UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13
OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended May 31, 2012
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13
OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from __________ to ______________
Commission File Number 333-133347
PEPTIDE TECHNOLOGIES, INC.
--------------------------------------
(Exact name of registrant as specified in its charter)
Nevada 98-0479983
---------------------------------- -----------------------------
State or other jurisdiction of (I.R.S. Employer
incorporation or organization Identification No.)
601 Union Street, Two Union Square, 42nd Floor, Seattle, Washington 98101
-------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (206) 388-5498
Indicate by check mark whether the registrant (1) filed all reports required to
be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 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 [ ]
Indicate by check mark whether the registrant has submitted electronically and
posted on its corporate Web site, if any, every Interactive Data File required
to be submitted and posted pursuant to Rule 405 of Regulation S-T (ss.232.405 of
this chapter) during the preceding 12 months (or for such shorter period that
the registrant was required to submit and post such files).
Yes [ ] No [ ]
Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
definition of "large accelerated filer," "accelerated filer" and "smaller
reporting company" in Rule 12b-2 of the Exchange Act.
Larger accelerated filer[ ] Accelerated filer [ ]
Non-accelerated filer [ ] Smaller reporting company [X]
Indicate by check mark whether registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act). Yes [ ] No [X]
1
Number of shares issued and outstanding of the registrant's class of common
stock as of July 12, 2012: 141,048,000 shares of common stock
The Company recognized $nil revenues during the quarter ended May 31, 2012.
2
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited) Page
----
Interim Balance Sheets F-6
Interim Statements of Loss and Comprehensive Loss F-7
Interim Statements of Cash Flows F-8
Interim Statement of Changes in Stockholders' Deficiency F-9
Notes to Interim Financial Statements F-10 to F-14
Item 2. Management's Discussion and Analysis or Plan of Operations 15
Item 3 Quantitative and Qualitative Disclosure about Market Risk 21
Item 4 Controls and Procedures 21
PART II - OTHER INFORMATION
Item 1 Legal Proceedings 22
Item 1A. Risk Factors - Not Applicable
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 22
Item 3. Defaults upon Senior Securities - Not Applicable 22
Item 4. Mine Safety Disclosures - Not Applicable 22
Item 5. Other Information 22
Item 6. Exhibits 22
SIGNATURES 23
3
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
PEPTIDE TECHNOLOGIES, INC.
(A Development Stage Company)
INTERIM FINANCIAL STATEMENTS
(Expressed in U.S. Dollars)
(Unaudited)
MAY 31, 2012
Financial Statements
Page
Interim Balance Sheets F-6
Interim Statements of Loss and Comprehensive Loss F-7
Interim Statements of Cash Flows F-8
Interim Statement of Changes in Stockholders' Deficiency F-9
Notes to Interim Financial Statements F-10 to F-14
F-4
PEPTIDE TECHNOLOGIES, INC.
(A Development Stage Company)
Interim Financial Statements
(Expressed in U.S. Dollars)
(Unaudited)
May 31, 2012
F-5
PEPTIDE TECHNOLOGIES, INC.
(A Development Stage Company)
INTERIM BALANCE SHEETS
May 31, November 30,
2012 2011
(Unaudited) (Audited)
ASSETS
Current Assets
Cash and cash equivalents $ 2,439 $ 1,656
Prepaid expenses 96 127
--------------------------------------
Total Current Assets 2,535 1,783
Intangible assets and intellectual property (Note 6) 45,000 75,000
--------------------------------------
TOTAL ASSETS $ 47,535 $ 76,783
======================================
LIABILITIES AND STOCKHOLDERS' DEFICIENCY
LIABILITIES
Current Liabilities
Accounts payable and accrued liabilities (Note 3) $ 266,409 $ 138,910
Note payable (Note 4) 61,762 60,213
--------------------------------------
Total Current Liabilities 328,171 199,123
--------------------------------------
STOCKHOLDERS' (DEFICIENCY)
Capital Stock (Note 7)
Authorized:
675,000,000 common shares, par value $0.001 per share
Common shares issued and outstanding:
141,048,000 and 171,023,000 at May 31, 2012 and November 30,
2011, respectively 141,048 171,023
Additional paid-in capital 75,240 50,265
Accumulated other comprehensive income - 694
Accumulated deficit (105,837) (105,837)
Accumulated deficit during development stage (391,087) (238,485)
--------------------------------------
Total Stockholders' Deficiency (280,636) (122,340)
--------------------------------------
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIENCY $ 47,535 $ 76,783
======================================
The accompanying notes are an integral part of these interim financial statements.
F-6
PEPTIDE TECHNOLOGIES, INC.
(A Development Stage Company)
INTERIM STATEMENTS OF LOSS AND COMPREHENSIVE LOSS
(Unaudited)
Cumulative Amounts
For the For the For the from re-entering of
three-month For the six-month period six-month period development stage on
period ended three-month period ended May 31, ended May 31, June 26, 2010 to May
May 31, 2012 ended May 31, 2011 2012 2011 31, 2012
------------------------------------------------------------------------------------------------
Expenses
Consulting - $ - $ 120,000 $ - $ 225,975
Office and administration 1,122 172 2,069 566 8,518
Professional fees 7,636 1,678 29,625 10,669 96,439
Supplies and materials - - - - 59,130
------------------------------------------------------------------------------------------------
8,758 1,850 151,694 11,235 390,062
------------------------------------------------------------------------------------------------
Net Loss before Other Item (8,758) (1,850) (151,694) (11,235) (390,062)
------------------------------------------------------------------------------------------------
Other Item
Foreign exchange gain (loss) 1,282 - 445 333 445
Interest expense (Note 4) (682) - (1,353) - (1,470)
------------------------------------------------------------------------------------------------
Net Loss For The Period (8,158) (1,850) (152,602) (10,902) (391,087)
================================================================================================
Other Comprehensive Loss
Foreign currency translation
adjustment - - (694) (333) (333)
------------------------------------------------------------------------------------------------
Comprehensive Loss For the Period $ (8,158) $ (1,850) $ (153,296) $ (11,235) $ (391,420)
================================================================================================
Loss per share from continuing
operations - Basic and diluted $ (0.00) $ (0.00) $ 000 $ (0.00)
Loss per share from discontinued
operations - Basic and diluted $ (0.00) $ (0.00) $ 000 $ (0.00)
============================================================================
Weighted Average Number of Shares
Outstanding 141,045,253 96,000,000 144,481,988 96,000,000
============================================================================
The accompanying notes are an integral part of these interim financial statements.
