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EX-10 - VIRIDAX CORP | v188695_ex10.htm |
EX-31.1 - VIRIDAX CORP | v188695_ex31-1.htm |
EX-32.2 - VIRIDAX CORP | v188695_ex32-2.htm |
EX-32.1 - VIRIDAX CORP | v188695_ex32-1.htm |
EX-31.2 - VIRIDAX CORP | v188695_ex31-2.htm |
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
10-K
x ANNUAL REPORT UNDER SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the
Fiscal Year ended April 30,
2009
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
000-33473
VIRIDAX CORPORATION
(Exact
name of registrant as specified in its charter)
FLORIDA
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65-1138291
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(State
or other jurisdiction of
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(I.R.S.
Employer Identification No.)
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Incorporation
or organization)
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270 NW 3rd Court, Boca Raton, Florida
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33432-3720
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(Address
of principal executive offices)
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Zip
Code
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Registrant’s
Telephone Number, including area code: (561)
368-1427
Securities
registered pursuant to Section 12(b) of the Act: None .
Securities
registered pursuant to Section 12(g) of the Act:
Common
(Title of
Class)
Indicate
by check mark if the registrant is a well-know seasoned issuer, as
defined in Rule 405 of the Securities Act. ¨Yes x
No
Indicate
by check mark if the Registrant is not required to file
reports pursuant to Section 13 or Section 15(d) of the
Act. ¨Yes x
No
Note – Checking the box above
will not relieve any registrant required to file reports pursuant to Section 13
or 15(d) of the Exchange Act from their obligations under those
sections.
Indicate
by check mark whether the registrant (I) has filed all reports
Indicate by required to be filed by Section l3 or 15(d)of the Securities
Exchange Act of I 934 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 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(§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). oYes ¨
No
Indicate
by check mark if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K (§229.405 of this chapter) is not contained herein, and will not
be contained, to the best of the registrant’s knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form I0—K
or any amendment to this Form 10-K.x
Indicate
by checkmark whether 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 I2b-2 of the Exchange Act.
Large
accelerated filer ¨
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Accelerated
filer ¨
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Non-accelerated
filer ¨ (Do
not check if a smaller reporting company)
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Smaller reporting company
x
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Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Act). ¨Yes x No
The
aggregate market value of voting and non-voting common equity held by
non-affiliates computed by reference to the price at which the common equity was
sold within the past 60 days is not applicable because there have been no sales
of the common equity within the past 60 days and there is no public market for
the stock.
(APPLICABLE
ONLY TO CORPORATE REGISTRANTS)
As of the
date of this filing there are 24,349,090 shares of common stock
outstanding.
DOCUMENTS
INCORPORATED BY REFERENCE
None.
CAUTIONARY NOTE REGARDING
FORWARD-LOOKING STATEMENTS
This
report contains forward-looking statements within the meaning of Section 27A of
the Securities Act and Section 21E of the Exchange Act. We have based these
forward-looking statements largely on our current expectations and projections
about future events and financial trends affecting the financial condition of
our developmental business. These forward-looking statements are subject to a
number of risks, uncertainties and assumptions, including, among other
things:
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Our
ability to obtain capital;
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Our
ability to fully implement our business
plan;
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General
economic and business conditions, both nationally and in our
markets;
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Our
expectations and estimates concerning future revenues, if any, financing
plans and the impact of
competition;
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Other
risk factors that may directly affect our ability to market our products
to end-users on a financially successful
basis.
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In addition, in this report we use
words or phrases such as "high value", "effective", "plans", "strong”, "future",
and similar expressions to identify forward-looking statements.
We undertake no obligation to update
publicly or revise and forward-looking Statements, whether as a result of new
information, future events or otherwise after the date of this report. In light
of these risks and uncertainties, the forward-looking events and circumstances
discussed in this report may not occur and actual results could differ
materially from those anticipated or implied in the forward-looking
statements.
PART
I
Item
1. Description of Business
General
Viridax
is a biopharmaceutical discovery and development company formed to expedite the
commercialization of new technologies and products for the treatment of
bacterial infectious diseases, most especially for the treatment of
antibiotic-resistant infections. The bacteriophage-based-technologies
under development by Viridax specifically target bacterial pathogens that incite
resistant infections in substantial human populations. The Company is developing
new products that target specific bacterial pathogens that represent some of the
most significant infections encountered in the community setting and as
nosocomial (hospital-acquired) agents.
The
increased incidence of bacteria infectious diseases and the spread of infectious
diseases incited by multi-drug resistant strains of bacteria have led to
intensified research into new agents and therapeutic strategies Viridax is
developing novel bacteriophage-based products that have a known mechanism of
action that is shown to be effective against the specific targeted bacterial
hosts
2
Development
of Our Business During Fiscal 2009
The 2009
fiscal year of the Company runs from May l, 2008 through April 30, 2009. During
this period the Company has experienced developments as follows:
Research
Agreements
On March
2, 2009, the Company amended its Research Agreement with Olive-View - UCLA
Educational and Research Agreement (ERI), a California nonprofit corporation, by
suspending any future services by ERI. In addition, ERI forgave any remaining
financial obligations due by the Company. As a replacement
for the ERI arrangement, on March l, 2009 the Company entered into a Research
Agreement, identified as a Cooperative Research and Development Agreement
(CRADA), with the Agricultural Research Service of the United States Department
of Agriculture. The purpose of this project is to evaluate and further develop
certain novel Multi-Domain Lytic Fusion Proteins (MDLFPs) that are being
developed by USDA for use in the treatment of antibiotic-sensitive and
antibiotic-resistant infections incited by the bacterial pathogen Staphylococcus aureus (S.
aureus), and most specifically for the treatment of infections incited by
Methicillin-Resistant S. aureus (MRSA).
USDA is
developing novel MDLFPs that are shown to be effective against S. aureus, and that are
predicted to be refractory to resistance development. Viridax is partnered with
USDA to support the further evaluation and development of the MDLFP technology,
as well as the commercial development of the resulting antibacterial products.
The MDLFPS are being evaluated for their effect on clinical isolates of
MRSA.
The
MDLFPs were constructed by USDA by fusing three peptidoglycan hydrolase lytic
domains that each have the ability to target a unique staphylococcal cell wall
peptidoglycan structural bond, and thereby incite cell lysis and cell death. The
MDLFP constructs each harbor three cell lytic activities that each target a
different bond of the bacterial pathogen’s peptidoglycan cell wall structure.
Verification that all three lytic domains are functional in each triple fusion
construct is currently being conducted under a USDA project plan
objective.
In this
age of ever-increasing antibiotic resistance among some of the most serious
bacterial pathogens in human health care, it is essential to develop new agents
to safely and effectively treat these infections, and such new agents must be
refractory to further resistance development. It is also important to avoid the
use of broad-spectrum antibiotics, so as to have minimal impact on the commensal
bacterial community, including the lateral transfer of DNA elements that harbor
resistance or toxin genes.
3
The
MDLFPs being developed for use as novel antibacterial agents offer multiple
advantages,
such as they:
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Are
expected to preclude the development of new antibiotic resistance (The
fusion of three lytic activities into one novel fusion protein product is
expected to avoid known resistance
mechanisms).
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Have
high pathogen specificity, thus limiting the need for broad-spectrum
antibiotics. (The US Food and Drug Administration [FDA], the US
Centers for Disease Control and Prevention [CDC], and the USDA
collectively recommend avoiding imposing new selective pressures on
pathogenic and non-pathogenic bacteria as a result of the introduction of
additional conventional broad-spectrum
antibiotics).
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Are
low-cost to manufacture by conventional biopharmaceutical
manufacturing
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methods.
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Are
active against all forms of a bacterial pathogen, including against
biofilms.
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Have
product attributes that are highly sought by pharmaceutical
companies.
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Are
active against both intracellular and extracellular
pathogens.
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Are
active against multi-drug resistant bacteria, including
MRSA.
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Address
substantial global pharmaceutical
markets.
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Are
well protected by patent.
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Are
safe for human use.
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Under the
CRADA, USDA has identified a series of novel lytic enzymes, that when fused as
MDLFPs maintain their antibacterial lytic activity against S. aureus and show
synergistic activity that is greater than the additive activities of the
individual enzymes when tested alone. The project work includes the evolution of
numerous MDLFP constructs. The initial MDLFP constructs have been screened
against clinical isolates of MRSA and are shown to effectively lyse the pathogen
cells, resulting in their destruction. As this project further
continues it will include further evolution and refinement of the MDLFP
constructs, in anticipation of the initiation of biopharmaceutical product
development work in the next stage. Viridax has the right to enter into an
exclusive license agreement with USDA for commercialization of the resulting
products.
The
Agreement with the Agricultural Research Service has been amended to run through
January 10, 2011.
Change
in Officers
On April
1, 2009, Richard E. Herman, Ph.D, was appointed by the Board of Directors as
Vice President, Research and Development.
Change
in the Board of Directors
On July
18, 2009, Javaid Sheikh voluntarily resigned as a member of the Board of
Directors. There was no conflict or adverse circumstances whatsoever regarding
his resignation.
4
Revenues
The
Company had no revenue during the year ended April 30, 2009. The Company
obtained its funding from the sales of its Class A preferred stock overseas
pursuant to an offering prospectus approved by the German Federal Financial
Supervisory Authority (BAF IN). The BAFIN approved an
extension of this offering prospectus for 2009.
Products
Viridax
plans to introduce a series of high value products based on certain proprietary
forms of lytic bacteriophage, plus a novel delivery technology, initially for
the treatment of S.
aureus and other Staphylcooccus spp. The
underlying technology base is expected to provide a core platform for the
development of multiple products for the treatment of bacteria in addition to
Staphylcooccus
spp.
Staphylcooccus aureus
Bacteriophage (Staph phage) Products for the Treatment of:
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Respiratory Infections:
MRSA-incited Ventilator-Associated Pneumonia
(MRSA-VAP)
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Systemic
infections: MRSA-incited Bacteremia
(MRSA-Bacteremia)
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MRSA-incited Ventilator-Associated
Pneumonia (MRSA-VAP): VAP is characterized as pneumonia of infectious
origin in a patient on a ventilator, which results in fluid accumulation in lung
alveoli. VAP is distinguished from other pneumonias by the inciting pathogen,
the antibiotic treatments administered, and the methods of diagnosis prognosis
and prevention. In order to have VAP, the patient must be on a ventilator. It is
the fact that the patient is on a ventilator that defines VAP not the infectious
agent. VAP that is incited by MRSA is referred to as
MRSA-VAP. Patients on a ventilator are already sick and highly
likely to become infected with MRSA and develop MRSA-VAP which has a high rate
of mortality among all patients on a ventilator, and most especially among the
elderly.
MRSA-Incited Bacteremia
(MRSA-Bacteremia): Bacteremia is the presence of bacteria in the blood,
which may be caused by dental work, catheterization of the urinary tract,
surgical treatment of an abscess or infected wound, or colonization of
indwelling devices, especially intravenous and intracardiac catheters, urethral
catheters or ostomy devices and tubes. Bacteremia secondary to
infection usually originates in the genitourinary (GU) or gastrointestinal (Gl)
tract, or on the skin. Chronically ill patients, immunocompromised
patients and injection drug users have an increased risk of bacteremia. MRSA is
a common, dangerous and difficult-to-treat inciting agent of
bacteremia.
5
The Pathogen, Staphylococcus
aureus: S aureus and many other
species of Staphylococcus (Staph) are
common bacteria typically encountered on the skin and in the nasal passages of
healthy people. Staph can cause serious, life-threatening infections of the
respiratory tract and cardiovascular system, including the blood
stream, bone, soft tissue, skin and eye. Most Staph infections are minor,
inciting such conditions as pimples, boils and other common skin ailments, and
most can be managed without antibiotics. However, Staph can also
cause serious and sometimes fatal systemic infections, such as may result from
ordinary surgical or trauma wounds. During the past 50 years,
treatment of these infections has become more difficult, primarily because Staph
have become resistant in various degrees to nearly all antibiotics, including
the commonly used penicillin-related antibiotics, such as Methicillin. The forms
of S aureus that are
resistant to methicillin and other antibiotics are known as
Methicillin-resistant Staphylococcus aureus
(MRSA).
