UNITED STATES SECURITIES AND EXCHANGE COMMISSION  Washington, D.C. 20549  Form 10-KSB   |X|   ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934  For the fiscal year ended December 31, 2006  TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934  For the transition period from                to  Commission file number: 0-20532  Dexterity Surgical, Inc. (Name of small business issuer in its charter)  Delaware                                74-2559866 (State or other jurisdiction of             (I.R.S. Employer Identification No.) incorporation or organization)  501 South Johnstone, Suite 501Bartlesville, Oklahoma 74003(Address of principal executive offices)     (Zip Code) Issuer's telephone number (214) 432-8295  5444 Westheimer Road, Suite 1685Houston, Texas 77056(Former address of principal executive offices)     (Zip Code) Former Issuer's telephone number (713) 622-0516  Securities registered pursuant to Section 12(b) of the Exchange Act:  Title of each className of each exchange on which registeredNoneN/A Securities registered pursuant to Section 12(g) of the Exchange Act:  Common Shares,  $ .001 par value    1  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 [ ]  Check if there is no disclosure of delinquent filers in response to Item 405 of Regulation S-B is not contained in this form, and no disclosure will be contained, to the best of registrants knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-KSB or any amendment to this Form 10-KSB.  [    ]  Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).                 Yes    [   X   ]     No    [       ]  Issuers revenues for its most recent fiscal year:   $-0- (operations are discontinued).  Aggregate market value of the voting and non-voting common equity held by non-affiliates of the registrant, computed by reference to the closing price of such stock as of March 1, 2007 ($.001) was $54,043.  For purposes of this computation, we consider all directors and holders of 10% or more of our common stock to be affiliates.   Therefore the number of shares of our common stock held by non-affiliates as of March 1, 2007 was 25,054,043.  Check whether the issuer has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court.  Yes    [  X  ]    No    [    ]  Number of shares issued and outstanding of each of the issuers classes of common equity as of March 1, 2007 was 25,054,043 shares of common stock, $0.001 par value.  Transitional Small Business Disclosure Format (Check one):  Yes    [       ]    No    [  X ]  2  PART I  Certain statements contained in this Form 10-KSB, including but not limited to statements made in this Item 1, Description of Business, and those made in Item 6, Managements Discussion and Analysis or Plan of Operation, are forward-looking statements within the meaning of Section 27A of the Securities Act and    Section 21E of the Exchange Act. Specifically, all statements other than statements of historical fact included in this Item 1 regarding Dexterity Surgical, Inc. and its affiliates (collectively, the Company) financial position, business strategy and plans and objectives of management of the Company for future operations are forward-looking statements. These forward-looking statements are based on the beliefs of the Companys management, as well as assumptions made by and information currently available to the Companys management. When used in this report, the words anticipate, believe, estimate, expect and intend and words or phrases of similar import, as they relate to the Company or the Companys management, are intended to identify forward-looking statements. Such statements reflect the current view of the Company with respect to future events and are subject to certain risks, uncertainties and assumptions related to certain factors including, without limitation, the Companys ability to raise capital, the Companys dependence on its sole manufacturer and sole distributor, the Companys ability to distribute safe and effective products on a cost-effective basis, demand for and acceptance of the Companys products, the level of competition in the marketplace, the ability of the Companys customers to be reimbursed by third-party payors, competitive factors, general economic conditions, customer relations, relationships with vendors, the interest rate environment, governmental regulation and supervision, technological change, changes in industry practices, one-time events and other factors described herein, and in the Companys annual, quarterly and other reports filed with the SEC (collectively, cautionary statements). Although the Company believes that its expectations are reasonable, it can give no assurance that such expectations will prove to be correct. Based upon changing conditions, should any one or more of these risks or uncertainties materialize, or should any underlying assumptions prove incorrect, actual results may vary materially from those described herein as anticipated, believed, estimated, expected or intended. All subsequent written and oral forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by the applicable cautionary statements. The Company does not intend to update these forward-looking statements.  In this Annual Report on Form 10-KSB, the Company, we, our, or us refers to Dexterity Surgical, Inc.    NOTICE OF FILING OF BANKRUPTCY PETITION AND SALE OF OPERATING ASSETS   On April 19, 2004, Dexterity Surgical, Inc. filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Southern District of Texas Houston Division (the Bankruptcy Court) in order to facilitate the restructuring of the Companys debt, trade liabilities and other obligations.  On June 4, 2004, the United States Trustee appointed the Committee of Unsecured Creditors (the Committee).  On February 24, 2006, with an effective date of March 31, 2006, Dexterity entered into an agreement, and the bankruptcy court approved, the sale of substantially all of the assets of the Company, including its inventory, manufacturing equipments, and its licensed technology rights (including all patents) .  As part of the orderly wind down of its business, the Company ceased all operations.  In conjunction with the sale of assets, Dexteritys plan of reorganization was confirmed effective March 31, 2006, which Plan contained the following major provisions: an investment banking group will consummate a merger transaction, and acquired controlling shares of the Companys outstanding equity and provided $175,000 as a cash infusion for the creditors and payment of administrative expenses; certain creditors have received 29,800 common shares; and all liabilities subject to compromise as of March 31, 2006 were dismissed.  The Company has no continuing operations at December 31, 2006 or date of this report.  GIVEN THESE UNCERTAINTIES, READERS ARE CAUTIONED NOT TO PLACE UNDUE RELIANCE ON FORWARD-LOOKING STATEMENTS  Other than as required by law, we disclaim any obligation to update information concerning the factors mentioned above or to publicly announce the result of any revisions to any of the forward-looking statements contained herein to reflect future results, events or developments.  3  Item 1. Description of Business  CERTAIN DISCUSSIONS WHICH FOLLOW REGARDING THE DESCRIPTION OF BUSINESS REFER TO THE OPERATING BUSINESS PRIOR TO THE BANKRUPTCY AND SUBSEQUENT SALE OF COMPANYS OPERATIONAL ASSETS EFFECTIVE MARCH 31, 2006.  We were incorporated on December 23, 1988 as a Delaware corporation and commenced operations on January 1, 1989. In August 1992, we completed our initial public offering of common stock, which is currently traded on The Pink Sheets. Our executive offices are located at 5444 Westheimer Road, Suite 1685, Houston, Texas 77056, and our telephone number is (713) 622-0516.  Prior Operations  The business that we were engaged in during such times as we had operations was the distribution of instruments, equipment and surgical supplies used in hand-assisted laparoscopic surgery (HALS) through a distribution agreement.  HALS is a hybrid between open and laparoscopic surgery during which the surgeon inserts one hand into the abdominal cavity during laparoscopic surgery. By having his or her hand in the abdomen when performing laparoscopic surgery, the surgeon has tactile feedback, rapid finger dissection, enhanced retraction capabilities and simplified homeostasis.  The Dexterity Pneumo Sleeve is a device that allows the surgeon to insert one hand into the abdominal cavity while preserving the presence of air or gas in the preperitoneal space during laparoscopic surgery. This enabling technology is expected to greatly increase the number of advanced minimal access surgeries as well as the number of surgeons who perform these procedures. In addition to being used with the Dexterity Pneumo Sleeve, the Dexterity Protractor is used as a stand-alone product for open surgery, providing atraumatic retraction and wound protection.  We acquired Dexterity Incorporated, a Delaware corporation (Dexterity), in March 1999. Dexterity was located in the Philadelphia, Pennsylvania metropolitan area and had the exclusive rights of the Dexterity Pneumo Sleeve and Dexterity Protractor proprietary instruments, equipments and supplies used in HALS. Effective with such acquisition, we changed our name from LifeQuest Medical, Inc. to Dexterity Surgical, Inc.  On April 19, 2004, the Company filed a voluntary petition for relief for reorganization under Chapter 11 of the United States Bankruptcy Code (the Bankruptcy Code) in the United States Bankruptcy Court for the Southern District of Texas Houston Division. The Company underwent numerous operating changes and operated its business as a debtor-in-possession under the jurisdiction of the Bankruptcy Court.  On March 2, 2005, the Bankruptcy Court entered an Order confirming First Amended Plan of Liquidation.  In connection with that plan, assets of the company were scheduled to be auctioned, which auction culminated in the sale of substantially all of the Companys assets to Renaissance Capital Growth & Income Fund III, Inc., and Renaissance U.S. Growth Investment Trust, PLC., as approved by Bankruptcy Court order dated March 17, 2006.  The Company entered into a transaction in which an investment banking group acquired the controlling share of the Companys outstanding equity through the issuance of 25,000,000 new common shares and provided $175,000 cash for distribution to Companys creditors and administrative claims. This transaction was specifically provided for under the terms of the Order Approving Modification of the First Amended Plan, issued by the Bankruptcy Court on March 2, 2006.  As part of that transaction, all of the old shares of the Companys preferred stock, and stock options and warrants, were cancelled and 29,800 new common shares were issued to certain creditors.Pursuant to Bankruptcy Court Order and by filing a Certificate of Amendment to its Articles of Incorporation, the Company increased its authorized capital stock, par value $.0001, and effected a 1-for-500 reverse split of all issued and outstanding stock (the Rolled-Back Shares).  Although the effective date was set in 2006, the record date has not been set and announced to the market for the Rolled-Back Shares.  Following completion of the Plan of Reorganization, the Company has outstanding 25,054,043 new common shares.  Current Operations  The Company is now operating as a Post-Confirmation Debtor, and intends to locate and combine with an existing, privately-held company that is profitable or which, in management's view, has growth potential, irrespective of the industry in which it is engaged.  