F-7
PEPTIDE TECHNOLOGIES, INC.
(A Development Stage Company)
INTERIM STATEMENTS OF CASH FLOWS
(Unaudited)
Cumulative from
For the For the re-entering of
For the three-month three-month six-month For the six-month development stage
period ended period ended period ended period ended on June 26, 2010
May 31, 2012 May 31, 2011 May 31,2012 May 31, 2011 to May 31, 2011
Cash Flows used in Operating
Activities
Net loss $ (8,158) $ (1,850) $ (152,602) $ (10,902) $ (391,087)
Adjustments for non-cash
items:
Accrued interest 681 - 1,353 - 1,778
Foreign exchange loss (1,355) - 196 - (229)
Changes in operating assets
and liabilities
Prepaid expenses 82 91 31 91 2,614
Accounts payable and
accrued liabilities (255) (11,792) 127,499 (6,458) 265,659
--------------------------------------------------------------------------------------------
Net Cash Used in Operating
Activities (9,005) (13,551) (23,523) (17,269) (121,265)
============================================================================================
Cash Flows From Financing
Activities
Issuance of common shares 5,000 - 25,000 - 48,000
Increase in note payable - - - - 44,213
Contribution by related
party - 12,000 - 12,000 27,288
--------------------------------------------------------------------------------------------
Net Cash Provided by Financing
Activities 5,000 12,000 25,000 12,000 119,501
============================================================================================
Decrease in Cash during the
Period (4,005) (1,551) 1,477 (5,269) (1,764)
Effect of Exchange Rate Changes
on Cash - - (694) (333) (333)
Cash, Beginning of Period 6,444 2,039 1,656 6,090 4,536
--------------------------------------------------------------------------------------------
Cash, End of Period $ 2,439 $ 488 $ 2,439 $ 488 $ 2,439
============================================================================================
Supplemental Disclosure of Cash
Flow Information
Cash paid for:
Interest $ - $ - $ - $ - $ -
Income taxes $ - $ - $ - $ - $ -
The accompanying notes are an integral part of these interim financial statements.
F-8
PEPTIDE TECHNOLOGIES, INC.
(A Development Stage Company)
INTERIM STATEMENT OF STOCKHOLDERS' EQUITY DEFICIENCY
For the Period from November 30, 2009 through May 31, 2012
(Unaudited)
CAPITAL STOCK ACCUMULATED
------------------------------------------------
ADDITIONAL DEFICIT DURING ACCUMULATED OTHER
PAID-IN ACCUMULATED DEVELOPMENT COMPREHENSIVE
SHARES AMOUNT CAPITAL DEFICIT STAGE INCOME (LOSS) TOTAL
---------------------------------------------------------------------------------------------------------------
Balance, November
30, 2009 96,000,000 $ 96,000 $ - $ (104,786) $ - $ 312 $ (8,474)
Common shares
issued - cash
($0.004 per
share) (Notes
4 & 7) 120,000,000 120,000 - (104,000) - - 16,000
Common shares
cancelled (120,000,000) (120,000) 104,000 (16,000)
Contribution by
related party - - 13,000 - - - 13,000
Foreign currency
translation
adjustment - - - - - 21 21
Net loss for the
period - - - (1,051) (26,339) - (27,390)
---------------------------------------------------------------------------------------------------------------
Balance, November
30, 2010 96,000,000 96,000 13,000 (105,837) (26,339) 333 (22,843)
---------------------------------------------------------------------------------------------------------------
Common shares
issued for
property
(Notes 6 and
7) 75,000,000 75,000 - - - - 75,000
Common shares
issued for
cash (Note 7) 23,000 23 22,977 - - - 23,000
Contribution by
related
party (Note 5) - - 14,288 - - - 14,288
Foreign currency
translation
adjustment - - - - - 361 361
Net loss for the
period - - - - (212,146) - (212,146)
---------------------------------------------------------------------------------------------------------------
Balance November
30, 2011 171,023,000 171,023 50,265 (105,837) (238,485) 694 (122,340)
---------------------------------------------------------------------------------------------------------------
Common shares
cancelled for
property (Notes
6 and 7) (30,000,000) (30,000) - - - - (30,000)
Common shares
issued for
cash (Note 7) 25,000 25 24,975 - - - 25,000
Foreign currency
translation
adjustment - - - - - (694) (694)
Net loss for the
period - - - - (152,602) - (152,602)
------------------------------------------------------------------------------------------------------------------------------------
Balance, May 31,
2012 141,048,000 141,048 $ 75,240 $ (105,837) $ (391,087) $ - $ (280,636)
====================================================================================================================================
The accompanying notes are an integral part of these interim financial statements.
F-9
PEPTIDE TECHNOLOGIES, INC.
(A Development stage Company)
NOTES TO INTERIM FINANCIAL STATEMENTS
May 31, 2012
(Unaudited)
1. NATURE AND CONTINUANCE OF OPERATIONS
a) Organization
PEPTIDE TECHNOLOGIES, INC. (the "Company") was incorporated in the
State of Nevada, United States of America, on November 18, 2005. On
July 29, 2010, the Company's name was changed from Online Originals,
Inc. to CREEnergy Corporation. Effective October 12, 2011, the
Company's name was changed from CREEnergy Corporation to Peptide
Technologies, Inc. The Company's year-end is November 30.
b) Nature of Operations and Change in Business
Since the date of inception on November 18, 2005, the Company's
business plan was to develop a membership-based website art
gallery/auction house specifically focused on displaying and selling
original artwork.
The Company changed its status from a development stage company to an
operating company on November 30, 2009. Management realized that the
results of operations from the sale of artwork lacks luster and
decided to change the Company's business focus and plan for other
strategic opportunities and discontinued the sale of artwork with
effect from June 25, 2010. Effective June 26, 2010, the Company became
a development stage company focusing on a new business.
c) Unaudited Statements
While the information presented in the accompanying interim financial
statements is unaudited, it includes all adjustments which are, in the
opinion of management, necessary to present fairly the financial
position, results of operations and cash flows for the interim periods
presented. Except as disclosed below, these interim financial
statements follow the same accounting policies and methods of their
application as the Company's audited November 30, 2011 annual
financial statements. It is suggested that these interim financial
statements be read in conjunction with the Company's audited financial
statements for the year ended November 30, 2011, included in the
annual report previously filed with the Securities and Exchange
Commission on Form 10-K. The results of operations for the interim
periods presented are not necessarily indicative of the results to be
expected for the full year.
