UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the Quarterly Period Ended June 30, 2008
------------------------------------------
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 No. 333-132578
------------------------------------------------------
GETTING READY CORPORATION
- -------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 30-0132755
- -------------------------------------------------------------------------
(State or other jurisdiction of IRS Employer
incorporation or organization) Identification No.)
4400 Biscayne Boulevard, Suite 950, Miami, Florida 33137
- -------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(305) 573-4112
- ---------------------------------------------------------------------------
(Registrant's Telephone Number, including area code)
- ---------------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since last
report)
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 preceding 12 months (or for such shorter period that the
registrant was required to file such reports) and (2) has been subject to
such filing requirements for the past 90 days. Yes [X] No [ ]
Indicate by check mark whether the registrant is a large accelerated
filer, an accelerated filer, a non-accelerated filer, or a smaller reporting
company. See the definitions of "large accelerated filer," "accelerated
filer," and "smaller reporting company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer [ ] Accelerated filer [ ]
Non-accelerated filer [ ] (Do not check if a smaller reporting company)
Smaller reporting company [X]
Indicate by check mark whether the registrant is a shell company (as defined
in Rule 12b-2 of the Exchange Act.) Yes [X] No [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
On August 8, 2008, the number of shares of outstanding Common Stock of the
issuer was 18,332,896.
GETTING READY CORPORATION
FORM 10-Q
QUARTER ENDED JUNE 30, 2008
TABLE OF CONTENTS
PART I: FINANCIAL INFORMATION
Item 1. Financial Statements F-1-F-15
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 1
Item 3. Quantitative and Qualitative Disclosures About
Market Risk N/A
Item 4. Controls and Procedures 4
PART II: OTHER INFORMATION
Item 1. Legal Proceedings 5
Item 1A. Risk Factors N/A
Item 2. Unregistered Sales of Equity Securities and
Use of Proceeds 5
Item 3. Defaults upon Senior Securities 5
Item 4. Submission of Matters to a Vote of Security Holders 5
Item 5. Other Information 5
ITEM 6. Exhibits 5
SIGNATURES 6
EXHIBIT INDEX 7
GETTING READY CORPORATION
(A Development Stage Company)
CONDENSED BALANCE SHEET
June 30, 2008 September 30, 2007
ASSETS (Unaudited) (Audited)
---------------------- -----------------------
Current assets:
Cash $ 928,077 $ 1,093,414
Prepaids 15,470 8,745
------------ ------------
Total Current Assets 943,547 1,102,159
------------ ------------
TOTAL ASSETS $ 943,547 $ 1,102,159
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts Payable $ 16,331 $ 860
------------ ------------
Total current liabilities 16,331 860
Commitments and Contingencies
Stockholders' equity:
Preferred stock; $0.001 par value, 1,000,000 shares
authorized, none issued and outstanding - -
Common stock; $0.001 par value, 499,000,000 shares
authorized, 18,332,896 shares issued and outstanding 18,333 18,333
Additional paid-in capital 2,316,594 2,316,594
Deficit accumulated during the development stage (1,407,711) (1,233,628)
------------ ------------
Total stockholders' equity 927,216 1,101,299
------------ ------------
Total liabilities and stockholders' equity $ 943,547 $ 1,102,159
============ ============
See accompanying notes to unaudited condensed financial statements.
F-1
GETTING READY CORPORATION
(A Development Stage Company)
CONDENSED STATEMENTS OF OPERATIONS
(UNAUDITED)
FOR THE PERIOD FROM
FOR THE THREE MONTHS FOR THE NINE MONTHS NOVEMBER 26, 2002
ENDED JUNE 30, ENDED JUNE 30, (INCEPTION) TO
2008 2007 2008 2007 JUNE 30, 2008
----------- ----------- ----------- ----------- ----------------------
Operating Expenses:
Depreciation and amortization $ - $ - $ - $ - $ 31,514
Offering cost expense - - - - 120,392
Professional fees 39,603 23,381 152,929 158,589 850,791
General and administrative 14,029 19,563 48,567 37,717 401,625
------------ ------------ ------------ ------------ -------------
Total Operating Expenses 53,632 42,944 201,496 196,306 1,404,322
------------ ------------ ------------ ------------ -------------
Loss from Operations (53,632) (42,944) (201,496) (196,306) (1,404,322)
------------ ------------ ------------ ------------ -------------
Other Income (Expense):
Interest income 6,767 16,069 27,413 22,216 62,290
Interest expense - - - - (65,679)
------------ ------------ ------------ ------------ -------------
Total Other Income (Expense), net 6,767 16,069 27,413 22,216 (3,389)
------------ ------------ ------------ ------------ -------------
Net Loss $ (46,865) $ (26,875) $ (174,083) $ (174,090) $ (1,407,711)
============ ============ ============ ============ =============
Net Loss per share - Basic and Diluted $ (0.00) $ (0.00) $ (0.01) $ (0.02) $ (0.18)
============ ============ =========== ============ =============
Weighted average number of shares
outstanding during the period - basic
and diluted 18,332,896 18,332,896 18,332,896 11,461,529 7,861,382
============ ============ =========== ============ =============
See accompanying notes to unaudited condensed financial statements.
