Prevention Insurance.com was incorporated in the State of Nevada on May 7,
1975, under the name Vita Plus, Inc. The name was later changed to Vita Plus
Industries, Inc. and in 2000 the Company’s name was changed to its current
name Prevention Insurance.com.
From inception until early 1999, the Company’s principal business consisted
of the sale and distribution of our own formulations of specific vitamins and
nutritional supplements, and of various other health and personal care products.
In 1991, we were licensed in Nevada as an agent for health and life insurance.
Since 1991, we have not derived any significant income from sales of insurance
policies. Effective March 15, 1999, we sold for cash substantially all of our
assets associated with the traditional distribution of vitamin and dietary supplement
formulations, including all inventory of vitamins and nutritional supplements
and terminated all business activities associated with the distribution of individual
vitamins and dietary supplements. We did, however, retain our insurance agency
license, our Prevention Insurance website and ownership rights in certain trademarks.
In 2005, the Company added a second line of business focused on the development
of ATM machine sale operations. On December 28, 2007, the Company entered into
a letter agreement (the “Letter Agreement”), with Paragon Capital
LP (“Paragon”) and Scott Goldsmith, which after the satisfaction
of the terms of the Letter Agreement, would result in a change in control of
the Company. In connection with the terms of the Letter Agreement, the Company
and Paragon entered into a stock purchase agreement (the “Purchase Agreement”)
pursuant to which Paragon purchased an aggregate of 71,428,571 shares of the
Company’s common stock, par value $0.01 per share (the “Old Common
Stock”) for an aggregate purchase price equal to $250,000. As provided
pursuant to the terms of the Purchase Agreement, our then sole officer and director,
Alan P. Donenfeld, was elected to the Board of Directors of the Company and
appointed to serve as the Company’s President, Chief Executive Officer
and Chief Financial Officer.
On February 5, 2008, in connection with the transactions contemplated by the
Letter Agreement, Mr. Goldsmith, Paragon and the Company signed an agreement
and release (the “Release”), which provided for, among other items,
(a) cancellation of 1,000,000 shares of the Company’s preferred stock,
par value $0.01 per share (the “Old Preferred Stock”), issued in
the name of Mr. Goldsmith, (b) cancellation of warrants to purchase up to 2,000,000
shares of the Company’s Old Common Stock, in exchange for (1) payment
in full of all of the Company’s liabilities, debts, and payables, (2)
an initial payment to Mr. Goldsmith of $200,000, (3) conveyance of the assets
and liabilities of Quick Pay, Inc. to Mr. Goldsmith, (4) an additional payment
to Mr. Goldsmith, upon certain events happening such as a reverse merger with
a private company, of $400,000 or 1,600,000 shares of Old Common Stock, regardless
of any stock splits for a period from four years from the date of the issuance
of the stock and (5) future assignment of warrants held by Paragon to Mr. Goldsmith
upon completion of a reverse merger.
The Company’s principal business objective for the next 12 months and
beyond such time will be to achieve long-term growth potential through a combination
with a business rather than immediate, short-term earnings. The Company will
not restrict its potential candidate target companies to any specific business,
industry or geographical location and, thus, may acquire any type of business.
The analysis of new business opportunities will be undertaken by or under the
supervision of our management and the Company’s principal shareholders.
Current or future management of the Company may decide to hire outside consultants
to assist in the investigation and selection of business opportunities, and
might pay a finder’s fee, in stock or in cash, as allowed by law. Since
the Company has no current plans to use any outside consultants, no criteria
or policies have been adopted.
As of the date of this report, the Company has not entered into any definitive
agreement with any party, nor have there been any specific discussions with
any potential business combination candidate regarding business opportunities
for the Company. The Company has unrestricted flexibility in seeking, analyzing
and participating in potential business opportunities. In its efforts to analyze
potential acquisition targets, the Company will consider the following kinds
of factors:
Potential for growth, indicated by new technology, anticipated market expansion
or new products;
Competitive position as compared to other firms of similar size and experience
within the industry segment as well as within the industry as a whole;
Strength and diversity of management, either in place or scheduled for recruitment;
Capital requirements and anticipated availability of required funds, to be provided
by the Company or from operations, through the sale of additional securities,
through joint ventures or similar arrangements or from other sources;
The cost of participation by the Company as compared to the perceived tangible
and intangible values and potentials;
The extent to which the business opportunity can be advanced; and
The accessibility of required management expertise, personnel, raw materials,
services, professional assistance and other required items.