However, the Company does not intend to combine with a private company, where the combination could result in the Company being declared an investment company subject to the Investment Company Act of 1940. A combination may be structured as a merger, consolidation, exchange of the Company's common stock for stock or assets or any other form which will result in the combined enterprise's becoming a publicly-held corporation.  Pending negotiation and consummation of a combination, the Company anticipates that it will have, aside from carrying on its search for a combination partner, no business activities, and, thus, will have no source of revenue.  Should the Company incur any significant liabilities prior to a combination with a private company, it may not be able to satisfy such liabilities as incurred.  Equipment and Employees:  Since disposing of its operations and returning its equipment, real estate and other assets to its creditors, the Company has had no operations and owns no equipment.  The Companys only employee is its President (who also has the role of Chief Executive Officer and Chief Financial Officer).  Governmental Regulation and Legal Uncertainties  The Company is currently subject to various laws and regulations relating to its business, including those of the Bankruptcy Code.  The Company must adhere to the Orders of the Bankruptcy Court and any Plan of Reorganization.  If the Company were alleged to violate federal, state or foreign civil or criminal laws, even if these claims could be successfully defended, the Company could be materially adversely affected.   Item 2. Description of Property.  The Company currently leases its corporate headquarters on a month-to-month basis.   Item 3. Legal Proceedings.  On April 19, 2004, Dexterity Surgical, Inc. filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Southern District of Texas Houston Division (the Bankruptcy Court) in order to facilitate the restructuring of the Companys debt, trade liabilities and other obligations.  The Company continued in possession of its property as a Debtor in Possession pursuant to 11 U.S.C. §§1107 and 1108.  On or about December 7, 2004, the Company filed the First Amended Plan of Reorganization Under Chapter 11, Title 11, United States Code of Dexterity Surgical, Inc. (the Plan). The Plan provided for the orderly liquidation of the Debtors assets in order to provide a distribution to its creditors.  The primary source of funding for the Plan was the sale of substantially all of the Debtors assets, including license rights, and the consummation of a Restructuring Transaction between the Debtor and an Investor Group, whereby the Investors provided a DIP loan of $50,000, and with an additional $125,000 paid as contribution in consideration for, among other things, 25,000,000 new common shares and the promise to enter into an exchange agreement with a merger partner designated by the Investors.  On February 7, 2005, the Court held a hearing to confirm the Plan and on March 2, 2005, entered the Order Confirming First Amended Plan of Liquidation Under Chapter 11, Title 11, United States Code of Dexterity Surgical, Inc dated December 7, 2004 (the Confirmation Order).  The Confirmation Order contains certain modifications to the plan which are non-material to the liquidation of the Debtors assets.  On March 2, 2006, the Court entered an Order Approving Modification of the First Amended Plan. For purposes of this Report, the First Amended Plan, as modified, shall be referred to as the Plan.  After the March 2, 2006 confirmation, the Company paid all priority claims in full, and on March 31, 2006, the Company sold substantially all of its operating assets and paid all secured creditors in satisfaction of their liens on personal property in the full amount previously agreed to and approved by Bankruptcy Court order, substantially consummating the Plan.  4  Under the terms of the Plan, the Company is authorized to take the following actions:  (i) implement a reverse split such that the currently issued and outstanding stock of the Company shall be no greater than 25,000 (the Rolled-Back Shares), (ii) issue 25,000,000 shares of restricted common stock, $.001 par value, to the Investors (the New Common Stock), (iii) convert the $50,000 DIP Loan upon presentment to the Reorganized Debtor by the holders of the underlying note into 6,000,000 common shares and 3,000,000 warrants having an exercise price of $1.00 for five years, all of which will be issued as payment for the obligations under the DIP Loan, (iv) issue 25,000 common shares to be distributed to holders of Allowed Class 3 General Unsecured Claims, in addition to 100 shares of common stock to be distributed to each unsecured Allowed Class 3 General Unsecured Creditor who is not also an Allowed Class 5 Interest holder; (v) after issuance of the New Common Stock, cancel the previously issued shares, and, (vi) at Companys discretion, have newly-appointed Directors issue 25,000 shares (New Shares) to persons designated by the new Directors as part of the Share Transfer transaction, at no further consideration to the Company. The Plan provides that the Board of Directors may remain seated until the reorganization set forth in the Plan is completed.  The Directors were given authority by the Bankruptcy Court to, appoint new members to the Board, amend the Reorganized Debtors bylaws, amend the fiscal year , execute a share exchange agreement and issue shares in which effective control or majority ownership are given to an acquiring business entity, and to increase the Reorganized Debtors authorized common shares to 100,000,000 by filing a certificate of amendment, and all of the preceding changes were authorized by the Bankruptcy Court to be done without need of shareholder approval.  There are no other legal proceedings at this time.   Item 4. Submission of Matters to a Vote of Security Holders.  No matters were submitted to a vote of security holders during the fiscal year 2006.    PART II  Item 5. Market for Common Equity and Related Stockholder Matters.  Market Information  (A) The common shares of the Company have been traded in the over-the-counter market under the trading symbol DEXTQ, with trading commencing in August 1992. The following table sets forth the range of the high and low bid prices for the common shares of the Company for the quarters indicated, as reported by The OTC Bulletin Board for those periods. These prices reflect inter-dealer prices, without retail mark-up, mark-down, or commission and may not represent actual transactions. Bid Prices High Low  Calendar Year 2006 First Quarter $ .001 $ .001 Second Quarter $ .001 $ .001 Third Quarter $ .001 $ .001 Fourth Quarter $ .001 $ .001  Calendar Year 2005 First Quarter $ .004 $ .002 Second Quarter $ .007 $ .000 Third Quarter $ .001 $ .001 Fourth Quarter $ .007 $ .000  (B) On March 1, 2007, there were 150 shareholders of record.  (C) The Company has never declared a cash dividend on its common shares and no assurance can be given that the Company will declare any cash dividend on its common shares in the future. Payments of dividends are within the discretion of the Company's Board of Directors and depend upon the earnings, capital requirements, and operating and financial condition of the Company, among other factors. The Company has no operations or earnings from operations, and does not expect to pay cash dividends in the foreseeable future.   Recent Sales of Unregistered Securities  In September 2006, Company issued 29,800 shares to creditors and 25,000,000 restricted shares to an investor, pursuant to the terms of the Bankruptcy Court Order.  The shares were not registered in reliance upon the Bankruptcy Court Order under Section 4(2) of the Act in that they were not made available for sale to the public and are restricted against resale until they are registered under the Act or sold under an exemption from registration.  The 25,000,000 shares were issued also as part of the Order Confirming, the Company is authorized to convert the Bankruptcy DIP Loan of $50,000 upon presentment by the holders into 6,000,000 common shares and 3,000,000 warrants having an exercise price of $1.00 for five years, all of which will be issued as payment for the obligations under the DIP Loan.  Item 6. Management's Discussion and Analysis or Plan of Operation  OVERVIEW  The following discussion should be read in conjunction with the Financial Statements, including footnotes, contained herein. The discussion is qualified in its entirety by the foregoing. Historical results of operations and the percentage relationships among any amounts in the Financial Statements, and any trends that may appear to be inferable therefrom, should not be taken as necessarily indicative of trends of operations or results of operations for any future periods.  Except for certain historical information contained herein, the following discussion contains forward-looking statements that involve risks, assumptions and uncertainties which are difficult to predict. All statements, other than statements of historical fact, are statements that could be deemed forward-looking statements, including any projections of earnings, revenues, or other financial items, any statement of plans, strategies, and objectives of management for future operations; any statements concerning proposed new services or developments; any statements regarding future economic conditions or performance; and any statements of belief and any statement of assumptions underlying any of the foregoing. Words such as "believe," "may," "could," "expects," "hopes," "anticipates," and "likely," and variations of these words, or similar expressions, are intended to identify such forward-looking statements. The Company's actual results could differ materially from those discussed here, and since Company is no longer operating, future results likely differ materially from the information set forth here. Factors that could negatively impact the Companys future include, but are not limited to, the war in Iraq, adverse changes in general economic conditions, Companys ability to successfully consummate a business combination, interest rates, the ability to borrow working capital, and other factors. The Company does not assume, and specifically disclaims, any obligation to update any forward-looking statement contained in this annual report.   5  RESULTS OF OPERATIONS  Effective March 31, 2006, the Company sold substantially all of its operating assets and ceased operations.  All of its prior operations are classified as discontinued.  The Company has no current operations.   CAPITAL AND LIQUIDITY  As of December 31, 2006, the Company had no cash or any operating assets.  The Company currently has no operations and intends to locate and combine with an existing, privately-held company that is profitable or which, in management's view, has growth potential, irrespective of the industry in which it is engaged.  However, the Company does not intend to  combine with a private company, which may be deemed to be an investment company subject to the Investment Company Act of 1940. A combination may be structured as a merger, consolidation, exchange of the Company's common stock for stock or assets or any other form which will result in the combined enterprise's becoming a publicly-held corporation.  Pending negotiation and consummation of a combination, the Company anticipates that it will have, aside from carrying on its search for a combination partner, no business activities, and, thus, will have no source of revenue.  Should Company need to incur any significant liabilities prior to a combination with a private company, it may not be able to satisfy such liabilities.  Employees:  The Company has no employees as of the date of this reporting other than its sole officer.  Research and Development Expenditures:  The Company did not incur any research or development expenditures during the year ended December 31, 2006 or 2005.  Subsidiaries:  The Company has no subsidiaries.  