has net operating  loss of $633,218  during the period  January
10,  1999  through  December  31,  1999 and had a  stockholders'  deficiency  of
$315,218 at December 31, 1999.

Item 7.  Financial Statements and Supplementary Data

     Financial  statements and supplementary  data are included herein beginning
with page F-1.

                                      8
<PAGE>


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

     The Board of Directors of the Company have appointed Holtz Rubenstein & Co,
LLP ("HR") as auditors for the  Company.  Ralph S.  Inocencio  CPA, had been the
outside accountant for the Company through March 29, 1999. During the year ended
December  31,  1998  and  the  year  ended  December  31,  1999,  there  were no
disagreements  between  IR and Ralph S.  Inocencio  or Holtz  Rubenstein  on any
matter of accounting  principles and practices,  financial statement disclosure,
or audit  scope  and  procedure,  which  disagreement,  if not  resolved  to the
satisfaction of HR, would have caused it to make reference to the subject matter
of the disagreement in connection with its report.

Part III

Item 9.  Directors and Executive Officers, Promoters and Control Persons

Name and Age                                                           Position
-------------------------------------------------------------------------------
Murray Fox (76)............................. President, Chief Executive Officer,
                                             Chief Financial Officer, Director
Anthony Conte (46)...........................Vice President, Director
David C. Katz (59)...........................Secretary, Director


Murray J. Fox - Director, President and Chief Executive Officer

     Mr. Fox has been in the recycling  business in excess of twenty  years.  He
founded Recycling Enterprises, Inc., a glass recycler in the 1970's. Mr. Fox was
also a co-founder of REI Distributors, Inc. in 1981 and became the largest glass
recycler  in the state of New Jersey.  REI merged with Pure Tech  International,
Inc., a plastics recycler,  in 1991. The newly combined business continued under
the Pure Tech name and became one of the largest plastic  recycler in the United
States.  In 1995 Pure Tech  merged  with  Ozite  Corporation  and thus  became a
diversified manufacturer of plastic materials and products as well as continuing
in the  recycling  field.  Mr. Fox  remained a director and officer of the newly
named PureTec Corporation until it was sold and privatized in 1998.

Anthony Conte - Director and Vice President

     Mr. Conte was President of Pure Tech  Plastics  from  1992-1998 and in that
capacity was  responsible  for all facets of the  business.  This included 5 PET
recycling  facilities in the Northeast as well as the building of several plants
in the Far East that were licensed from Pure Tech.  From 1989 to 1991, Mr. Conte
worked as an  independent  consultant to Pure Tech  International.  From 1977 to
1988,  Mr.  Conte  founded  and was COO of  Alcon  Enterprises,  an  independent
supplier of services and part to the food and beverage industries.  Mr. Conte is
currently Chairman of Ecoboard Holdings, Inc.

David Katz, Director and Secretary

     Mr. Katz served the President and COO of PureTec Corporation from 1988-1998
when the company was sold to a private buyer.  Prior to joining PureTec he was a
consultant to the food and beverage packing industry. From 1982-1987 he was Vice
President  and Director of Operations  for Taylor Wine Company,  a subsidiary of
The  Coca-Cola  Company.  Prior to that he was US Director of Packaging  for the
Coca-Cola  Company in Atlanta,  Georgia and was responsible for coordinating the
introduction of PET bottles to the U.S. soft drink industry.

                                      9
<PAGE>

     All  directors  hold office until the next annual  meeting of the Company's
shareholders and until their successors have been elected and qualify.  Officers
serve at the pleasure of the Board of Directors.  Murray Fox,  Anthony Conte and
David Katz will devote such time and effort to the  business  and affairs of the
Company as may be  necessary  to perform  their  responsibilities  as  executive
officers and/or directors of the Company.

     Aside from the above  officers and  directors,  there are no other  persons
whose activities will be material to the operations of the Company at this time.

Family Relationships

     There are no family  relationships  between or among the executive officers
and directors of the Company.

