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| PRTN > SEC Filings for PRTN > Form 8-K on 13-Nov-2012 | All Recent SEC Filings |
13-Nov-2012
Entry into a Material Definitive Agreement, Completion of Acquisition or
On August 23, 2012, the Company and its controlling stockholders (the "Controlling Stockholders") entered into a Share Exchange Agreement (the "Share Exchange") with Eaton Scientific Systems, Ltd., a Nevada corporation ("ESSL") and the shareholders of ESSL (the "ESSL Shareholders"), whereby the Company acquired 25,000,000 shares of common stock (100%) of ESSL (the "ESSL Stock") from the ESSL Shareholders. In exchange for the ESSL Stock, the Company issued 25,000,000 shares of its common stock to the ESSL Shareholders.
The foregoing summary description of the terms of the Share Exchange may not contain all information that is of interest to the reader. For further information regarding specific terms and conditions of the Share Exchange, reference is made to such agreement filed as Exhibit 2.1 to the Company's Current Report on Form 8-K filed with the SEC on August 24, 2012, and is incorporated herein by this reference.
The Company's Chief Executive Officer, Mr. Michael J. Borkowski, and the Company's controlling shareholder and former President, Ms. Christine Buchanan-McKenzie, entered into a Common Stock Purchase Agreement, whereby Mr. Borkowski would purchase one hundred (100%) percent of the Company's common shares owned by Mrs. Buchanan-McKenzie, or 240,000,000 shares, at par value $.0001, representing approximately 54.1% of the Company's total issued and outstanding shares. The Common Stock Purchase Agreement, and subsequent transaction closing, was completed on October 22, 2012. On October 23, 2012, the Common Stock Purchase Agreement was finalized, and a Change in Control of the Registrant took place.
In conjunction with the 25,000,000 Share Exchange and sale of 240,000,000 the total shares held by ESSL Shareholders is 265,000,000 or approximately 59.8% of the issued and outstanding common stock of the Company as of October 30, 2012. In addition certain ESSL shareholders owning a total of 135,779,375 shares of the Company's common stock representing approximately 30.64% of the issued and outstanding common stock of the Company entered into three (3) separate twenty-four (24) month Lock-Up Agreements, which are attached herewith as Exhibits 10.9 through 10.11.
On September 12, 2012, the Company issued a Convertible Promissory Note ("Convertible Note") in the amount of $500,000 to a related party. The Convertible Note is interest free, is payable within 2 years, and contains a conversion feature which allows for the principal balance to be converted into common stock of the Company. The Convertible Note is attached herewith as Exhibit 99.4.
The information provided in Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 2.01.
The information provided in Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 3.02.
Exemption From Registration. The shares of Common Stock referenced herein were
issued in reliance upon an exemption from registration afforded either under
Section 4(2) of the Securities Act for transactions by an issuer not involving a
public offering, or Regulation D promulgated thereunder, or Regulation S for
offers and sales of securities outside the U.S.
The information provided in Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 5.01.
On August 22, 2012, Christine Buchanan-McKenzie resigned from all positions with the Company, including, but not limited to that of President, Chief Executive Officer, Chief Financial Officer, Secretary, Treasurer, and a member of the Board of Directors. The resignation did not involve any disagreement with the Company on any matter relating to the Company's operations, policies or practices. On the same day, Mr. Michael Borkowski was appointed as President, Chief Executive Officer, Chief Financial Officer, Secretary, Treasurer, and a member of the Board of Directors of the Company.
The biography for the newly appointed directors and officers are set forth below under the section entitled, "DIRECTORS AND EXECUTIVE OFFICERS".
The information provided in Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 8.01. As a result of the Share Exchange, (i) Eaton Scientific Systems, Ltd. became a wholly owned operating subsidiary of the Company; and (ii) the business of Eaton Scientific Systems, Ltd., which is more fully described below, became the Company's principal operations.
Prior to the closing of the Share Exchange, there were no outstanding options or warrants to purchase shares of capital stock of the Company, and the Company had not adopted an equity incentive plan or otherwise reserved shares for issuance as incentive awards to officers, directors, employees and other qualified persons in the future.