Patents and Trademarks:  The Company does not own, either legally or beneficially, any patent or trademark.  Reports to Security Holders:  In March 2007, the Company filed all reports due under Form 10-QSB for each quarter of 2004, 2005 and 2006, as well as Forms 10-KSB for the fiscal years 2004 and 2005.  Annual reports were not provided directly to its security holders..  However, shareholders and the general public may view copies of all of our filings with the SEC, by visiting the SEC website (http://www.sec.gov) and performing a search of Companys electronic filings.   RISK FACTORS   1. THE COMPANY LACKS OPERATIONS AND HAS LOSSES WHICH ARE EXPECTED TO CONTINUE INTO THE FUTURE.  The Company ceased operations March 31, 2006 when substantially all its operating assets were sold.  The Companys operating history is not a useful measure upon which an evaluation of its future success or failure can be made.  The Companys ability to achieve and maintain profitability and positive cash flow is dependent upon:  - the ability to generate revenues; and - the ability to raise the capital necessary to acquire an operating entity or engage in a merger or other transaction with an operating entity.  The Company is a shell corporation as that is defined under Rule 12b-2.  Based upon current plans, the Company expects to incur operating losses in future periods.  The Company cannot guarantee that it will be successful in generating revenues in the future.  2. IF THE COMPANY DOES NOT SUCCESSFULLY CONSUMMATE A BUSINESS COMBINATION, THE COMPANY WILL REQUIRE ADDITIONAL FUNDS  For the Company to once again engage in operations, it will either need to raise additional funds through public or private debt or sale of equity, or it will need to acquire or enter into a merger transaction with an operating entity.  Company is currently seeking to engage in such a merger with an operating entity, but there is no guarantee that this merger will reach a successful completion.   If the merger fails and the Company seeks additional financing, this financing may not be available when needed.  Even if this financing is available, it may be on terms that the Company deems unacceptable or are materially adverse to its interests with respect to dilution of book value, dividend preference, liquidation preference, or other terms.  3. THE COMPANY IS NOT AN OPERATING COMPANY AND DOES NOT HAVE ANY SIGNIFICANT CAPITAL.  Because the Company does not have significant capital, it must limit its operations and there is little chance that operations will begin at any time soon, as a result of such limited capital, unless the Company obtains additional funding to acquire an operating entity or enters into a merger transaction with an operating entity.  4. BECAUSE ROSETTA GRANITE  OWNS MORE THAN 50% OF THE COMPANYS OUTSTANDING COMMON SHARES AND WILL BE ABLE TO DECIDE WHO WILL BE OUR DIRECTORS, YOU MAY NOT BE ABLE TO ELECT ANY DIRECTORS.  Rosetta Granite owns 25,000,000 common shares, constituting 99.78% of the Companys outstanding common stock, and controls the Company.  As a result, unless the Company issues more shares to persons other than Rosetta Granite or Rosetta Granite sells some of its shares, Rosetta Granite will be able to elect all of the Companys Directors and control its operations.  If the Company does enter into an acquisition or merger transaction, the Company may issue a significant number of shares in connection with that transaction.  This could result in a reduction in value to the common shares you own because of the ineffective voting power. Rosetta Granites majority ownership could adversely affect the value of your shares and prevent the Company from undergoing a change of control in the future.  5. THE COMPANY HAS NOT PAID DIVIDENDS AND NONE ARE ANTICIPATED.  To date, the Company has paid no cash dividends on its common shares.  For the foreseeable future, the Company expects that earnings generated from the Companys operations will be retained for use in its business and not to pay dividends.  6. "PENNY STOCK" RULES MAY MAKE BUYING OR SELLING THE COMPANYS COMMON STOCK DIFFICULT.  Trading in the Companys securities is subject to the Penny Stock Rules.  The SEC has adopted regulations that generally define a penny stock to be any equity security that has a market price of less than $5.00 per share, subject to certain exceptions. These rules require that any broker-dealer who recommends our securities to persons other than prior customers and accredited investors, must, prior to the sale, make a special written suitability determination for the purchaser and receive the purchasers written agreement to execute the transaction. Unless an exception is available, the regulations require the delivery, prior to any transaction involving a penny stock, of a disclosure schedule explaining the penny stock market and the risks associated with trading in the penny stock market. In addition, broker-dealers must disclose commissions payable to both the broker- dealer and the registered representative and current quotations for the securities they offer. The additional burdens imposed upon broker-dealers by such requirements may discourage broker-dealers from effecting transactions in our securities, which could severely limit the market price and liquidity of our securities. Broker-dealers who sell penny stocks to certain types of investors are required to comply with the Commissions regulations concerning the transfer of penny stock. These regulations require broker-dealers to:  - Make a suitability determination prior to selling a penny stock to the purchaser;  - Receive the purchasers written consent to the transaction; and  - Provide certain written disclosures to the purchaser.  These requirements may restrict the ability of broker-dealers to sell the Companys common stock and may affect your ability to resell our common stock.  OFF-BALANCE SHEET ARRANGEMENTS  We currently have no off-balance sheet arrangements that have or are reasonably likely to have a current or future material effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.  RISK FACTORS  There are many factors that affect our business and the results of its operation, some of which are beyond our control.  The following is a description of some of the important factors that may cause the actual results of our operations in future periods to differ materially from those currently expected or desired.  CRITICAL ACCOUNTING POLICIES  Due to the bankruptcy of the Company and its limited operations, critical accounting policies are generally limited to the proper classification of assets and liabilities.  The Company has applied the provisions of SOP 90-7, Financial Reporting by Entities in Reorganization Under the Bankruptcy Code and adopted Fresh-Start accounting effective October 1, 2006.   6  Item 7.  Financial Statements  Report of Independent Registered Public Accounting Firm F-1 Balance Sheets as of December 31, 2006 and 2005 F-2 Statements of Operations for the Years Ended December 31, 2006 and 2005 F-4 Statements of Stockholders Equity for the Years Ended December 31, 2006 and 2005 F-5 Statements of Cash Flows for the Years Ended December 31, 2006 and  2005 F-6 Notes to Audited Financial Statements F-7        REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM   To the Board of Directors Dexterity Surgical, Inc. San Antonio, Texas  We have audited the accompanying balance sheets of Dexterity Surgical, Inc. (Company) as of December 31, 2006 and 2005 and the related statements of operations, stockholders equity and cash flows for the years then ended.  These financial statements are the responsibility of the Companys management.  Our responsibility is to express an opinion on these financial statements based on our audits.  We conducted our audits in accordance with standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements.  An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements.  An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.  We believe that our audits provide a reasonable basis for our opinion.  In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Dexterity Surgical, Inc. as of December 31, 2006 and 2005, and the results of its operations and its cash flows for the years then ended in conformity with U.S. generally accepted accounting principles.  The Company adopted Fresh-Start accounting as of October 1, 2006.  The impact of this is more fully described in Note A to the financial statements.   /s/ Akin, Doherty, Klein & Feuge, P.C.    Akin, Doherty, Klein & Feuge, P.C. San Antonio, Texas April 6, 2007    F-1  DEXTERITY SURGICAL, INC. Post-Confirmation Debtor Balance Sheets December 31, 2006 and 2005   2006 2005 (Successor (Predecessor Company) Company) ASSETS  Current Assets: Cash and cash equivalents $          - $  213,452 Accounts receivable, net - 165,464 Inventories, net - 9,384 Other current assets - 89,619 Total current assets - 477,919  Property and Equipment, net - -  Other Assets: Licensed technology rights, net - 21,299 Other assets - 4,720 Total other assets - 26,019   Total Assets $          - $  503,938   See notes to audited financial statements.  F-2  DEXTERITY SURGICAL, INC. Post-Confirmation Debtor Balance Sheets December 31, 2006 and 2005   2006 2005 (Successor (Predecessor Company) Company) LIABILITIES AND STOCKHOLDERS EQUITY  Current Liabilities: Accounts payable and accrued expenses $             - $        456,088 Current portion of long-term obligations, including debt and royalty obligations in default - - Total current liabilities - 456,088  Royalty Obligation - -  Liabilities Subject to Compromise - 18,034,642  Commitments and Contingencies - -  Stockholders Equity: Preferred stock, $.001 par value; 2,000,000 shares authorized and  2,445 shares issued and outstanding at December 31, 2005;  all preferred stock cancelled in 2006 - 2 Common stock, $.001 par value; 50,000,000 shares authorized and 12,121,492 issued and outstanding at December 31, 2005; 100,000,000 authorized and 25,029,800 issued and outstanding at December 31, 2006 25,030 12,122 Additional paid-in capital (25,030) 34,733,804 Accumulated deficit - (52,732,720) Total stockholders equity (deficit) - (17,986,792)   Total Liabilities and Stockholders Equity $              - $        503,938    See notes to audited financial statements.  F-3  DEXTERITY SURGICAL, INC. Post-Confirmation Debtor Statements of Operations Years Ended December 31, 2006 and 2005   2006 2005 (Successor (Predecessor Company) Company)  Net sales $         - $  1,659,371 Cost of sales - 650,916 Gross profit 1,008,455  Operating Income (Expense): Selling, general and administrative (63,957) (1,213,959) Reimbursement of costs 63,957 - Net other income (expense) - 1,213,220  Income (loss) from Continuing Operations - (205,504)  Discontinued Operations and Reorganization Items: Income from discontinued operations 176,711 - Gain on debt discharge of discontinued operations, reorganization item 18,055,429 - Professional fees on discontinued operations, reorganization item (245,348) (300,547) 17,986,792 (300,547)  Income (loss) before income taxes 17,986,792 (506,051)  Income taxes - -  Net Income (Loss) 17,986,792 (506,051)  Dividend requirement on cumulative convertible preferred stock - (195,600)   Net Income (Loss) Applicable to Common Stockholders $  17,986,792 $    (701,651)    Earnings (Loss) Per Share  Basic and diluted income (loss) per common share: Continuing operations $            - $           - Discontinued operations                                                                             $            1.17               $            (.16)  Weighted average shares outstanding used in computing basic and diluted loss per common share 15,348,569 12,121,492   See notes to audited financial statements.  F-4