Item 10. Compliance with Section 16(a) of the Exchange Act

     Murray Fox , Anthony Conte, and David Katz did not file Forms 3 at the time
the Company's Form 10-SB was declared effective.

Item 11. Executive Compensation:

     The  Company,  in  consideration  for various  services  performed  for the
Company,  has signed an employment  agreement with Murray Fox.  Murray Fox is to
receive  annual  compensation  in the amount of $100,000 per year.  However,  at
present  no cash  payments  are being  made to Murray  Fox and the salary due is
being  accrued  on the books of the  Company.  Except  for the  above  described
compensation,  it is not anticipated  that any executive  officer of the Company
will  receive any cash or non-cash  compensation  for his or her services in all
capacities  to the  Company  until such time as the Company  commences  business
operations.  At such time as IR commences  operations,  it is expected  that the
Board of Directors  will approve the payment of salaries in a reasonable  amount
to each of its officers for their services in the  positions.  At such time, the
Board of Directors  may, in its  discretion,  approve the payment of  additional
cash or  non-cash  compensation  to the  foregoing  for  their  services  to the
Company. No compensation has been paid to executives for the last 3 years.

     The Company does not provide  officers  with  pension,  stock  appreciation
rights, long-term incentive or other plans but has the intention of implementing
such plans in the future.

Compensation of Directors

     The Company has no standard  arrangements for compensating the directors of
the Company for their attendance at meetings of the Board of Directors.

     There were no stock appreciation rights granted, nor were any stock options
granted,  to any of the above named  officers in the fiscal year ended  December
31, 1999.  Murray Fox has the right to receive 50,000 options under the terms of
his employment contract.

                                      10
<PAGE>


Item 12. Security Ownership of Certain Beneficial Owners and Management

     The  following  table sets  forth  information  as of  December  31,  1999,
regarding the ownership of the Company's Common Stock by each shareholder  known
by the  Company  to be the  beneficial  owner of more  than five per cent of its
outstanding shares of Common Stock, each director and all executive officers and
directors as a group.  Except as otherwise  indicated,  each of the shareholders
has sole voting and investment  power with respect to the shares of Common Stock
beneficially owned.

   (a) Security ownership of certain beneficial owners;
<TABLE>
<CAPTION>

                                  (2)                         (3)
     (1)                          Name and Address of         Amount and Nature of      (4)
     Title of Class               Beneficial Owner            Beneficial Owner          Percent of Class
     ---------------------------- --------------------------- ------------------------- -----------------
     <S>                          <C>                         <C>                       <C>
     Common Stock, par value      Murray Fox (1)(2)(3)
     $0.001                       112 Main Street             1,625,360                 32.29%
                                  Webster, MA 01570

                                  Anthony Conte (1)(2)(3)
                                  9 Suncrest Drive            645,009                   12.82%
                                  Dix Hills, NY 11746

                                  David Katz (1)(2)(3)
                                  54 Tarn Drive               302,940                   6.02%
                                  Morris Plains, NJ 07950

</TABLE>


(b) Security ownership of management

<TABLE>
<CAPTION>

                                  (2)                         (3)
     (1)                          Name and Address of         Amount and Nature of      (4)
     Title of Class               Beneficial Owner            Beneficial Owner          Percent of Class
     ---------------------------- --------------------------- ------------------------- -----------------
     <S>                          <C>                         <C>                       <C>
     Common Stock, par value      Murray Fox
     $0.001                       112 Main Street             1,625,360                 32.29%
                                  Webster, MA 01570

                                  Anthony Conte
                                  9 Suncrest Drive            645,009                   12.82%
                                  Dix Hills, NY 11746

                                  David Katz
                                  54 Tarn Drive               302,940                   6.02%
                                  Morris Plains, NJ 07950

     Total                                                    2,573,309                 51.13%
     ---------------------------- --------------------------- ------------------------- -----------------
</TABLE>


(1) Based upon 5,033,128 shares of the Company's Common Stock issued and
    outstanding as of December 31, 1999.