As of the date of the Share Exchange, there were no material relationships between the Company and ESSL, or between the Company and any of ESSL's respective affiliates, directors, or officers, or any associates of its respective officers or directors, other than with respect to the Share Exchange.
Corporate History
The Company was incorporated on December 8, 2009 under the laws of the State of Nevada. The Company's wholly owned subsidiary, Pristine Solutions Limited, was incorporated under the laws of Jamaica. The Company's original business plan focused on developing a network of sales points for the sale and service of tankless water heaters in Jamaica, through Pristine Solutions Limited. The Company's aim was to become the first tankless water heater company specializing in tankless-only products to enter the Jamaican market, and the only company in the Jamaican market offering solar-powered tankless water heater products. As part of its plan, on December 30, 2009, the Company entered into a distribution agreement with Zhongshan Guangsheng Industry Co., Ltd., of China ("Zhongshan"), the manufacturer of the tankless water heaters. Zhongshan currently manufactures the tankless water heaters under the brand Gleamous Electric Appliances.
On August 23, 2012, the Company and its Controlling Stockholders entered into a Share Exchange with ESSL and the ESSL Shareholders, whereby the Company acquired 25,000,000 shares of common stock (100%) of ESSL from the ESSL Shareholders. In exchange for the ESSL Stock, the Company issued 25,000,000 shares of its common stock to the ESSL Shareholders.
As a result of the Share Exchange, (i) ESSL became the Company's wholly owned subsidiary; and (ii) the Company intends to continue the ESSL operations as its primary business.
Please note that the information provided below, unless otherwise noted, relates to the combined enterprises of ESSL and the Company after the Share Exchange.
Business Description
Eaton Scientific Systems, Ltd., a Nevada corporation, was formed in January 31, 2006. The Company is headquartered in Beverly Hills, California, and is engaged in biomedical product development in the area of women's health. The Company's mission is to provide solutions to women's health issues surrounding pre-menopausal, peri-menopausal and post-menopausal conditions. The Company intends to develop non-hormonal treatments, and address the specific need for a non-hormonal solution to "Hot-Flushes", a common symptom experienced by many pre-menopausal and post-menopausal women.
The Company is in the process of developing a novel treatment for climacteric (menopausal) symptoms, has filed a Provisional Patent Application, USPTO No. 60/719,756, and a Patent Pending Application USPTO No. 11/523,975, which covers a novel indication for an existing FDA cleared prescription drug, Tropine 3 ("Homatropine"). Tropine 3 is an orally ingested prescription product containing Homatropine, which is intended to reduce climacteric symptoms and improve quality of life in menopausal women who are experiencing "hot flashes" and "night sweats", but who are not receiving hormone replacement therapy ("HRT"). Homatropine (Equipin, Isopto Homatropine) is an anticholinergic medication that inhibits muscarinic acetylcholine receptors and thus the parasympathetic nervous system.
The Company has also developed a Clinical Trial Protocol for a Phase I/II, Prospective, Randomized, Double Blind, Placebo-Controlled, Dose Escalation, Open Label Study to Test the Efficacy and Safety of Homatropine Methylbromide Oral Suspension on Selected Climacteric Symptoms and Quality of Life in Menopausal Women Not Receiving HRT for its new drug indication and will execute the Trial with the goal of generating data that supports its claims. The Company has retained a team of medical professionals and is preparing the Protocol in order to begin a Clinical Trial (the "Study") for FDA approval of Tropine 3 containing Homatropine in oral suspension. The purpose of the Study is to look at the effectiveness and safety of the drug Homatropine, to see if it will provide relief of hot flashes, night sweats and other menopause symptoms, and improve the quality of life in women. The Company's goal is to complete the study, barring any unforeseen delays, by the end of the 2nd calendar quarter of 2013. Provided that the data supports the Company's Claims it has outlined its Patent Application, it will present the information to the FDA for review. The Company anticipates that the FDA will request a Phase III Trial to be conducted by the Company prior to a review for consideration of Tropine 3 receiving an FDA Approval.