F-2
GETTING READY CORPORATION
(A Development Stage Company)
CONDENSED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
For the Years Ended September 30, 2007 and 2006,
and for the Period from November 26, 2002 (Inception)
To June 30, 2008
(Unaudited)
Prepaid
Common Stock Deficit Services
$0.001 Par Value Accumulated Paid
---------------- Additional During With Total
Paid in Development Common Stock Stockholders'
Shares Amount Capital Stage Stock Payable Equity
--------- -------- ---------- ------------- ---------- --------- -------------
Issuance of common stock to
founders at par, November 2002 3,701,072 $ 3,701 $ (3,701) $ - $ - $ - $ -
Authorization of stock to
founder at par, November 2002 - - (740) - - 740 -
Issuance of common stock for
cash, December 2002 ($0.47/share) 105,744 106 49,894 - - - $ 50,000
Net loss for the period ended
September 30, 2003 - - - (33,185) - - (33,185)
--------- -------- -------- ------------- ---------- --------- ----------
Balance, September 30, 2003 3,806,816 $ 3,807 $ 45,453 $ (33,185) $ - $ 740 $ 16,815
Issuance of common stock for
cash, January 2004* 42,298 42 19,958 - - - 20,000
Issuance of common stock for
cash, May 2004 ($.135 per share) 29,609 29 3,971 - - - 4,000
Issuance of common stock for
cash, May 2004* 14,804 15 6,985 - - - 7,000
F-3
Issuance of common stock for
services, June 2004* 185,054 185 87,315 - (72,917) - 14,583
Issuance of common stock for
services, July 2004* 395,000 395 177,355 - - - 177,750
Issuance of common stock to
founder at par, July 2004 740,214 740 - - - (740) -
Amortization of prepaid services
paid with common stock - - - - 43,750 - 43,750
Net loss for the period ended
September 30, 2004 - - - (324,543) - - (324,543)
---------- -------- -------- ------------ ---------- --------- ----------
Balance, September 30, 2004 5,213,795 $ 5,213 $341,037 $(357,728) $ (29,167) $ - $ (40,645)
Amortization of prepaid services
paid with common stock - - - - 29,167 - 29,167
Termination of agreement and
return of common stock issued
for services, April 2005 (395,000) (395) 395 - - - -
Issuance of common stock for
cash, May 2005 ($1.50 per share) 2,833 3 4,247 - - - 4,250
Issuance of common stock for
cash, June 2005 ($1.50 per share) 667 1 999 - - - 1,000
Net loss for the period ended
September 30, 2005 - - - (230,800) - - (230,800)
---------- -------- -------- ------------- ---------- --------- -----------
Balance, September 30, 2005 4,822,295 $ 4,822 $346,678 $(588,528) $ - $ - $(237,028)
Issuance of common stock for
cash, October 2005
($1.50 per share) 7,000 7 10,493 - - - 10,500
Issuance of common stock for
services, October 2005
($1.50 per share) 16,666 17 24,983 - - - 25,000
F-4
Issuance of common stock for cash,
November 2005 ($1.50 per share) 4,033 4 6,046 - - - 6,050
Issuance of common stock for cash,
December 2005 ($1.50 per share) 333 0 500 - - - 500
Issuance of common stock for
services, December 2005
($1.50 per share) 1,667 2 2,498 - - - 2,500
Issuance of common stock for cash,
January 2006 ($1.50 per share) 667 1 999 - - - 1,000
Issuance of common stock for
services, April 2006
($3.75 per share) 6,667 7 24,993 - - - 25,000
Issuance of common stock for cash,
June 2006 ($1.20 per share) 5,000 5 5,987 - - - 5,992
Net loss for the period ended
September 30, 2006 - - - (464,995) - - (464,995)
---------- -------- -------- ------------- ---------- --------- -----------
Balance, September 30, 2006 4,864,328 4,864 $423,178 $(1,053,523) $ - $ - $(625,481)
Issuance of common stock
for cash, December 2006
(0.1698/share) 4,048,791 4,049 695,355 - - - 699,404
Issuance of common stock
for cash, March 2007
($0.06/share) 9,349,777 9,350 557,650 - - - 567,000
Issuance of common stock as a
finder's fee ($0.01/share) 70,000 70 (70) - - - -
Forgiveness of related
party debt by former CEO - - 625,481 - - - 625,481
F-5
In-kind contribution for
professional fees - - 15,000 - - - 15,000
Net loss for the period
ended September 30, 2007 - - - (180,105) - - (180,105)
----------- -------- ----------- ------------- ---------- --------- - ------------
Balance, September 30, 2007 18,332,896 18,333 2,316,594 (1,233,628) - - 1,101,299
----------- -------- ----------- ------------- ---------- --------- - ------------
Net loss for the period
ended June 30, 2008 - - - (174,083) - - (174,083)
Balance June 30, 2008 18,332,896 18,333 $2,316,594 $(1,407,711) $ - $ - $ (927,216)
(Unaudited) =========== ======== =========== ============= ========== ========= ============
*Common stock issued at $0.48 per share
See accompanying notes to unaudited condensed financial statements.