DEXTERITY SURGICAL, INC. Post-Confirmation Debtor Statements of Stockholders Deficit Years Ended December 31, 2006 and 2005   Additional Preferred Common Paid-In Accumulated Stock  Stock Capital Deficit Total  Balance, December 31, 2004 $  2 $   12,122 $ 34,733,804 $ (52,226,669) $ (17,480,741)  Net loss - - - (506,051) (506,051)  Balance at December 31, 2005 2 12,122 34,733,804 (52,732,720) (17,986,792)  Net income - - - 17,986,792 17,986,792  Transactions resulting from Plan of Reorganization and Fresh-Start Accounting: Cancellation of shares (2) - 2 - - Elimination of accumulated deficit - - (34,745,928) 34,745,928 - Reverse stock split of original stockholders and issuance of new shares, net - 12,908 (12,908) - -   Balance, December 31, 2006 - $   25,030 $       (25,030) $             - $             -


See notes to audited financial statements.  F-5


DEXTERITY SURGICAL, INC. Post-Confirmation Debtor Statements of Cash Flows Years Ended December 31, 2006 and 2005   2006 2005 (Successor (Predecessor Company) Company) Operating Activities  Net income (loss) $ 17,986,792 $   (506,051) Adjustments to reconcile net loss to net cash provided (used) by operating activities: (Gain) loss from discontinued operations and reorganization items (17,986,792) 300,547 Depreciation and amortization - 858,812 Changes in operating assets and liabilities: Accounts receivable - (100,336) Inventories - 78,187 Other current assets - 8,511 Accounts payable and accrued liabilities - (68,568) Net cash provided before reorganization items - 571,102 Reorganization items: Professional fees paid (195,348) - Payments on liabilities subject to compromise (39,213) (363,000) Other reorganizations items 21,109 - Net cash provided (used) by operating activities (213,452) (363,000)  Investing Activities Purchases of licensed technology - (50,000) Net cash (used) by investing activities - (50,000)  Net change in cash and cash equivalents (213,452) 158,102 Cash and cash equivalents, beginning of year 213,452 55,350   Cash and Cash Equivalents, End of Year $              - $    213,452    Supplemental Information Interest paid in cash $              - $           - Federal income taxes paid in cash - -