The information as of November 30, 2011 is taken from the audited
financial statements as of that date.
d) Basis of Presentation
The accompanying interim financial statements have been prepared in
conformity with generally accepted accounting principles in the United
States of America, which contemplates the continuation of the Company
as a going concern. However, the Company has negative working capital
at May 31, 2012 and has losses to date of approximately $496,924 These
matters raise substantial doubt about its ability to continue as a
going concern. In view of these matters, realization of certain of the
assets in the accompanying interim balance sheet is dependent upon its
ability to meet its financing requirements, raise additional capital,
and the success of its future operations. There is no assurance that
future capital raising plans will be successful in obtaining
sufficient funds to assure its eventual profitability. Management is
actively seeking to add new products and/or services in order to show
profitability. To date, due to the continued economic conditions, they
have not yet been able to find products and services that would
contribute to their business. We believe that actions planned and
presently being taken to revise its operating and financial
requirements will provide the opportunity for the Company to continue
as a going concern. The interim financial statements do not include
any adjustments that might result from these uncertainties.
F-10
PEPTIDE TECHNOLOGIES, INC.
(A Development stage Company)
NOTES TO INTERIM FINANCIAL STATEMENTS
May 31, 2012
(Unaudited)
2. RECENT ACCOUNTING PRONOUNCEMENTS
In December 2011, the Financial Accounting Standards Board ("FASB")
issued Accounting Standards Update ("ASU") No. 2011-12, "Comprehensive
Income". This update amends certain pending paragraphs in ASU No.
2011-05 "Presentation of Comprehensive Income", to effectively defer
only those changes that relate to the presentation of reclassification
adjustments out of accumulated other comprehensive income for annual
and interim financial statements for public, private, and non-profit
entities.
In September 2011, the FASB issued ASU No. 2011-08, "Intangibles -
Goodwill and Other" which allows an entity to first assess qualitative
factors to determine whether it is necessary to perform the two-step
quantitative goodwill impairment test. Under these amendments, an
entity would not be required to calculate the fair value of a reporting
unit unless the entity determines, based on a qualitative assessment,
that it is more likely than not that its fair value is less than its
carrying amount. ASU No. 2011-08 will be effective for the Company in
fiscal 2013, with early adoption permitted. The adoption of this update
will not have a material effect on its financial statements.
In June 2011, the FASB issued ASU No. 2011-05, "Presentation of
Comprehensive Income". This update presents an entity with the option
to present the total of comprehensive income, the components of net
income, and the components of other comprehensive income either in a
single continuous statement of comprehensive income or in two separate
but consecutive statements. In both choices, an entity is required to
present each component of net income along with total net income, each
component of other comprehensive income along with a total for other
comprehensive income, and a total amount for comprehensive income. This
update eliminates the option to present the components of other
comprehensive income as part of the statement of changes in
stockholders' equity. The amendments in this update do not change the
items that must be reported in other comprehensive income or when an
item of other comprehensive income must be reclassified to net income.
As ASU No. 2011-05 relates only to the presentation of Comprehensive
Income, adoption of this update will not have a material effect on its
financial statements.
3. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES
Accounts payable and accrued liabilities are non-interest bearing,
unsecured and have settlement dates within one year.
4. NOTE PAYABLE
November 30,
May 31, 2011
2012 (Audited)
During the year ended November 30, 2010, Fotoview Inc. ("Fotoview") $ 16,000 $ 16,000
On September 21, 2011, PSI Services ("PSI") issued a loan of $500 to 500 500
On November 13, 2011, PSI Services ("PSI") issued a loan of $43,596 to
the Company. The loan is unsecured and bears interest at a rate of 6% per
annum. The loan payable to PSI as at May 31, 2012 consists of principal
of $43,484 (CAD $45,000) (November 30, 2011 - $43,596 (CAD $45,000)) and
accrued interest of $1,778 (November 30, 2011 - $117). 45,262 43,713
------------- ------------
$ 61,762 $ 60,213
------------- ------------
F-11
PEPTIDE TECHNOLOGIES, INC.
(A Development stage Company)
NOTES TO INTERIM FINANCIAL STATEMENTS
May 31, 2012
(Unaudited)
5. RELATED PARTY TRANSACTIONS
During the six month period ended May 31, 2012, a director and
shareholder of the Company made cash contribution in the amount of $Nil
(May 31, 2011 - $12,000, Cumulative - $27,288).
6. INTANGIBLE ASSETS AND INTELLECTUAL PROPERTY
On August 23, 2011, the Company entered into an agreement (the "Asset
Purchase Agreement") with unrelated parties that subsequently became
directors of the Company to acquire intangible assets and intellectual
property known as the Peptide Technology Platforms (the "Platforms") in
exchange for 75,000,000 common shares of the Company (issued on August
23, 2011) (Note 7).
On December 21, 2011 the Company entered into an amended agreement
amending the Asset Purchase Agreement dated August 23, 2011 (the
"Amended Asset Purchase Agreement") and, as a result, a total of
30,000,000 common shares were returned to treasury and cancelled (Note
7) in exchange for payment of half of one percent of all gross monies
received by the Company from revenue produced from products derived
from the use of all the formulae listed in the Assets Purchase
Agreement. In addition, a monthly stipend of CAD $15,000 per month is
to be paid commencing from receipt of monies from the first contract
signed to purchase products derived from the use of the formulae for a
period of five years from the date of the Amended Asset Purchase
Agreement (Note 10).
The Platforms includes but are not limited to the following:
i. Proteomic research platforms which include proprietary solid
phase media side-chain protected peptide array synthesis;
ii. Peptide libraries;
iii. Combination design techniques;
iv. Peptide molecule modifications;
v. A proprietary genetic algorithm that designs peptides for
goodness to fit to a target; and
vi. Proprietary and patented application platforms, including a
viral vector gene therapy and epitode-mapping based vaccine
development.
7. CAPITAL STOCK
Authorized
The Company's authorized common stock consists of 675,000,000 shares of
common stock with a par value of $0.001 per share. On August 10, 2010,
the Company increased the number of authorized share capital from
75,000,000 shares of common stock to 675,000,000 shares of common stock
with the same par value of $0.001 per share.
Issued and outstanding
On June 2, 2010, and effective August 10, 2010, the directors of the
Company approved a forward split of the common stock of the Company on
a basis of 30 new common shares for 1 old common share. As a result of
the forward stock split, 208,800,000 additional shares were issued.
Capital and additional paid-in capital have been adjusted accordingly.