F-6
GETTING READY CORPORATION
(A Development Stage Company)
CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)
FOR THE NINE MONTHS ENDED FOR THE PERIOD FROM
JUNE 30, NOVEMBER 26, 2002 (INCEPTION)
2008 2007 TO JUNE 30, 2008
------------- ------------- -----------------------------
Cash Flows from Operating Activities:
Net Loss $(174,083) $(174,090) $(1,407,711)
Adjustments to reconcile net loss
to net cash used in operations:
Common stock issued for services - - 317,750
Write-off of deferred offering costs - - 133,850
Depreciation and amortization - - 31,514
In-kind contribution for
professional fees - 15,000 15,000
Changes in operating assets and liabilities:
(Increase) decrease in:
Prepaids (6,725) (15,303) (15,470)
Increase (decrease) in:
Accounts payable 15,471 - 144,221
Accrued salaries - - 180,000
Accrued interest payable - - 65,728
---------- ---------- ------------
Net cash used in operating activities (165,337) (174,393) (535,118)
---------- ----------- ------------
Cash Flows from Investing Activities:
Purchase of property and equipment - - (4,217)
----------- ----------- -------------
Net cash used in investing activities - - (4,217)
Cash Flows From Financing Activities:
Proceeds from loans payable - related party - - 510
Increase in deferred offering costs - - (133,850)
F-7
Proceeds from issuance of common stock - 1,266,404 1,376,696
Proceeds from issuance of notes payable - - 235,556
Repayments on notes payable - - (11,500)
----------- ----------- ------------
Net cash provided by financing activities - 1,266,404 1,467,412
----------- ----------- ------------
Net Increase (Decrease) in Cash (165,337) 1,092,011 928,077
Cash at beginning of period $1,093,414 $ - $ -
----------- ----------- ------------
Cash at end of period $ 928,077 $1,092,011 $ 928,077
=========== =========== ============
Supplemental disclosure of
cash flow information:
Cash paid for interest $ - $ - $ -
=========== ========== ============
Cash paid for taxes $ - $ - $ -
=========== ========== ============
Supplemental disclosure of noncash investing
and financing activities:
On December 4, 2006, the Company's CEO
forgave certain assumed liabilities
in connection with the sale of the
controlling interest in the Company to
unrelated third parties. (See Note 5) $ - $ 625,481 $ 625,481
=========== ========== ============
Transfer of net book value of fixed assets
to CEO in exchange for reduction of
related party debt $ - $ - $ 1,020
=========== ========== ============
F-8
Cancellation of note payable and related
debt discount and deferred offering costs $ - $ - $ 300,000
=========== ========== ============
Contribution of website development costs
in exchange for reduction in note payable $ - $ - $ 28,318
=========== ========== ============
Stock based payment in exchange for
prepaid services $ - $ - $ 72,917
=========== ========== ============
Stock paid as finder's fee (70,000 shares)
(See Note 6) $ - $ 70 $ 70
=========== ========== ============
See accompanying notes to unaudited condensed financial statements.
F-9
Getting Ready Corporation
(A Development Stage Company)
Notes to Condensed Financial Statements
June 30, 2008
Unaudited
1. BASIS OF PRESENTATION
The accompanying unaudited condensed financial statements have been
prepared in accordance with accounting principles generally accepted in the
United States of America and the rules and regulations of the United States
Securities and Exchange Commission for interim financial information and with
the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly,
they do not include all the information and footnotes necessary for a
comprehensive presentation of financial position and results of operations.
It is management's opinion, however, that all material adjustments
(consisting of normal recurring adjustments) have been made that are
necessary for a fair financial statement presentation. The results for the
interim period are not necessarily indicative of the results to be expected
for the year.
For further information, refer to the audited financial statements and
footnotes of the Company for the year ended September 30, 2007, included in
the Company's Form 10-KSB.
2. NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. Nature of Operations and Liquidity
Getting Ready Corporation (the "Company") is a development stage
enterprise that was incorporated under the laws of the State of Delaware on
November 26, 2002.
Winston Acquisition Corp. was formed as a wholly owned subsidiary of the
Company for the sole purpose of the merger discussed below. This entity had
no transactions during the period.
The accompanying unaudited financial statements have been prepared on the
basis which assumes that the Company will continue to operate as a going
concern and which contemplates the realization of assets and the satisfaction
of liabilities and commitments in the normal course of business. As
reflected in the accompanying unaudited financial statements, the Company has
a net loss of $174,083 and net cash used in operations of $165,337 for the
nine months ended June 30, 2008. The Company also has a deficit accumulated
during the development stage of $1,407,711. The Company has positive working
capital of $927,216 and has the ability to meet all obligations due over the
course of the next twelve months. The Company is currently in the
development stage and has not generated any operating revenues since
inception.
On November 13, 2007, the Company entered into a Merger Agreement and
Plan of Reorganization with Winston Laboratories, Inc., a Delaware
corporation ("Winston") and Winston Acquisition Corp., a Delaware corporation
F-10
and wholly-owned subsidiary of the Company ("Merger Sub"). The merger is
subject to customary closing conditions, including the condition that the
merger be approved by Winston stockholders. The Company expects the merger
to close during the third calendar quarter of 2008, but there can be no
assurance that the merger will in fact close.
B. Use of Estimates
In preparing financial statements, management is required to make
estimates and assumptions that affect the reported amounts of assets and
liabilities, disclosure of contingent assets and liabilities at the date of
the financial statements, and revenues and expenses during the periods
presented. Actual results may differ from these estimates.
C. Cash and Cash Equivalents
The Company minimizes its credit risk associated with cash by
periodically evaluating the credit quality of its primary financial
institution. The balance at times may exceed federally insured limits. The
balance exceeded the federally insured limit by $812,326 at June 30, 2008.