See notes to audited financial statements.  F-6


DEXTERITY SURGICAL, INC. Post-Confirmation Debtor Notes to Audited Financial Statements December 31, 2006 and 2005    NOTE A BANKRUPTCY PROCEEDINGS  On April 19, 2004 (Petition Date), Dexterity Surgical, Inc. (Dexterity or Company) filed a voluntary petition for reorganization under Chapter 11 of the Federal bankruptcy laws (Bankruptcy Code) in the United States Bankruptcy Court for the Southern District of Texas (Bankruptcy Court).  The Company has experienced significant operating losses, has an accumulated deficit, and is in default on most of its significant debt instruments.  The defaults on its debt precipitated the need to seek protection under Chapter 11 in order to reorganize the Company.  Sale of Assets:  On February 24, 2006 , (with an effective date of March 31, 2006), Dexterity entered into an agreement, and the bankruptcy court approved, the sale of substantially all of the assets of the Company, including its inventory, manufacturing equipment, and its licensed technology rights (including all patents) for approximately $2,240,000.  The Company received $17,600 in cash plus a $40,000 note receivable due on March 31, 2009.  In addition, the purchaser paid $2,182,400 towards the convertible debentures due to Renaissance Capital Group Inc. (see Note G (4)).  Acceptance of Reorganization Plan:  In conjunction with the sale of assets, Dexteritys Plan of Reorganization was confirmed April 13, 2006 with an effective date of March 31, 2006.  Substantially all liabilities subject to compromise were dismissed, thereby being recognized as gain on debt discharge in the statement of operations for the three months ended March 31, 2006.  The majority of the remaining accounts payable and accrued expenses at March 31, 2006 were amounts due to the Companys legal counsel, all of which were paid or otherwise settled during the period ended June 30, 2006.  The Plan also included the following major provisions:  1. The Company will increase its authorized capital stock to 100,000,000 by filing a Certificate of Amendment to its Articles of Incorporation and then effect a 1-for-500 reverse split of all issued and outstanding common stock (the Rolled-Back Shares)  This was completed July 27, 2006.  2. The Company will issue 25,000,000 new shares of restricted common stock to an investment banking group (the Investors).  The Investors anticipate consummating a merger transaction and have provided $175,000 as a cash infusion for creditors and payment of administrative claims.  Of the $175,000 paid to the Company, $50,000 represents a loan which will be repaid through the issuance of 6,000,000 new common shares and 3,000,000 warrants having an exercise price of $1.00 for five years.  This was completed September 8, 2006.  3. The Company will issue 29,800 shares of new common stock to certain creditors.  This issuance was completed September 8, 2006.  4. All current (old) outstanding common shares were consolidated with the 25,000 shares authorized by the Order Confirming.  All preferred shares, and all outstanding stock options and warrants were cancelled.  Upon emergence from bankruptcy and as a result of the Plan of Reorganization, on October 1, 2006, the Company adopted the provisions of Statement of Position 90-7, Financial Reporting by Entities in Reorganization under the Bankruptcy Code, (SOP 90-7), with respect to Fresh-Start accounting.  Changes in accounting principles required under U. S. generally accepted accounting principles within 12 months of emerging from bankruptcy are required to be adopted at the date of emergence.  Additionally, the Company may choose to make changes in accounting practices and policies at that time.  For all of these reasons, financial statements for periods subsequent to emergence from Chapter 11 may not be comparable with those of prior periods.   F-7  DEXTERITY SURGICAL, INC. Post-Confirmation Debtor Notes to Audited Financial Statements December 31, 2006 and 2005    The accompanying financial statements have been prepared on a going concern basis, which assumes continuity of operations and realization of assets and satisfaction of liabilities in the ordinary course of business.  Accordingly, all pre-petition liabilities subject to compromise have been segregated in the balance sheet and classified as liabilities subject to compromise, at the estimated amount of allowable claims.  Liabilities not subject to compromise are separately classified as current and non-current.  Revenues, expenses, realized gains and losses, and provisions for losses resulting from the reorganization are reported separately as Reorganization Items.  Cash used for reorganization items is disclosed separately in the statements of cash flows.  Included in Liabilities Subject to Compromise are the following significant components at December 31:  2005  Accounts payable and accrued expenses $   3,037,033 Accrued interest 2,666,341 Dexterity notes (1) 1,000,000 Line of credit (1) 645,995 Royalty obligations (1) 8,415,710 Convertible debentures (1)(2) 2,269,563  $ 18,034,642  (1)  Represents debt and obligations of the Company in default at the Petition Date.  (2)  Although this is secured debt, it was subject to compromise, and as discussed below in Subsequent Event  Sale of Asset, this liability was settled with a payment of $2,182,400 in 2006.   NOTE B  ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES  Organization and Description of the Company and Risk Factors:Dexterity Surgical, Inc., a Delaware corporation,  was incorporated on December 23, 1988, and commenced operations on January 1, 1989.  The Company was engaged in the development, commercialization, and distribution of proprietary and nonproprietary medical devices.  Bankruptcy Accounting:  As discussed in Note A, for financial reporting purposes, the Company has applied the provisions of SOP 90-7, Financial Reporting by Entities in Reorganization under the Bankruptcy Code, and Fresh-Start Accounting.  The results of the discontinued operations have been reclassified from continuing operations to discontinued operations effective January 1, 2006.  The Company had no reserves following acceptance of the Plan of Reorganization.  Revenue Recognition:The Company recognizes revenue when each of the following four criteria are met: 1) a contract or sales arrangement exists; 2) products have been shipped or services have been rendered; 3) the price of the products or services is fixed or determinable; and 4) collectibility is reasonably assured.  Sales taxes billed are reported directly as a liability to the taxing authority, and are not included in revenue.  Commissions earned are recognized when customer orders are placed with product suppliers.  Customers may return products in the event of product defect or inaccurate order fulfillment.  The Company maintains an allowance for sales returns based upon a historical analysis of returns.  Returns were not significant in 2005 or 2004.  Cash and Cash Equivalents:The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents.   F-8  DEXTERITY SURGICAL, INC. Post-Confirmation Debtor Notes to Audited Financial Statements December 31, 2006 and 2005    NOTE B  ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - continued  Accounts Receivable:Accounts receivable are reported at outstanding principal net of an allowance for doubtful accounts of approximately $23,000 at December 31, 2005.  The allowance for doubtful accounts is generally determined based on an account-by-account review.  Accounts are charged off when collection efforts have failed and the account is deemed uncollectible.  The Company normally does not charge interest on accounts receivable.  Inventories:Furnished goods inventory is stated at the lower of cost (determined on an average-cost basis which approximates the first-in, first-out method) or market.  Property and Equipment:  Property and equipment is stated at cost.  Depreciation is provided utilizing the straight-line method over the estimated useful lives of the respective assets  (generally three to ten years).  Additions and improvements that extend the useful life of an asset are capitalized.  Repairs and maintenance are charged to expense as incurred.  Research and Development:Research and development costs are expensed as incurred.  No such costs were incurred in 2006 and 2005.  Licensed Technology Rights:  The carrying value of licensed technology rights is periodically reviewed for impairment.  Impairments are recognized when the expected future operating cash flows derived from such licensed technology rights are less than their carrying value, and are measured by comparing the carrying value of the asset to discounted future cash flows.  Amortization expense of approximately $810,000 was incurred in 2005.  No amortization expense was incurred in 2006.  Advertising:  The Company expenses advertising costs as incurred.  The Company did not incur any advertising costs in 2006 or 2005.  Shipping and Handling: Amounts billed to customers for shipping and handling costs are included in net sales.  Costs incurred for shipping and handling are included in cost of sales.  Shipping and handling costs were approximately $1,000 in 2006 and $4,000 in 2005.  Segment Disclosure:The Company currently manages its medical devices business as one operating segment.  Stock-Based Compensation:  On January 1, 2006, the Company adopted Statement of Financial Accounting Standards No. 123 (revised 2004), Share-Based Payment, (SFAS 123(R)) which requires the measurement and recognition of compensation expense for all share-based payment awards made to employees and directors including grants of stock options and employee stock purchases under the Companys Employee Stock Purchase Plan based on estimated fair values.  