When adjusted retroactively, there was an $119,501 shortage of
additional paid-in capital; thus an adjustment to accumulated deficit
of $104,000 was recorded on May 21, 2010 (the date of issuance of
120,000,000 shares) and $15,501 to the beginning balance. The interim
financial statements contained herein reflect the appropriate values
F-12
PEPTIDE TECHNOLOGIES, INC.
(A Development stage Company)
NOTES TO INTERIM FINANCIAL STATEMENTS
May 31, 2012
(Unaudited)
for capital stock and accumulated deficit. Unless otherwise noted, all
references in the accompanying interim financial statements to the
number of common shares and per share amounts have been retroactively
restated to reflect the forward stock split.
The total issued and outstanding capital stock is 141,048,000 common
shares with a par value of $0.001 per common share. The Company's
common stock issuances to date are as follows:
a) On November 18, 2005, 54,000,000 shares of the Company's common
stock were issued to a former director and officer of the Company
for cash proceeds of $18,000.
b) On November 28, 2005, 21,000,000 shares of the Company's common
stock were issued to a former director and officer of the company
for cash proceeds of $7,000.
c) On July 21, 2006, the Company completed a public offering and
issued 21,000,000 shares of the Company's common stock for cash
totalling $70,000. The Company incurred offering costs of $14,501
related to this offering, resulting in net proceeds of $55,499.
d) On May 21, 2010, 120,000,000 shares of the Company's restricted
common stock, valued at $16,000, were issued to a former director
and officer of the Company. On October 29, 2010, the 120,000,000
restricted common shares of the Company previously issued to a
former director and officer of the Company were returned to
treasury for no consideration. The shares were cancelled on
November 2, 2010 (Note 4).
e) On August 23, 2011, the Company issued 75,000,000 shares of its
restricted common stock in exchange for intangible assets and
intellectual property. On December 21, 2011 a total of 30,000,000
common shares were returned to treasury and cancelled (Note 6).
f) During October and November 2011, 23,000 shares of the Company's
common stock were issued for cash proceeds of $23,000.
g) On 5 January 2012, 5,000 shares of the Company's common stock
were issued for cash proceeds of $5,000.
h) On 6 January 2012, 5,000 shares of the Company's common stock
were issued for cash proceeds of $5,000.
i) On 15 January 2012, 5,000 shares of the Company's common stock
were issued for cash proceeds of $5,000.
j) On 24 January 2012, 5,000 shares of the Company's common stock
were issued for cash proceeds of $5,000.
k) On 20 April 2012, 5,000 shares of the Company's common stock were
issued for cash proceeds of $5,000.
8. INCOME TAXES
The Company is subject to foreign and domestic income taxes. The
Company has had no income, and therefore has paid no income tax.
Deferred income taxes arise from temporary timing differences in the
recognition of income and expenses for financial reporting and tax
purposes. The Company's deferred tax assets consist entirely of the
benefit from net operating loss ("NOL") carry-forwards. The NOL carry
forwards expire in various years through 2032. The Company's deferred
tax assets are offset by a valuation allowance due to the uncertainty
of the realization of the NOL carry-forwards. NOL carry-forwards may be
further limited by a change in company ownership and other provisions
of the tax laws.
F-13
PEPTIDE TECHNOLOGIES, INC.
(A Development stage Company)
NOTES TO INTERIM FINANCIAL STATEMENTS
May 31, 2012
(Unaudited)
The Company's deferred tax assets, valuation allowance, and change in
valuation allowance are as follows:
Period Ending Estimated Estimated Change in Effect of
NOL NOL Tax Benefit Valuation Valuation change in Net Tax
Carry-forward Expires from NOL Allowance Allowance tax rate Benefit
November 30, 2011 328,821 2031 115,087 (115,087) (74,251) - -
May 31, 2012 481,423 2032 168,498 (168,498) (53,411) - -
Income taxes at the statutory rate are reconciled to the Company's
actual income taxes as follows:
May 31, 2012 November 30, 2011
Income tax benefit at statutory rate resulting
Deferred income tax valuation allowance 35% 35%
-------------------- ----------------------
Actual tax rate 0% 0%
==================== ======================
9. CONTINGENCY
On November 22, 2010, the Company was served with a claim filed by a
former director and officer of the Company. The claim alleges that the
former director and officer of the Company suffered losses and damages
as a result of the failure of the Company in providing him with
corporate documents and implementing a change of the board of
directors. The Company has retained legal counsel to address the claim.
On December 8, 2010, the Company filed a Statement of Defense
requesting that the claim be dismissed. In the opinion of management,
this claim is without merit and the Company intends to defend this
claim vigorously. As a loss is not deemed probable, no accruals have
been made as of May 31, 2012.
10. COMMITMENTS
The Company is committed to pay half of one half percent of all gross
monies received by the Company from revenue produced from products
derived from the use of all the formulae listed in the Assets Purchase
Agreement. In addition a monthly stipend of CAD $15,000 per month is to
be paid commencing from receipt of monies from the first contract
signed to purchase products derived from the use of the formulae for a
period of five years from the date of the Amended Asset Purchase
Agreement (Note 6).
11. SUBSEQUENT EVENTS
On June 1, 2012, PSI Services issued a loan of $19,268 (CAD $20,000) to
the Company. The loan is unsecured and bears interest at a rate of 6%
per annum. There are no other reportable events during the period from
the six month period ended May 31, 2012 to the date the interim
financial statements are available to be issued on July 16, 2012.
F-14
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS
The following discussion should be read in conjunction with our unaudited
financial statements and notes thereto included herein. In connection with, and
because we desire to take advantage of, the "safe harbor" provisions of the
Private Securities Litigation Reform Act of 1995, we caution readers regarding
certain forward looking statements in the following discussion and elsewhere in
this report and in any other statement made by, or on our behalf, whether or not
in future filings with the Securities and Exchange Commission. Forward-looking
statements are statements not based on historical information and which relate
to future operations, strategies, financial results, or other developments.
Forward-looking statements are necessarily based upon estimates and assumptions
that are inherently subject to significant business, economic, and competitive,
uncertainties and contingencies, many of which are beyond our control and many
of which, with respect to future business decisions, are subject to change.
These uncertainties and contingencies can affect actual results and could cause
actual results to differ materially from those expressed in any forward-looking
statements made by or on our behalf. We disclaim any obligation to update
forward-looking statements.
The following discussion of the plan of operation, financial condition, results
of operations, cash flows and changes in financial position of our Company
should be read in conjunction with our most recent financial statements and
notes appearing elsewhere in this Quarterly Report on Form 10-Q, our Quarterly
report on Form 10-Q filed April 16, 2012, and our Annual Report on Form 10-K
filed on February 28, 2012.