Of the
many available antibiotics, Vancomycin generally provides some measure of
success. However, a new form of resistant S aureus known as
Vancomycin-lntermediate-Resistant S aureus (VISA) has emerged
to further confound treatment. The newest and most frightening form of
antibiotic-resistant Staph is known as Vancomycin-Resistant S aureus (VRSA). VlSA and
VRSA cannot be treated successfully with Vancomycin, but fortunately, nearly all
VISA and VRSA isolates are found to be susceptible to some other antibiotics.
The delay to treatment is always costly and can be fatal.
VISA and
VRSA infections are becoming more common, and the fact that they are present
suggests that the incidence and prevalence of these infections will likely
become even greater. Federal agencies in the US including the National
Institutes of Health, the Centers for Disease Control and Prevention and the US
Food and Drug Administration (FDA), state dearly that perhaps the most serious
infectious disease health crises in the world today is the emergence and spread
of resistant forms of Staphyloooccus, Pseudomonas
and Tuberculosis.
Bacterial
resistance mechanisms to bacteriophage are distinct from those to antibiotics,
making bacteriophage an excellent alternative to conventional antibiotic
treatment. Conventional antibiotics are considered to be toxic by the
FDA but there has not been any toxicity associated with
bacteriophage. Also, the costs for producing bacteriophage are far
less than the costs for most antibiotics, especially the latest generation
antibiotic products that are used to treat resistant infections.
Summary
of Pharmaceutical Development Progress.
The
bacteriophage isolate selected for further development as the Product Candidate
for use against S
aureus initially specifically against MRSA-VAP was screened among several
other bacteriophage isolates against many hundreds of MRSA clinical isolates to
determine their relative activity against multiple types and forms of MRSA,
including against specific clinical isolates of MRSA-VAP. Of the many
bacteriophages, one was selected for further development as the single Product
Candidate, based on its high level of reproducible activity against the panel of
MRSA clinical isolates.
The
selected MRSA Product Candidate bacteriophage was manufactured in compliance
with current Good Manufacturing Practices (cGMP) of the USFDA and large numbers
of doses were produced for use in preclinical tests of safety and efficacy,
analytical methods development, stability studies, formulations development and
spectrum of activity studies. The Company now knows how to make, formulate and
use the Product Candidate in the next battery of studies that will be conducted
in compliance with current Good Laboratory Practices (cGLP) guidelines of the
USFDA.
6
Contract
Manufacturing Organizations and Contract Research Organizations have been
evaluated, and specific firms selected for collaboration on the manufacture and
testing of the MRSA Product. Candidate bacteriophage, in anticipation
of filing a Pre-IND (Pre-investigational New Drug Application) report with the
FDA as a key step in scheduling a Pre-IND meeting. Successful
completion of the Pre-IND meeting and filing of a formal lND are critical steps
to initiating Phase I (First-in-Human) Clinical Investigations of safety.
Successful completion of the Phase I clinical trial will precipitate subsequent
regulatory filings with FDA to gain authorization to initiate a series of Phase
II clinical investigations, first for
further safety testing, to be followed by combined safety and efficacy
trials.
The manufacturing development work
completed to date demonstrates that the selected MRSA Product Candidate
bacteriophage can be manufactured and purified to FDA standards, and that the
selected MRSA Product Candidate is safe and efficacious through the preclinical
testing process.
Other Technologies and Products for
Staphylococcus
aureus.
Multi-Domain Lytic Fusion Proteins
(Proprietary): In addition to the use of lytic bacteriophage as
antibacterial therapeutic agents, Viridax is also developing a second generation
technology using bacterial and bacteriophage lytic enzymes that are engineered
for expression in host producer strain bacterial cells in the form of
multi-domain lytic fusion proteins. The resulting multi-domain lytic
fusion protein products retain the lytic activity of each individual enzyme, but
provide enhanced multi-targeted lytic activity against the cell walls of
specific bacterial pathogens Nucleic acid sequences for individual antibacterial
lytic enzymes are identified in bacteria and bacteriophage. The sequences are
engineered into a bacterial producer strain, thereafter to be expressed as a
single novel fusion protein that is isolated, purified and formulated for use as
a therapeutic product. The initial multi-domain lytic fusion proteins for S aureus have been
identified, constructed, produced and tested. Screening for anti-MRSA activity
is in process, and production and purification methods are being
evaluated.
Therapeutic Vaccine
(Proprietary): A lytic bacteriophage, specific to a targeted bacterial
pathogen, is selected for its ability to infect, parasitize, lyse and kill the
pathogen. The bacteriophage is then engineered to express multiple subunit
antigens or multi-domain subunit fusion antigens against the specific bacterial
pathogen on the surface of the selected lytic bacteriophage. The resulting
engineered bacteriophage is thereafter produced in the form of a lytic
bacteriophage antigen display platform that elicits an immune response on one or
more mucosal surfaces of an infected subject, thereby providing a lytic
bacteriophage therapeutic effect, based on the direct lytic activity of the
bacteriophage, plus a multi-domain subunit fusion antigen multimucosal vaccine
effect. The initial lytic bacteriophage antigen display platform for S aureus has been
selected.
7
Regulatory
Affairs
Viridax’s
products will be regulated by governing authorities in the United States, the
United Kingdom, the European Union and other countries both within the
International Conference on Harmonization (ICH) and without, according to the
country’s local regulatory requirements. The regulatory process
in the European Community is similar to that in the USA. The clinical trials
process is initiated by filing a CTX (Clinical Trial Exemption, the US
equivalent is the investigational New Drug Application or IND) for therapeutic
products with the European Medicines Agency (EMA or, European Medicines
Evaluation Agency [EMEA]), which is analogous to the US Food and Drug
Administration (FDA). The EMA application dossier contains, among other sections
1) A Summary of the dossier; 2) Chemical, pharmaceutical and biological
documentation; 3) Pharmacotoxicological documentation; and, 4) Clinical trials
documentation, all of which are similar to the US counterpart.
In the
US, such products are regulated by the FDA pursuant to the federal Food, Drug
and Cosmetic Act and the Public Health Service Act. These regulations govern
preclinical and clinical testing conducted to establish safety and
effectiveness, product licensure prior to marketing, and manufacturing
compliance. In addition to FDA regulations, the Company is also subject to other
federal and state regulations, such as the Occupational Safety and Health Act
and the Environmental Protection Act. The major steps required before a
pharmaceutical agent may be marketed in the US include: 1)
preclinical testing; 2) submission to the FDA of an lND which must become
effective prior to commencing human clinical trials; 3) the
performance and evaluation of scientifically-valid and well-controlled human
clinical trials to establish safety and efficacy; 4) submission of a New Drug
Application (NDA) or a Product License Application (PLA) to the FDA; and, 5) FDA
approval of the NDA or PLA prior to product commercialization. In
addition to obtaining FDA approval for each product, each drug manufacturing
establishment must undergo preapproval inspection by the FDA.
Preclinical
studies are being conducted to provide the minimum acceptable predictive value
of safety and efficacy for the proposed product indication(s). Preclinical
studies are being performed by qualified contract
laboratories. Studies will be conducted in compliance with cGLP
guidelines, as required, and will be designed and executed to meet current
worldwide regulatory requirements The required CTX-enabling and lND-enabling
preclinical studies for the Company’s products will be managed by Viridax to
support government applications. Only the minimum number of
required preclinical safety, efficacy and pharmacokinetics studies will be
conducted by the Company.
Manufacturing
Essential
to successful scale-up manufacturing of therapeutic products for use in
preclinical testing, clinical trials, regulatory approval and commercial sale is
the establishment of cGMP systems that will result in reproducible
manufacturing. Viridax has substantial experience in cGMP
manufacturing of pharmaceutical products and plans to have the initial product
manufactured under contract at a cGMP-compliant facility. Bacteriophage-based
products are considered biologics by FDA and EMEA
Guidelines. Viridax has experience in establishing systems in
compliance with these guidelines. Scale up cGMP batches of
bacteriophage for preclinical testing and for clinical trials will be
out-sourced to a known contract manufacturing organization (CMO) having direct
experience with biopharmaceutical products. Viridax collaborates with
a CMO that is in full compliance with FDA guidelines.
8
Estimated
Market Opportunity
The
international infectious disease therapeutics market grew from about $16 billion
in 1991 to more than $45 billion in 2007, and continues to grow. The US market
share has grown from about 31% to about 37% while the Japanese market share has
declined from about 26% to about 21%. The European market share
and the markets in the rest of the world have remained nearly stable during that
period, with Europe represented by about a 28% market share, and the rest of the
world about 15%. The US market share for new-generation antibiotics
alone is anticipated to exceed $15 billion within the next year. This phenomenal
growth continues in spite of the fact that bacteria have now developed
resistance to nearly all of the antibiotic agents that represent the product
growth leaders. This has led to a continual stream of new antibiotic
products introduced to the market, many of which have a greatly shortened
product life as a direct result of the rapid development of
resistance.
The
medical community, including national and international public health agencies,
has been urging the biomedical research community to expand their efforts to
identify new technologies and products employing novel mechanisms of action
against infectious bacteria. The underlying technology surrounding
Viridax’s products is anticipated to yield multiple new therapeutic agents for
the treatment of sensitive and resistant forms of various bacterial
diseases. The development and marketing of new antibacterial products
that have novel mechanisms of action are less likely to elicit the development
of resistance and will represent one of the most substantial market
opportunities and perhaps some of the most medically useful products in modern
human health care.
In US
hospitals it is estimated that perhaps 3,000,000 patients are infected each year
by bacterial pathogens, and from 80,000 to 100,000 people die from infections
compared with a yearly mortality of about 8,000 in the early 1990s by infectious
diseases. About 90%of Staphylococcal infections
which are responsible for about 15% of all bacterial infections are
now resistant to penicillin, and more than 80% are resistant to
methicillin.
Competition
Competition
for Viridax’s technology, products and markets is represented by pharmaceutical
and biotechnology companies that discover, develop, make and sell antibiotic
products for the treatment of bacterial infectious diseases, and would include
firms that develop new antibiotics, new derivatives of existing antibiotics or
new classes of antibiotics to which resistance has not developed. Competition
would also be represented by new vaccines or by new classes of agents that may
represent novel mechanisms of action for which the development of resistance is
an unlikely event. Viridax is currently unaware of any company that may
represent direct competition to its bacteriophage-based products for the
treatment of Ventilator-Associated Pneumonia or Bacteremia, as incited by
Methicillin-Resistant or Methicillin-Sensitive Staphylococcus
aureus (MRSA or MSSA), but it must be assumed
that technologcaIly-competent scientists and companies are working to
discover and develop new or similar technologies and products that will be
competitive with those of Viridax.
9
Competitive
Companies: There are 11 US and international biotechnology
companies that are identified currently by Viridax as working in the field of
bacteriophage technology and products, plus a number of academic
investigators. These firms and investigators are working primarily to
develop bacteriophage for use in the food processing industry and for the
treatment of animal diseases, with a few working to develop antiseptic and
disinfectant products. A couple of firms are identified as developing and using
bacteriophage as biotechnology tools aid as platform
technologies. The firms Intralytix and Novolytics are developing
bacteriophage for use as therapeutic agents
against MRSA, and may be considered as competitive with
Viridax.
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Biochimpharm
- Eliava Institute, Tbilisi, Republic of Georgia (www.biochimpharm.ge). Biochimpharm
was formed within the Eiava Institute as a business operation and is
licensed to produce bacteriophage for the treatment of dysentery and other
infections.
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Biocontrol
Limited and Biocontrol lnternational Inc. - Nottingham, England and
Richmond, VA (www.biocontrol-ltd.com). Biocontrol's lead
bacteriophage-based product seeks to control Pseudomonas aeruginosa
infections in cystic fibrosis patients and antibiotic-resistant ear
infections
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Biophage
Inc. – Montreal, Canada (www.biophage.com). Biophage exploits new
platform technologies
in the health industry, with focus on cancer, infectious diseases,
inflammation and immune
modulation.