SFAS 123(R) supersedes the Companys previous accounting under Accounting Principles Board Opinion No. 23, Accounting for Stock Issued to Employees (APB 25) for periods beginning 2006.  The Company adopted SFAS 123(R) using the modified prospective transition method, which requires the application of the accounting standard as of January 1, 2006.  The Companys financial statements as of       December 31, 2006 reflects the impact of SFAS 123(R).  In accordance with the modified prospective transition method, the Companys financial statements for the prior period have not been restated to reflect, and do not include, the impact of SFAS 123(R).  There was no impact to the Company for adopting SFAS 123(R) in 2006 as there were no options granted in 2006, and all previously issued options were cancelled as a result of the Plan of Reorganization.  The Company did not have any stock based compensation in 2005.   F-9  DEXTERITY SURGICAL, INC. Post-Confirmation Debtor Notes to Audited Financial Statements December 31, 2006 and 2005    NOTE B  ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - continued  Earnings (Loss) Per Share: Basic earnings (loss) per share (EPS) is computed by dividing income (loss) 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 securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the Company.  Since the Company had a net loss for the years ended December 31, 2006 and 2005, diluted EPS equals basic EPS, as potentially dilutive common stock equivalents are antidilutive in loss periods.  Use of Estimates:The preparation of financial statements in conformity with U.S. 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 may differ from those estimates.  New Accounting Pronouncements:  In June 2006, FASB issued FASB Interpretation No. 48, Accounting for Uncertain Tax Positions, an interpretation to FASB Statement No. 109, Accounting for Income Taxes.  This interpretation requires an enterprise to recognize, in it financial statements, the best estimate of the impact of a tax position only if that position is probable of being sustained on audit based solely on the technical merits of the position.  In evaluating whether the probable recognition threshold has been met, this interpretation requires the presumption that the tax position will be evaluated during an audit by taxing authorities.  The Company is required to adopt the provisions of FIN 48 during the first fiscal year beginning after December 15, 2006, and does not expect its adoption to have a significant impact on its operations or financial position.  Concentration of Risk:Credit Risk:The Companys accounts receivable are due from trade customers, including hospitals, clinics and practicing surgeons.  Ongoing credit evaluations of customers financial conditions are performed, and generally, no collateral is required.  The Company maintains reserves for possible credit losses, and such losses have not exceeded managements expectations.  Sales to one customer, Weck Closure Systems, represented 94% of the Companys net sales for the year ended December 31, 2005 and 93% in 2006, prior to the Company ceasing operations.  Products:The Protractor product line accounted for 94% of net sales for the year ended December 31, 2005 and 93% in 2006, prior to the Company ceasing operations.  Fair Value of Financial Instruments:  The Companys financial instruments include cash and cash equivalents, accounts receivable, and long-term debt.  The carrying amounts of these financial instruments, excluding long-term debt, have been estimated by the Company to approximate fair value.  The fair value of long-term debt classified as liabilities subject to compromise cannot be reasonably estimated at December 31, 2006 or 2005.    F-10  DEXTERITY SURGICAL, INC. Post-Confirmation Debtor Notes to Audited Financial Statements December 31, 2006 and 2005    NOTE C  PROPERTY AND EQUIPMENT  Property and equipment consists of the following at December 31:  2006 2005  Machinery and equipment $             - $   783,020 Furniture and fixtures - 11,000 Total property and equipment 794,020 Less accumulated depreciation - (794,020)  Net property and equipment $             - $        -   NOTE D  LICENSED TECHNOLOGY RIGHTS  Licensed technology rights consists of the following at December 31:  2006 2005  Technology rights $            - $   3,261,020 Less accumulated amortization - (3,239,721)  Net technology rights $            - $        21,299   NOTE E  FEDERAL INCOME TAXES  Deferred income taxes reflect the net effect of temporary differences between the carrying amounts of assets and liabilities for financial reporting and tax purposes.  Significant components of the Companys deferred tax assets and liabilities are as follows at December 31:  2006 2005  Deferred Tax Assets: Tax loss and other carryforwards $   140,000 $   9,760,000 Impairment differences - 4,600,000  Total deferred tax assets 140,000 14,360,000 Less valuation reserve (140,000) (14,360,000)  Net deferred tax asset $             - $           -  The $18,055,429 gain on debt discharge is excluded from taxable income under Internal Revenue Code Section (IRC) 108.  However, such amount does reduce the Companys tax loss and other carryforwards.  Further, as a result of the ownership change in 2006, IRC Section 382 limits the utilization of pre-change tax loss and other carryforwards.  Accordingly, the Companys estimated tax loss and other carryforwards is reduced to approximately $140,000 at December 31, 2006, is further limited under IRC Section 382 to approximately $7,000 per year.  As there is no assurance of future taxable income, a 100% valuation reserve in 2006 and 2005 has been established against the Companys net deferred tax assets.  The Company will continue to evaluate the necessity for such valuation reserves in the future.   F-11  DEXTERITY SURGICAL, INC. Post-Confirmation Debtor Notes to Audited Financial Statements December 31, 2006 and 2005    NOTE F  LEASE OBLIGATIONS, COMMITMENTS, AND CONTINGENCIES  Operating Leases:The Company leases its administrative office space or a month-to-month basis.  Rent expense totaled approximately $11,400 in 2006 and $36,000 in 2005.  Disputes, Lawsuits and Contingencies:  All disputes and suits were settled as part of the bankruptcy proceedings as discussed in Note A.   NOTE G  DEBT AND OTHER LONG-TERM OBLIGATIONS  A significant portion of the Companys debt and other long-term obligations were in default at December 31, 2005.  All of these amounts are classified as liabilities subject to compromise at December 31, 2005, and were cancelled as a result of the Plan of Reorganization in 2006..  (1) Unsecured notes payable related to Dexterity acquisition, bearing interest at 12%, interest due quarterly, matured in October 2001.  At December 31, 2005, the Company was in default with respect to this obligation.  (2) Revolving line of credit secured by accounts receivable, inventories, and intangible assets.  In May 2001, Teleflex, Inc., a major stockholder in the Company, purchased this instrument from the previous lender.  The outstanding balance accrues interest at prime plus 1.5%, plus an additional 3% due to the Companys default on the line of credit.  There are no additional funds available under the current borrowing base.  At December 31, 2005, the Company was in default with respect to this obligation.  (3) Royalty obligation related to Dexterity acquisition, subject to annual minimum payments over a period of seven years commencing in 1999 and discounted at 12%. The minimum payments aggregate approximately $9.7 million over the seven-year royalty period.  At December 31, 2005, the Company was in default with respect to this obligation.  The agreement between the Company and the holders of the royalty obligation specifies that a penalty of 12% shall be applied to any royalty amounts not paid when due.  Penalties of $-0-, $155,648, and $397,608 are included in interest expense at December 31, 2005, 2004, and 2004, respectively.  (4) In December 1997, the Company sold 250,000 shares of common stock to affiliates of Renaissance Capital Group, Inc. (Renaissance), in a private placement for aggregate proceeds of $1,000,000, and placed $3,000,000 in 9% convertible debentures (debentures) with Renaissance.  At December 31, 2005, the Company was in default with respect to this obligation.  At December 31, 2005, all of the above obligations, as well as all other debts due on the Petition Date of April 19, 2004, are included on the balance sheet as Liabilities Subject to Compromise.  The debts were cancelled as a result of the Plan of Reorganization in 2006.   NOTE H  PREFERRED STOCK  All of the rights of the preferred stockholders were terminated as a result of the Plan of Reorganization approved by the Bankruptcy Court in 2006.  See Note A.    F-12  DEXTERITY SURGICAL, INC. Post-Confirmation Debtor Notes to Audited Financial Statements December 31, 2006 and 2005    NOTE I  EARNINGS PER SHARE  The following is a reconciliation of the numerator and denominator of the basic net loss per share (diluted loss per share equals basic loss per share since the effects of common stock equivalents are anti-dilutive in loss years):  2006 2005  Numerator: Net income (loss) $  17,986,792 $     (506,051) Preferred stock dividends - (195,600)  Net income (loss) applicable to common stockholders $  17,986,792 $     (701,651)  Denominator: Basic weighted average common shares outstanding 15,348,569 12,121,492 Effect of dilutive common stock equivalents - -  Weighted average shares outstanding 15,348,569 12,121,492   NOTE J  STOCK OPTIONS AND WARRANTS  All stock options and warrants were terminated as a result of the Plan of Reorganization approved by the Bankruptcy Court in 2006.  See Note A.  The Company has no outstanding stock options or warrants as of December 31, 2006.