The Company has recently finished its first Clinical Trial Protocol and is prepared to conduct the Study. The purpose of the Study will be to demonstrate that Tropine 3, its novel new indication of Homatropine, and existing FDA Approved drug currently used to treat heavy coughing, has the ability to provide relief to pre-menopausal, menopausal and post-menopausal women suffering from hot flashes. The Company's technical mission is to prove its central thesis that Homatropine in an oral suspension formula can reduce hot flashes in pre-menopausal, menopausal and post-menopausal women through multiple clinical trial validations.
The Market
Pre-Menopausal, Menopausal & Post-Menopausal
The climacteric (also known as menopause) is defined as the syndrome of endocrine (hormonal), somatic (bodily) and psychological changes occurring at the termination of the reproductive period in the female. According to the Greene Climacteric scale, there are 21 common symptoms associated with a woman's climacteric stage, namely heart beating quickly or strongly, feeling tense or nervous, difficulty in sleeping, excitability, attacks of panic, difficulty in concentrating, feeling tired or lacking in energy, loss of interest in most things, feeling unhappy or depressed, crying spells, irritability, feeling dizzy or faint, pressure or tightness in head or body, parts of the body feel numb or tingling, headaches, muscle and joint pains, loss of feeling in hands and feet, breathing difficulties, hot flushes, sweating at night, and loss of interest in sex. Other symptoms commonly experienced in climacteric women include urinary frequency and urgency, palpitations, and anxiety.
About 50 million women in the United States alone, experience hot flashes. Eighty-five percent of the women in the United States experience hot flashes of some kind as they approach menopause and for the first year or two after their periods stop. Between 20% and 50% of women continue to have them for many more years. As time goes on, the intensity decreases. The women's health market as it pertains to menopause is approximately 26.8 million women and is expected to grow to over 50 million as the baby boomers start to enter this phase of their life. Though there are many issues affecting women in the menopausal age the biggest factors focus on hormonal replacement therapies and the treatments association to breast cancer.
Menopause is a normal part of life, just like puberty. It is the time of a woman's last period, but symptoms can begin several years earlier. Some symptoms of menopause can last for months or years after. Changing levels of estrogen and progesterone, which are two female hormones made in a women's ovaries, might lead to these symptoms. This time of change is known as the menopausal transition, but many women and their doctors also call it peri-menopause. It can begin several years before a women's last menstrual period. Peri-menopause lasts for 1 year after a women's last period. After a full year without a period, women can say they have been "through menopause." Post-menopause follows menopause and lasts the rest of their life.
The average age of a woman having her last period, menopause, is 51. But, some women have their last period in their forties, and some have it later in their fifties. Smoking can lead to early menopause. So can some types of operations. For example, surgery to remove a uterus (called a hysterectomy) will make a woman's periods stop, and that is menopause. A woman might not have menopause symptoms like hot flashes immediately, however, because, if her ovaries are untouched, they still make hormones. In time, when the ovaries start to make less estrogen, menopause symptoms could start. But, sometimes both ovaries are removed (called an oophorectomy), usually along with her uterus. That is menopause too. In this case, menopause symptoms can start right away; no matter what age a woman is, because her body has lost its main supply of estrogen.
According to the recent study "Women's Health Therapeutics Market to 2017" ("GBI Study") by GBI Research issued in January 1, 2012, there continues to be a "high unmet need will drive uptake of novel drugs". GBI Research finds that the women's health therapeutics market will grow rapidly, largely due to the introduction of new therapies and the increased awareness among patients and physicians in two of the largest segments within women's health disorders, the menopause and osteoporosis areas. According to the GBI Research Study, Novel non-hormonal therapeutics will become more popular during the forecast period. The GBI Study further overall women's health therapeutics market is driven by postmenopausal osteoporosis and menopause.
According to the GBI Study the women's health therapeutics market research and development pipeline is only moderately strong, with the majority of first-in-class drugs in late stages of development. These drugs are expected to drive market revenues and it is expected that, if they are approved and are shown to have better safety profiles, patients will comply with novel therapies. In particular, non-hormones are set to take over the conventional hormone therapeutics market.