(2) Executive officer of the Company.

(3) Member of the Board of Directors of the Company.

(4) Based upon 5,033,128 shares of the Company's Common Stock issued and
    outstanding as of December 31, 1999.

                                      11
<PAGE>


Item 7.  Certain Relationships and Related Transactions:

     Escrow  Agreement-As  part of the merger with Fox Group the shareholders of
Fox Group signed an Escrow  Agreement  with Reva  Enterprises,  Inc. and John B.
Lowy, P. C.who are  shareholders  of the Company which called for the former Fox
Group  shareholders  to return on pro-rata  basis 750,000 shares of common stock
that was issued to them at the time of the merger if certain  tangible net worth
levels were not met. The Company did not achieve the required tangible net worth
and in  accordance  with the escrow  agreement  the 750,000  escrow  shares were
released to Reva Enterprises effective September 29, 1999.

     Fox Group Enterprises Shareholder  Agreement-The  shareholders of Fox Group
at the time of the acquisition signed an agreement that called for the return of
3,867,204  shares  to the  Company  to be used  for the  acquisition  of  I-ROCK
technology and/or company.  Effective  September 29, 1999, the shares covered by
the  escrow  agreements  (3,867,204  shares)  were  returned  to  the  Company's
treasury.

     Since the Company's acquisition of Fox Group in March 1999, it has received
$328,000 in cash in the form of loans from Murray Fox which are  represented  by
promissory  notes issued by the Company.  The  promissory  notes bear interest a
5.5% per annum, with a default interest rate of 18% per annum.

Item 15. Exhibits, Financial statement Schedules and Reports on Form 8-K

     No Forms 8-K were filed during the fiscal year ending December 31, 1999.

                                      12
<PAGE>



Item 16.     Index to Exhibits

3(i)     Articles of Incorporation as of IR as amended and filed April 30, 1999
         (incorporated by reference) from Registration Statement on Form 10-SB.

3(ii)    Bylaws of IR (incorporated by reference) from Registration Statement
         on Form 10-SB.

10(i)    Escrow Agreement with Reva and Downey (incorporated by reference) from
         Registration Statement on Form 10-SB.

10(ii)   Fox Group Enterprises Stockholder Agreements (incorporated by
         reference) from Registration Statement on Form 10-SB.

10(iii)  1999 Stock Option Plan

                                      13
<PAGE>



                                   SIGNATURES


     Pursuant  to the  requirements  off  Section 13 or 15(d) of the  Securities
exchange Act of 1934, Registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.

                     IR OPERATING CORPORATION



                                                     By: /s/ Murray Fox
                                                     -------------------------
                                                     Murray Fox, President/CEO

Date: March 22, 2000

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


Date                       Signature                 Title
--------------------------------------------------------------------------------

March 22, 2000             By:/s/ Murray Fox         President and Director
                           -----------------
                                  Murray Fox

March 22, 2000             By:/s/ Anthony Conte      Vice President and Director
                           --------------------
                                  Anthony Conte

March 22, 2000             By:/s/ David C. Katz      Secretary and Director
                           --------------------
                                  David C. Katz

                                      13
<PAGE>



                            IR OPERATING CORPORATION
                         (A Development Stage Company)
                     REPORT ON AUDIT OF FINANCIAL STATEMENTS
          PERIOD JANUARY 10, 1999 (INCEPTION)THROUGH DECEMBER 31, 1999



                          INDEX TO FINANCIAL STATEMENTS



Page

F-2                               Independent auditors' report

F-3                               Balance sheet

F-4                               Statement of operations

F-5                               Statement of stockholders' deficiency

F-6                               Statement of cash flows

F-7 - 11                          Notes to financial statements

                                      F-1

<PAGE>



                          Independent Auditors'
 Report






Board of Directors and Stockholders
IR Operating Corporation

     We have audited the accompanying balance sheet of IR Operating  Corporation
(a  development  stage  company)  as of  December  31,  1999,  and  the  related
statements of operations, stockholders' deficiency and cash flows for the period
January  10,  1999  (inception)  through  December  31,  1999.  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  generally  accepted  auditing
standards.  Those standards require 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 IR Operating Corporation as
of December 31, 1999,  and the results of its  operations and its cash flows for
the period January 10, 1999 (inception)  through December 31, 1999 in conformity
with generally accepted accounting principles.