D. Earnings per Share
Basic earnings (loss) per share is computed by dividing the net income
(loss) less preferred dividends for the period by the weighted average number
of shares outstanding. Diluted earnings (loss) per share is computed by
dividing net income (loss) less preferred dividends by the weighted average
number of shares outstanding including the effect of share equivalents. At
June 30, 2008 and 2007, the Company had no outstanding common stock
equivalents.
E. Segment Information
The Company follows Statement of Financial Accounting Standards No. 131,
"Disclosures about Segments of an Enterprise and Related Information."
During 2008 and 2007, the Company only operated in one segment; therefore,
segment information has not been presented.
F. Recent Accounting Pronouncements
In September 2006, the Financial Accounting Standards Board ("FASB")
issued SFAS No. 157, "Fair Value Measurements", which clarifies the principle
that fair value should be based on the assumption that market participants
would use when pricing an asset or liability. It also defines fair value and
establishes a hierarchy that prioritizes the information used to develop
assumptions. SFAS No. 157 is effective for financial statements issued for
fiscal years beginning after November 15, 2007. The Company does not expect
SFAS No. 157 to have a material impact on its financial position, results of
operations or cash flows.
In February 2007, the FASB issued Statement of Financial Accounting
Standards No. 159, "The Fair Value Option for Financial Assets and Financial
Liabilities-Including an Amendment of FASB Statement No. 115" ("SFAS 159").
F-11
This standard permits an entity to measure financial instruments and certain
other items at estimated fair value. Most of the provisions of SFAS No. 159
are elective; however, the amendment to FASB No. 115, "Accounting for Certain
Investments in Debt and Equity Securities," applies to all entities that own
trading and available-for-sale securities. The fair value option created by
SFAS 159 permits an entity to measure eligible items at fair value as of
specified election dates. The fair value option (a) may generally be applied
instrument by instrument, (b) is irrevocable unless a new election date
occurs, and (c) must be applied to the entire instrument and not to only a
portion of the instrument. SFAS 159 is effective as of the beginning of the
first fiscal year that begins after November 15, 2007. Early adoption is
permitted as of the beginning of the previous fiscal year provided that the
entity (i) makes that choice in the first 120 days of that year, (ii) has not
yet issued financial statements for any interim period of such year, and
(iii) elects to apply the provisions of FASB 157. Management is currently
evaluating the impact of SFAS 159, if any, on the Company's financial
statements. The adoption of SFAS No. 159 is not expected to have a material
effect on the Company's financial position, results of operations or cash
flows.
In December 2007, the FASB issued SFAS No. 160, "Noncontrolling Interests
in Consolidated Financial Statements, an amendment of Accounting Research
Bulletin No. 51" ("SFAS 160"). SFAS 160 establishes accounting and reporting
standards for ownership interests in subsidiaries held by parties other than
the parent, changes in a parent's ownership of a noncontrolling interest,
calculation and disclosure of the consolidated net income attributable to the
parent and the noncontrolling interest, changes in a parent's ownership
interest while the parent retains its controlling financial interest and fair
value measurement of any retained noncontrolling equity investment. SFAS 160
is effective for financial statements issued for fiscal years beginning after
December 15, 2008, and interim periods within those fiscal years. Early
adoption is prohibited. The Company must adopt these new requirements on
October 1, 2009. The adoption of SFAS No. 160 is not expected to have a
material effect on the Company's financial position, results of operations or
cash flows.
In December 2007, the FASB issued SFAS 141R, Business Combinations ("SFAS
141R"), which replaces FASB SFAS 141, Business Combinations. This Statement
retains the fundamental requirements in SFAS 141 that the acquisition method
of accounting be used for all business combinations and for an acquirer to be
identified for each business combination. SFAS 141R defines the acquirer as
the entity that obtains control of one or more businesses in the business
combination and establishes the acquisition date as the date that the
acquirer achieves control. SFAS 141R will require an entity to record
separately from the business combination the direct costs, where previously
these costs were included in the total allocated cost of the acquisition.
SFAS 141R will require an entity to recognize the assets acquired,
liabilities assumed, and any noncontrolling interest in the acquired at the
acquisition date, at their fair values as of that date. This compares to the
cost allocation method previously required by SFAS 141. SFAS 141R will
require an entity to recognize as an asset or liability at fair value for
certain contingencies, either contractual or non-contractual, if certain
criteria are met. Finally, SFAS 141R will require an entity to recognize
F-12
contingent consideration at the date of acquisition, based on the fair value
at that date. This Statement will be effective for business combinations
completed on or after the first annual reporting period beginning on or after
December 15, 2008. Early adoption of this standard is not permitted and the
standards are to be applied prospectively only. Upon adoption of this
standard, there would be no impact to the Company's results of operations and
financial condition for acquisitions previously completed. The adoption of
this standard will impact any acquisitions completed after October 1, 2009.
In March 2008, the FASB issued SFAS No. 161 "Disclosures About
Derivative Instruments and Hedging Activities-An Amendment of FASB Statement
No. 133" ("SFAS 161"). SFAS 161 establishes the disclosure requirements for
derivative instruments and for hedging activities with the intent to provide
financial statement users with an enhanced understanding of the entity's use
of derivative instruments, the accounting of derivative instruments and
related hedged items under Statement 133 and its related interpretations, and
the effects of these instruments on the entity's financial position,
financial performance, and cash flows. This statement is effective for
financial statements issued for fiscal years beginning after November 15,
2008. We do not expect its adoption will have a material impact on our
financial position, results of operations or cash flows.
