SECTION
2 - FINANCIAL INFORMATION
Item
2.01 Completion of Acquisition or Disposition of Assets
SAFE
HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995
Information
included in this Form 8-K may contain forward-looking statements within the
meaning of Section 27A of the Securities Act and Section 21E of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"). This information may
involve known and unknown risks, uncertainties and other factors which may cause
Mach One Corporation (“Mach One”) and WhiteHat Holdings, LLC (“WhiteHat”) actual
results, performance or achievements to be materially different from future
results, performance or achievements expressed or implied by any forward-looking
statements. Forward-looking statements, which involve assumptions and describe
Mach One and WhiteHat’s future plans, strategies and expectations, are generally
identifiable by use of the words "may," "will," "should," "expect,"
"anticipate," "estimate," "believe," "intend" or "project" or the negative of
these words or other variations on these words or comparable terminology.
Forward-looking statements are based on assumptions that may be incorrect, and
there can be no assurance that any projections or other expectations included in
any forward-looking statements will come to pass. Mach One and WhiteHat’s actual
results could differ materially from those expressed or implied by the
forward-looking statements as a result of various factors. Except as required by
applicable laws, Mach One undertakes no obligation to update publicly any
forward-looking statements for any reason, even if new information becomes
available or other events occur in the future.
ACQUISITION
OF WHITEHAT HOLDINGS, LLC BY MACH ONE CORPORATION
On April
14, 2010, Mach One Corporation, a Nevada corporation (“Mach One”), completed an
acquisition of WhiteHat Holdings, LLC, a Delaware limited liability company
(“WhiteHat”), through the merger of WhiteHat into White Hat Acquisition Corp., a
wholly-owned subsidiary of Mach One (the “Merger Sub”), pursuant to a Plan and
Agreement of Merger entered into by the parties on February 25, 2010 (the
“Merger Agreement”). The Merger Sub will change its name to WhiteHat
Holdings, Inc. and will operate as a wholly-owned subsidiary of Mach One. Mach
One will continue its business under the name Mach One. In accordance with the
Merger Agreement, Kevin P. Quirk, President and CEO of WhiteHat, has been
appointed a director of Mach One together with Gilbert Peter. Messrs: Quirk and
Peter’s have the right to appoint one more director of Mach
One. Therefore, the directors of Mach One consist of five current
Mach One directors, Tad M. Ballantyne, Monte B. Tobin, Kevin G. Sallstrom, Mark
A. Thomas and Brittin Eustis and three new directors named by White Hat, Kevin
P. Quirk, Gilbert Peter and a director to be selected by Messrs. Quirk and
Peter. Mr. Quirk will continue to be the President and CEO of White
Hat.
Pursuant
to the terms of the Merger Agreement, as partial consideration (i) $400,000
shall be deposited into a WhiteHat account not later than April 30,2010, to be
used by WhiteHat to pay its legal, accounting, marketing and debt
expenses and to further the development of its business, and (ii) all
of the issued and outstanding shares of common and preferred stock of WhiteHat
were converted into 154,798,788 shares of Mach One common stock and distributed
to the WhiteHat shareholders pro rata. In addition, $987,000 of WhiteHat
indebtedness was cancelled and converted into 15,343,750 shares of Mach One
common stock. Upon the close of the acquisition, the former WhiteHat
shareholders owned approximately 45% of the total issued and outstanding common
stock of Mach One. In the event that less than $400,000 is deposited
into a WhiteHat account by April 30, 2010, Mach One shall issue additional
shares of its common stock (“Penalty Shares”) to the WhiteHat shareholders, pro
rata. In addition, Mach One is obligated to provide additional
capital to the WhiteHat subsidiary of not less than $1,600,000 on or before July
4, 2010. In the event Mach One fails to provide such capital within
the required time period, Mach One will issue to the former WhiteHat
shareholders up to 33,691,592 additional shares of its common stock (“Additional
Shares”). However, in no event will the total number of shares issued
to the WhiteHat shareholders at the closing , together with any Penalty Shares
and/or Additional Shares exceed 49.9% of Mach One’s issued and outstanding
common stock.
Additional
details regarding the WhiteHat acquisition, including a copy of the Merger
Agreement, are provided in Mach One’s Current Report on Form 8-K previously
filed on March 3, 2010.
BUSINESS
OF MACH ONE
Mach One
Corporation is a global wellness solutions company with operations in Animal
Wellness; Organics & Sustainables; and BioPharm Process Systems. Through its
Animal Wellness Group, the Company focuses on major opportunities for positive,
long-term health and longevity benefits for disease-threatened animals in the
commercial livestock and poultry industries, especially the beef and dairy
sectors. The Organics & Sustainables Group, through its flagship company
Ceres Organic Harvest, Inc. (Ceres), addresses the growing needs of food
manufacturers in the organic foods market which are challenged to increase
production capacity for organic raw commodities and feed stocks that go into the
finished products. The BioPharm Process Systems Group provides documentation,
process modules, process skids, custom tanks and vessels and custom stainless
steel fabrication to the biopharmaceutical industry, and also will be integral
in setting up and servicing the projected three U.S.-based laboratories for
production of Mach One's Animal Wellness Group Bridge™ product
line.