     The accompanying  financial  statements have been prepared assuming that IR
Operating  Corporation will continue as a going concern.  As discussed in Note 1
to the financial statements, IR Operating Corporation has suffered a loss in the
current period and has negative working capital. These factors raise substantial
doubt regarding its ability to continue as a going concern.  Management's  plans
in  regard  to  these  matters  are  also  described  in Note 1.  The  financial
statements do not include adjustments that might result from the outcome of this
uncertainty.




                                                  HOLTZ RUBENSTEIN & CO., LLP

Melville, New York
March 2, 2000


                                      F-2
<PAGE>

                            IR OPERATING CORPORATION
                          (A Development Stage Company)

                                 BALANCE SHEET
                                DECEMBER 31, 1999





ASSETS

 CURRENT ASSETS:
  Cash                                                   $     4,551
  Prepaid expenses                                            30,057
                                                           -----------
     Total current assets                                     34,608

                                                           -----------
 PATENTS (Note 3)                                             67,641
                                                           -----------
                                                         $   102,249
                                                           ===========


LIABILITIES AND STOCKHOLDERS' DEFICIENCY
CURRENT LIABILITIES:
   Accounts payable and accrued expenses                 $    89,467
   Loan payable - stockholder(Note 4)                        328,000
                                                           -----------
    Total current liabilities                                417,467

COMMITMENT (Note 8)

STOCKHOLDERS' DEFICIENCY: (Note 6)
 Common stock, par value $.001 per share;
  authorized 50,000,000 shares, issued and
  outstanding 5,033,128 shares                                5,033
 Preferred stock, par value $.001;authorized
  5,000,000 shares; 0 issued and outstanding                      -
 Additional paid-in capital                                 312,967
 Deficit accumulated during the development stage          (633,218)
                                                          -----------
                                                           (315,218)
                                                         -----------
                                                        $   102,249
                                                         ===========





                        See notes to financial statements

                                       F-3
<PAGE>

                            IR OPERATING CORPORATION
                         (A Development Stage Company)
                            STATEMENT OF OPERATIONS
          PERIOD JANUARY 10, 1999 (INCEPTION) THROUGH DECEMBER 31, 1999



EXPENSES: (Notes 4, 5, 7 and 8)

 Organization and merger costs                              $  347,905
 Loss on aborted acquisition                                   122,114
 General and administrative                                    154,349
 Interest expense                                                8,850
                                                            -----------

NET LOSS                                                    $ (633,218)
                                                            ===========

NET LOSS PER SHARE (Note 6)                                 $     (.13)
                                                            ===========
WEIGHTED AVERAGE NUMBER
 OF SHARES OF COMMON
 STOCK OUTSTANDING                                           4,758,341
                                                            ===========




                        See notes to financial statements

                                       F-4
<PAGE>

                            IR OPERATING CORPORATION
                         (A Development Stage Company)

                     STATEMENT OF STOCKHOLDERS' DEFICIENCY
                                 (Notes 5 and 6)

<TABLE>
<CAPTION>


                                                   Common Stock          Preferred Stock
                                                   50,000,000 Shares     5,000,000 Shares                    Deficit
                                   Common Stock    $.001 Par Value       $.001 Par Value                     Accumulated
                                   -------------------------------------------------------  Additional       During the
                                          Par                  Par                  Par      Paid-in         Development
                                 Shares   Value    Shares     Value      Shares    Value     Capital         Stage            Total
                                ---------------------------------------------------------------------------------------------------
<S>                             <C>     <C>       <C>       <C>          <C>    <C>         <C>             <C>            <C>

