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GPAYE > SEC Filings for GPAYE > Form 8-K/A on 12-Jun-2014All Recent SEC Filings

Show all filings for GOLD PARTY PAYDAY INC

Form 8-K/A for GOLD PARTY PAYDAY INC


12-Jun-2014

Entry into a Material Definitive Agreement, Completion of Acquisition or


Item 1.01 Entry into a Material Definitive Agreement.

On May 14, 2014, we entered into a merger agreement (the "Merger Agreement") with 2418146 Ontario Inc., an Ontario (Canada) corporation ("GPAY Sub"), which is our wholly-owned subsidiary formed for purposes of consummating the Merger Agreement, and Canada Cannabis Corp., an Ontario (Canada) corporation ("CCC"). Pursuant to the terms of the Merger Agreement, CCC and GPAY Sub shall cause to be executed and filed Articles of Amalgamation pursuant to the Ontario Business Corporations Act to consummate the amalgamation, which we intend to file on May 21, 2014 (the "Closing Date"). As of the Closing Date, pursuant to the terms of the Merger Agreement, the company resulting from the amalgamation ("CCC2") is a wholly-owned subsidiary of the Company and retains the CCC name and business, and each of the predecessor companies ceased. Additionally, as of the Closing Date, pursuant to the terms and conditions of the Merger Agreement, we acquired 100% of the issued and outstanding shares of common stock of CCC in exchange for the issuance of 1,004,939 shares of our common stock, par value $0.000001.


Additionally, on May 14, 2014, we entered into a business transfer and indemnity agreement (the "Transfer Agreement") with Tatum L. Morita, who is our President, CEO, CFO, a director of the Company and our majority shareholder (holding 4,000,000 of 4,333,350 shares of our common stock immediately prior to the Closing Date). Pursuant to the terms of the Transfer Agreement, immediately after the Closing Date, Ms. Morita (i) returned to the Company 4,000,000 shares of the Company's common stock, (ii) agreed that outstanding loans made by Ms. Morita to the Company in the aggregate amount of $7,100 are satisfied and paid in full, and (iii) agreed to indemnify and hold harmless the Company and CCC2 with respect to all liabilities of the Company in existence, arising during, or relating to the period prior to the Closing Date. Pursuant to the terms of the Transfer Agreement, on the Closing Date, the Company (i) transferred to Ms. Morita the assets of the Company business, as in existence prior to the Closing Date, (ii) paid cash consideration to Ms. Morita in the amount of $361,650, and
(iii) agreed to, jointly and severally with CCC2, indemnify and hold harmless Ms. Morita with respect to all liabilities of the Company incurred after the Closing Date.

As a result of the transactions effected by the Merger Agreement and the Transfer Agreement, (i) the former business of CCC is now the sole business of the Company's wholly-owned subsidiary, CCC2, (ii) our sole business is now to invest in and support the business of CCC2, and (iii) there is a change of control whereby the former shareholders of CCC now own a controlling 75% ownership interest in the Company.

As a further condition of the Merger Agreement, the current officers and directors of the Company resigned, each effective immediately with the exception of Ms. Morita's resignation as a director, which will be effective upon compliance with Rule 14f-1 under the Securities Exchange Act of 1934 (the "Exchange Act"). Mr. Benjamin Ward was appointed to serve as a Director and also as the CEO and President of the Company, effective immediately. Additionally, Mr. John Esteireiro was appointed to serve as the Company's COO and Mr. Peter Strang and Mr. Silvio Serrano were appointed as Vice Presidents, each effective immediately. Finally, Mr. Esteireiro, Mr. Strang, Mr. Serrano and Mr. Dale Rasmussen were appointed to serve as Directors of the Company, which appointments will be effective upon compliance with Rule 14f-1 under the Exchange Act.



Item 2.01 Completion of Acquisition or Disposition of Assets.

The disclosure required by this item is included in Item 1.01 hereof and is incorporated herein by reference.

The foregoing summary of the Merger Agreement, Transfer Agreement and Articles of Amalgamation is not complete and is qualified in its entirety by reference to the complete text of the Merger Agreement, Transfer Agreement and Articles of Amalgamation, which are attached hereto as Exhibits 2.1, 2.2 and 2.3, respectively.

DESCRIPTION OF BUSINESS

Corporate History and Background

Gold Party Payday, LLC, our predecessor, was organized as a Limited Liability Company on August 16, 2011 under the laws of the State of California. We were incorporated on September 19, 2011 under the laws of the State of Delaware for the sole purpose of acquiring all of the outstanding membership units of Gold Party Payday, LLC. Prior to the acquisition transaction described above under "Item 1.01" of this Current Report, our business operations consisted of organizing events and parties in which guests bring their unwanted jewelry, scrap gold and silver, coins and other gold and silver items to sell to us at a discount, after which we resold the items to refineries.


Upon the consummation of the transactions contemplated by the Merger Agreement and Transfer Agreement, as described above under "Item 1.01" of this Current Report, our sole business is now to invest in and support the business of CCC2, our wholly-owned subsidiary, which will continue the former business of CCC and descriptions of our business hereinafter refer to the business of CCC before the Closing Date.

CCC was incorporated in the Province of Ontario (Canada) on January 20, 2014. CCC was a development stage company whose principal line of business was in the pharmaceutical sector. More specifically, CCC was focused on applying to obtain its initial license to produce and supply medical marihuana (the "License") under the newly effective Marihuana for Medical Purposes Regulation (the "MMPR") in Canada and other startup activities in preparation for commencing full operations in the production and supply of medical marihuana.