The independent registered public accounting firms' reports on the Company's
financial statements as of November 30, 2011, and for each of the years in the
two-year period then ended; include a "going concern" explanatory paragraph that
describes substantial doubt about the Company's ability to continue as a going
concern. Management's plans in regard to the factors prompting the explanatory
paragraph are discussed below and also in Note 1 to the unaudited quarterly
financial statements.
Discontinued Operations and New Developments
Since inception, the Company's business plan was to develop a membership based
website art gallery/auction house specifically focused on displaying and selling
original artwork. The Company changed its status from a development stage
company to an operating company on November 30, 2009. Management realized that
the results of operations from the sale of artwork was lack-luster, and it was
decided to change the Company's business focus and plan for other strategic
opportunities and discontinued the sale of artwork to be effective June 25,
2010. Effective June 26, 2010, the Company started to focus on a new business
development. On July 29, 2010, the Company's name changed from Online Originals,
Inc. to Creenergy Corporation. The name change was intended to convey a sense of
the Company's new business focus as it looked to pursue other opportunities.
Specifically, the Company intended to obtain leases for the exploration and
production of oil and gas in northern Canada and the United States. These
objectives have not been realized and the Company has abandoned its efforts in
this area.
On August 23, 2011, the Company entered into an Asset Purchase Agreement in
which the Company, in exchange for 75,000,000 shares of the Company's restricted
common stock, will receive all rights and title to proprietary technologies and
formulas involving the application of specialty peptides. On December 21, 2011
the Asset Purchase Agreement was amended and 30,000,000 of the 75,000,000 shares
issued were returned to treasury and cancelled. Having done this, the Company
has changed its business focus from obtaining leases for the exploration and
production of oil and gas in areas of northern Alberta, Canada, to the
manufacturing and distribution of natural peptide solutions to combat the
economic burden caused by the zebra and quagga mussels to the hydropower
electricity industry.
Business of Issuer
Peptide Technologies, Inc. is a development stage company that is engaged in the
development and manufacture of environmentally safe peptide-based products used
to combat the rapidly growing problems caused by the quagga and zebra mussel
infestation in U.S. and Canadian waters. The Company specializes in the
development of peptide formulas which may be added to a specific coating product
and applied to substrates, creating a surface which is uninhabitable by the
15
quagga and zebra mussels. The advantages of our peptide formulas are (1) they
are 100% safe to humans; (2) they will not kill the mussels which are now an
integral part of the food chain, the disruption of which would be an
environmental unknown; and (3) they are organic and eco-environmentally
friendly.
Background
The zebra mussel (Dreissena polymorpha) and its cousin, the quagga mussel
(Dreissena rostriformis bugensis), are small bivalve mollusks with two matching
half shells, having an average life span of 3 to 5 years. Zebra mussels are
native to the Black, Caspian, and Azov Seas, dating back to 1769. By the late
18th and early 19th centuries, zebra mussels had spread to most all major
drainages of Europe because of widespread construction of canal systems. They
first appeared in Great Britain in 1824, where they are now well established.
Since then, zebra mussels have expanded their range into Denmark, Sweden,
Finland, Ireland, Italy, and the rest of Western Europe. Zebra mussels were
first discovered in North America in 1988 in the Great Lakes. The first account
of an established population came from Canadian waters of Lake St. Clair, a
water body connecting Lake Huron and Lake Erie. By 1990, zebra mussels had been
found in all the Great Lakes. The following year, zebra mussels escaped the
Great Lakes basin and found their way into the Illinois and Hudson rivers. The
Illinois River was the key to their introduction into the Mississippi River
drainage which covers over 1.2 million square miles. Since its introduction, the
zebra mussel has spread to 23 states in America and two Canadian provinces.
The quagga mussel is indigenous to the Dneiper River drainage of Ukraine and
Ponto-Caspian Sea. It was discovered in the Bug River in 1890 by Andrusov, who
named the species in 1897. The quagga mussel was first sighted in the Great
Lakes in September 1989, when one was found near Port Colborne, Lake Erie,
though the recognition of the quagga type as a distinct species was not until
1991. In August 1991, a mussel with a different genotype was found in a random
zebra mussel sample from the Erie Canal near Palmyra, New York, and after
confirmation that this mussel was not a variety of Dreissena polymorpha, the new
species was named "quagga mussel" after the "quagga", an extinct African
relative of the zebra. The first sighting of quagga mussels outside the Great
Lakes basin was made in the Mississippi River between St. Louis, Missouri and
Alton, Illinois in 1995. In January 2007, populations of quagga mussels were
discovered in Lake Mead near Boulder City, Nevada, and in Lake Havasu and Lake
Mohave on the California/Arizona border.
The quagga mussel is a prolific breeder, possibly contributing to its spread and
abundance. Dreissena are dioecious (either male or female) with external
fertilization. A fully mature female mussel is capable of producing up to one
million eggs per year. After fertilization, pelagic microscopic larvae, or
veligers, develop within a few days and these veligers soon acquire minute
bivalve shells. Free-swimming veligers drift with the currents for three to four
weeks feeding by their hair-like cilia while trying to locate suitable substrata
to settle and secure byssal threads. Zebra and quagga mussels accumulate organic
pollutants within their tissues to levels more than 300,000 times greater than
concentrations in the environment and these pollutants are found in their
pseudofeces, which can be passed up the food chain, therefore increasing
wildlife exposure to organic pollutants (Snyder et al., 1997). Another major
threat involves the fouling of native freshwater mussels. Since quaggas were
discovered in Lake Michigan in 1998, plankton rings formed by the passage of
storms have been eaten away by the quagga mussels, threatening the local
ecosystem.
Numerous pipelines, filter screens, hydroelectric turbines and pumping stations,
irrigation tunnels, canals and aqueducts are becoming clogged with quagga and
zebra mussels, and this proliferation and dispersion of mussel populations
threatens to impact reclamation operations and multiple dams across North
America, resulting in the interruption of hydropower and water delivery at
significant economic costs. Of particular concern is the blockage of water lines
designed to cool the hydropower turbines at dams like Hoover.
The quagga mussels, which grow to about 1.5 inches, are clogging water lines
that are used to cool the 17 massive hydropower turbines at Hoover Dam and have
already forced dam operators to temporarily shut down turbines that supply
electricity to 1.6 million people in southern Nevada, Arizona and California.