F-12  DEXTERITY SURGICAL, INC. Post-Confirmation Debtor Notes to Audited Financial Statements December 31, 2006 and 2005


Item 8. Changes In and Disagreements With Accountants on Accounting and Financial Disclosure  None.   Item 8A. Controls and Procedures  As a Post-Confirmation Debtor, the Company is operating and controlled by orders in the Bankruptcy Court.  Prior to the filing of the Bankruptcy, we carried out an evaluation , under the supervision of management, including our principal executive officer and principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Exchange Act Rule 13a-14.  Based upon this evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures are effective in timely alerting them to material information relating to that is required to be included in our periodic SEC reports.  There have been no significant changes in our internal controls or in other factors that could significantly affect those controls subsequent to the date we carried out this evaluation.   Item 8B. Other Information  None.   PART III  Item 9. Directors, Executive Officers, Promoters and Control Persons and Corporate Governance; Compliance with Section 16(a) of the Exchange Act  The Officer and Director of the Company is as follows:  Name Age Position With Company  Randall K. Boatright 58 President, Chief Executive Officer, Chief Financial Officer, sole Director  Randall K. Boatright has served as a director of the Company since February 1997, and President since 2005.       Mr. Boatright has also served as Vice President, Chief Financial Officer and Secretary of the Company since 1992 and in 1998 was named an Executive Vice President.  From 1985 to 1992, Mr. Boatright served as Executive Vice President, Chief Financial Officer, and Director of Abraxas Petroleum Corporation.  Prior to that, Mr. Boatright practiced accounting with the firm of Coopers and Lybrand LLP.  Mr. Boatright is a certified public accountant in Texas.  The position of director is for a one year term and until a successor is elected.   Section 16(a) Beneficial Ownership Reporting Compliance  All reports required to be filed by management on Form 4 were filed timely.


F-11  DEXTERITY SURGICAL, INC. Post-Confirmation Debtor Notes to Audited Financial Statements December 31, 2006 and 2005


Item 10. Executive Compensation  Summary Compensation Table  Long Term Compensation Annual Compensation Awards  Securities Fiscal Underlying All Other Name and Principal Position Year Salary Bonus Options Compensation  Randall K. Boatright, President 2004 $ 167,692 $      - $       - $  - 2005 $ 189,493 $      - $       - $  - 2006 $ 129,000 $      - $       - $  -  Stock Options Grants in Fiscal 2006:  No stock options were granted by the Company in 2006.  Aggregated Option Exercises in Fiscal 2006 and Fiscal Year-End Option Values:  No options were exercised in 2006.  As a result of the Plan of Reorganization, all existing options and warrants were terminated in 2006.  Long-Term Incentive Plan Awards in Fiscal 2006:  The Company did not grant any long-term incentive plan awards to executive officers during fiscal 2006.  Compensation of Directors:  During 2006, non-employee members of the Board of Directors received no compensation of any form, and were not reimbursed for any expenses.  Employment Agreements and Change-of-Control Arrangements:  All employment agreements were cancelled as a result of the bankruptcy filing on April 19, 2004.   Item 11. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder  Matters  (a) The following is a table of all persons known to the Company to be the beneficial owner of more than 5% of the Company's voting securities.  Title of Class Name and Address of Amount and Percent of Beneficial Owner Nature of Class Beneficial Owner  Common shares Rosetta Granite 25,000,000 * 99.78% 501 South Johnstone, Ste. 501 Bartlesville, OK  74003  *  Shares issued in connection with the Plan of Reorganization on September 8, 2006.


F-12  DEXTERITY SURGICAL, INC. Post-Confirmation Debtor Notes to Audited Financial Statements December 31, 2006 and 2005


