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 August 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 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
1
Number of shares issued and outstanding of the registrant's class of common
stock as of October 12, 2012: 146,058,000 shares of common stock
The Company recognized $nil revenues during the quarter ended August 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
Notes to Interim Financial Statements F-9 to F-14
Item 2. Management's Discussion and Analysis or Plan of Operations 15-to 21
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 to 23
Item 6. Exhibits 23
SIGNATURES 24
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)
AUGUST 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
Notes to Interim Financial Statements F-9 to F-14
4
PEPTIDE TECHNOLOGIES, INC.
(A Development Stage Company)
Interim Financial Statements
(Expressed in U.S. Dollars)
(Unaudited)
August 31, 2012
5
PEPTIDE TECHNOLOGIES, INC.
(A Development Stage Company)
INTERIM BALANCE SHEETS
August 31, November 30,
2012 2011
(Unaudited) (Audited)
ASSETS
Current Assets
Cash and cash equivalents $ 4,186 $ 1,656
Prepaid expenses 65 127
--------------------------------------
Total Current Assets 4,251 1,783
Intangible assets and intellectual property (Note 6) 45,000 75,000
--------------------------------------
TOTAL ASSETS $ 49,251 $ 76,783
======================================
LIABILITIES AND STOCKHOLDERS' DEFICIENCY
LIABILITIES
Current Liabilities
Accounts payable and accrued liabilities (Note 3) $ 246,460 $ 138,910
Notes payable (Note 4) 87,848 60,213
--------------------------------------
Total Current Liabilities 334,308 199,123
--------------------------------------
STOCKHOLDERS' DEFICIENCY
Capital Stock (Note 7)
Authorized:
675,000,000 common shares, par value $0.001 per share Common shares
issued and outstanding:
146,053,000 and 171,023,000 at August 31, 2012 and November 30, 2011,
respectively 146,053 171,023
Additional paid-in capital 80,235 50,265
Accumulated other comprehensive income - 694
Accumulated deficit (105,837) (105,837)
Accumulated deficit during development stage (405,508) (238,485)
--------------------------------------
Total Stockholders' Deficiency (285,057) (122,340)
--------------------------------------
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIENCY $ 49,251 $ 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
from
For the For the For the For the re-entering of
three-month three-month period nine-month nine-month development stage on
period ended ended period ended period ended June 26, 2010 to
August 31, 2012 August 31, 2011 August 31, 2012 August 31, 2011 August 31, 2012
-----------------------------------------------------------------------------------------------------
Expenses
Consulting
(Note 5 and 7) $ 5,000 $ - $ 125,000 $ - $ 230,975
Office and
administration 3,277 197 5,346 764 11,795
Professional fees 2,468 15,851 32,093 26,520 98,907
Supplies and
materials - - - - 59,130
-----------------------------------------------------------------------------------------------------
Net Loss Before
Other Items (10,745) (16,048) (162,439) (27,284) (400,807)
-----------------------------------------------------------------------------------------------------
Other Items
Foreign exchange
gain (loss) (2,730) - (2,285) 333 (2,285)
Interest expense
(Note 4) (946) - (2,299) - (2,416)
-----------------------------------------------------------------------------------------------------
Net Loss for the
Period (14,421) (16,048) (167,023) (26,951) (405,508)
=====================================================================================================
Other Comprehensive
Loss
Foreign currency
translation
adjustment - - (694) (333) (333)
-----------------------------------------------------------------------------------------------------
Comprehensive Loss
for the Period $ (14,421) $ (16,048) $ (167,717) $ (27,284) $ (405,841)
=====================================================================================================
Loss per share from
continuing
operations
- Basic and
diluted $ (0.00) $ (0.00) $ (0.00) $ (0.00)
Loss per share
from discontinued
operations -
Basic and diluted $ (0.00) $ (0.00) $ (0.00) $ (0.00)
=================================================================================
Weighted Average
Number of Shares
Outstanding 141,050,802 102,521,739 143,334,090 98,189,781
=================================================================================
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 re-entering of
For the nine-month development
nine-month period ended stage on June
period ended August 31, 26, 2010 to
August 31,2012 2011 August 31, 2012