In 2010, the global women's health therapeutics market was estimated to be worth $14,530,000, after a Compound Annual Growth Rate ("CAGR") of 3.5% between 2002 and 2010. By 2017, the market is estimated to reach $24.6 billion, indicating a CAGR of 7.9% between 2010 and 2017. Owing to several factors such as the publication of the Women's Health Initiative ("WHI") study results, and a lack of effective therapeutics, the women's health therapeutics market grew only moderately between 2002 and 2010. However, the launch of novel therapeutics in the near future is expected to satisfy the unmet need in the market. This will have a pronounced effect on positive growth in the menopause therapeutics market.
The Company believes that the menopausal market has considerable unmet need, as the fear of diseases that have, in certain studies ("2002 Women's Health Initiative") been linked to hormonal therapeutics. Hormones have been shown to be associated with significant safety issues such as risks of breast cancer and . . .
FINANCIAL INFORMATION
FINANCIAL INFORMATION OF EATON SCIENTIFIC SYSTEMS LTD
Interim Financial Statements of Eaton Scientific Systems, Inc:
Unaudited Balance Sheets as of June 30, 2012 and December 31,
2011 F-7
Unaudited Statements of Income for three and six months ended
June 30, 2012 and 2011 F-8
Unaudited Statements of Cash Flows for six months ended June 30,
2012 and 2011 F-9
Audited Financial Statements of Eaton Scientific Systems, Inc. Report of Independent Registered Public Accounting Firm F-10 Balance Sheets as of December 31, 2011 and 2010 F-11 Statement of Income for the years ended December 31, 2011 and 2010 F-12 Statement of Cash Flows for the years ended December 31, 2011 and 2010 F-13 Statement of Stockholders' Equity for the years ended December 31, 2011 and 2010 F-14
Notes to the Financial Statements of Eaton Scientific Systems,
Inc.
Notes to the unaudited Financial Statements for the six months
ended June 30, 2012, and the audited Financial Statements for the
years ended December 31, 2011 and 2010 F-15
PRO FORMA FINANCIAL INFORMATION
Summary of Transaction
On August 23, 2012, the Company and its controlling stockholders (the "Controlling Stockholders") entered into a Share Exchange Agreement (the "Share Exchange") with Eaton Scientific Systems, Ltd., a Nevada corporation ("ESSL") and the shareholders of ESSL (the "ESSL Shareholders"), whereby the Company acquired 25,000,000 shares of common stock (100%) of ESSL (the "ESSL Stock") from the ESSL Shareholders. In exchange for the ESSL Stock, the Company issued 25,000,000 shares of its common stock to the ESSL Shareholders.
The foregoing summary description of the terms of the Share Exchange may not contain all information that is of interest to the reader. For further information regarding specific terms and conditions of the Share Exchange, reference is made to such agreement filed as Exhibit 2.1 to the Company's Current Report on Form 8-K filed with the SEC on August 24, 2012, and is incorporated herein by this reference.
The Company's Chief Executive Officer, Mr. Michael J. Borkowski, and the Company's controlling shareholder and former President, Ms. Christine Buchanan-McKenzie, entered into a Common Stock Purchase Agreement, whereby Mr. Borkowski would purchase one hundred (100%) percent of the Company's common shares owned by Mrs. Buchanan-McKenzie, or 240,000,000 shares, at par value $.0001, representing approximately 54.1% of the Company's total issued and outstanding shares. The Common Stock Purchase Agreement, and subsequent transaction closing, was completed on October 22, 2012. On October 23, 2012, the Common Stock Purchase Agreement was finalized, and a Change in Control of the Registrant took place.
Pro Forma Financial Information
July 31, 2012
The unaudited condensed consolidated pro forma financial information of Pristine Solutions, Inc. ("PSI") as of July 31, 2012, gives effect to the Share Exchange as if the transaction had occurred on July 31, 2012.
The unaudited condensed consolidated pro forma balance sheet gives effect to the transaction as of July 31, 2012. The unaudited condensed consolidated pro forma statement of operations for the six month ended July 31, 2012, gives effect to the transaction as if it had occurred February 1, 2011.
The unaudited condensed consolidated pro forma financial information has been included as required by the rules of the Securities and Exchange Commission and is presented for illustrative purposes only. Such information is not necessarily indicative of the operating results or financial position that would have occurred had the transaction taken place or had occurred on the earliest date of February 1, 2011.