BUSINESS
OF WHITEHAT
Company
Information
White Hat
Brands, LLC, (“White Hat Brands”) is the operating company and a wholly-owned
subsidiary of WhiteHat.
With
rates of obesity and diabetes in children rising at alarming rates,
Atlanta-based White Hat Brands is focused on kids’ health and wellness and is
committed to offering nutritious products to provide parents smart alternatives
to the leading beverages and snacks. White Hat Brands produces a
variety of great tasting, fortified juice beverages for kids under the brand
Dog On It! ® that are
made with all-natural ingredients and loaded with calcium and vitamins A, B, C,
D & E – without adding excess sugar or high fructose corn
syrup.
From
August 2007 through October 2008, White Hat Brands executed a regional test of
Dog On It! through large format grocery in the Northeastern
U.S. During that time, it gained distribution in approximately 2,000
major grocery outlets, including the New York, Philadelphia and Boston
markets. In November of 2007, Dog On It! became the first children’s
beverage brand to be accepted as a national partner of the Juvenile Diabetes
Research Foundation (JDRF). Additionally, White Hat Brands received
several Hermes and MarCom awards for Dog On It!’s packaging and marketing
materials.
Some of
the keys to White Hat Brand’s success to date include:
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Early
investment in sophisticated Enterprise Resource Planning solution which
facilitated daily operations and management of the
business.
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Existing
broker and buyer relationships enabling aggressive
speed-to-market.
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National
co-marketing partnerships with the JDRF and the American Camps Association
fostering brand credibility among consumers and differentiating Dog On It!
from the competition.
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White Hat
Brand’s management has close to 60 years of combined experience in the food and
beverage industry, including The Coca-Cola Company, Anheuser Busch, Cliffstar
Corporation, In Zone Brands and Lang Naturals
Products
Dog On
It! fortified juice beverages are made with all natural ingredients and deliver
substantial nutrients and fruit flavor without excess sugar!
All Dog
On It! products are:
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High
in Vitamins A, B,C, D, E
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Excellent
Source of Calcium
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Low
in Sugar and Calories*
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Served
in Convenient 8-oz Portion-controlled
Bottles
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Dog On
It! products contain none of the following:
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No
High Fructose Corn Syrup!
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No
Artificial Sweeteners
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No
Artificial Colors or Preservatives
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Low
in Calories—only 80 calories
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*When
compared ounce for ounce to the leading juice beverages
Dog On
It! comes in five fruit flavors —Orange Splash, Berry Punch, Kiwi Watermelon,
Tropical Tangerine, and Strawberry Lemonade.
Dog On It! is 25% juice and only 80 calories,
with no artificial sweeteners added. Overall, 100% juice drinks have higher
levels of sugar and calories, without the extra nutrients in Dog On
It! White Hat created Dog On It! fortified juice beverage
because kids don't need all that extra sugar—especially high fructose corn
syrup! Kids need great taste, essential vitamins and minerals, LOW SUGAR, with
NO artificial anything added!
“Fortified” means that White Hat has added
essential vitamins and nutrients to Dog On It! to make it specially formulated
for growing kids. Through its marketing efforts, White Hat makes the claim that
ounce for ounce, Dog On It! delivers more nutritional value than 100% juice,
more than milk and more than any sports drink or water.
Marketing
To garner
brand acceptance among consumers and to underscore White Hat Brand’s commitment
to combating increasing rates of obesity and diabetes in children, its strategic
partners include the Juvenile Diabetes Research Foundation International (JDRF),
the world’s leading supporter of medical research on Type 1 diabetes and related
complications, and the American Camps Association, a network of approximately
2,500 camps nationwide whose purpose is to promote human development and enrich
the lives of children through the camp experience. Dog On It! carries the JDRF
logo on all its packaging.
With the
regional test of Dog On It!, White Hat Brands employed a two-pronged marketing
plan: (1) invest heavily in retail customer programs to drive consumer trial
(i.e., pricing promotions, in-circular ads, in-store sampling and couponing) and
(2) leverage its national partnership with the JDRF to lend credibility to the
brand and engage target consumers directly through event marketing
opportunities.
Business
Strategy
In the
interest of minimizing overhead, White Hat Brands is a ‘virtual
company’. Beyond the core management team responsible for overseeing
the operations, sales, marketing and financial performance of the business, all
additional support comes from outside providers, including third party contract
manufacturers, logistics management companies, sales brokers and wholesalers,
beverage formulation houses and marketing agencies.
Through
this network of partners, White Hat Brands has successfully tested a proprietary
brand in Dog On It! that it will continue to develop by pursuing new
distribution channels and by introducing new formats of the
product. Additionally, White Hat Brands has incubated other
proprietary brands to enhance its portfolio of functional food and beverage
products. Subsequent to this merger with Mach One, White Hat Brands
will also be equipped to scale the business through an acquisition strategy
targeting health and wellness food and beverage brands.