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Biopharm
Pharmaceuticals - Tbilisi, Georgia (biopharm@got.ge). Biopharm acquired
the phage production plant of the Eliava Institute. They make vitamins
various biomedical reagents, probiotics; and about 20 liters a month of
phage products for local use.
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GangaGen
Biotechnologies Ltd., Bangalore, India; GangqGen, Inc., Palo Alto, CA,
GangaGen Life Sciences, lnc., Ottawa, Canada (www.gangagen.com). GangaGen
emphasizes the diagnosis and treatment of nosocomial infections, secondary
infections and topical infections.
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lmmunopreparat
Research Productive Association - Ufa, Bashkortostan, Russian Federation.
lmmunopreparat is a pharmaceutical company in Ufa, Russia. The Company’s
subsidiary, Biophag, currently manufactures two complex phage preparations
targeting various bacterial
pathogens.
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Intralytix,
Inc. — Baltimore, MD (www.intralytix.com). Intralytix is a biotechnology
company focused on the production and marketing of products
using bacteriophage to control bacterial pathogens in environmental, food
processing and medical settings. They are also developing a
product that relies on a complex combination of bacteriophage targeted for
the treatment of wound infections that include Staphylococcus aureus
and other bacterial pathogens.
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Novolytics
Limited - Warwick, Coventry, UK (www.novolytics.co.uk). Novolytics was
formed in 2002 out of the University of Warwick, Coventry, UK to exploit
the use of bacteriophages to combat bacterial infections, initially
antibiotic-resistant Staph
infections.
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Phage
Botech, Ltd. — Tel Aviv, Israel (www.phage-biotech.com). Phage Biotech
focuses on the development, production and application of lytic
bacteriophage technology toward an array of clinical, veterinary,
agricultural, industrial and ecologic
applications.
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Phage
international, Inc. – Los Altos, CA (www.phageinternational.com). Phage
International was formed in July of 2004. Their goal is to become a
primary marketer of bacteriophage therapies in the western world. They
collaborate with the Eliava Institute, Tbilisi, Republic of
Georgia.
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Special
Phage Services Pty Ltd. - Brookvale, NSW, Australia (www.specialphages
services.au). Special Phage Services was established to
develop bacteriophage as alternatives to antibiotics. The
Company has a license with a Georgian-based company for phage technology
and strains.
|
Competitive Products: MRSA has
developed resistance to most commercially-available antibiotics, such as the
fluoroquinolones, including ciprofloxicin, levofloxacin, moxifloxacin and
gatifloxacin, and to the macrolides, such as erythromycin, clarithromycin and
azithromycin, which are not recommended for MRSA because of their high
resistance rates. The few antibiotics that are recommended for MRSA
are highly toxic and used only for specific, critical indications, such as
serious respiratory and systemic infections and for difficult-to-treat skin and
soft tissue infections. The antibiotics listed below are mostly highly toxic and
are highly subject to the development of new resistance:
•
|
Vancomycin (vancomycin;
off patent) is a glycopeptide that inhibits cell wall peptidogycan. It is
used to treat staph infections of the heart and blood, plus
life-threatening infections by Gram-positive bacteria unresponsive to less
toxic antibiotics. It is considered to be a drug of last
resort.
|
•
|
Targocid (Teicoplanin,
Sanofi-Aventis) is a glycopeptide that inhibits bacterial cell wall
peptidoglycan. It is used to treat staph infections of the heart and
blood. It is highly toxic.
|
•
|
Zyvox (Linezolid,
Pharmacia & Upjohn) is an oxazolidinone that interferes with the
production of bacterial proteins. It is used to treat
complicated skin and soft tissue infections and pneumonia incited by S aureus. It is highly
toxic.
|
•
|
Cubicin (Daptomycin,
Cubist) is a toxic cyclic Iipopeptide that binds the membrane of
Gram-positive bacteria. It is used for complicated bacterial infections of
skin and soft tissue incited by S
aureus.
|
•
|
Televancin (\/IBATIV,
Theravance and Astellas) is an injectable lipoglycopeptide for
the treatment of adults with complicated skiin and skin structure
infections caused by susceptible Gram-positive bacteria, including S aureus both
methicillin-resistant and methicillin-susceptible
strains.
|
11
•
|
Oritavancin (The
Medicines Company) is a development-stage glycopeptide for the treatment
of Gram-positive infections. Safety and efficacy have not been
established for any use. It has activity in vitro against a
broad spectrum of resistant and sensitive bacteria, including
MRSA.
|
•
|
Ceftobiprole (Basilea
Pharmaceutica) is a cephalosporin with activity against
MRSA. It is statistically non-inferior to vancomycin plus
ceftazidime for the treatment of skin and soft tissue
infections.
|
•
|
Platensimycin (Merck) is
an experimental drug that blocks membrane development. It is
effective against S
aureus only when administered continuously. It is low in toxicity
and activity.
|
•
|
Tygacil
Tigecydine, Wyeth) is used for the treatment of adults with complicated
skin and skin structure infections including infections caused by S aureus, and for
complicated intra-abdominal infections. Resistance is
expected to emerge rapidly, as it did for the parent compound
tetracycline.
|
Intellectual
Property
Viridax
considers intellectual property as fundamental to its long-term success, and has
adopted a program to identify and protect intellectual property and to
characterize, develop and patent novel technologies created within its and its
collaborators laboratories The Company’s patent strategy is designed to identify
and patent the key technologies and products which are essential for the
development of effective therapeutic agents. It is anticipated that
patent claims directed to these key elements will create significant barriers to
entry by future competitors.
Biotechnology
inventions are patentable if they are novel, non-obvious and do not occur in the
same form in nature. Bacteriophages are well known, as is their broad
application as therapeutics for treating infectious diseases. Historic
investigators were unaware of the considerable genetic diversity expressed in
different clinical strains of bacteria. The Company is seeking domestic and
international patent protection for its novel and patentable bacteriophage and
other products. The Company is establishing exclusive rights to
the technologies derived and patented in this manner.
Employees
Viridax
currently has two employees, Richard C. Honour, President and Richard E. Herman,
Vice President, Research and Development. No compensation has been paid during
the year ended April 30, 2009. As of April 30, 2009, accrued compensation to
Richard C. Honour was $131,356 and will be paid as cash flow requirements
permit.
12
ITEM 2. DESCRIPTION OF
PROPERTY
The
Company owns no real property, nor does it have any leasehold interests at this
time.
The
Company’s executive offices are provided, without payment of rent at this time
at 270 NW 3rd Court, Boca Raton, Florida. This address is the location of the
offices of Ledyard H. DeWees, P.A., the law firm representing Viridax
Corporation which has agreed to provide office space and secretarial assistance
without charge.
ITEM
3. LEGAL PROCEEDINGS
There is
no litigation of any type whatsoever pending or threatened by or
against the Company, its officers and/or its directors.
ITEM
4. SUBMISSION OF
MATTERS TO A VOTE OF SECURITY HOLDERS
Not applicable.
PART
II
ITEM
5.
|
MARKET
FOR COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND
SMALL BUSINESS ISSUER PURCHASES OF EQUITY
SECURITIES.
|
(A)
MARKET INFORMATION
There is
no public trading market for the Company’s stock.
(B) HOLDERS
There are
258 shareholders of record of the Company’s common stock, as of the date of this
filing.
(C) DIVIDENDS
The
Company has not paid any dividends to date and has no plans to do so in the
foreseeable future.
(D)
|
SECURITIES
AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION
PLANS.
|
None.
13
|
(E)
|
RECENT
SALES OF UNREGISTERED SECURITIES
|
On March
31, 2006, the Board of Directors of Viridax Corporation approved the efforts of
the Company in filing with the German Federal Financial Supervisory Authority
(BaFin) a sales prospectus providing for the sale of up to the authorized limit
of 3,000,000 shares of its Class A Preferred Stock, Par Value $ 1.00 per share,
pursuant to the rules and requirements of Regulation S as promulgated by the
United States Securities and Exchange Commission. East Slope Funding Corporation
of Florida (formerly, East Slope Funding Corp.) has been designated as the
Escrow Agent to receive the gross proceeds as paid by a given subscriber and to
pay the net sum of US $3.50 per share to the Company and deliver a copy of the
purchaser's subscription agreement. Under this arrangement, and within
exemptions from the requirements of the prospectus, 357,429 shares have been
sold for a total cash consideration of $1,250,998 through the date of this
filing. Final approval of the prospectus by the BaFin was obtained September 4,
2006. Subsequently, it has been necessary to obtain a renewal
approval of our prospectus from the BaFin.
The
Company claimed an exemption from registration under Regulation S based upon the
following facts: (1) the offer and sale of the shares to each individual
purchaser was an offshore transaction because each purchaser was a resident of
Germany at the time of the transaction and located within that country, (2)
there were no directed selling efforts and no activities were undertaken to
condition the market. The Company comes within the Category 2 safe harbor as set
forth in Rule 903(c)(2) because the sale of the preferred stock complies with
the general conditions of Rule 903(a) and (b) and the stock certificates bear
restrictive legends that meet the Regulation S selling restrictions in terms of
transactional restrictions and offering restrictions.
The Class
A Preferred Stock is non-cumulative and non-voting. Each share of Preferred
Stock is convertible to Common Stock as follows: (1) if the owner wishes to
exchange the certificate within one year from the date of purchase, that owner
shall receive four shares of Common Stock for each one share of Preferred Stock,
(2) if the owner wishes to exchange the certificate after owning it for a period
longer than one year but less than two years, the owner shall receive 4.4 shares
of Common Stock for each one share of Preferred Stock, (3) if the owner wishes
to exchange the certificate after owning it for a period longer than two years
but less than three years, the owner shall receive 4.6 shares of Common Stock
for each one share of Preferred Stock, and (4) if the owner wishes to exchange
the certificate after owning it for three years, that owner shall receive five
shares of Common Stock for each one share of Preferred Stock. Once an owner has
owned the Preferred Stock for three years, the option to convert to Common Stock
must be exercised within 30 days thereafter or the conversion option shall
lapse.
ITEM
6. PLAN OF
OPERATION
As of the
date of this filing, Viridax Corporation believes that it has funds on hand to
continue for the next three months. The Company is in arrears according to its
payment obligations under the Research Agreement with the Agricultural Research
Service, a branch of the United States Department of Agriculture. The Company is
anticipating that sales of its Class A Preferred Stock in Europe will provide
funds for continuing operations but there is no assurance that such sales will
be realized.
14
The
Company has secured a commercial line of credit with Wachovia Bank, NA in the
amount of $200,000. As of the date of this filing, the current balance on the
line of credit was $35,000, for which the Company is making monthly payments.
Except for the draw dated November 24, 2009, there is no intention to further
draw against this credit line.
The plan
of operation for the next twelve months is to continue under the Research
Agreement with the Agricultural Research Agreement, if the Company can secure
sufficient sales of its Preferred Stock or obtain outside financing. As there is
no assurance of future sales of the Preferred Stock, there is no present
commitment for outside financing.
ITEM
8. FINANCIAL
STATEMENTS
The attached audited financial
statements for Viridax Corporation for the year ended April 30, 2009
are submitted in compliance with Regulation S-X.
ITEM
9. CONTROLS AND
PROCEDURES
Evaluation of Disclosure
Controls and Procedures
Our Chief Executive Officer and Chief
Financial Officer have evaluated the effectiveness and design of our disclosure
controls and procedures (as such term is defined in Rule 13a-15(e)) under the
Exchange Act of 1934 (the “Exchange Act”). Disclosure controls and
procedures are the controls and other procedures that we designed to ensure that
we record, process, summarize and report in a timely manner the information we
must disclose in reports that we file with or submit to the Securities and
Exchange Commission under the Exchange Act. Based on this evaluation,
our Chief Executive Officer and Chief Financial Officer have concluded that our
disclosure controls and procedures were effective as of the end of the period
covered by this report.