The mussels have caused similar problems at the downstream Davis Dam in Lake
Mohave and Parker Dam in Lake Havasu, both of which provide electricity for
thousands of people in Arizona and California. The mussels have also threatened
to clog water intake lines in Lake Mead operated by the Southern Nevada Water
System that supply water to more than 2 million people in the Las Vegas area.
16
What took decades to unfold in the Great Lakes has played out in a matter of
months in Lake Mead. Quaggas can lay eggs six or seven times a year in the
warmer water, compared with once or twice a year in the Great Lakes.
If you drained Lake Mead above Hoover Dam, says National Park Service biologist
Bryan Moore, it would reveal that brown canyon walls that were mussel-free just
two years ago are now black with quaggas at densities of up to 55,000 per square
meter. The Bureau of Reclamation, which operates the Hoover, Davis and Parker
dams, has employed divers with high-pressure water hoses to blow mussels out of
pipelines and filter gates, and the agency retains the option of using chlorine
treatments on the mussels if necessary. But those treatments are expensive,
temporary and, in the case of chlorine, can have negative environmental effects.
Colonization of the Columbia River Basin (CRB)in the Pacific Northwest by zebra
and quagga mussel could affect all submerged components and conduits of the
Federal Columbia River Power System (FCRPS) including trash racks, raw water
distribution systems (headers), turbine bearing cooling systems, diffuser
plates, service and fire-water systems, and fish passage facilities.
Despite the uncertainty about zebra and quagga mussel tolerance to water
velocity, irregularities such as cracks and crevices and scaling in older pipes
and flanges can provide lower velocity refugia where zebra and quagga mussel
settlement can occur. The attached mussels, in turn, then produce additional low
flow refuges, allowing colonization in otherwise inhospitable flow environments.
Settlement can also occur when water flow is reduced during generation down-time
as conditions become more conducive to attachment.
Zebra and quagga mussel densities within the CRB could vary widely depending on
water chemistry, food availability, and breeding population. After their initial
introduction, zebra mussel populations can rapidly increase by orders of
magnitude, and then similarly decrease. Under ideal conditions in the Laurentian
Great Lakes zebra mussel densities reach 700,000 - 800,000 per square meter
(Kovalak et al, 1993). In the lower Mississippi River, where the zebra mussel
has been introduced, densities of 400,000 per square meter have been reported
(Kraft, 1995). The Mississippi has an ideal environment for zebra and quagga
mussels, in part because food resources are abundant (Kraft, 1995). While
Columbia River water quality parameters are favorable to zebra and quagga mussel
colonization (Athearn 1999), the Columbia River's lower plankton densities in
comparison to the Mississippi or Great Lakes, may limit zebra and quagga mussel
population densities.
Densities of zebra and quagga mussels in the Pacific Northwest will determine
the severity of impacts on hydropower, navigation, and fish passage facilities.
Zebra mussel densities in powerhouses will depend on the configuration of the
water systems and water conduit materials. The potential economic impacts of
zebra and quagga mussels on hydropower generation facilities in the Columbia
River will be determined by a number of factors including density, growth rate,
and maintenance costs. While density and growth are affected by environmental
factors as noted above, maintenance costs will also be driven by the difficulty
in accessing fouled areas, the methods available for removal and control, and
the amount of time available for maintenance activities. They prefer to cling to
flat, stainless steel structures where water flows less than 6 feet per second.
The muscles infestation sets in and begins to clog hydroelectric power cooling
pipes and other hardware in the dams' operations with quagga colonies. Not only
do they pose a threat to the cooling pipe system for hydroelectric turbines, but
also to the network that supplies domestic water for workers and visitors at the
dams.
Economic Impacts:
oHydroelectric Dams and Nuclear Power Plants
There are more than 85,000 dams in the United States alone, of which
approximately 11% are federally owned and operated. The major concern is the
blockage of water lines designed to cool the hydropower turbines at dams like
Hoover. This problem has already caused a "significant increase in the frequency
of high temperature alarms in cooling systems, requiring shutdowns" so that the
mussels could be removed.
Quagga
The quagga mussels, which grow to about 1.5 inches, are clogging water lines
that are used to cool the 17 massive hydropower turbines at Hoover Dam and have
already forced dam operators to temporarily shut down turbines that supply
electricity to 1.6 million people in southern Nevada, Arizona and California.
The mussels have caused similar problems at the downstream Davis Dam in Lake
Mohave and Parker Dam in Lake Havasu, both of which provide electricity for
thousands of people in Arizona and California. The mussels have also threatened
17
to clog water intake lines in Lake Mead operated by the Southern Nevada Water
System that supply water to more than 2 million people in the Las Vegas area.
Maintenance costs will also be driven by the difficulty in accessing fouled
areas, the methods available for removal and control, and the amount of time
available for maintenance activities. It has been estimated that hundreds of
millions of dollars is spent annually to combat the mussel infestation at
hydroelectric dams alone, and it is expected that this amount will increase
exponentially once the infestation has spread to the West.
Virtually any submerged area with a moderate flow rate that draws water from an
infested water source is vulnerable to colonization. This is especially true of
areas that offer protection to small mussels, such as crevices or seams. Intake
screens, for example, are common settlement areas and are often coated with
clumps or druses of mussels. The presence of dislodged shells in the discharge
of a facility's raw well or forbay is a common first indicator of the presence
of zebra mussels in the raw water main. Facilities may also experience a
noticeable decrease in head pressure. Most facilities have numerous components
subject to severe biofouling.
oShipping Industry
The shipping industry worldwide spends huge amounts every year combating the
effects of "fouling". Every year or two, ocean going vessels must dry-dock in
order to undergo extensive work over two or more weeks to remove barnacles that
have attached to the hull. Prior to dry-docking, ships gradually undergo rapid
increases in additional fuel costs due to increased drag from fouling. The
mechanism involved in fouling occurs in a series of three steps. Within one
week, the hull surface is coated with a slimy deposit. Following this, various
micro-organisms (bacteria) attach. Barnacles attach to this slimy/bacterial
coating and become attached to the ship's hull using a biocement generated by a
series of three proteins that undergo a conformational change, within the
organism. This cement is one of, if not the strongest cement known to date of
anything produced naturally.
The current antifouling paint applied to ship hulls contains toxic chemicals and
heavy metals. However, as the international shipping community has been issuing
legislation prohibiting the use of these environmentally hazardous substances -
there is a need for alternatives.
oRecreational Boating Industry
In contrast, Lake Mead Marina predicts the costs to the West's recreational
boating industry alone will be immense in the coming few years. Mussels are
smothering everything under the waterline at marinas, making simple maintenance
on boats and floating docks expensive and time consuming, not to mention
dangerous due to the razor-sharp shells being plucked from the water.