In April 2008, the FASB issued FASB Staff Position ("FSP") SFAS No. 142-
3, "Determination of the Useful Life of Intangible Assets". This FSP amends
the factors that should be considered in developing renewal or extension
assumptions used to determine the useful life of a recognized intangible
asset under FASB Statement No. 142, "Goodwill and Other Intangible Assets"
("SFAS 142"). The intent of this FSP is to improve the consistency between
the useful life of a recognized intangible asset under SFAS 142 and the
period of expected cash flows used to measure the fair value of the asset
under SFAS 141R, and other GAAP. This FSP is effective for financial
statements issued for fiscal years beginning after December 15, 2008, and
interim periods within those fiscal years. Early adoption is prohibited.
The Company is currently evaluating the impact of SFAS FSP 142-3, but does
not expect the adoption of this pronouncement will have a material impact on
its financial position, results of operations or cash flows.
In May 2008, the FASB issued SFAS No. 162, "The Hierarchy of Generally
Accepted Accounting Principles" ("SFAS 162"). SFAS 162 identifies the
sources of accounting principles and the framework for selecting principles
to be used in the preparation of financial statements of nongovernmental
entities that are presented in conformity with generally accepted accounting
principles in the United States. This statement is effective 60 days
following the SEC's approval of the Public Company Accounting Oversight
Board's amendments to AU Section 411, The Meaning of Present Fairly in
Conformity with Generally Accepted Accounting Principles. The Company is
currently evaluating the impact of SFAS 162, but does not expect the adoption
of this pronouncement will have a material impact on its financial position,
results of operations or cash flows.
F-13
In May 2008, the Financial Accounting Standards Board issued SFAS No.
163, "Accounting for Financial Guarantee Insurance Contracts-An
Interpretation of FASB Statement No. 60" ("SFAS 163"). SFAS 163 requires
that an insurance enterprise recognize a claim liability prior to an event of
default when there is evidence that credit deterioration has occurred in an
insured financial obligation. It also clarifies how Statement 60 applies to
financial guarantee insurance contracts, including the recognition and
measurement to be used to account for premium revenue and claim liabilities,
and requires expanded disclosures about financial guarantee insurance
contracts. It is effective for financial statements issued for fiscal years
beginning after December 15, 2008, except for some disclosures about the
insurance enterprise's risk-management activities. SFAS 163 requires that
disclosures about the risk-management activities of the insurance enterprise
be effective for the first period beginning after issuance. Except for those
disclosures, earlier application is not permitted. The adoption of this
statement is not expected to have a material effect on the Company's
financial statements.
Other accounting standards that have been issued or proposed by the FASB
or other standards-setting bodies do not require adoption until a future date
and are not expected to have a material impact on the financial statements
upon adoption.
G. Reclassifications
Certain amounts in the year 2007 financial statements have been
reclassified to conform to the year 2008 presentation. These
reclassifications had no effect on the financial position, results of
operations or cash flows.
3. EQUIPMENT
During the year ended September 30, 2006, equipment with a net book value
of $1,020 was transferred to the Company's former CEO in exchange for a
reduction of related debt. The debt was subsequently assumed by the
Company's former CEO and forgiven. (See Notes 5 and 6)
4. WEBSITE DEVELOPMENT COSTS
Website development costs capitalized since inception were $28,318. All
of these costs had been fully amortized during the year ended September 30,
2005.
5. ACCOUNTS PAYABLE, ACCRUED LIABILITIES, LOANS PAYABLE AND NOTES PAYABLE
In connection with the sale of a controlling interest in the Company in
December 2006 to unrelated third parties, the Company's former CEO assumed
all outstanding debt aggregating $625,481. Subsequently, these debts were
forgiven and charged to additional paid-in capital, as this was in substance
a capital transaction with a related party. Accordingly, no gain or loss was
recognized. (See Notes 3 and 6)
F-14
6. STOCKHOLDERS' EQUITY
A. Stock Issuances
During December 2006, the Company's former CEO assumed all outstanding
debt aggregating $625,481. (See Notes 3 and 5)
On December 1, 2006, the Company's board of directors approved a one for
fifteen reverse stock split. All share and per share amounts have been
retroactively restated in the accompanying unaudited financial statements.
On December 4, 2006, the Company sold 4,048,791 shares of restricted
common stock for $699,404 ($0.1698/share). The sale resulted in control
being obtained by an unrelated third party investor group. In addition, the
Company's former CEO assumed certain liabilities of the Company. (See Note
5)
On December 4, 2006, the Company issued 70,000 shares of restricted
common stock having a fair value of $70 as a finder's fee relating to the
Company's change in control. The payment had a net effect on equity of $0,
as additional paid-in capital was debited and common stock was credited for
the same balance at par value.
In December 2006, the unrelated third party investor group contributed
$15,000 toward corporate expenses. The Company has recorded this as an in-
kind contribution of capital.
On March 21, 2007, the Company sold 9,349,777 shares of common stock for
$567,000 ($0.06/share). As a result of the sale, majority control (51%) of
the Company was obtained by a previously unrelated third party. All funds
were deposited into an interest bearing certificate of deposit.