Management’s Annual Report
on Internal Control Over Financial Reporting.
Management is responsible for
establishing and maintaining adequate internal control over financial reporting
and for the assessment of the effectiveness of those internal
controls. As defined by the SEC, internal control over financial
reporting is a process designed by our principal executive officer and principal
financial officer to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of the financial statements in
accordance with U.S. generally accepted accounting principles.
Because
of its inherent limitation, internal control over financial reporting may not
prevent or detect misstatements. Also, projection of any evaluation
of effectiveness to future periods are subject to the risk that controls may
become inadequate because of changes in condition, or that the degree of
compliance with the policies or procedures may deteriorate.
15
The Company’s Chief Executive Officer
and Chief Financial Officer have assessed the effectiveness of our internal
control over financial reporting as of April 30, 2009. In making this
assessment, management used the criteria set forth by the Committee of
Sponsoring Organization of Treadway Commission (COSO) in Internal
Control-Integrated Framework. Based on our assessment and those
criteria, our Chief Executive Officer and Chief Financial Officer have concluded
that our internal control over financial reporting was effective as
of April 30, 2009.
This Annual Report does not include an
attestation report of the company’s registered public accounting firm regarding
internal control over financial reporting. Management’s report was
not subject to attestation by the Company’s registered public accounting firm
pursuant to temporary rules of the Securities and Exchange Commission that
permit the Company to provide only management’s report in this Annual
Report.
Changes in Internal Control
Over Financial Reporting
There were no changes in our internal
control over financial reporting or in other factors identified in connection
with the evaluation required by paragraph (d) of Exchange Act Rules 13a-15 or
15d-15 that occurred during the fourth quarter ended April 30, 2009 that have
materially affected, or are reasonably likely to materially affect, our internal
control over financial reporting.
PART
III
ITEM
10.
|
DIRECTORS,
EXECUTIVE OFFICERS AND CORPORATE
GOVERNANCE
|
(A)
IDENTIFY DIRECTORS AND EXECUTIVE OFFICERS
Name
|
Age
|
Position
|
Richard
C. Honour
|
69
|
President,
Chief
Executive
Officer
|
Director,
Chairman
|
||
Kenneth
E. Lehman
|
63
|
Chief
Financial Officer
|
Director
|
||
Ledyard
H. DeWees
|
78
|
Secretary
|
Michael
C. Maloney
|
55
|
Director
|
16
Richard
C. Honour, Ph.D., President and CEO, Director
From
1997-2002, Dr. Honour served as the President and CEO of Phage Therapeutics,
Inc. and Phage Therapeutics International, Inc. companies involved in the
discovery and development of bacteriophage pharmaceutical products for the
treatment of antibiotic-resistant and other bacterial
infections. In 2003 he served as a Director of Phage Genomics, Inc.,
a company also involved in the discovery and development of bacteriophage
pharmaceutical products for the treatment of antibiotic-resistant and other
bacterial infections. In 2002, to the present day he is a Director of
Eulara Corporation, a company that develops and markets skin care products and
dietary supplements. He is also the current President of Mycobis
Corporation, a Florida biopharmaceutical company formed to discover and develop
bacteriophage therapeutic agents for the treatment of antibiotic-resistant and
sensitive bacterial pathogens. Dr. Honour was named to the Board of
Directors on April 25, 2005.
Ledyard
H. DeWees, Esq., Secretary
Mr.
DeWees is an attorney and a member of the Florida Bar since 1959. For
the past five years he has limited his practice to corporate and securities
laws. He was named as Secretary on April 25, 2005.
Michael
C. Maloney, RAC, Director
Mr.
Maloney has 28 years of experience in FDA regulated medical products including
medical devices, in vitro diagnostics, drugs, biologics, critical care
monitoring equipment and contract manufacturing. He was President and
CEO of La Haye Laboratories, Inc. from 1997-2001 and President and CEO of
Emerald Pharmaceuticals, L.P. from 2001-2004. He is currently Senior Regulatory
Affairs Specialist of ZymoGenetics, Inc. Mr. Maloney holds a BA in
Biological Sciences from San Jose State University and is regulatory affairs
certified (RAC) through the Regulatory Affairs Professional Society. He was
named to the Board of Directors on April 25, 2005.
Kenneth
E. Lehman, MBA, Chief Financial Officer, Director
Mr.
Lehman has more than 28 years of experience in managerial accounting and project
management. He has corporate operational experience in general
accounting with specific emphasis on budgets, financial statements and analysis,
accounting policies and procedures, fixed asset management and
auditing. While a New Ventures Manager at US West, Inc. from 1972 –
2000, Mr. Lehman established and implemented regional non-regulated accounting
procedures for Wireless PCS equipment and Spectrum licenses. From
2000-2002 he was controller of Phage therapeutics, Inc. and from 2002-2005 he
was Vice President of Mycobis Corporation. He was named to the Board
of directors on April 29, 2005.
(B)
Family Relationships
Not
applicable.
17
(C)
INVOLVEMENT IN CERTAIN LEGAL PROCEEDINGS
Not applicable.
(D) CODE
OF ETHICS
The
Company has adopted a Code of Ethics that applies to the Company’s
chief executive officer, principal accounting officer or controller,
or employees of whatever designation performing similar functions.
For
purposes of clarification, the term “code of ethics” means the written standards
that are reasonably designed to deter wrongdoing and to promote:
|
·
|
Honest and ethical conduct,
including the ethical handling of actual or apparent conflicts of interest
between personal and professional
relationships.
|
|
·
|
Full, fair, accurate timely
and understandable disclosure in the periodic reports
required to be filed by the
company.
|
|
·
|
Compliance with applicable
governmental laws, rules and
regulations.
|
|
·
|
Prompt internal reporting to
the appropriate persons identified in the code of violations of the code;
and
|
·
|
Accountability for adherence
to the code.
|
The full
text of the Company’s “Code of Business Conduct and Ethics” is included herein
by reference. See Exhibit 13. The company will provide to any person
without charge a copy of its Code of Business conduct and Ethics upon receiving
a written request therefore at the main office of the Company, delivered by
letter or facsimile form.
(E)
|
IDENTIFICATION
OF THE AUDIT COMMITTEE
|
The Company has established a
separately-designated standing audit committee in accordance with
Section 3(a)(58)(A) of the Exchange Act (15 USC 78c(a)(58)(A) ). The
members of this committee are Kenneth E. Lehman, Chief Financial Officer, and
Richard C. Honour, President.
The audit
committee has adopted a formal charter specifying (i) the scope of the audit
committee’s responsibilities and how to carry out those responsibilities,
including structure, processes and membership requirements, (ii)
receipt from the outside auditor of a formal written statement delineating all
relationships between the auditor and the Company, consistent with Independence
Standards Boards Standard I, and the Committee’s responsibility for actively
engaging in communications with the auditor pertaining to any relationships that
may impact the objectivity of the auditor and (iii) items pertaining to the
outside auditor’s accountability to the Board of Directors and the audit
committee.
The audit
committee has also adopted guidelines and procedures consistent with the
requirements and standards of Section 301 of the Sarbanes-Oxley Act of 2002,
amending Section 10A of the Securities Exchange Act of 1934.
18
(F) AUDIT
COMMITTEE, FINANCIAL EXPERT
The audit
committee has one financial expert serving on its audit
committee. The name of the financial expert is Kenneth E. Lehman,
MBA. Mr. Lehman holds a Bachelor of Arts, Accounting, degree from the
University of Washington and a Masters of business Administration, Finance and
Accounting, degree (1986) from City University, Seattle. Mr. Lehman
is independent as provided within Schedule 14A of Regulation S-B in that, other
than his capacity as an officer and director of the Company, he does and has not
accepted directly or indirectly any consulting, advisory, or other compensatory
fee from the Company and is not an affiliated person of the
Company.
ITEM
11. EXECUTIVE
COMPENSATION
(a)
GENERAL
No
employee, officer, or director is receiving compensation.
(b) SUMMARY
COMPENSATION TABLE
Not
applicable. No executive compensation plan is under
consideration.
(c) OPTION/SAR GRANTS
TABLE
Not
applicable.
|
(d)
|
AGGREGATED
OPTION/SAR EXERCISES AND FISCAL YEAR-END OPTIONS/SAR VALUE
TABLE
|
Not
applicable.
(e)
|
LONG-TERM INCENTIVE PLAN
(ALTIP@) AWARDS
TABLE
|
Not
applicable.
|
(f)
|
COMPENSATION
OF DIRECTORS
|
There are
no arrangements whatsoever pertaining to compensation for
the directors, including expense reimbursements.
|
(g)
|
EMPLOYMENT
CONTRACTS AND TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL
ARRANGEMENTS
|
Not
applicable.
|
(h)
|
REPORT
ON REPRICING OF OPTIONS/SAR’s
|
Not
applicable.
19
ITEM
12
|
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
STOCKHOLDER MATTERS
|
|
(a)
|
SECURITIES
AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION
PLANS
|
None
|
(b)
|
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS
|
The table
below lists the beneficial ownership of the Company’s voting securities by each
person known by the Company to be the beneficial owner of more than 5% of such
voting securities.
Name and Address
|
Amount and Nature
|
Percent of
|
||||||
Title of Class
|
of Beneficial Owner
|
of Beneficial Owner
|
Class
|
|||||
Common
|
Brett
L. DeWees
|
5,914,153
shares
|
24.30 | % | ||||
737
SE 1st
Way, Apt. 107
|
Direct
Ownership
|
|||||||
Deerfield
Beach, FL 33441
|
||||||||
Common
|
Mycobis
Corporation
|
8,000,000
shares
|
32.87 | % | ||||
19211
64th
Place, NE
|
Direct
Ownership
|
|||||||
Kenmore,
WA 98028
|
(C) SECURITY OWNERSHIP OF
MANAGEMENT
Not applicable
(D) CHANGES IN
CONTROL
Not applicable
ITEM
13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
During the year ended April 30, 2009,
the Company received advances totaling $8,000 from a company, the president and
sole shareholder of which are non-major stockholders. The notes are unsecured,
bear interest at 5% per annum and are due upon demand.
20
ITEM
14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
(A) Audit
Fees
The aggregate fees billed for
professional services rendered for the audit of annual financial statements
included in Form 10-K for the fiscal year ended April 30, 2009 and for the
review of quarterly financial statements included in Form 10-Q for the quarters
ended July 31, 2008, October 31, 2008 and January 31, 2009 were
$28,000.
The aggregate audit fees billed for
professional services rendered for the audit of annual financial statements
included in Form 10-KSB for the fiscal year ended April 30, 2008 and for the
review of quarterly financial statements included in Form 10-QSB for the
quarters ended July 31, 2007, October 31, 2007 and January 31, 2008 were
$27,000.
(B) Audit-Related
Fees
None.
(C) Tax Fees
The aggregate fees billed in each of
the last two fiscal years for professional services rendered by the principal
accountants for tax compliance, tax advice, and tax planning were $1,500 ($750
for each fiscal year). The services comprising these fees were for the
preparation of federal and state corporate income tax returns
(D) All Other
Fees
None.
(E) Pre-Approval
Policies
The Board of Directors and Management
are required to pre-approve all auditing services and permitted non-audit
services (including the fees and terms thereof) to be performed for the Company
by its independent auditor, subject to the de minimis exceptions for non-audit
services described in Section 10A(i)(1)(B) of the Securities Exchange Act of
1934 that are approved by the Audit Committee prior to the completion of the
audit.
21
ITEM
15. EXHIBITS
(a)
INDEX TO EXHIBITS
Exhibit Number
|
Page Number
|
Description
|
||
3(i)(a)
|
*Articles
of Incorporation of
|
|||
Media
Advisory Group, Inc.
|
||||
3(i)(b)
|
*Certification
of Reinstatement
|
|||
3(i)(c)
|
*Articles
of Amendment changing
name
to I & E Tropicals, Inc.
|
|||
3(i)(d)
|
**Articles
of Amendment changing
name
to Viridax Corporation
|
|||
3(ii)
|
*Bylaws
of Viridax Corporation
|
|||
10
|
**Asset
Purchase Agreement
|
|||
10
|
E-1
|
***Research
Agreement
|
||
14
|
**Code
of Ethics
|
|||
10
|
|
E-15
|
|
Research
Agreement
|
*Incorporated
by reference to Form 10-SB/12G, filed 1/7/02.