Cash Flows used in Operating Activities
Net loss $ (167,023) $ (26,951) $ (405,508)
Adjustments for non-cash items:
Accrued interest 2,299 - 2,299
Common shares issued for services (Note 5,000 - 5,000
5 and 7)
Changes in operating assets and liabilities
Prepaid expenses 62 (1,223) 2,645
Accounts payable and accrued liabilities 107,550 8,913 245,710
-----------------------------------------------------------
Net Cash Used in Operating Activities (52,112) (19,261) (149,854)
===========================================================
Cash Flows From Financing Activities
Issuance of common shares 30,000 - 53,000
Increase in notes payable 25,336 - 69,549
Contribution by related party - 14,202 27,288
-----------------------------------------------------------
Net Cash From Financing Activities 55,336 14,202 149,837
===========================================================
Increase (Decrease) in Cash During the Period 3,224 (5,059) (17)
Effect of Exchange Rate Changes on Cash (694) (333) (333)
Cash, Beginning of Period 1,656 6,090 4,536
-----------------------------------------------------------
Cash, End of Period $ 4,186 $ 698 $ 4,186
===========================================================
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)
NOTES TO INTERIM FINANCIAL STATEMENTS
August 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 August 31, 2012 and has losses to date of approximately $511,345.
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-9
PEPTIDE TECHNOLOGIES, INC.
(A Development stage Company)
NOTES TO INTERIM FINANCIAL STATEMENTS
August 31, 2012
(Unaudited)
2. RECENT ACCOUNTING PRONOUNCEMENTS
In July 2012, he Financial Accounting Standards Board ("FASB") issued
Accounting Standards Update ("ASU") No. 2012-02, "Intangibles -
Goodwill and Other". This update presents an entity with the option to
first to assess qualitative factors to determine whether it is more
likely than not that an indefinite-lived intangible asset is impaired
as a basis for determining whether it is necessary to perform the
quantitative impairment test in accordance with Subtopic 350-30,
"Intangibles - Goodwill and Other - General Intangibles Other than
Goodwill". The more-likely-than-not threshold is defined as having a
likelihood of more than fifty percent. ASU No. 2012-02 will be
effective for annual and interim impairment tests performed for fiscal
years beginning after September 15, 2012, with early adoption
permitted. The adoption of this update will not have a material effect
on the Company's financial statements.
In December 2011, FASB issued 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. ASU
No. 2011-12 will be effective for fiscal years, and interim periods
within those years, beginning after December 15, 2011. As ASU No.
2011-12 relates only to the presentation of comprehensive income,
adoption of this update will not have a material effect on the
Company's financial statements.
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 annual and
interim impairment tests performed for fiscal years beginning after
December 15, 2011, with early adoption permitted. The adoption of this
update will not have a material effect on the Company's 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.
ASU No. 2011-05 will be effective for fiscal years, and interim periods
within those years, beginning after December 15, 2011. As ASU No.
2011-05 relates only to the presentation of Comprehensive Income,
adoption of this update will not have a material effect on the
Company's 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.
F-10
PEPTIDE TECHNOLOGIES, INC.
(A Development stage Company)
NOTES TO INTERIM FINANCIAL STATEMENTS
August 31, 2012
(Unaudited)
4. NOTES PAYABLE
November 30,
August 31, 2011
2012 (Audited)
During the year ended November 30, 2010, Fotoview Inc. ("Fotoview")
issued a loan of $16,000 to a former director of the Company to
purchase 120,000,000 restricted common shares of the Company. Upon
the director's resignation, the 120,000,000 common shares were
cancelled, and the Company assumed the loan payable to Fotoview.
The loan is unsecured, bears no interest, and has no fixed terms
of repayment (Note 7). $ 16,000 $ 16,000
On September 21, 2011, PSI issued a loan of $500 to the Company. The 500 500
loan is unsecured, bears no interest, and has no fixed terms of
repayment.
On November 13, 2011, PSI issued a loan of $43,596 to the Company. 47,567 43,713
The loan is unsecured and bears interest at a rate of 6% per annum.
The loan payable to PSI as at August 31, 2012 consists of principal
of $45,401 (CAD $45,00) (November 30, 2011 - $43,596 (CAD $45,000))
and accrued interest of $2,166 (November 30, 2011 - $117).