BALANCE, January 10, 1999          -    $   -        -      $ -           -     $      -    $  -            $    -         $    -
Common stock issued for cash     1,000   300,000     -        -           -            -       -                 -          300,000

Common stock shares issued
for acquisition of Fox Group
Enterprises, Inc.               (1,000) (300,000)  7,838,102  7,838         -          -     292,162             -            -

Common stock issued to
 consultants                       -        -      1,062,230  1,062         -          -      16,938             -           18,000

Stock reversion                    -        -     (3,867,204)(3,867)        -          -       3,867             -            -

Net loss                           -        -        -        -             -          -         -            (633,218)    (633,218)
                                 ---------------------------------------------------------------------------------------------------

BALANCE, December 31, 1999         -    $   -     5,033,128 $ 5,033         -   $      -    $312,967         $(633,218)   $(315,218)
                                 ===================================================================================================

</TABLE>





                        See notes to financial statements

                                       F-5
<PAGE>

                            IR OPERATING CORPORATION
                         (A Development Stage Company)

                            STATEMENT OF CASH FLOWS
             JANUARY 10, 1999 (INCEPTION) THROUGH DECEMBER 31, 1999





CASH FLOWS FROM OPERATING ACTIVITIES:
   Net loss                                                       $(633,218)
   Adjustments to reconcile net loss to net
   cash used in operating activities:
    Loss incurred in merger transaction                             200,000
    Non-cash compensation                                            18,000
    Changes in operating assets and liabilities:
     (Increase) in assets:
       Prepaid expenses                                             (30,057)
      Increase in liabilities:
       Accounts payable and accrued
        expenses                                                     89,467
                                                                  ----------
    Net cash used in operating activities                          (355,808)
                                                                  ----------

CASH FLOWS FROM INVESTING ACTIVITIES:
   Net cash used in business acquisition                           (200,000)
   Acquisition of intangible assets                                 (67,641)
                                                                  ----------
    Net cash used in investing activities                          (267,641)
                                                                  ----------
CASH FLOWS FROM FINANCING ACTIVITIES:
   Proceeds from loan payable - stockholder                         328,000
   Proceeds from issuance of common stock                           300,000
                                                                  ----------
    Net cash provided by financing activities                       628,000
                                                                  ----------
Net increase in cash and cash equivalents                             4,551

Cash and cash equivalents at beginning of period                          -
                                                                  ----------
Cash and cash equivalents at end of period                       $    4,551
                                                                  ==========

                        See notes to financial statements

                                       F-6
<PAGE>

                            IR OPERATING CORPORATION
                         (A Development Stage Company)

                         NOTES TO FINANCIAL STATEMENTS
         PERIOD JANUARY 10, 1999 (INCEPTION) THROUGH DECEMBER 31, 1999

1.   Nature of Operations:

     The Company has been in the development stage since inception. IR Operating
Corporation's (the "Company") financial statements for the period ended December
31, 1999 have been  prepared on a going  concern  basis which  contemplates  the
realization of assets and the settlement of liabilities  and  commitments in the
normal  course of  business.  The Company  incurred a net loss of  approximately
$633,000 for the period January 10, 1999 (inception)  through December 31, 1999.
Management's  plans  regarding  improving the results of future  operations  and
liquidity  include  acquisitions  and mergers.  The Company has acquired certain
patents for plastics  technology and is currently  developing plans to engage in
plastics processing.

2.   Summary of Significant Accounting Policies:

     a. Statement of cash flows

     For purposes of the  statement  of cash flows,  the Company  considers  all
highly liquid debt instruments purchased with a maturity of three months or less
to be cash equivalents.

     b. 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
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.

     c. Organization costs

     The Company expenses  organization  costs as incurred.  Organization  costs
incurred in the period January 10, 1999  (inception)  through  December 31, 1999
approximated $130,000.

     d. Income taxes

     Deferred tax assets and  liabilities  are  determined  based on differences
between  financial  reporting and tax bases of assets and  liabilities,  and are
measured  using the  enacted  tax rates and laws that will be in effect when the
differences  are expected to reverse.  At December  31,  1999,  the deferred tax
assets  relating to the Company's net operating loss carry  forwards  ($114,000)
and organization costs ($139,000), were fully reserved.