**Incorporated
by reference to Form 10-KSB, filed on 6/27/05.
***
Incorporated by reference to Form 10-KSB, filed on 8/13/07.
22
SIGNATURES
In accordance with the Exchange Act,
the registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
Dated: June
21 , 2010
|
By:
|
/s/ Richard C.
Honour
|
Name: Richard
C. Honour
|
||
Title: President
|
In accordance with the Exchange Act,
this report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.
Person
|
Capacity
|
Date
|
||
/s/ Richard C.
Honour
|
President and Director
|
June 21, 2010
|
||
Richard
C. Honour
|
(Principal
Executive Officer)
|
|||
/s/ Kenneth E. Lehman
|
Director
|
|||
Kenneth
E. Lehman
|
(Principal
Financial Officer)
|
June
21, 2010
|
||
/s/ Michael C.
Maloney
|
Director
|
June 21, 2010
|
||
Michael C. Maloney
|
23
VIRIDAX
CORPORATION
(A
Development Stage Company)
FINANCIAL
STATEMENTS
APRIL
30, 2009
VIRIDAX
CORPORATION
(A Development Stage
Company)
CONTENTS
PAGE
|
|
Report
of Independent Registered Public
|
|
Accounting
Firm
|
F-1
|
Financial
Statements:
|
|
Balance
Sheets
|
F-2
|
Statements
of Operations
|
F-3
|
Statements
of Changes in Stockholders’
|
|
Equity
(Deficit)
|
F-4
to F-8
|
Statements
of Cash Flows
|
F-9
to F-10
|
Notes
to Financial Statements
|
F-11
to F-25
|
Report of
Independent Registered Public Accounting Firm
To The
Board of Directors
Viridax
Corporation
We have
audited the accompanying balance sheets of Viridax Corporation (a development
stage company), as of April 30, 2009 and 2008 and the related statements of
operations, changes in stockholders' equity (deficit) and cash flows for the
years ended April 30, 2009 and 2008 and for the period from July 1, 1998
(inception) through April 30, 2009. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.
We
conducted our audits in accordance with standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our
opinion, the financial statements referred to above present fairly, in all
material respects, the financial position of Viridax Corporation (a development
stage company) as of April 30, 2009 and 2008, and the results of its operations
and its cash flows for the years ended April 30, 2009 and 2008 and for the
period from July 1, 1998 (inception) through April 30, 2009 in conformity with
accounting principles generally accepted in the United States.
The
accompanying financial statements have been prepared assuming the Company will
continue as a going concern. As discussed in Note 10 to the financial
statements, the Company is still in the development stage with an accumulated
deficit of $2,251,342, and, since inception, a negative cash flow from
operations of $1,810,216. These factors raise substantial doubt about its
ability to continue as a going concern. Management’s plans regarding this matter
are also described in Note 10. The accompanying financial statements do not
include any adjustments that might result from the outcome of this
uncertainty.
June
21, 2010
|
|
Boca
Raton, Florida
|
Earl
M. Cohen, C.P.A., P.A.
|
F-1
VIRIDAX
CORPORATION
(A
Development Stage Company)
BALANCE
SHEETS
April
30,
|
April
30,
|
|||||||
2009
|
2008
|
|||||||
ASSETS
|
||||||||
CURRENT
ASSETS
|
||||||||
Cash
|
$ | 859 | $ | 41,429 | ||||
Notes
receivable and accrued interest
|
||||||||
-
related parties, net of allowance
|
||||||||
for
doubtful accounts of $15,826 and
|
||||||||
$0,
respectively
|
3,729 | 28,999 | ||||||
Prepaid
expenses
|
25,342 | 54,171 | ||||||
Total
Current Assets
|
29,930 | 124,599 | ||||||
COMPUTER
AND LABORATORY EQUIPMENT - NET
|
27,985 | 31,212 | ||||||
OTHER
ASSET
|
||||||||
Bacteriophage
material
|
1,795,000 | 1,830,000 | ||||||
TOTAL
ASSETS
|
$ | 1,852,915 | $ | 1,985,811 | ||||
LIABILITIES AND STOCKHOLDERS’
EQUITY
|
||||||||
CURRENT
LIABILITIES
|
||||||||
Note
payable - bank
|
$ | 49,000 | $ | - | ||||
Accounts
payable and accrued expenses
|
198,629 | 106,336 | ||||||
Note
payable and accrued interest
|
||||||||
-
related parties
|
8,033 | - | ||||||
Total
Current Liabilities
|
255,662 | 106,336 | ||||||
COMMITMENTS
|
||||||||
STOCKHOLDERS’
EQUITY
|
1,597,253 | 1,879,475 | ||||||
TOTAL
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
$ | 1,852,915 | $ | 1,985,811 |
Read
accompanying Notes to Financial Statements.
F-2
VIRIDAX
CORPORATION
(A
Development Stage Company)
STATEMENTS
OF OPERATIONS
July
1,1998
|
||||||||||||
Year
Ended
|
Year
Ended
|
(Inception)
|
||||||||||
April
30,
|
April
30,
|
to
April 30,
|
||||||||||
2009
|
2008
|
2009
|
||||||||||
REVENUE
|
$ | - | $ | - | $ | 735 | ||||||
EXPENSES
|
||||||||||||
General
and administrative
|
413,622 | 688,854 | 2,047,077 | |||||||||
Impairment
of bacteriophage material
|
35,000 | 45,000 | 205,000 | |||||||||
Total
Expenses
|
448,622 | 733,854 | 2,252,077 | |||||||||
NET
(LOSS)
|
$ | (448,622 | ) | $ | (733,854 | ) | $ | (2,251,342 | ) | |||
(LOSS)
PER SHARE
|
$ | (.02 | ) | $ | (.03 | ) | $ | (.15 | ) | |||
WEIGHTED
AVERAGE NUMBER OF COMMON
|
||||||||||||
SHARES
OUTSTANDING
|
24,349,090 | 24,344,275 | 15,353,567 |
Read
accompanying Notes to Financial Statements.
F-3
VIRIDAX
CORPORATION
(A
Development Stage Company)
STATEMENTS
OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT)
PERIOD
FROM JULY 1, 1998 (INCEPTION) THROUGH APRIL 30, 2009
Deficit
|
||||||||||||||||||||||||||||||||
Accumulated
|
||||||||||||||||||||||||||||||||
Preferred
Stock
|
Common
Stock
|
Additional
|
Stock
|
During
the
|
||||||||||||||||||||||||||||
Number
of
|
Par
|
Number
of
|
Par
|
Paid-In
|
Subscription
|
Development
|
||||||||||||||||||||||||||
Shares
|
Value
|
Shares
|
Value
|
Capital
|
Receivable
|
Stage
|
Total
|
|||||||||||||||||||||||||
July
15, 1998
|
||||||||||||||||||||||||||||||||
Common
shares issued to
|
||||||||||||||||||||||||||||||||
founders
for services
|
||||||||||||||||||||||||||||||||
rendered
($.001 per share)
|
- | $ | - | 4,000,000 | $ | 4,000 | $ | 1,000 | $ | - | $ | - | $ | 5,000 | ||||||||||||||||||
Net
(loss)
|
- | - | - | - | - | - | (5,000 | ) | (5,000 | ) | ||||||||||||||||||||||
Balance
- April 30, 1999
|
- | - | 4,000,000 | 4,000 | 1,000 | - | (5,000 | ) | - | |||||||||||||||||||||||
Net
(loss)
|
- | - | - | - | - | - | - | - | ||||||||||||||||||||||||
Balance
- April 30, 2000
|
- | - | 4,000,000 | 4,000 | 1,000 | - | (5,000 | ) | - | |||||||||||||||||||||||
Net
(loss)
|
- | - | - | - | - | - | - | - | ||||||||||||||||||||||||
Balance
- April 30, 2001
|
- | - | 4,000,000 | 4,000 | 1,000 | - | (5,000 | ) | - | |||||||||||||||||||||||
Common
shares issued for
|
||||||||||||||||||||||||||||||||
cash
($.001 per share)
|
||||||||||||||||||||||||||||||||
September
2001
|
- | - | 1,120,000 | 1,120 | 280 | - | - | 1,400 | ||||||||||||||||||||||||
October
2001
|
- | - | 10,480,000 | 10,480 | 2,620 | - | - | 13,100 | ||||||||||||||||||||||||
Net
(loss)
|
- | - | - | - | - | - | (4,343 | ) | (4,343 | ) | ||||||||||||||||||||||
Balance
- April 30, 2002
|
- | - | 15,600,000 | 15,600 | 3,900 | - | (9,343 | ) | 10,157 | |||||||||||||||||||||||
Net
(loss)
|
- | - | - | - | - | - | (8,956 | ) | (8,956 | ) | ||||||||||||||||||||||
Balance
- April 30, 2003
|
- | - | 15,600,000 | 15,600 | 3,900 | - | (18,299 | ) | 1,201 | |||||||||||||||||||||||
Net
(loss)
|
- | - | - | - | - | - | (6,790 | ) | (6,790 | ) | ||||||||||||||||||||||
Conversion
of net stockholders
|
||||||||||||||||||||||||||||||||
loans
to additional paid-in
|
||||||||||||||||||||||||||||||||
capital
|
- | - | - | - | 245 | - | - | 245 | ||||||||||||||||||||||||
Balance
- April 30, 2004
|
- | - | 15,600,000 | 15,600 | 4,145 | - | (25,089 | ) | (5,344 | ) |
Read
accompanying Notes to Financial Statements.
F-4
VIRIDAX
CORPORATION
(A
Development Stage Company)
STATEMENT
OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT) (CONTINUED)
PERIOD
FROM JULY 1, 1998 (INCEPTION) THROUGH APRIL 30, 2009
Deficit
|
||||||||||||||||||||||||||||||||
Accumulated
|
||||||||||||||||||||||||||||||||
Preferred
Stock
|
Common
Stock
|
Additional
|
Stock
|
During
the
|
||||||||||||||||||||||||||||
Number
of
|
Par
|
Number
of
|
Par
|
Paid-In
|
Subscription
|
Development
|
||||||||||||||||||||||||||
Shares
|
Value
|
Shares
|
Value
|
Capital
|
Receivable
|
Stage
|
Total
|
|||||||||||||||||||||||||
Balances
forward
|
- | $ | - | 15,600,000 | $ | 15,600 | $ | 4,145 | $ | - | $ | (25,089 | ) | $ | (5,344 | ) | ||||||||||||||||
April
2005
|
||||||||||||||||||||||||||||||||
Common
shares issued for
|
||||||||||||||||||||||||||||||||
cash
($.25 per share)
|
- | - | 160,000 | 160 | 39,840 | - | - | 40,000 | ||||||||||||||||||||||||
Common
shares issued for
|
||||||||||||||||||||||||||||||||
purchase
of bacteriophage
|
||||||||||||||||||||||||||||||||
material
($.25 per share)
|
- | - | 8,000,000 | 8,000 | 1,992,000 | - | - | 2,000,000 | ||||||||||||||||||||||||
Net
(loss)
|
- | - | - | - | - | - | (12,101 | ) | (12,101 | ) | ||||||||||||||||||||||
Conversion
of notes payable
|
||||||||||||||||||||||||||||||||
and
accrued interest and
|
||||||||||||||||||||||||||||||||
net
stockholders loans to
|
||||||||||||||||||||||||||||||||
additional
paid-in capital
|
- | - | - | - | 13,551 | - | - | 13,551 | ||||||||||||||||||||||||
Balance
- April 30, 2005
|
- | - | 23,760,000 | 23,760 | 2,049,536 | - | (37,190 | ) | 2,036,106 | |||||||||||||||||||||||
July
1, 2005
|
||||||||||||||||||||||||||||||||
Common
shares issued for
|
||||||||||||||||||||||||||||||||
cash
and stock subscription
|
||||||||||||||||||||||||||||||||
receivable
($.80 per share)
|
- | - | 400,000 | 400 | 319,600 | (280,000 | ) | - | 40,000 | |||||||||||||||||||||||
June
2005 through April 2006
|
||||||||||||||||||||||||||||||||
Common
shares issued for
|
||||||||||||||||||||||||||||||||
cash
($1 per share)
|
- | - | 357,167 | 357 | 356,810 | - | - | 357,167 | ||||||||||||||||||||||||
Payments
received on stock
|
||||||||||||||||||||||||||||||||
subscription
receivable
|
- | - | - | - | - | 113,476 | - | 113,476 | ||||||||||||||||||||||||
- | - | 24,517,167 | 24,517 | 2,725,946 | (166,524 | ) | (37,190 | ) | 2,546,749 |
Read
accompanying Notes to Financial Statements.