On June 1, 2012, PSI issued a loan of $19,412 to the Company. The 20,456 -
loan is unsecured and bears interest at a rate of 6% per annum. The
loan payable to PSI as at August 31, 2012 consists of principal of
$20,178 (CAD $20,000) (November 30, 2011 - $Nil) and accrued interest
of $278 (November 30, 2011 - $Nil).
On September 21, 2012, PSI issued a loan of $3,325 (CAD $3,295) to the
Company. The loan is unsecured, bears no interest, and has no
fixed terms of repayment. 3,325 -
------------- -----------------
$ 87,848 $ 60,213
------------- -----------------
5. RELATED PARTY TRANSACTIONS
During the nine month period ended August 31, 2012, a director and
shareholder of the Company made cash contribution in the amount of $Nil
(August 31, 2011 - $14,202, Cumulative - $27,288).
On August 31, 2012, the Company issued 5,000,000 restricted common
shares as a par value of $0.001 per value to a director of the Company
for consulting services rendered (Note 7).
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).
F-11
PEPTIDE TECHNOLOGIES, INC.
(A Development stage Company)
NOTES TO INTERIM FINANCIAL STATEMENTS
August 31, 2012
(Unaudited)
On December 14, 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 20, 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
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 146,053,000 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.
F-12
PEPTIDE TECHNOLOGIES, INC.
(A Development stage Company)
NOTES TO INTERIM FINANCIAL STATEMENTS
August 31, 2012
(Unaudited)
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 January 5, 2012, 5,000 shares of the Company's common stock
were issued for cash proceeds of $5,000.
h) On January 6, 2012, 5,000 shares of the Company's common stock
were issued for cash proceeds of $5,000.
i) On January 15, 2012, 5,000 shares of the Company's common stock
were issued for cash proceeds of $5,000.
j) On January 24, 2012, 5,000 shares of the Company's common stock
were issued for cash proceeds of $5,000.
k) On April 20, 2012, 5,000 shares of the Company's common stock
were issued for cash proceeds of $5,000.
l) On July 11, 2012, 5,000 shares of the Company's common stock were
issued for cash proceeds of $5,000.
m) On August 31, 2012, the Company issued 5,000,000 fully vested
shares of the Company's restricted common stock at a par value of
$0.001 per share to a director of the Company for consulting
services rendered (Note 5).
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.
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) - -
August 31, 2012 495,844 2032 173,545 (173,545) (58,458) - -
F-13
PEPTIDE TECHNOLOGIES, INC.
(A Development stage Company)
NOTES TO INTERIM FINANCIAL STATEMENTS
August 31, 2012
(Unaudited)
Income taxes at the statutory rate are reconciled to the Company's
actual income taxes as follows:
August 31, 2012 August 31, 2011
Income tax benefit at statutory
rate resulting (35%) (35%)
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 August 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 EVENT
The following reportable event occurred during the period from the nine
month period ended August 31, 2012 to the date the interim financial
statements are available to be issued on October 12, 2012.
On September 27, 2012, 5,000 shares of the Company's common stock were
issued for cash proceeds of $5,000.
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 July 16, 2012, 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
15
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
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.
17
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.
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
18
and these pollutants are found in their pseudofeces, which can be passed up the
food chain, therefore increasing wildlife exposure to organic pollutants.
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
19
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.
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 August 31, 2012, our cash balance was $4,186. In addition, we have prepaid
expenses of $65. 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 August 31, 2012, we had a working capital deficit of $330,057 compared to a
working capital deficit of $197,340 at November 30, 2011. At August 31, 2012,
our total assets consisted of cash of $4,186, prepaid expenses of $65, 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 August 31, 2012, our total current liabilities increased to $334,308 from
$199,123 at November 30, 2011. During the nine months ended August 31, 2012,
accounts payable and accrued liabilities increased by $107,550..
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 August 31, 2012 Compared To The Three Months Ended
August 31, 2011.
We recognized $Nil revenues from operational sales during the three months
ending August 31, 2012.