As White
Hat Brands’ product portfolio matures, it will consider all traditional ways of
optimizing shareholder value.
Industry
Overview
The U.S.
market for functional foods and beverages increased 6% with sales totaling
almost $31 billion in 2008, and is forecasted to reach $43 billion by
2013.
In
addition to Kevin P. Quirk, President and CEO, WhiteHat Brands’ management team
is comprised of three additional full-time employees responsible for the
operations, sales and marketing of its products.
White Hat
is not a party to nor is it aware of any existing, pending or threatened
lawsuits or other legal actions.
PROPERTIES
White Hat Brands® and Dog On It! ® are trademarks
of White Hat.
Item
3.02 Unregistered Sales of Equity Securities.
On April
14, 2010, pursuant to a Plan and Agreement of Merger, Mach One issued
154,798,788 shares of its common stock to 67 holders of shares of WhiteHat
common and preferred stock (“WhiteHat Shareholders”) and 15,343,750 shares of
its common stock was issued to 7 creditors (the “Creditors”) upon the
cancellation and conversion of $987,000 in indebtedness owed by
WhiteHat.
All of
the WhiteHat Shareholders and Creditors above are sophisticated individuals who
had the opportunity to review all of Mach One’s SEC filings and to discuss with
the officers and directors of Mach One the business and financial activities of
Mach One. All the investors acquired their shares for investment and
not with a view toward distribution. All of the stock certificates issued to the
74 WhiteHat Shareholders and Creditors set forth above have been affixed with an
appropriate legend restricting sales and transfers. Therefore, based
on the foregoing, Mach One has issued the 170,142,538 shares in reliance upon
the exemptions from registration provided by Section 4(2) of the Securities Act
of 1933 and/or Regulation D, thereunder.
Item
5.02 Departure of Directors or Certain Officers; Appointment of Certain
Officers; Compensatory Arrangements of Certain Officers
Pursuant
to the Agreement, Kevin P. Quirk and Gilbert Peter were appointed to the Board
of Directors of Mach One as of April 14, 2010. Following are the résumés of
Messrs. Quirk and Peter:
Kevin P. Quirk. Mr. Quirk,
age 42, founded WhiteHat Holdings, LLC and its wholly-owned subsidiary White Hat
Brands in 2006 and has continued to serve as the President and CEO of both
entities since their formations. Prior to founding White Hat Brands, Mr. Quirk
was employed by The Coca-Cola Company where he held a variety of senior-level
marketing positions, most recently on the Minute Maid business. Prior to
Coca-Cola, Mr. Quirk spent nine years at Anheuser-Busch where he worked in Brand
Management, Field Sales and Marketing, Wholesaler Development and Strategic
Planning. Mr. Quirk has a BS in Marketing and a BA in Communications from Saint
Louis University and extensive executive management coursework at Harvard
Business School.
Gilbert Peter. Mr.
Peter, age 50, has long
been an entrepreneur with holdings in many companies over the years in both the
private and public sector. As Director of his own Private Venture firm,
established in 2000 Mr. Peter has focused on developing early stage or start-up
companies and bringing them through the seed stage towards acquisition or public
offering. Mr. Peter has helped successfully launch companies in many sectors,
and is a generalist as far as sectors. His area of concentration over the past
few years includes, Business Service, Healthcare, software, sports apparel,
Sports and entertainment, as well as Real Estate Telecommunications. His most
recent interests center around Health and wellness, which includes a children’s
fortified healthy beverage company established in 2007, as well as newly formed
walk-in medical centers, same day outpatient surgery centers, and a plastic
surgery center that focuses on cutting edge hair replacement. Mr. Peters main
area of expertise has always been focused on formation, as well as providing
strategic relationships that are crucial to development. Over the last 15 years
Mr. Peter has formed long standing and personal relationships with major banks
worldwide including, Morgan Stanley, Goldman Sacs, and
CIBC Oppenheimer to name a few. He has also built longstanding relationships
with many private Venture Capital groups. Mr. Peter has been actively involved
with many non-profit organizations including, The Children’s Cancer Center in
Tampa Florida, as well as The Mellanby Autism Foundation, serving as a past
Board member of both of these organizations. Mr. Peter Has a wife and 3 children
and currently resides in Fort Lauderdale Florida
Item
7.01 Regulation FD Disclosure
On
April 15, 2010, Mach One issued a news release related to the acquisition of
WhiteHat Holdings, LLC. A copy of the news release is attached as Exhibit 99.1
hereto and incorporated herein by reference. This disclosure does not constitute
an offer to sell, or the solicitation to buy, any such security.
Item 9.01
Financial Statements and Exhibits.
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(a)
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Financial Statements of
Business Acquired.
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Mach One
hereby undertakes to file the financial statements required by this Item 9.01(a)
not later than 71 days after the date this Form 8-k was due for
filing.
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(b)
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Pro Forma Financial
Statements.
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Mach One
hereby undertakes to file the pro forma financial information required by this
Item 9.01(b) not later than 71 days after the date this Form 8-K was due for
filing.