The United States Park Service, which figures the mussels have been in Lake Mead
since 2005, is trying to protect the rest of the West's waters by requiring
boats that have been docked in a slip to be decontaminated with jets of scalding
water before departing Lake Mead. A killer hot wash costs about $40 for a small
boat and up to $200 for a houseboat.
oEcological Damage
The infestation of zebra and quagga mussels are wreaking havoc on the native
species indigenous to the waterways they inhabit. These mussels attach to other
mussel species and crustaceans making it almost impossible for them to eat and
survive. While the zebra and quagga do have predator enemies, there are not
enough to consume the rapidly growing infestation.
This is more than an ecological concern. The federal government plans to spend
over a billion dollars in the coming years to help these species recover, and
zebra and quagga mussels have a history of ravaging native species in the waters
they invade. In Lake Michigan, for example, prey fish numbers are less than 10%
of what they were before the invasive mussels arrived.
Zebra mussels are also believed to be the source of deadly avian botulism
poisoning that has killed tens of thousands of birds in the Great Lakes since
the late 1990s.
Zebra and quagga mussels accumulate organic pollutants within their tissues to
levels more than 300,000 times greater than concentrations in the environment
and these pollutants are found in their pseudofeces, which can be passed up the
food chain, therefore increasing wildlife exposure to organic pollutants.
18
Another major threat involves the fouling of native freshwater mussels. Since
quaggas were discovered in Lake Michigan in 1998, plankton rings formed by the
passage of storms have been eaten away by the quagga mussels, threatening the
local ecosystem.
Other zebra and quagga mussel infested applications include:
o Drinking water treatment facilities
o Fish hatcheries and aquaculture facilities
o Golf courses
o Impoundments and reservoirs
o Institutions (hospitals, colleges, etc.)
o National scenic river ways
o Navigation locks
o Public agencies
o Farm irrigation water
Our Advantages
We believe that our proprietary technology provide advantages over potential
competitors to meet their objectives.
Proprietary Technology:
We intend to manufacture a product based on proprietary technology that took
over ten years to develop.
Our approach allows us to construct and test a targeted peptide in weeks as
opposed to the present vaccine development that can take longer than a year to
make and test. We have reconstructed the peptides in such a way that enzymes do
not recognize them and therefore will not destroy them. As a result, our
targeted peptides will have the opportunity to perform the objective they were
designed to fulfill. Additionally, peptides based on structures of the naturally
occurring barnacle cement proteins are non-toxic, and once sloughed off into
seawater, peptides would be eaten as totally non-toxic food by marine organisms.
The Company has developed proprietary innovative peptide proteomic technologies
involving the use of peptides to create a solution that would effectively
prevent zebra and quagga muscles from attaching to equipment, water intake
pipes, and even boat hulls to colonize in massive numbers. The Company uses
computer algorithms to generate peptides capable of interacting with
biologically significant protein targets. When fully developed, Peptide
Technologies' peptide solution will slow the rate of zebra and quagga mussel
fouling as well as to eliminate the harm to water users and marine life through
the use of safe, environmentally-friendly natural peptides. While the production
of an underwater adhesive that mimics the properties of mussels has been an
ongoing field of research, Peptide Technologies is focused on proteins that
comprise the glue that affixes the byssal threads of the zebra and quagga
mussels to hard surfaces.
We have two designs that we are launching for use by the shipping and boating
industry based upon our technology:
o The first was the design of specific peptide inhibitors of a bacteria
that attaches to a ship's hull, which could be incorporated into paint
used to coat the hull following defouling in dry-dock. The peptides
would prevent attachment of the bacteria and subsequent attachment of
the barnacles. Furthermore, any release of the peptides into the ocean
as the paint wears off, would not pose any environmental threat since
peptides are biodegradable natural proteins.
o The second approach was the design of peptide inhibitors that will
prevent folding of the proteins in barnacles that generate the
powerful cement that "glue" them to the ship's hull. Both of the above
approaches offered the shipping industry a solution to an age old
problem costing literally billions of dollars in lost time at sea
(dry-dock scraping of barnacles and painting) and significantly
reduced fuel costs by preventing any increase in drag.
19
Principal Products and Services
The Company intends to develop and provide a sustainable natural solution that
addresses the economic burdens caused by the zebra and quagga mussels, without
harming other organisms or depleting a segment of the natural food chain.
Material Changes in Financial Condition
At May 31, 2012, our cash balance was $2,439. In addition, we have prepaid
expenses of $96. Cash on hand is currently our only source of liquidity. We do
not have any lending arrangements in place with banking or financial
institutions and we do not anticipate that we will be able to secure these
funding arrangements in the near future.
At May 31, 2012, we had a working capital deficit of $325,636 compared to a
working capital deficit of $197,340 at November 30, 2011. At May 31, 2012, our
total assets consisted of cash of $2,439, prepaid expenses of $96, and
Intangible Asset and Intellectual Property of $45,000. This compares with total
assets at November 30, 2011, which consisted of cash of $1,656, prepaid expenses
of $127 and Intangible Asset and Intellectual Property of $75,000.
At May 31, 2012, our total current liabilities increased to $328,171 from
$199,123 at November 30, 2011. During the six months ended May 31, 2012,
accounts payable and accrued liabilities increased by $127,499.
We believe our existing cash balances will not be sufficient to carry our normal
operations over the next three (3) months. Our short and long-term survival is
dependent on sales of securities as necessary or from shareholder loans, and
thus, to the extent that we require additional funds to support our operations
or the expansion of our business, we will attempt to sell additional equity
shares or issue debt. Any sale of additional equity securities will result in
dilution to our stockholders. Continuing events in worldwide capital markets may
make it more difficult for us to raise additional equity or capital. There can
be no assurance that additional financing, if required, will be available to us
or on acceptable terms.
Result of Operations
For The Three Months Ended May 31, 2012 Compared To The Three Months Ended May
31, 2011.
We recognized $nil revenues from operational sales during the three months
ending May 31, 2012.
During the three months ended May 31, 2012, operating expenses were $8,758
compared to $1,850 for the three months ended May 31, 2011. The increase of
$6,908 was due to an increase in professional fees of $5,958 due to our pursuit
of business opportunities related to the peptide technology. Operating expenses
during the three months ended May 31, 2012, professional fees of $7,636 and
office and administration costs of $1,122 compared to professional fees of
$1,678 and office and administration fees of $172 incurred for the three months
ended May 31, 2011.