F-5
VIRIDAX
CORPORATION
(A
Development Stage Company)
STATEMENTS
OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT) (CONTINUED)
PERIOD
FROM JULY 1, 1998 (INCEPTION) THROUGH APRIL 30, 2009
Deficit
|
||||||||||||||||||||||||||||||||
Accumulated
|
||||||||||||||||||||||||||||||||
Preferred
Stock
|
Common
Stock
|
Additional
|
Stock
|
During
the
|
||||||||||||||||||||||||||||
Number
of
|
Par
|
Number
of
|
Par
|
Paid-In
|
Subscription
|
Development
|
||||||||||||||||||||||||||
Shares
|
Value
|
Shares
|
Value
|
Capital
|
Receivable
|
Stage
|
Total
|
|||||||||||||||||||||||||
Balance
forward
|
- | - | 24,517,167 | 24,517 | 2,725,946 | (166,524 | ) | (37,190 | ) | 2,546,749 | ||||||||||||||||||||||
Reversal
of stock
|
||||||||||||||||||||||||||||||||
subscription
receivable due
|
||||||||||||||||||||||||||||||||
to
cancellation of stock
|
||||||||||||||||||||||||||||||||
purchase
agreement
|
- | - | (211,827 | ) | (212 | ) | (166,312 | ) | 166,524 | - | - | |||||||||||||||||||||
Reclassification
of additional
|
||||||||||||||||||||||||||||||||
funds
received from stock
|
||||||||||||||||||||||||||||||||
purchase
agreements
|
- | - | - | - | 21,808 | - | - | 21,808 | ||||||||||||||||||||||||
Net
(loss)
|
- | - | - | - | - | - | (535,091 | ) | (535,091 | ) | ||||||||||||||||||||||
Balance
- April 30, 2006
|
- | - | 24,305,340 | 24,305 | 2,581,442 | - | (572,281 | ) | 2,033,466 | |||||||||||||||||||||||
May
through August 2006
|
||||||||||||||||||||||||||||||||
Common
shares issued for
|
||||||||||||||||||||||||||||||||
cash
($1 per share)
|
- | - | 22,750 | 23 | 22,727 | - | - | 22,750 | ||||||||||||||||||||||||
December
2006
|
||||||||||||||||||||||||||||||||
Common
shares issued for
|
||||||||||||||||||||||||||||||||
cash
($1.40 per share) net
|
||||||||||||||||||||||||||||||||
of
commissions
|
- | - | 10,000 | 10 | 11,190 | - | - | 11,200 | ||||||||||||||||||||||||
May
2006 through April 2007
|
||||||||||||||||||||||||||||||||
Preferred
shares issued
|
||||||||||||||||||||||||||||||||
for
cash ($7.00 per share)
|
||||||||||||||||||||||||||||||||
net
of commissions
|
44,500 | 44,500 | - | - | 111,250 | - | - | 155,750 | ||||||||||||||||||||||||
Net
(loss)
|
- | - | - | - | - | - | (496,585 | ) | (496,585 | ) | ||||||||||||||||||||||
Balance
- April 30, 2007
|
44,500 | 44,500 | 24,338,090 | 24,338 | 2,726,609 | - | (1,068,866 | ) | 1,726,581 |
Read
accompanying Notes to Financial Statements.
F-6
VIRIDAX
CORPORATION
(A
Development Stage Company)
STATEMENTS
OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT) (CONTINUED)
PERIOD
FROM JULY 1, 1998 (INCEPTION) THROUGH APRIL 30, 2009
Deficit
|
||||||||||||||||||||||||||||||||
Accumulated
|
||||||||||||||||||||||||||||||||
Preferred
Stock
|
Common
Stock
|
Additional
|
Stock
|
During
the
|
||||||||||||||||||||||||||||
Number
of
|
Par
|
Number
of
|
Par
|
Paid-In
|
Subscription
|
Development
|
||||||||||||||||||||||||||
Shares
|
Value
|
Shares
|
Value
|
Capital
|
Receivable
|
Stage
|
Total
|
|||||||||||||||||||||||||
Balance
forward
|
44,500 | 44,500 | 24,338,090 | 24,338 | 2,726,609 | - | (1,068,866 | ) | 1,726,581 | |||||||||||||||||||||||
May
2007 through April 2008
|
||||||||||||||||||||||||||||||||
Preferred
shares issued
|
||||||||||||||||||||||||||||||||
for
cash ($7.00 per share)
|
||||||||||||||||||||||||||||||||
net
of commissions
|
246,929 | 246,929 | - | - | 617,319 | - | - | 864,248 | ||||||||||||||||||||||||
June
2007
|
||||||||||||||||||||||||||||||||
Payment
of accounts
|
||||||||||||||||||||||||||||||||
payable
by stockholder
|
- | - | - | - | 22,500 | - | - | 22,500 | ||||||||||||||||||||||||
September 2007 and
February 2008
|
||||||||||||||||||||||||||||||||
Conversion
of preferred
|
||||||||||||||||||||||||||||||||
stock
to common
|
(2,500 | ) | (2,500 | ) | 11,000 | 11 | 2,489 | - | - | - | ||||||||||||||||||||||
Net
(loss)
|
- | - | - | - | - | - | (733,854 | ) | (733,854 | ) | ||||||||||||||||||||||
Balance
- April 30, 2008
|
288,929 | $ | 288,929 | 24,349,090 | $ | 24,349 | $ | 3,368,917 | $ | - | $ | (1,802,720 | ) | $ | 1,879,475 | |||||||||||||||||
May
2008 through April 2009
|
||||||||||||||||||||||||||||||||
Preferred
shares issued
|
||||||||||||||||||||||||||||||||
for
cash ($7.00 per share)
|
||||||||||||||||||||||||||||||||
net
of commissions
|
46,000 | 46,000 | - | - | 115,000 | - | - | 161,000 | ||||||||||||||||||||||||
334,929 | 334,929 | 24,349,090 | 24,349 | 3,483,917 | - | (1,802,720 | ) | 2,040,475 |
Read
accompanying Notes to Financial Statements.
F-7
VIRIDAX
CORPORATION
(A
Development Stage Company)
STATEMENTS
OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT) (CONTINUED)
PERIOD
FROM JULY 1, 1998 (INCEPTION) THROUGH APRIL 30, 2009
Deficit
|
||||||||||||||||||||||||||||||||
Accumulated
|
||||||||||||||||||||||||||||||||
Preferred
Stock
|
Common
Stock
|
Additional
|
Stock
|
During
the
|
||||||||||||||||||||||||||||
Number
of
|
Par
|
Number
of
|
Par
|
Paid-In
|
Subscription
|
Development
|
||||||||||||||||||||||||||
Shares
|
Value
|
Shares
|
Value
|
Capital
|
Receivable
|
Stage
|
Total
|
|||||||||||||||||||||||||
Balance
forward
|
334,929 | 334,929 | 24,349,090 | 24,349 | 3,483,917 | - | (1,802,720 | ) | 2,040,475 | |||||||||||||||||||||||
March
2009
|
||||||||||||||||||||||||||||||||
Payment
of accounts
|
||||||||||||||||||||||||||||||||
payable
by stockholder
|
- | - | - | - | 5,400 | - | - | 5,400 | ||||||||||||||||||||||||
Net
(loss)
|
- | - | - | - | - | - | (448,622 | ) | (448,622 | ) | ||||||||||||||||||||||
Balance
- April 30, 2009
|
334,929 | $ | 334,929 | 24,349,090 | $ | 24,349 | $ | 3,489,317 | $ | - | $ | (2,251,342 | ) | $ | 1,597,253 |
Read
accompanying Notes to Financial Statements.
F-8
VIRIDAX
CORPORATION
(A
Development Stage Company)
STATEMENTS
OF CASH FLOWS
July
1,
|
||||||||||||
1998
|
||||||||||||
Year
Ended
|
Year
Ended
|
(Inception)
|
||||||||||
April
30,
|
April
30,
|
to
April 30,
|
||||||||||
2008
|
2008
|
2009
|
||||||||||
CASH
FLOWS FROM OPERATING ACTIVITIES:
|
||||||||||||
Net
(loss)
|
$ | (448,622 | ) | $ | (733,854 | ) | $ | (2,251,342 | ) | |||
Adjustments
to reconcile net (loss)
|
||||||||||||
to
cash (used in) operating activities:
|
||||||||||||
Depreciation
|
9,440 | 4,364 | 15,472 | |||||||||
Impairment
of bacteriophage material
|
35,000 | 45,000 | 205,000 | |||||||||
Bad
debt - note receivable
|
15,826 | - | 15,826 | |||||||||
Common
shares issued for services
|
||||||||||||
rendered
|
- | - | 5,000 | |||||||||
Conversion
of accrued interest to
|
||||||||||||
additional
paid-in capital
|
- | - | 576 | |||||||||
(Increase)
in accrued interest receivable
|
(369 | ) | (870 | ) | (1,968 | ) | ||||||
Decrease
(increase) in prepaid expenses
|
28,829 | (54,171 | ) | (25,342 | ) | |||||||
Increase
(decrease) in accrued interest
|
||||||||||||
payable
|
33 | (256 | ) | 33 | ||||||||
Increase
(decrease) in accounts payable
|
||||||||||||
and
accrued expenses
|
97,693 | (40,766 | ) | 226,529 | ||||||||
NET
CASH (USED IN) OPERATING ACTIVITIES
|
(262,170 | ) | (780,553 | ) | (1,810,216 | ) | ||||||
CASH
FLOWS FROM INVESTING ACTIVITIES:
|
||||||||||||
Purchase
of computer and laboratory equipment
|
(6,213 | ) | (32,893 | ) | (43,457 | ) | ||||||
Increase
in note receivable - related parties
|
- | (27,000 | ) | (38,700 | ) | |||||||
Repayment
of loans receivable - related parties
|
9,813 | 11,300 | 21,113 | |||||||||
Increase
in loans receivable - stockholder
|
- | - | (12,000 | ) | ||||||||
Repayments
of loans receivable - stockholder
|
- | - | 4,000 | |||||||||
NET
CASH PROVIDED BY (USED IN) INVESTING
|
||||||||||||
ACTIVITIES
|
3,600 | (48,593 | ) | (69,044 | ) |
Read
accompanying Notes to Financial Statements.