                                       F-7
<PAGE>


2.   Summary of Significant Accounting Policies: (Cont'd)

     e. Comprehensive income (loss)

     Other comprehensive income refers to revenues,  expenses,  gains and losses
that  under   generally   accepted   accounting   principles   are  included  in
comprehensive  income  but are  excluded  from net income as these  amounts  are
recorded directly as an adjustment to stockholders'  equity.  Comprehensive loss
was equivalent to net loss for the period.

3.   Patents:

     During  1999,  the  Company  acquired  the  rights to certain  patents  for
plastics technology for aggregate consideration  approximating $68,000. The cost
of these patents will be charged to operations over their estimated useful lives
(15 years) commencing with the Company's start of operations.

4.   Loan Payable - Stockholder:

     As of December 31, 1999,  the Company has borrowed an aggregate of $328,000
from an  officer/stockholder.  The loans are evidenced by promissory  notes with
interest  accruing  at the rate of 5.5% per  annum.  The entire  amount  must be
repaid when the Company receives funding of $1,500,000.

     In the event of default, as defined, the unpaid principal balance shall, at
the option of the  holder,  become  immediately  due,  with the amount  then due
accruing  interest at a rate of 18% per annum or the highest  rate  permitted by
law, which ever is less.

5.   Merger Agreement:

     On March 29, 1999, Atlantic Medical Corporation  ("Atlantic") acquired 100%
of the  issued  and  outstanding  common  stock of Fox Group  Enterprises,  Inc.
("Fox") making the Fox a wholly-owned subsidiary of Atlantic. Under the terms of
the merger  agreement,  the holders of Fox were issued  7,441,700  shares of the
Company's  common stock. An additional  1,062,230 shares of common stock (valued
at $18,000) were issued to consultants in connection with the  transaction.  The
pre-merger shareholders of Atlantic were paid $200,000 by Fox.

     In connection  with the  non-attainment  of certain  conditions,  effective
September 29, 1999, the Fox holders returned 3,867,204 shares of common stock to
the Company's treasury and an additional 750,000 shares reverted to the Atlantic
shareholders.

     Although in the form of a merger,  the  transaction  is, in  substance,  an
acquisition of Atlantic by Fox. Atlantic and stockholders  agree that all issued
and  outstanding  shares of common  stock of Fox,  equal to one hundred  percent
(100%),  shall be exchanged  with Atlantic for  approximately  84% of the common
stock of Atlantic.  Stockholders  represent and warrant that they will hold such
shares  of  Atlantic  for  investment   purposes  and  not  for  further  public
distribution. These shares will be appropriately restricted.

                                       F-8
<PAGE>


5.   Merger Agreement: (Cont'd)

     The excess of the consideration  paid over the fair value of the net assets
received was charged to operations in the period ended December 31, 1999.

     Prior to the closing of the merger agreement  unanimous written consent was
received  of  Atlantic's  directors  and a majority of  Atlantic's  shareholders
approved Atlantic changing its name to "IR Operating Corporation".

6.   Stockholders' Equity:

     a. Capitalization

     Pursuant to an amendment of the Company's certificate of incorporation, the
Company has authorized 50,000,000 shares, par value $0.001, of common stock. The
common stock has one vote per share,  with no  cumulative  voting.  There are no
pre-emptive  rights,  no  conversion  rights,  no  preferences,   no  redemption
provision,  no sinking fund  provisions  or any  liability  for further calls or
assessments.  There are no stated  liquidation  rights other than those that may
exist under Delaware law.