Item 12. Certain Relationships and Related Transactions, and Director Independence  There are no reportable relationships or transactions.   Item 13. Exhibits  ExhibitNumberIdentification of Exhibit2.1Plan of Merger and acquisition Agreement dated December 18, 1998, between Dexterity Incorporated and the Company (incorporated by reference herein to Exhibit 2.8 to the Companys Annual Report on Form 10-KSB for the year ended December 31, 1998).3.1Restated Certificate of Incorporation, as amended (incorporated by reference herein to    Exhibit 3.1 to the Companys Annual Report on Form 10-KSB for the fiscal year ended       December 31, 2000).3.2Bylaws of the Registrant (incorporated by reference herein to Exhibit 3.2 to the Companys Registration Statement on Form S-1 filed on August 19, 1992, Registration No. 33-49196).4.1Convertible Loan Agreement among the Company, Renaissance Capital Growth and Income Fund III, Inc., Renaissance US Growth and Income Trust PLC and Renaissance Capital    Group, Inc. dated December 19, 1997.10.11989 Stock Option Plan of LifeQuest Medical, Inc. (incorporated by reference herein to Exhibit 4.4 to the Companys Registration Statement on Form S-8 filed on October 12, 1993, Registration No. 33-70174).10.2Incentive Stock Option Agreement dated October 17, 1994, between Life Quest Medical, Inc. and Randall K. Boatright (incorporated herein by reference to Exhibit 10.16 to the Companys Annual Report on Form 10-K for the fiscal year ended December 31, 1994).10.31994 Non-Employee Director Stock Option Plan (incorporated herein by reference to Exhibit 10.19 to the Companys Annual Report on Form 10-K for the fiscal year ended December 31, 1994).10.4Non-Qualified Stock Option Agreement dated October 17, 1994, between LifeQuest Medical, Inc. and Robert B. Johnson (incorporated herein by reference to Exhibit 10.21 to the Companys Annual Report on Form 10-K for the fiscal year ended December 31, 1994).10.5Non-Qualified Stock Option Agreement dated March 2, 1995, between LifeQuest Medical, Inc. and Jeffrey H. Berg, Ph.D. (incorporated herein by reference to Exhibit 10.22 to the Companys Annual Report on Form 10-K for the fiscal year ended December 31, 1994).10.6Non-Qualified Stock Option Agreement dated December 27, 1996, between LifeQuest Medical, Inc. and K. C. Fadem (incorporated herein by reference to Exhibit 10.2 to the Companys Current Report on Form 8-K filed January 10, 1997).10.7Non-Qualified Stock Option Agreement dated December 27, 1996, between LifeQuest Medical, Inc. and Robert Fadem (incorporated herein by reference to Exhibit 10.4 to the Companys Current Report on Form 8-K filed January 10, 1997).10.8Employment Agreement dated April 1, 1998, between the Company and Randall K. Boatright (incorporated herein by reference to Exhibit 10.1 to the Companys Form 10-Q for the quarter ended June 30, 1998).ExhibitNumberIdentification of Exhibit10.9Series A cumulative convertible Stock Purchase Agreement dated August 11, 1998, among the Company, Renaissance Capital Growth & Income Fund III, Inc. and Renaissance U.S. Growth & Income Trust, PLC (incorporated herein by reference to Exhibit 10.5 to the Companys Form 10-Q for the quarter ended June 30, 1998).10.10Series A cumulative convertible Preferred Stock Purchase Agreement dated August 11, 1998, among the Company, Richard A. Woodfield and R. Michael Yates (incorporated herein by reference to Exhibit 10.6 to the Companys Form 10-Q for the quarter ended June 30, 1998).10.11Series B convertible Stock Purchase Agreement dated November 19, 1998, among the Company, Renaissance Capital Growth & Income Trust Fund III, Inc. and Renaissance U.S. Growth & Income Trust, PLC (incorporated by reference herein to Exhibit 10.18 to the Companys Annual Report on Form 10-KSB for the year ended December 31, 1998).10.12Amended Employment Agreement between the Company and Richard A. Woodfield dated December 15, 1998. (incorporated by reference herein to Exhibit 10.19 to the Companys Annual Report on Form 10-KSB for the year ended December 31, 1998).10.13Amended Stock Option Agreement between the Company and Richard A. Woodfield dated December 15, 1998. (incorporated by reference herein to Exhibit 10.20 to the Companys Annual Report on Form 10-KSB for the year ended December 31, 1998).10.14Series B Convertible Preferred Stock Purchase agreement dated January 21, 1999, between the Company and Richard A. Woodfield (incorporated by reference herein to Exhibit 10.1 to the Companys Quarterly Report on Form 10-QSB filed May 14, 1999).10.15Consulting Agreement between the Company and Christopher Black dated March 18, 1999 (incorporated by reference herein to Exhibit 10.2 to the Companys Quarterly Report on    Form 10-QSB filed May 14, 1999).10.16Royalty Agreement among the Company and TFX Equities Incorporated dated March 18, 1999 (incorporated by reference herein to Exhibit 10.3 to the Companys Quarterly Report on Form 10-QSB filed May 14, 1999).10.17Registration Rights Agreement among the Company and Dexterity Stockholders dated March 18, 1999 (incorporated by reference herein to Exhibit 10.4 to the Companys Quarterly Report on Form 10-QSB filed May 14, 1999).10.18Amended Employment Agreement between the Company and Randall K. Boatright dated December 1, 2000 (incorporated herein by reference to Exhibit 10.25 to the Companys Annual Report on Form 10-KSB for the year ended December 31, 2000).10.19Series C Convertible Preferred Stock Purchase Agreement dated July 31, 2000 (incorporated herein by reference to Exhibit 10.26 to the Companys Annual Report on Form 10-KSB for the year ended December 31, 2000).10.20Distribution Agreement between the Company and Weck Closure Systems LLC dated June 5, 2001 (incorporated herein by reference to Exhibit 10.1 to the Companys Quarterly Report on Form 10-QSB filed August 10, 2001).10.21Second Amendment to Amended Employment Agreement between the Company and Richard Woodfield dated effective January 30, 2003 (incorporated herein by reference to Exhibit 10.25 to the Companys Annual Report on Form 10-KSB filed March 28, 2003).  ExhibitNumberIdentification of Exhibit10.22Office Lease Agreement dated October 13, 2003, between the Company and Franklin Post Oak, Ltd.10.23First Amendment to Distribution Agreement between the Company and Weck Closure Systems, LLC dated October 24, 2003.14.1Code of Ethics for Senior Financial Officers23.1*Consent of Akin, Doherty, Klein & Feuge, a professional organization31*Certification by the Chief Executive Officer and Chief Financial Officer pursuant to            Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended.32*Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S. Section 1350 as required by Sarbanes Oxley Act of 2002.  *  Filed herewith.   Item 14. Principal Accountant Fees and Services  Audit and Other Fees Paid to Independent Auditors:  The following table presents fees billed by Akin Doherty, Klein & Feuge, P.C. for professional services rendered to us in fiscal years ended December 31, 2005 and  December 31, 2006.  Services Rendered Fiscal 2006 Fiscal 2005  Audit Fees $ 19,580 $ 17,000 Audit Related Fees $ $          0 Tax Fees $ $          0 All Other Fees $ $          0  Audit Fees:  The audit fees paid to Akin, Doherty, Klein & Feuge, P.C. for fiscal 2006 were incurred and paid primarily in 2007.  The audit fees paid to Akin Doherty, Klein & Feuge, P.C. for the fiscal 2005 audit were incurred and paid until 2006.  The audit fees are billed for professional services rendered for the audit of the Companys annual financial statements and the reviews of the financial statements included in the Quarterly Reports on Form 10-QSB.  Audit-Related Fees:  We did not incur any audit-related fees from our independent auditors for fiscal year 2005 or 2006.  Tax Fees:  We did not incur any tax fees from our independent auditors for fiscal years 2005 and 2006.  All Other Fees:  We did not incur any fees from our independent auditors for all other services (other than audit services and audit-related services) in fiscal years 2005 and 2006.


F-13  DEXTERITY SURGICAL, INC. Post-Confirmation Debtor Notes to Audited Financial Statements December 31, 2006 and 2005


Pre-Approval Policy for Services by Independent Auditors:  Our Audit Committee implemented pre-approval policies and procedures for our engagement of the independent auditors for both audit and permissible non-audit services. Under these policies and procedures, all services provided by the independent auditors must be approved by the Audit Committee prior to the commencement of the services, subject to certain de-minimus non-audit service (as described in Rule 2-01(c)(7)(C) of Regulation S-X) that do not have to be pre-approved as long as management promptly notifies the Audit Committee of such service and the Audit Committee approves it prior to the service being completed. Since May 6, 2003, the effective date of the SEC's rules requiring Audit Committee pre-approval of all audit and non-audit services performed by our independent auditors, all of the services provided by our independent auditors have been approved in accordance with our pre-approval policies and procedures.


F-14  DEXTERITY SURGICAL, INC. Post-Confirmation Debtor Notes to Audited Financial Statements December 31, 2006 and 2005


SIGNATURES  In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.   DEXTERITY SURGICAL, INC.  By: /s/   Randall K. Boatright ________________________ Randall K. Boatright President and Director April 13, 2007   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.   By: /s/   Randall K. Boatright ________________________ Randall K. Boatright Chief Executive Officer Chief Financial Officer April 13, 2007


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