During the three months ended August 31, 2012, operating expenses were $10,745
compared to $16,048 for the three months ended August 31, 2011. The significant
decrease of $5,303 was mainly due to a decrease in professional fees of $13,384
offset by an increase in consulting fees of $5,000. Operating expenses during
the three months ended August 31, 2012, consisted of consulting fees of $5,000,
professional fees of $2,468 and office and administration costs of $3,277
compared to professional fees of $15,851 and office and administration fees of
$197 incurred for the three months ended August 31, 2011.
We recognized a net loss of $14,421 for the three months ended August 31, 2012,
compared to a net loss of $16,048 for the three months ended August 31, 2011.
The decrease of $1,627 was a direct result of the decrease in operating
expenses, as discussed above.
For The Nine Months Ended August 31, 2012 Compared To The Nine Months Ended
August 31, 2011.
During the nine months ended August 31, 2012, operating expenses were $162,439
compared to $27,284 for the nine months ended August 31, 2011. The increase of
$135,155 was due to an increase in consulting fees of $125,000 and an increase
in professional fees of $5,573 along with an increase of $4,582 of office and
administration expenses due to our pursuit of business opportunities related to
the peptide technology. Operating expenses during the nine months ended August
20
31, 2012, consisted of consulting fees of $125,000, professional fees of $32,093
and office and administration costs of $5,346 compared to professional fees of
$26,520 and office and administration fees of $764 incurred for the nine months
ended August 31, 2011.
We recognized a net loss of $167,023 for the nine months ended August 31, 2012,
compared to a net loss of $26,951 for the nine months ended August 31, 2011. The
increase of $140,072 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 August 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 August 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
On 11 July 2012, 5,000 shares of the Company's common stock were issued for cash
proceeds of $5,000.
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.
Resignation of Officers Effective August 31, 2012, letters of resignation
tendered by Deborah Fortescue-Merrin as President of the Company and Richard
Fortescue as Secretary/Treasurer and Chief Financial Officer were accepted.
Appointment of Board Member and Officer
Effective August 31, 2012, Mr. Erik Odeen has been appointed to the Board of
Directors of the Company to serve as Secretary/Treasurer until he resign or his
successors be elected by the shareholders of the Company or appointed by the
Board of Directors. Erik Odeen was also appointed to serve as Chief Financial
Officer of the Company
Erik Odeen, CPA, CFE, is a seasoned executive with over 24 years' experience in
corporate management, financial leadership, international manufacturing &
distribution operations, and public accounting. He manages a consulting practice
which provides financial management and strategic-planning advisory services to
both public and privately-held company clients. More recently, Erik has provided
22
CFO and CEO services where his focus has been corporate restructuring and
reorganization, SEC and BCSC reporting, resolving complex accounting issues, and
corporate fraud prevention.
Mr. Odeen spent eight years in public accounting with Deloitte & Touch and
PCAOB-registered McKennon, Wilson & Morgan (Irvine, CA) where he specialized in
managing external audits, complex accounting issues, SEC Reporting and
Sarbanes-Oxley compliance.
Mr. Odeen's public company experience ranges from start-up and development stage
to Fortune 100 companies, including turn-around and M&A engagements. During his
13 year career with International Paper, Erik worked in Corporate Audit, was
instrumental in the planning and implementation of financial and operating
systems, and served in senior-level management positions with a division of
XPEDX, IP's distribution arm. Erik earned a Bachelor of Business Administration
in accounting and economics; holds an active CPA license in the state of
California; and is an active member of the American Institute of Certified
Public Accountants (AICPA), the California Society of CPAs (CalCPA), and the
global Association of Certified Fraud Examiners (ACFE).
In consideration for accepting the appointment of Chief Financial Officer for
the Company, five million (5,000,000) fully vested shares of the Company's
restricted common stock were issued to Erik Odeen.
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 - Chief Executive Officer
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 - Chief Executive Officer
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 12th day of
October, 2012.
PEPTIDE TECHNOLOGIES, INC.
Date: October 15, 2012 By: /s/ Scott McKinley
------------------
Name: Scott McKinley
Title: Chief Executive Officer
Date: October 15, 2012 By: /s/ Erik Odeen
--------------
Name: Erik Odeen
Title: Chief Financial Officer
24