B. Amendment of Certificate of Incorporation
On February 27, 2008, the Company's Board of Directors and, on
February 28, 2008, the holders of 9,912,190 shares or 54.2% of the Company's
common stock approved an amendment to the Certificate of Incorporation (a) to
increase the number of authorized shares of capital stock to 1,150,000,000
shares, consisting of 900 million shares of Common Stock, $0.001 par value,
and 250 million shares of Preferred Stock, $0.001 par value, and (b) to
clarify the terms of the Preferred Stock by describing in the Certificate of
Incorporation the rights of the Board of Directors to designate the rights,
preferences and designations of series of the Preferred Stock (the
"Amendment"). This action will become effective on the date of filing the
Amendment with the Delaware Secretary of State.
F-15
PART I
FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
The unaudited, condensed financial statements included herein,
commencing at page F-1, have been prepared in accordance with the
requirements of Regulation S-K and, therefore, omit or condense certain
footnotes and other information normally included in financial statements
prepared in accordance with accounting principles generally accepted in the
United States of America. In the opinion of management, all adjustments
(including all normal recurring adjustments) necessary for a fair
presentation of the financial information for the interim periods reported
have been made.
Results of operations for the three months and nine months ended June
30, 2008, are not necessarily indicative of the results of operations
expected for the year ending September 30, 2008.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The following discussion with regard to our financial condition and
operating results contains certain forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. These
statements are based on current plans and expectations of Getting Ready
Corporation (the "Company", "we" or "us") and involve risks and uncertainties
that could cause actual future activities and results of operations to be
materially different from those set forth in the forward-looking statements.
Important factors that could cause actual results to differ include, among
others, our inability to consummate an acquisition of an operating business
or, in the event that we do consummate the transaction contemplated, our
ability to operate the combined business profitably.
The discussion of our financial condition should be read in conjunction
with our unaudited, condensed financial statements and notes thereto included
elsewhere in this Report and the Company's Annual Report on Form 10-KSB for
the fiscal year ended September 30, 2007, which was filed with the Securities
and Exchange Commission on December 26, 2007.
FINANCIAL RESULTS FOR THE THREE MONTHS ENDED JUNE 30, 2008
For the quarter ended June 30, 2008, we recorded a net loss of
approximately $46,900 or less than $0.01 per share. Included in the
financial results for the quarter ended June 30, 2008, were professional fees
of approximately $39,600 and general and administrative expenses of
approximately $14,000, which together constituted our total operating
expenses. We had interest income of approximately $6,800 during the quarter.
From inception (November 26, 2002) through June 30, 2008, our accumulated
deficit was $1,407,711.
1
For the three months ended June 30, 2007, we recorded a net loss of
approximately $26,900 or less than $0.01 per share. Our expenses for the
three months ended June 30, 2007, consisted of professional fees of
approximately $23,400 and general and administrative expenses of
approximately $19,600, and we had interest income of approximately $16,100
for the quarter.
Our net loss was greater in the quarter ended June 30, 2008 than in the
same quarter of the previous year as a result of higher professional fees
incurred in connection with our planned merger with Winston Laboratories,
Inc. In addition, our interest income was approximately $9,300 less in this
quarter than in the same quarter of last year as a result of cash used for
expenses while we have no operating revenues.
FINANCIAL RESULTS FOR THE NINE MONTHS ENDED JUNE 30, 2008
For the nine months ended June 30, 2008, we recorded a net loss of
approximately $174,100 or $0.01 per share. The financial results for the
nine months included professional fees of approximately $153,000 and general
and administrative expenses of approximately $48,600, which together
constituted our total operating expenses, and we had interest income of
approximately $27,400.
For the nine months ended June 30, 2007, we recorded a net loss of
approximately $174,100 or $0.02 per share. Our professional fees were
approximately $158,600 and our general and administrative expenses were
approximately $37,700, and we had interest income of approximately $22,200
during this period.
While the loss was approximately the same for the nine months ended June
30, 2008 and June 30, 2007, there were fewer outstanding shares during the
nine months ended June 30, 2007, resulting in a greater loss per share. Our
expenses have been relatively constant since the change of control in
December 2006, and our general and administrative expenses have been minimal
because we do not pay any salaries or rent.
We have never generated operating revenues or income and cannot expect
to do so until such time as we effect a business combination with an
operating company. However, in the event that we do consummate our proposed
merger, there can be no assurances that the combined operation will operate
profitably.
LIQUIDITY
As of June 30, 2008, we had cash of approximately $928,100 and
liabilities of approximately $16,300, which consisted of current accounts
payable. Our cash is invested in a certificate of deposit and money market
accounts. We anticipate that the primary uses of working capital will
include general and administrative expenses and costs associated with
consummating our proposed business combination with Winston Laboratories,
Inc., a Delaware corporation ("Winston"). We believe that we have sufficient
funds to cover our expenses for at least the next twelve months.
2
OFF-BALANCE SHEET ARRANGEMENTS AND CONTRACTUAL OBLIGATIONS
We have no off-balance sheet arrangements and no contractual
obligations. Our liabilities consist solely of current accounts payable,
which were approximately $16,300 at June 30, 2008.