F-9
VIRIDAX
CORPORATION
(A
Development Stage Company)
STATEMENTS
OF CASH FLOWS (CONTINUED)
July
1,
|
||||||||||||
1998
|
||||||||||||
Year
Ended
|
Year
Ended
|
(Inception)
|
||||||||||
April
30,
|
April
30,
|
to
April 30,
|
||||||||||
2009
|
2008
|
2009
|
||||||||||
CASH
FLOWS FROM FINANCING ACTIVITIES:
|
||||||||||||
Issuance
of common stock
|
- | - | 507,425 | |||||||||
Issuance
of preferred stock, net
|
161,000 | 864,248 | 1,180,998 | |||||||||
Payments
on stock subscription receivable
|
- | - | 113,476 | |||||||||
Proceeds
of note payable - bank
|
50,000 | - | 50,000 | |||||||||
Repayment
of note payable - bank
|
(1,000 | ) | - | (1,000 | ) | |||||||
Proceeds
of note payable - related party
|
8,000 | - | 14,000 | |||||||||
Repayment
of note payable - related party
|
- | (6,000 | ) | (6,000 | ) | |||||||
Proceeds
of notes payable
|
- | - | 5,000 | |||||||||
Increase
in amount due to stockholder
|
- | - | 16,220 | |||||||||
NET
CASH PROVIDED BY FINANCING ACTIVITIES
|
218,000 | 858,248 | 1,880,119 | |||||||||
NET
(DECREASE) INCREASE IN CASH
|
(40,570 | ) | 29,102 | 859 | ||||||||
CASH
- BEGINNING
|
41,429 | 12,327 | - | |||||||||
CASH
- ENDING
|
$ | 859 | $ | 41,429 | $ | 859 | ||||||
SUPPLEMENTAL
DISCLOSURE OF NONCASH INVESTING
|
||||||||||||
AND
FINANCING ACTIVITIES:
|
||||||||||||
Common
shares issued for services rendered.
|
$ | - | $ | - | $ | 5,000 | ||||||
Common
shares issued for purchase of
|
||||||||||||
bacteriophage
material.
|
$ | - | $ | - | $ | 2,000,000 | ||||||
Conversion
of notes payable and accrued
|
||||||||||||
interest
and net stockholders loans to
|
||||||||||||
additional
paid-in capital.
|
$ | - | $ | - | $ | 13,796 | ||||||
Accounts
payable paid on behalf of Company by
|
||||||||||||
stockholder.
|
$ | 5,400 | $ | 22,500 | $ | 27,900 | ||||||
Conversion
of preferred shares for common.
|
$ | - | $ | 8,750 | $ | 8,750 |
Read
accompanying Notes to Financial Statements.
F-10
VIRIDAX
CORPORATION
(A
Development Stage Company)
NOTES
TO FINANCIAL STATEMENTS
APRIL
30, 2009
NOTE
1.
|
ORGANIZATION
|
Viridax
Corporation was incorporated on July 1, 1998 under the laws of the State of
Florida as Media Advisory Group, Inc. and on August 6, 2001 changed its name
to I & E Tropicals, Inc. On April 5, 2005, the company amended its
Articles of Incorporation to change its name to Viridax Corporation. With the
acquisition of the bacteriophage material on April 24, 2005, the Company is
pursuing its plan to expedite the bacteriophage material’s commercialization.
This bacteriophage material is expected to be used for the treatment of
bacterial infections incited by Staphylococcus aureus and
other Staphlylococcus species.
The Company has decided to discontinue its original business plan for the
importing and exporting of exotic marine life. The company’s headquarters is in
Boca Raton, Florida.
The
Company has insignificant revenue to date. Since its inception, the Company has
been dependent upon the receipt of capital investment or other financing to fund
its continuing activities. In addition to the normal risks associated with a new
business venture, there can be no assurance that the Company’s product
development will be successfully completed or that it will be a commercial
success.
NOTE
2.
|
SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES
|
Computer and Laboratory
Equipment
Computer
and laboratory equipment is recorded at cost. Expenditures for major betterments
and additions are charged to the property and equipment accounts, while
replacements, maintenance and repairs which do not improve or extend the life of
the respective assets are expensed. Depreciation
is computed by the straight-line method over the estimated useful lives of the
assets ranging from three to seven years.
F-11
VIRIDAX
CORPORATION
(A
Development Stage Company)
NOTES
TO FINANCIAL STATEMENTS
APRIL
30, 2009
NOTE
2.
|
SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES
(CONTINUED)
|
Bacteriophage
Material
On April
24, 2005 the Company entered into an agreement with a biomedical company to
purchase certain Staphylococcus aureus bacteriophages in exchange for 2,000,000
shares of common stock. The bacteriophages were valued at $2 million based upon
the Company’s most recent sale of common stock for cash. The Company intends to
expedite the commercialization of the bacteriophages by obtaining financing to
complete pre-clinical testing and initiate clinical trials in order to obtain
regulatory approval for marketing. In the alternative, a
market currently exists for the bacteriophage material in certain countries
outside the United States.
The
Company accounts for any impairment in accordance with SFAS No. 142, “Goodwill
and Other Intangible Assets.” In accordance with SFAS No. 142, intangible
assets are reviewed for evidence or changes in circumstances that indicate that
their carrying value may not be recoverable. The Company periodically
reviews the carrying value to determine whether or not an impairment to such
value has occurred. As of April 30, 2009 and 2008, an impairment of $35,000 and
$45,000 was recognized pursuant to the results of an independent valuation of
the bacteriophage material, respectively.
Income
Taxes
Deferred
income taxes are provided for differences between the basis of assets and
liabilities for financial and income tax reporting. A valuation allowance is
provided against deferred income tax assets in circumstances where management
believes recoverability of a portion of the assets is not reasonably
assured.
F-12
VIRIDAX
CORPORATION
(A
Development Stage Company)
NOTES
TO FINANCIAL STATEMENTS
APRIL
30, 2009
NOTE
2.
|
SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES
(CONTINUED)
|
(Loss) Per
Share
(Loss)
per share is computed by dividing net (loss) for the year by the weighted
average number of common shares outstanding. The effect of the conversion of the
preferred stock is excluded from the calculation of net loss per share as the
effect was anti-dilutive.
Statement of Cash
Flows
For
purposes of this statement the Company considers all highly liquid investments
with an original maturity of three months or less to be cash equivalents. As of
April 30, 2009 and 2008, the Company had no cash equivalents.
Use of
Estimates
Management
uses estimates and assumptions in preparing financial statements in accordance
with generally accepted accepted
accounting principles. Those estimates and assumptions affect the reported
amounts of assets and liabilities, the disclosure of contingent assets and
liabilities, and the reported revenues and expenses. Accordingly, actual results
could vary from the estimates that were assumed in preparing the financial
statements and those differences could be material.
Fair Value of Financial
Instruments
The
carrying amounts of the Company’s financial instruments including notes
receivable and notes payable - related parties, notes payable - bank and
accounts payable and accrued expenses approximate fair value due to the
relatively short period to maturity for these instruments.
F-13
VIRIDAX
CORPORATION
(A
Development Stage Company)
NOTES
TO FINANCIAL STATEMENTS
APRIL
30, 2009
NOTE
2.
|
SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES
(CONTINUED)
|
Recent Accounting
Pronouncements
In December 2007, the Financial
Accounting Standards Board (FASB) issued SFAS No. 160, “Noncontrolling Interests in
Consolidated Financial Statements – an amendment of ARB No. 51”. This
statement improves the relevance, comparability, and transparency of the
financial information that a reporting entity provides in its consolidated
financial statements by establishing accounting and reporting standards that
require; the ownership interests in subsidiaries held by parties other than the
parent and the amount of consolidated net income attributable to the parent and
to the noncontrolling interest be clearly identified and presented on the face
of the consolidated statement of income, changes in a parent’s ownership
interest while the parent retains its controlling financial interest in its
subsidiary be accounted for consistently, when a subsidiary is deconsolidated,
any retained noncontrolling equity investment in the former subsidiary be
initially measured at fair value, entities provide sufficient disclosures that
clearly identify and distinguish between the interests of the parent and the
interests of the noncontrolling owners. SFAS No. 160 affects those
entities that have an outstanding noncontrolling interest in one or more
subsidiaries or that deconsolidate a subsidiary. SFAS No. 160 is effective
for fiscal years, and interim periods within those fiscal years, beginning
on or
after December 15, 2008. Early adoption is prohibited. The adoption of this
statement is not expected to have a material effect on the Company's financial
statements.
F-14
VIRIDAX
CORPORATION
(A
Development Stage Company)
NOTES
TO FINANCIAL STATEMENTS
APRIL
30, 2009
NOTE
2.
|
SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES
(CONTINUED)
|
Recent Accounting
Pronouncements (Continued)
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). This statement is intended
to improve transparency in financial reporting by requiring enhanced disclosures
of an entity’s derivative instruments and hedging activities and their effects
on the entity’s financial position, financial performance, and cash flows.
SFAS 161 applies to all derivative
instruments within the scope of SFAS 133, “Accounting for Derivative Instruments
and Hedging Activities” (SFAS 133) as well as related hedged items, bifurcated
derivatives, and nonderivative instruments that are designated and qualify as
hedging instruments. Entities with instruments subject to SFAS 161 must provide more robust
qualitative disclosures and expanded quantitative disclosures. SFAS 161 is effective prospectively for
financial statements issued for fiscal years and interim periods beginning after
November 15, 2008, with early application permitted. The adoption of this
statement is not expected to have a material effect on the Company's financial
statements.
F-15
VIRIDAX
CORPORATION
(A
Development Stage Company)
NOTES
TO FINANCIAL STATEMENTS
APRIL
30, 2009
NOTE
2.
|
SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES
(CONTINUED)
|
Recent Accounting
Pronouncements (Continued)
In May
2008, the FASB issued SFAS No. 162, “The Hierarchy of Generally Accepted
Accounting Principles.” SFAS No. 162 identifies the sources of accounting
principles and provides entities with a framework for selecting the principles
used in preparation of financial statements that are presented in conformity
with GAAP. The current GAAP hierarchy has been criticized because it is
directed to the auditor rather than the entity, it is complex, and it ranks
FASB Statements of Financial Accounting Concepts, which are subject to the same
level of due process as FASB Statements of Financial Accounting Standards, below
industry practices that are widely recognized as generally accepted but that are
not subject to due process. The Board believes the GAAP hierarchy should be
directed to entities because it is the entity (not its auditors) that is
responsible for selecting accounting principles for financial statements that
are presented in conformity with GAAP. The adoption of FASB 162 is not expected
to have a material impact on the Company’s financial position.
In May
2008, the FASB issued SFAS No. 163, “Accounting for Financial Guarantee
Insurance Contracts-an interpretation of FASB Statement No. 60.” Diversity
exists in practice in accounting for financial guarantee insurance contracts by
insurance enterprises under FASB Statement No. 60, Accounting and Reporting by
Insurance Enterprises. This results in inconsistencies in the recognition and
measurement of claim liabilities. This Statement requires that an insurance
enterprise recognize a claim liability prior to an event of default (insured
event) when there is evidence that credit deterioration has occurred in an
insured financial obligation. This Statement requires expanded disclosures about
financial guarantee insurance contracts. The accounting and disclosure
requirements of the Statement will improve the quality of information provided
to users of financial statements. The adoption of FASB 163 is not expected to
have a material impact on the Company’s financial position.
F-16
VIRIDAX
CORPORATION
(A
Development Stage Company)
NOTES
TO FINANCIAL STATEMENTS
APRIL
30, 2009
NOTE
3.
|
COMPUTER AND
LABORATORY EQUIPMENT
|
As of
April 30, 2009 and 2008, computer and laboratory equipment wasas
follows:
2009
|
2008
|
|||||||
Computer
equipment
|
$ | 16,289 | $ | 15,597 | ||||
Laboratory
equipment
|
27,168 | 21,647 | ||||||
43,457 | 37,244 | |||||||
Accumulated
depreciation
|
(15,472 | ) | (6,032 | ) | ||||
Laboratory
and computer
|
||||||||
equipment-net
|
$ | 27,985 | $ | 31,212 |
During
the years ended April 30, 2009 and 2008, depreciation expense was $9,440 and
$4,364, respectively.
NOTE
4.
|
NOTE PAYABLE -
BANK
|
On June
26, 2008, the Company secured a business equity line of credit in the amount of
$200,000 which expires June 26, 2038. However, commencing June 26, 2023, any
outstanding advances are payable in monthly installments and no additional
advances will be available. Interest is payable monthly at prime less .15% on
any outstanding balance. The line of credit is secured by real property owned by
a company, the president of which is a stockholder of the Company and a
guarantee by the stockholder himself. As of April 30, 2009 and 2008, the amount
outstanding on this line of credit was $49,000 and $-0-, respectively. Subsequent to April 30,
2009, additional advances and repayments were $18,000 and $32,000,
respectively.