     The Company has authorized  5,000,000 shares, par value $0.001 of preferred
stock.  Shares of preferred  stock may be issued in such classes or series,  and
may have such voting  powers,  full or limited,  or no voting  powers,  and such
designations, preferences and relative, participating, optional or other special
rights  and  qualifications,  or  restrictions  thereof,  shall  be  stated  and
expressed in the Articles of  Incorporation or of any amendment  thereto,  or in
the resolution or  resolutions  providing for the issue of such stock adopted by
the Board of Directors pursuant to the authority which is expressly vested in it
by the provisions thereof.

     b. Net loss per share

     Statement of Financial  Accounting  Standards No. 128, "Earnings Per Share"
(SFAS No. 128) requires dual  presentation  of basic and diluted EPS.  Basic EPS
excludes  dilution  and is computed by dividing  net income  available to common
stockholders by the weighted average number of common shares outstanding for the
period.  Diluted EPS reflects the  potential  dilution that could occur if stock
options or convertible securities were exercised or converted into common stock.

     Contingently  issuable  and issued  shares are  excluded  from the weighted
average number of shares  outstanding  until all necessary  conditions have been
satisfied at the end of the reporting  period.  The 3,867,204  shares subject to
reversion to the Company (Note 5) were excluded from the EPS computation for the
period January 10, 1999 (inception) through December 31, 1999.

     Basic and diluted loss per share amounts were equivalent for the period.



                                       F-9
<PAGE>

6.   Stockholders' Equity: (Cont'd)

     c. Stock option plan

     The  Company  has  adopted a  non-qualified  option  plan  ("the 1999 Plan"
covering 3,000,000 shares of common stock of the company. Options under the Plan
are granted at terms set by the Board of Directors  at the time of issuance.  As
of December 31, 1999, no options have been granted under the 1999 Plan.

7.   Loss on Aborted Acquisition:

     During the period January 10, 1999  (inception)  through December 31, 1999,
the Company incurred charges to operations of approximately $122,000 relating to
an aborted acquisition of assets.

8.   Commitments:

     a. Employment agreement

     In April 1999 the Company  entered  into a five year  employment  agreement
with an officer  which  provides for a minimum  annual  salary of $100,000.  The
officer is also  entitled to options to acquire  50,000  shares of the Company's
stock at an exercise price to be determined by the Board.

     b. Consulting agreement

     The Company is party to a five year  agreement  with an outside  consultant
which becomes  effective  upon the Company's  commencement  of  operations.  The
agreement  provides  for minimum  annual  compensation  of $100,000 in the first
year, with annual 10% increases thereafter.  Additional increases will be earned
in the event the Company meets certain  operating  thresholds.  In the event the
Company generates annual revenues from the its plastic processing technology, in
excess of $1 million,  the consultant shall be granted options to acquire 10,000
shares of common stock at an exercise price equal to the current market value.

     In  consideration  for a covenant  not to  compete  with the  Company,  the
consultant  will be entitled to receive  25,000  shares of common stock upon the
Company's commencement of operations.

     c. Litigation

     The Company is involved in various lawsuits and other matters incidental to
its business. In the opinion of management,  the ultimate  liabilities,  if any,
resulting from such lawsuits and claims will not materially affect the financial
position of the Company.




                                      F-10
<PAGE>


8.   Commitments:

     d. Lease agreement

     On March  1,  2000,  the  Company  entered  into a lease  agreement  for an
operating  facility.  The  agreement,  with an  initial  term of twelve  months,
provides  for an  annual  rent,  including  real  estate  taxes  and  insurance,
approximating $72,000, payable in monthly installments.

9.   License Agreement:

     The Company entered into an agreement to license its patented technology to
a third  party.  The Company is entitled to future  compensation  in the form of
license  payments,  commencing  when the licensee  reaches  certain  performance
levels,  and royalty  payments  based on sales volume.  The Company will provide
technical support for which it will be compensated for its direct costs.

10.  Supplemental Information - Statement of Cash Flows:

     No cash  payments  for interest or income taxes were made during the period
January 10, 1999 (inception) through December 31, 1999.


                                      F-11
<PAGE>


                                 EXHIBIT INDEX

Exhibit No     Description                                 Page

10(iii)        1999 Stock Option Plan                         2


                                       1