Business Overview

Our corporate officers are located in Oakville, Ontario, Canada. The Company intends to operate under the recently effective MMPR to manufacture and market medical marihuana products in Canada and internationally, as permitted by local laws.

On April 3, 2014, CCC submitted to Health Canada, the Canadian government agency charged with enforcing the MMPR, an application to obtain its initial License to produce and supply medical marihuana under the MMPR. At the request of Health Canada, CCC subsequently submitted an update to the application on April 25, 2014. To date, the Company estimates that it has spent approximately CAD $1,650,000 on the license application process, including architectural drawings, engineer reports and a deposit with respect to the facility where the Company intends to house the initial licensed operations.

To obtain the License under the MMPR, we are required to show plans for securing marihuana products. We believe the security plan we submitted to Health Canada with our application exceeds the requirements, including:

Extensive security systems for the grow facility consisting of electronically controlled entry to all grow, processing, and storage areas to restrict access to only those personnel whose presence is required by their work;
Closed circuit camera systems covering entrances to the building, as well as to each grow, processing, and storage area;
Installation of controlled access vaults for storage of marihuana products and waste to restrict access to only those personnel whose presence is required by their work;
Tamper proof designs on security equipment;
Securing the entire property with appropriate fencing to deter unauthorized access and protective and impervious exterior sealant;
Security clearances of all personnel who will be directly involved in the cultivation, harvesting and storage chain of custody with respect to the marihuana products; and
Operational controls and procedures to ensure on site management of product and mitigate risk of product loss.


Additionally, the MMPR requires us to show adequate quality assurance measures through standard operating procedures, process flow and laboratory testing of marihuana products. We intend to implement our quality assurance program through . . .



Item 3.02 Unregistered Sales of Equity Securities.

Reference is made to the disclosure set forth above under "Item 2.01" of this Current Report under the heading "Recent Sales of Unregistered Securities", which disclosure is incorporated herein by reference.



Item 5.01 Changes in Control of the Registrant.

Reference is made to the disclosure set forth above under "Item 1.01" of this Current Report, which disclosure is incorporated herein by reference. Other than the transactions and agreements disclosed in "Item 1.01," we know of no arrangements, which may result in a change in control at a subsequent date.



Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

Pursuant to the terms of the Merger Agreement, the current officers and directors of the Company resigned, each effective immediately with the exception of Ms. Morita's resignation as a director, which will be effective upon compliance with Rule 14f-1 under the Exchange Act. Mr. Benjamin Ward was appointed to serve as a Director and as the CEO and President of the Company, effective immediately. Additionally, Mr. John Esteireiro was appointed to serve as the Company's COO and Mr. Peter Strang and Mr. Silvio Serrano were appointed as Vice Presidents, each effective immediately. Finally, Mr. Esteireiro, Mr. Strang, Mr. Serrano and Mr. Dale Rasmussen were appointed to serve as Directors of the Company, which appointments will be effective upon compliance with Rule 14f-1 under the Exchange Act.

For certain biographical and other information regarding the newly appointed directors, see the disclosure under Item 2.01 of this report, which disclosure is incorporated herein by reference.




Item 9.01. Financial Statements and Exhibits.

(a) Financial statements of business acquired. In accordance with Item 9.01(a), audited financial statements of Canada Cannabis Corp. for the period from its inception (January 20, 2014) through March 31, 2014 are filed with this Current Report as Exhibit 99.1.

(b) Pro forma financial information. In accordance with Item 9.01(b), our pro forma financial statements are filed with this Current Report as Exhibit 99.2.

(c) Not applicable.

(d) Exhibits:

Exhibit Description

2.1* Merger Agreement, by and among the Company, 2418146 Ontario Inc. and Canada Cannabis Corp., entered into on May 14, 2014

2.2* Business Transfer and Indemnity Agreement by and between the Company and Tatum L, Morita, entered into on May 14, 2014

2.3* Articles of Amalgamation

  10.1* Acquisition Agreement, by and among Canada Cannabis Corp., 2393245 Ontario
        Inc. c.o.b. Growlite Canada and Silvio Serrano, entered into on March 31,
        2014

10.2* Loan Agreement, by and between Canada Cannabis Corp. and 2393245 Ontario Inc. c.o.b. Growlite Canada, entered into on March 31, 2014

  10.3* Agreement of Purchase and Sale, by and among Canada Cannabis Corp., I.L.
        Rosen Limited, Time Holdings Limited and Tanak Group Ltd., entered into on
        April 1, 2014

10.4* Consulting Agreement, by and between Canada Cannabis Corp. and Advanced Cannabis Solutions Consulting, entered into on March 1, 2014

10.5 Lease Agreement, by and between Canada Cannabis Corp. and Keevil Co., entered into on January 10, 2014

  10.6* Consulting Agreement, in the form entered into by and between Canada
        Cannabis Corp. and each of Benjamin Ward, John Esteireiro, Peter Strang,
        Silvio Serrano, and Mariana Bracic, each dated January 21, 2014

10.7* Extension Letter, by and among Canada Cannabis Corp., I.L. Rosen Limited, Time Holdings Limited and Tanak Group Ltd., entered into on May 16, 2014

10.8* Employment Agreement, entered into by and between Canada Cannabis Corp.

and Benjamin Ward, dated March 21, 2014

99.1 Audited financial statements of Canada Cannabis Corp. for the period from its inception (January 20, 2014) through March 31, 2014

99.2 Pro forma financial statements

* Included in initial Current Report on Form 8-K filed on May 20, 2014.


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