NOTE
5.
|
INCOME
TAXES
|
As of
April 30, 2009 and 2008, no deferred income taxes have been recorded due to the
Company having no history of profitable operations. Significant components
of the Company’s net deferred income taxes are as
follows:
F-17
VIRIDAX
CORPORATION
(A
Development Stage Company)
NOTES
TO FINANCIAL STATEMENTS
APRIL
30, 2009
NOTE
5.
|
INCOME TAXES
(CONTINUED)
|
2009
|
2008
|
|||||||
Net
operating loss carryforwards
|
$ | 703,250 | $ | 568,250 | ||||
Start-up
expenditures
|
1,750 | 1,750 | ||||||
705,000 | 570,000 | |||||||
Less:
Valuation allowance
|
(705,000 | ) | (570,000 | ) | ||||
Net
deferred income tax asset
|
$ | - | $ | - |
During
the year ended April 30, 2009, the valuation allowance increased by
$135,000.
The
reconciliation of income tax (benefit) computed at the federal statutory rate to
income tax expense (benefit) is as follows:
2009
|
2008
|
|||||||
Tax
(benefit) at federal
|
||||||||
statutory
rate
|
(34.00 | )% | (34.00 | )% | ||||
State
tax (benefit), net
|
||||||||
of
federal benefit
|
(3.63 | ) | (3.63 | ) | ||||
Valuation
allowance
|
37.63 | 37.63 | ||||||
Tax
provision (benefit)
|
00.00 | % | 00.00 | % |
The
Company has net operating loss carryforwards for federal and state purposes of
approximately $1,874,700 available to offset future taxable income. The net
operating loss carryforwards, if not used, expire through April 30,
2029.
F-18
VIRIDAX
CORPORATION
(A
Development Stage Company)
NOTES
TO FINANCIAL STATEMENTS
APRIL
30, 2009
NOTE
6.
|
RELATED PARTY
TRANSACTIONS
|
Notes Receivable and Accrued
Interest
The
Company made advances to a company, the president of which is the president of
the Company. The notes are unsecured, bear interest at 6% per annum and are due
upon demand. As of April 30, 2009 and 2008, the balance of the notes receivable
was $2,400. Accrued interest as of April 30, 2009 and 2008 was $1,392 and
$1,192, respectively.
On
January 22, 2008, the Company advanced $25,000 to a company, the president of
which is a non-major stockholder. The note bears interest at 6% per annum due
upon demand. The note is collateralized by a security interest in the common
shares owned by the stockholder. Currently, the Company has a claim against the
estate of this shareholder. Management believes that the balance of the note
receivable including accrued interest of $15,826 is uncollectible. Accordingly,
an allowance for doubtful accounts has been recorded.
Laboratory
Equipment
On
January 8, 2008, the Company purchased laboratory equipment from its president
for $20,000.
Notes Payable and Accrued
Interest
During
the year ended April 30, 2009, the Company received advances totaling $8,000
from a company, the president and sole shareholder of which are non-major
stockholders. The notes are unsecured, bear interest at 5% per annum and are due
upon demand. As of April 30, 2009, the balance of the notes payable was $8,033
including accrued interest of $33. Subsequent to April 30,
2009, the Company received additional advances totaling $6,000.
F-19
VIRIDAX
CORPORATION
(A
Development Stage Company)
NOTES
TO FINANCIAL STATEMENTS
APRIL
30, 2009
NOTE
6.
|
RELATED PARTY
TRANSACTIONS (CONTINUED)
|
Legal
Fees
During
the years ended April 30, 2009 and 2008, $60,000 was charged by a
stockholder for legal services rendered. However, during the year ended April
30, 2009, legal fees totaling $44,500 was forgiven. As of April 30, 2008,
prepaid expenses included $9,500 for legal services paid in
advance.
Consulting
Fees
During
the year ended April 30, 2008, the Company paid $6,300 to two companies, the
president of which is the president of the Company, for consulting services
relating to bacteriophage studies and clinical testing.
During
the year ended April 30, 2008, the Company paid $2,000 to its chief financial
officer for consulting services rendered.
NOTE
7.
|
CAPITAL
STOCK
|
Preferred
Stock
The
Company has 3,000,000 shares of Class A non-cumulative, convertible preferred
stock of $1 par valueauthorized. The preferred shares are non-cumulative,
non-voting and convertible to common shares within the first 3 years under the
following schedule: shares converted within the first year of purchase shall
receive 4 shares of common for every share of preferred; shares converted in the
second year after purchase shall receive 4.4 shares of common for every share of
preferred; shares converted in the third year after purchase shall receive 4.6
shares of common for every share of preferred; after 3 years of ownership, the
shareholder shall receive 5 shares of common for every share of preferred, but
the right to convert must be exercised within 30 days of the 3 year anniversary
of purchase or the conversion right will lapse.
F-20
VIRIDAX
CORPORATION
(A
Development Stage Company)
NOTES
TO FINANCIAL STATEMENTS
APRIL
30, 2009
NOTE
7.
|
CAPITAL STOCK
(CONTINUED)
|
Preferred Stock
(Continued)
During
the year ended April 30, 2008, two stockholders converted a total of 2,500
shares of their preferred shares into 11,000 shares of the Company’s common
shares in accordance with the conversion schedule. No cash was exchanged with
the conversion.
On April
1, 2006, the Company entered into an Agency Agreement for the sale of up
to 3,000,000 shares of the Company’s Class A Preferred Stock. The stock is being
offered for sale in Germany and elsewhere in Europe at $7 per share ($3.50 per
share net proceeds to the Company), as determined by the Company’s management,
such sale being exempt from registration under Regulation S of the Securities
Act of 1933.
As of
April 30, 2009 and 2008, 334,929 and 288,929 preferred shares were issued and
outstanding, respectively. Subsequent to April 30, 2009, 21,600 preferred
shares were sold for net proceeds totaling $75,600.
Common
Stock
The
Company has 50,000,000 shares of $.001 par value common stock authorized.
Shareholders of common stock have one vote per share.
F-21
VIRIDAX
CORPORATION
(A
Development Stage Company)
NOTES
TO FINANCIAL STATEMENTS
APRIL
30, 2009
NOTE
7.
|
CAPITAL STOCK
(CONTINUED)
|
Common Stock
(Continued)
On June
1, 2005, the Company entered into a Stock Purchase Agreement for the sale, on a
best efforts basis, of an aggregate of 500,000 shares of common stock for $1 per
share, as determined by the Company’s management, such sale being exempt from
registration under Regulation S of the Securities Act of 1933. The Agreement
provided for the purchase of the shares at irregular intervals. During the year
ended April 30, 2006, 357,167 common shares were sold for cash totaling
$357,167. On April 25, 2006, the agreement was terminated by mutual
consent.
On July
1, 2005, the Company entered into a Stock Purchase Agreement for the sale of an
aggregate of 400,000 shares of common stock for $.80 per share, as determined by
the Company’s management, such sale being exempt from registration under
Regulation S of the Securities Act of 1933. The Agreement provided for the
purchase of the shares in installments with the first installment of 50,000
shares ($40,000) due within ten days of the date of the Agreement. The remaining
350,000 shares were to be paid in not more than seven installments with a
minimum of 50,000 shares per installment. This payment arrangement was not
followed. During the year ended April 30, 2006, 50,000 common shares were sold
for cash totaling $40,000. Stock subscriptions receivable of $280,000 were
recorded for the remaining 350,000 common shares, of which $113,476 was received
during the year ended April 30, 2006. On April 25, 2006, the agreement was
terminated. The balance of the subscription receivable of $166,524 was
reversed.
On April
12, 2006, the Company entered into a Stock Purchase Agreement for the sale, on a
best efforts basis, of an aggregate of 1,000,000 shares of common stock for $1
per share, as determined by the Company’s management, such sale being exempt
from registration under Regulation S of the Securities Act of 1933. The
Agreement provided for the purchase of the shares at irregular intervals. During
the year ended April 30, 2007, 22,750 common shares were sold for cash totaling
$22,750. On March 30, 2007, the agreement was terminated.
F-22
VIRIDAX
CORPORATION
(A
Development Stage Company)
NOTES
TO FINANCIAL STATEMENTS
APRIL
30, 2009
NOTE
7.
|
CAPITAL STOCK
(CONTINUED)
|
Common Stock
(Continued)
The sales
of common stock pursuant to the Stock Purchase Agreements referred to above
resulted in additional funds received of $21,808. As a result of the termination
of these agreements, the additional funds have been classified as additional
paid-in capital.
On
December 1, 2006, the Company issued 10,000 common shares in a private sale at
$1.40 per share, as determined by the Company’s management, such sale being
exempt from registration under Regulation D of the Securities Act of 1933. The
shares were issued for cash totaling $11,200 net of commissions of
$2,800.
On June
6, 2007, accounts payable of $22,500 was paid on behalf of the Company by a
stockholder and recorded as an increase in additional paid-in
capital.
On March
27, 2009, accounts payable of $5,400 was paid on behalf of the Company by a
stockholder and recorded as an increase in additional paid-in
capital.
As of
April 30, 2009 and 2008, 24,349,090 shares of common stock were issued and
outstanding. Subsequent to April 30,2009, the
Company issued 2,200,000 common shares in a private sale at $.01 per share, as
determined by the Company’s management, such sale being exempt from registration
under Regulation S of the Securities Act of 1933.
F-23
VIRIDAX
CORPORATION
(A
Development Stage Company)
NOTES
TO FINANCIAL STATEMENTS
APRIL
30, 2009
NOTE
8.
|
COMMITMENTS
|
Commencing
March 1, 2009, the Company entered into an agreement with an agency of the
United States Department of Agriculture to continue the laboratory work
necessary to evaluate and commercialize the bacteriophage material for a fee of
$150,000. A deposit of $50,000 was paid with the balance due in three quarterly
installments. These installments have not yet been paid. The fee is being
expensed over the term of the agreement. The agreement ended February 28, 2010
but was extended to January 10, 2011. For the year ended April 30, 2009, the
amount expensed was $24,658.
On July
10, 2008, the Company entered into a one year extension agreement with a
nonprofit medical facility to perform laboratory work that will support the
manufacture of the bacteriophage material for a fee of $220,000. A deposit of
$55,000 was paid with the balance due on the third, sixth and ninth month from
the date of the agreement. The fee is being expensed over the term of the
agreement. Effective March 2, 2009, the agreement was mutually suspended and the
amount due of $68,562 was forgiven. For the years ended April 30, 2009 and 2008,
the amount expensed for the original and extension agreements was $95,201 and
$172,451, respectively.
On April
11, 2008, the Company entered into a five year master agreement with a
pharmacology service company to perform various bacteriophage studies and
clinical testing. The Company has initially contracted for two studies for a
total fee of $13,840. For the years ended April 30, 2009 and 2008, the amount
expensed was $-0- and $4,470, respectively.
F-24
VIRIDAX
CORPORATION
(A
Development Stage Company)
NOTES
TO FINANCIAL STATEMENTS
APRIL
30, 2009
NOTE
9.
|
SUBSEQUENT
EVENTS
|
On April
30, 2010, the Company received proceeds of a loan totaling $20,000. The loan is
unsecured, bears interest at 2% per annum and is due upon
demand.
NOTE 10.
|
GOING
CONCERN
|
As reflected on the balance sheet, the
Company is still in the development stage with an accumulated deficit of
$2,251,342 and since inception, a negative cash flow from operations of
$1,810,216. These factors raise substantial doubt about its ability to continue
as a going concern. The ability of the Company to continue as a going concern is
dependent on its ability to raise additional capital. The financial statements
do not include any adjustments that might be necessary should the Company be
unable to continue as a going concern.
Management has secured continued
approval from the German exchange for the sale of preferred stock
and is continuing to pursue other contracts and/or grants to secure additional
funding. Management believes that the direction it is taking will secure
additional funding and that the Company will be able to continue as a going
concern.
F-25