OUR PROPOSED MERGER
On November 13, 2007, we entered into a Merger Agreement and Plan of
Reorganization (the "Agreement") with Winston and Winston Acquisition Corp.,
a Delaware corporation and wholly-owned subsidiary of the Company ("Merger
Sub"). In connection with the Agreement, Dr. Phillip Frost and certain other
investors (the "Frost investors") invested $5 million in Winston in exchange
for shares of preferred stock of Winston and warrants to acquire preferred
stock. In addition, Dr. Frost and certain other investors (together with the
Frost Investors are referred to herein as the "New Investors"), including
Glenn L. Halpryn and Noah Silver who are officers and directors of the
Company, expect to invest an additional $4 million in Winston before the
merger is consummated.
Under the terms of the Agreement, at the closing of the merger, each
common share of Winston will be converted into approximately 17.51 shares of
our common stock and each share of preferred stock of Winston will be
converted into approximately .01751 shares of our preferred stock, each such
preferred share being convertible into 1,000 shares of our common stock. The
Agreement also provides that the Company will assume Winston's stock option
plan. As of December 31 2007, Winston had outstanding 1,846,250 options to
purchase 1,846,250 shares of Winston's common stock. These options, as a
result of the merger, will represent options to purchase 32,332,239 shares of
the Company's common stock. The Merger Agreement provides that all
outstanding warrants to purchase Winston Series A Preferred Stock will be
assumed by the Company and amended and converted into the right to acquire
upon the exercise of such warrants an aggregate of 71,672 shares of the
Company's Series A Preferred Stock. As a result of the merger, it is
expected that our stockholders will receive approximately 2.6% of the
combined company on a fully diluted basis and the New Investors will own
convertible preferred stock representing approximately 24.4% of the combined
company on a fully diluted basis. The holders of Winston common stock,
options and warrants, which holders include the New Investors, will receive
approximately 97.4% of the combined company on a fully-diluted basis.
The merger is subject to customary closing conditions, including the
condition that the merger be approved by Winston stockholders. In addition,
the merger is subject to the condition that Winston shall have closed on the
additional $4 million investment and issued shares of Winston Series B
preferred stock to such investors in Winston. Subject to these and other
conditions, we expect the merger to close during the third calendar quarter
of 2008, but there can be no assurance that the merger will in fact close.
We intend to carry on the business of Winston after the merger, and we
expect to retain substantially all of Winston's current management. All of
our directors except Glenn L. Halpryn and Dr. Curtis Lockshin will resign and
will be replaced with directors selected by Winston. The business plan and
operations of Winston will be our operations as a result of the merger.
3
The combined company will be renamed Winston Pharmaceuticals, Inc. and
will be headquartered in Vernon Hills, Illinois, where Winston is currently
located.
Winston was incorporated in Delaware in 1998 and focuses on major pain
indications as well as on niche markets, where there is still significant
need for pain management options. Winston's products span a range of pain
indications, including episodic cluster headache, chronic daily headache,
osteoarthritis, neuropathic pain, cancer pain and post-operative pain.
Winston's flagship compound is Civamide, a TRPV-1 (transient receptor
potential vanilloid-1) receptor modulator, which Winston believes provides
exceptionally long-lasting analgesic activity. A single oral dose of
civamide, for example, provides effective analgesia for at least 7 days in a
variety of animal pain models. Winston is engaged in late-stage development
of civamide for various pain indications, and submitted its marketing
authorization application in Europe in January 2008 for a topical formulation
for relief of osteoarthritis pain (the "Topical Formulation").
During 2008 Winston intends to submit marketing authorization
applications for the Topical Formulation in Canada and North America, but
there can be no assurances that the applications will be made during the time
period that is currently planned.
ITEM 3. CONTROLS AND PROCEDURES
As of June 30, 2008, our Chief Executive Officer and our Chief Financial
Officer evaluated the Company's disclosure controls and procedures, and they
concluded that the Company maintains effective disclosure controls and
procedures. There were no changes in our internal control over financial
reporting during the quarter ended June 30, 2008.
Disclosure controls and procedures mean the methods designed to ensure
that information that the Company is required to disclose in the reports that
it files with the Securities and Exchange Commission is recorded, processed,
summarized and reported within the time periods required. Our controls and
procedures are designed to ensure that all information required to be
disclosed is accumulated and communicated to our management to allow timely
decisions regarding disclosure. Our controls and procedures are also
designed to provide reasonable assurance of the reliability of our financial
reporting and accurate recording of our financial transactions.
Controls and procedures, however well designed and operated, can provide
only reasonable, not absolute, assurance that the system's objectives will be
met. There are inherent limitations in all control systems, and no
evaluation of controls can provide absolute assurance that all gaps or
instances of fraud have been detected. These inherent limitations include
the realities that judgments in decision-making can be faulty, and that
simple errors or mistakes can occur.
4
PART II
OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
On February 27, 2008, our Board of Directors and, on February 28,
2008, the holders of 9,912,190 shares or 54.2% of our common stock approved
an amendment to our Certificate of Incorporation (a) to increase the number
of authorized shares of our capital stock to 1,150,000,000 shares, consisting
of 900 million shares of Common Stock, $0.001 par value, and 250 million
shares of Preferred Stock, $0.001 par value, and (b) to clarify the terms of
our Preferred Stock by describing in our Certificate of Incorporation the
rights of the Board of Directors to designate the rights, preferences and
designations of series of the Preferred Stock (the "Amendment"). This action
will become effective on the date of filing the Amendment with the Delaware
Secretary of State in accordance with the relevant sections of the Delaware
General Corporation Law. We anticipate that the Amendment will be filed
during the third calendar quarter of 2008, just prior to the closing of the
merger.