In applying the foregoing criteria, no one of which will be controlling, management
will attempt to analyze all factors and circumstances and make a determination
based upon reasonable investigative measures and available data. Potentially
available business opportunities may occur in many different industries, and
at various stages of development, all of which will make the task of comparative
investigation and analysis of such business opportunities extremely difficult
and complex. Due to the Companys limited capital available for investigation,
the Company may not discover or adequately evaluate adverse facts about the
opportunity to be acquired. In evaluating a prospective business combination,
we will conduct as extensive a due diligence review of potential targets as
possible given the lack of information which may be available regarding private
companies, our limited personnel and financial resources and the inexperience
of our management with respect to such activities. We expect that our due diligence
will encompass, among other things, meetings with the target business’s
incumbent management and inspection of its facilities, as necessary, as well
as a review of financial and other information which is made available to us.
This due diligence review will be conducted either by our management or by unaffiliated
third parties we may engage, including but not limited to attorneys, accountants,
consultants or such other professionals. The costs associated with hiring third
parties to complete a business combination target may be significant and are
difficult to determine as such costs may vary depending on a variety of factors,
including the amount of time it takes to complete a business combination, the
location of the target company and the size and the complexity of the target
company. Our limited funds and the lack of full-time management will likely
make it impracticable to conduct a complete and exhaustive investigation and
analysis of a target business before we consummate a business combination. Management
decisions, therefore, will likely be made without detailed feasibility studies,
independent analysis, market surveys and the like which, if we had more funds
available to us, would be desirable. We will be particularly dependent in making
decisions upon information provided by the promoters, owners, sponsors or other
associated with the target business seeking our participation.
We fully anticipate that business opportunities will come to the Company’s
attention from various sources. These sources may include, but not be limited
to, its principal shareholders, professional advisors such as attorneys and
accountants, securities broker-dealers, and others who may present unsolicited
proposals. Currently, the Company has no agreements, whether written or oral,
with any individual or entity, to act as a finder for the Company. However,
at the present, we contemplate that our majority shareholders or our sole officer
and certain of their affiliates may introduce a business combination target
to us.
It is possible that the range of business opportunities that might be available
for consideration by the Company could be limited by the impact of Securities
and Exchange Commission regulations regarding purchase and sale of “penny
stocks.” The regulations would affect, and possibly impair, any market
that might develop in the Company’s securities until such time as they
qualify for listing on NASDAQ or on another exchange which would make them exempt
from applicability of the “penny stock” regulations.
The Company believes that various types of potential merger or acquisition candidates
might find a business combination with the Company to be attractive. These include
acquisition candidates desiring to create a public market for their shares in
order to enhance liquidity for current shareholders, acquisition candidates
which have long-term plans for raising capital through the public sale of securities
and believe that the possible prior existence of a public market for their securities
would be beneficial, and acquisition candidates which plan to acquire additional
assets through issuance of securities rather than for cash, and believe that
the possibility of development of a public market for their securities will
be of assistance in that process. Acquisition candidates who have a need for
an immediate cash infusion are not likely to find a potential business combination
with the Company to be an attractive alternative.
The time and costs required to select and evaluate a target business and to
structure and complete a business combination cannot presently be ascertained
with any degree of certainty. The amount of time it takes to complete a business
combination, the location of the target company and the size and complexity
of the business of the target company are all factors that determine the costs
associated with completing a business combination transaction. The time and
costs required to complete a business combination transaction can be ascertained
once a business combination target has been identified. Any costs incurred with
respect to evaluation of a prospective business combination that is not ultimately
completed will result in a loss to us.