We recognized a net loss of $8,158 for the three months ended May 31, 2012,
compared to a net loss of $1,850 for the three months ended May 31, 2011. The
increase of $6,308 was a direct result of the increase in operating expenses, as
discussed above.
For The Six Months Ended May 31, 2012 Compared To The Six Months Ended May 31,
2011.
During the six months ended May 31, 2012, operating expenses were $151,694
compared to $11,235 for the six months ended May 31, 2011. The increase of
$140,459 was due to an increase in consulting fees of $120,000 and an increase
in professional fees of $18,956 due to our pursuit of business opportunities
related to the peptide technology. Operating expenses during the six months
ended May 31, 2012, consisted of consulting fees of $120,000, professional fees
of $29,625 and office and administration costs of $2,069 compared to
professional fees of $10,669 and office and administration fees of $566 incurred
for the six months ended May 31, 2011.
20
We recognized a net loss of $152,602 for the six months ended May 31, 2012,
compared to a net loss of $10,902 for the six months ended May 31, 2011. The
increase of $141,700 was a direct result of the increase in operating expenses,
as discussed above.
Off-Balance Sheet Arrangements
We currently do not have any off-balance sheet arrangements.
Critical Accounting Policies and Estimates
The preparation of the Company's financial statements in conformity with
generally accepted accounting principles in the United States requires
management to make assumptions and estimates that affect the reported amounts of
assets, liabilities, revenues and expenses as well as the disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
ITEM 3. QUANTATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
As a "smaller reporting company" as defined by Item 10 of Regulation S-K, the
Company is not required to provide information required by this Item.
ITEM 4. CONTROLS AND PROCEDURES
As of the end of the period covered by this report, we conducted an evaluation,
under the supervision and with the participation of our President and Chief
Financial Officer, of our disclosure controls and procedures (as defined in
Rules 13a-15(e) and 15d-15(e) under the 1934 Act). Based on this evaluation, the
President and Chief Financial Officer concluded that our disclosure controls and
procedures are effective to ensure that information required to be disclosed by
us in reports that we file or submit under the 1934 Act is recorded, processed,
summarized and reported within the time periods specified in the Securities and
Exchange Commission rules and forms.
Our management is responsible for establishing and maintaining adequate internal
control over financial reporting for the company in accordance with as defined
in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Our internal control
over financial reporting is designed to provide reasonable assurance regarding
the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally accepted
accounting principles.
Management's assessment of the effectiveness of the small business issuer's
internal control over financial reporting is as of the quarter ended May 31,
2012. We believe that our internal control over financial reporting was not
effective due to material weaknesses in the system of internal control.
Specifically, management identified the following control deficiency:
The Company has installed accounting software that does not prevent
erroneous or unauthorized changes to previous reporting periods and
does not provide an adequate audit trail of entries made in the
accounting software.
Because of its inherent limitations, internal control over financial reporting
may not prevent or detect misstatements. Also, projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become
inadequate because of changes in conditions, or that the degree of compliance
with the policies or procedures may deteriorate.
There was no change in our internal control over financial reporting that
occurred during the fiscal quarter ended May 31, 2012, that has materially
affected, or is reasonably likely to materially affect, our internal control
over financial reporting.
21
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
On November 22, 2010, the Company was served with a claim filed by a former
director and officer of the Company. The claim, filed in the court of Queen's
Bench of Alberta, Canada, alleges that the former director and officer of the
Company suffered losses and damages as a result of the failure of the Company in
providing him with corporate documents and implementing a change of the board of
directors. The Company has retained legal counsel to address the claim. On
December 8, 2010, the Company filed a Statement of Defense requesting that the
claim be dismissed. The Company intends to defend this claim vigorously.
Other then the above preceding, the Company is not a party to any other pending
legal proceedings, nor is the Company aware of any civil proceeding or
government authority contemplating any legal proceeding as of the date of this
filing.
ITEM 1A. RISK FACTORS
Not applicable.
Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
None.
Item 3. DEFAULTS UPON SENIOR SECURITIES
None.
Item 4. mine safety disclosure.
Not Applicable.
Item 5. Other Information
Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Appointment of Officer
Dr. Scott McKinley, Ph.D. has been appointed as Chief Executive Officer (CEO) of
the company, effective July 16, 2012. Dr. McKinley will continue to serve as
Chairman of the Board of Directors and Chief Operating Officer of the Company,
since October 3, 2011.
Dr. McKinley received his Ph.D. from the University of Waterloo, 1993. He has
mentored and supervised the research of graduate students and postdoctoral
fellows. He has also been the recipient of two Research Chairs: a) Natural
Sciences and Engineering Research Council ("NSERC") /Industrial Research Chair
and b) Canada Research Chair (Tier 1). Dr. McKinley holds a number of
directorships including the Vancouver Aquarium, Centre for Aquaculture and
Environmental Research (a partnership between UBC and Department of Fisheries
and Oceans ["DFO"]), and Pacific Ocean Shelf Tracking ("POST"). Dr. McKinley was
recently appointed to be a member of the High Level Expert Forum on how to feed
the world population in 2050, sponsored by the Food and Agriculture Organization
of the United Nations.
Since 2001 Dr. McKinley is been Professor of Animal Science at University of
British Columbia. He has over 30 years of experience in the field of ecology,
animal physiology and biochemistry. He has conducted his research across Canada
22
and Europe in fresh and marine waters. He has held a senior Canada Research
Chair and an Industrial and Natural Sciences and Engineering Chair and has
author two patents. He has served as Chair of the Technical Board of Experts for
the Great Lakes Fishery Commission, Research committee for the Pacific Ocean
Shelf Tracking (POST) study, and a member of the Board of Directors for POST and
the Vancouver Aquarium. He is presently Director of the West Vancouver Marine
Laboratory.
Item 6. Exhibits
(a) Pursuant to Item 601 of Regulation S-K, the following exhibits are included
herein.
Exhibit
Number Description
31.1 Section 302 Certification - President
31.2 Section 302 Certification - Chief Financial Officer.
32.1 Certification Pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 -
President.
32.2 Certification Pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 -
Chief Financial Officer.
23
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized, on this 16th day of July,
2012.
PEPTIDE TECHNOLOGIES, INC.
Date: July 16, 2012 By: /s/ Deborah Fortescue-Merrin
----------------------------
Name: Deborah Fortescue-Merrin
Title: President (Principal Executive
Officer)
Date: July 16, 2012 By: /s/ Richard Fortescue
---------------------
Name: Richard Fortescue
Title: Chief Financial Officer (Principal
Accounting Officer)
24