ITEM 5. OTHER INFORMATION
We have not made any material changes to the procedures by which our
stockholders may recommend nominees to our board of directors.
ITEM 6. EXHIBITS
(a) Exhibits.
Exhibit 31.1 Certification of Chief Executive
Officer pursuant to Rule 13a-14(a)
Exhibit 31.2 Certification of Chief Financial
Officer pursuant to Rule 13a-14(a)
Exhibit 32 Certification pursuant to Rule 13a-14(b) and
Section 1350, Title 18, United States Code
5
SIGNATURES
Pursuant to the requirements 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.
GETTING READY CORPORATION
(Registrant)
Dated: August 12, 2008 By: /s/ Glenn L. Halpryn
---------------------------------------
Glenn L. Halpryn
Chairman, Chief Executive Officer
and President
(Principal Executive Officer)
Dated: August 12, 2008 By: /s/ Alan Jay Weisberg
---------------------------------------
Alan Jay Weisberg
Chief Financial Officer
(Principal Financial and
Accounting Officer)
6
EXHIBIT INDEX
Exhibit No. Description
31.1 Certification of Chief Executive Officer
pursuant to Rule 13a-14(a)
31.2 Certification of Chief Financial Officer
pursuant to Rule 13a-14(a)
32 Certification of Chief Executive Officer and Chief
Financial Officer pursuant to 18 U.S.C. Section 1350
7
Exhibit 31.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER
I, Glenn L. Halpryn, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Getting Ready
Corporation;
2. Based on my knowledge, this report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by
this report;
3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material respects
the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this report;
4. The registrant's other certifying officer(s) and I are responsible
for establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control
over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-
15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our supervision, to
ensure that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this report is being
prepared;
(b) Designed such internal control over financial reporting, or caused
such internal control over financial reporting to be designed under our
supervision, 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;
(c) Evaluated the effectiveness of the registrant's disclosure controls
and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of the
period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant's internal
control over financial reporting that occurred during the registrant's most
recent fiscal quarter (the registrant's fourth fiscal quarter in the case of
an annual report) that has materially affected, or is reasonably likely to
materially affect, the registrant's internal control over financial
reporting; and
5. The registrant's other certifying officers and I have disclosed,
based on our most recent evaluation of internal control over financial
reporting, to the registrant's auditors and the audit committee of the
registrant's board of directors (or persons performing the equivalent
functions):
(a) All significant deficiencies and material weaknesses in the design
or operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant's ability to record,
process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's internal
control over financial reporting.
Dated: August 12, 2008 /s/ Glenn L. Halpryn
---------------------------------------
Glenn L. Halpryn
Chief Executive Officer and President
Exhibit 31.2
CERTIFICATION OF CHIEF FINANCIAL OFFICER
I, Alan Jay Weisberg, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Getting Ready
Corporation;
2. Based on my knowledge, this report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by
this report;
3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material respects
the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this report;
4. The registrant's other certifying officer(s) and I are responsible
for establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control
over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-
15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our supervision, to
ensure that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this report is being
prepared;
(b) Designed such internal control over financial reporting, or caused
such internal control over financial reporting to be designed under our
supervision, 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;
(c) Evaluated the effectiveness of the registrant's disclosure controls
and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of the
period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant's internal
control over financial reporting that occurred during the registrant's most
recent fiscal quarter (the registrant's fourth fiscal quarter in the case of
an annual report) that has materially affected, or is reasonably likely to
materially affect, the registrant's internal control over financial
reporting; and
5. The registrant's other certifying officers and I have disclosed,
based on our most recent evaluation of internal control over financial
reporting, to the registrant's auditors and the audit committee of the
registrant's board of directors (or persons performing the equivalent
functions):
(a) All significant deficiencies and material weaknesses in the design
or operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant's ability to record,
process, summarize and report financial information; and
b) Any fraud, whether or not material, that involves management or
other employees who have a significant role in the small business issuer's
internal control over financial reporting.
Dated: August 12, 2008 /s/ Alan Jay Weisberg
---------------------------------------
Alan Jay Weisberg
Chief Financial Officer
Exhibit 32
CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER PURSUANT
TO 18 U.S.C. SECTION 1350
In connection with the Quarterly Report on Form 10-Q of Getting Ready
Corporation for the period ended June 30, 2008, as filed with the Securities
and Exchange Commission (the "Report"), we, Glenn L. Halpryn, Chief Executive
Officer and President of Getting Ready Corporation, and Alan Jay Weisberg,
Chief Financial Officer of Getting Ready Corporation, hereby certify pursuant
to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, that:
1. The Report fully complies with the requirements of Section 13(a) or
15(d) of the Securities Exchange Act of 1934; and
2. The information contained in the Report fairly presents, in all
material respects, the financial condition and results of operations of
Getting Ready Corporation.
Dated: August 12, 2008 /s/ Glenn L. Halpryn
---------------------------------------
Glenn L. Halpryn
Chief Executive Officer and President
Dated: August 12, 2008 /s/ Alan Jay Weisberg
---------------------------------------
Alan Jay Weisberg
Chief Financial Officer
A signed original of this written statement required by Section 906 has been
provided to Getting Ready Corporation and will be retained by Getting Ready
Corporation and furnished to the Securities and Exchange Commission or its
staff upon request.