January 31, 2012
The unaudited condensed consolidated pro forma financial information of PSI as of January 31, 2012 gives effect to the Share Exchange as if the transaction had occurred on January 31, 2012.
The unaudited condensed consolidated pro forma balance sheet gives effect to the transaction as of January 31, 2012. The unaudited condensed consolidated pro forma statement of operations for the fiscal year ended January 31, 2012, gives effect to the transaction as if it had occurred February 1, 2011.
he unaudited condensed consolidated pro forma financial information has been included as required by the rules of the Securities and Exchange Commission and is presented for illustrative purposes only. Such information is not necessarily indicative of the operating results or financial position that would have occurred had the transaction taken place or had occurred on the earliest date of February 1, 2011.
CONDENSED CONSOLIDATED PRO FORMA FINANCIAL INFORMATION
FOR PRISTINE SOLUTIONS, INC.
AS OF AND FOR THE SIX MONTHS ENDED JULY 31, 2012
PRISTINE SOLUTIONS, INC.
CONDENSED CONSOLIDATED PRO FORMA BALANCE SHEETS
As of July 31, 2012
PSI Pro Forma
Historical ESSL Pro Forma Consolidated
July 31, 2012 Consolidation Adjustments July 31, 2012
(unaudited)
ASSETS
Current Assets $ 6,480 $ 392 $ $ 6,872
Property and equipment, net 5,048 - 5,048
Intangible assets, net - 24,006 24,006
Goodwill 159,710 [5] 159,710
TOTAL ASSETS $ 11,528 $ 24,398 $ - $ 195,636
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current Liabilities $ 57,627 $ 1,108 $ - $ 58,735
Long-term liabilities - 183,000 183,000
Total Liabilities 57,627 184,108 - 241,735
Stockholders' Deficit
Preferred Stock - [1] - - -
Common stock 41,800 [2] 100,000 [3] (75,000 )[4] 44,300 [9]
2,500 [6]
(25,000 )[7]
Additional paid in capital 8,700 (6,250 ) 75,000 [4] 6,200
(68,750 )[5]
(2,500 )[6]
Accumulated Deficit (96,599 ) (253,460 ) 253,460 [6] (96,599 )
Total Stockholders' Deficit (46,099 ) (159,710 ) 159,710 (46,099 )
TOTAL LIABILITIES AND STOCKHOLDERS'
DEFICIT $ 11,528 $ 24,398 $ 159,710 $ 195,636
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[1] 50,000,000 shares authorized, $.001 par, none issued
[2] 650,000,000 shares authorized , $.0001 par, 418,000,686 shares issued and outstanding
[3] 100,000,000 shares authorized, $.001 par, 100,000,000 shares issued and outstanding
[4] ESSL Reverse stock split - 4 to 1 = 100,000,000 shares split to 25,000,000 shares
[5] Elimination of subsidiary equity and recording of goodwill due to business combination
[6] Issuance of PSI shares to ESSL Shareholders - 25,000,000 shares x $.0001 par value = $2,500
[7] Issuance of ESSL shares to PSI Shareholders - 25,000,000 shares x $.001 par value = $25,000
[8] Total PSI shares issued and outstanding, 443,000,618 x par $.0001 = $44,300
PRISTINE SOLUTIONS, INC.
CONDENSED CONSOLIDATED PRO FORMA STATEMENT OF OPERATIONS
As of and for the Six Months Ended July 31, 2012
(unaudited)
PSI ESSL Pro Forma
Historical Consolidation Pro Forma Consolidated
July 31, 2012 June 30, 2012 Adjustments July 31, 2012
Gross Profit $ - $ - $ $ -
General and administrative expenses 19,429 27,939 - 19,429
Operating income (loss) (19,429 ) (27,939 ) - (19,429 )
Other income (expense) 407 - - 407
Net (loss) $ (19,022 ) $ (27,939 ) $ - $ (19,022 )
Net (loss) per common share - basic and
diluted $ (0.00 ) $ (0.00 )
Weighted average common shares
outstanding -
basic and diluted 418,000,686 443,000,686
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