UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549







FORM 10-K

A-2



|  |                                                                                     
|- | ------------------------------------------------------------------------------------
|þ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended: December 31, 2014



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:000-30651



MINDESTA INC.

(Exact name of Registrant as Specified in Its Charter)



|                                                               |                                  
|-------------------------------------------------------------- | ---------------------------------
|Delaware                                                       | 11-3763974                       
|(State or Other Jurisdiction of
Incorporation or Organization) | (IRS Employer
Identification No.)



|                                                  |           
|------------------------------------------------- | ----------
|                                                  |           
|429 Kent Street unit 112, Ottawa, Ontario, Canada | K2P 2B4   
|(Address of principal executive offices)          | (Zip Code)



|                                                               
|---------------------------------------------------------------
|Registrant's telephone number, including area code(613)241-9959



Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.  Yes  ̈  No þ



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 þ  No  ̈



Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 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 þ  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 during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes þ  No  ̈



Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrants knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  Yes  ̈  No  þ



Indicate by check mark whether the 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 12b-2 of the Exchange Act.



|                        |   |                           |  
|----------------------- | - | ------------------------- | -
|Large accelerated filer |  ̈ | Accelerated filer         |  ̈
|Non-accelerated filer   |  ̈ | Smaller reporting company | þ
|                        |   |                           |  

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).  Yes  ̈  No þ



At June 30, 2014, the aggregate market value of shares of common stock held by non-affiliates of the registrant was approximately $250,000.



At June 6, 2015 there were 213,493,022 shares of the registrants common stock outstanding (the only class of voting common stock).







---







TABLE OF CONTENTS



|           |                                                                                                              |     
|---------- | ------------------------------------------------------------------------------------------------------------ | ----
|           |                                                                                                              | PAGE
|           | PART I                                                                                                       |     
|           |                                                                                                              |     
|Item 1.    | Business                                                                                                     | 1   
|Item 1A.   | Risk Factors                                                                                                 | 13  
|Item 1B.   | Unresolved Staff Comments                                                                                    | 20  
|Item 2.    | Properties                                                                                                   | 21  
|Item 3.    | Legal Proceedings                                                                                            | 21  
|Item 4.    | Mine Safety Disclosures                                                                                      | 21  
|           |                                                                                                              |     
|           | PART II                                                                                                      |     
|           |                                                                                                              |     
|Item 5.    | Market For Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities | 22  
|Item 6.    | Selected Financial Data                                                                                      | 23  
|Item 7.    | Management's Discussion and Analysis of Financial Condition and Results of Operations                        | 23  
|Item 7A.   | Quantitative and Qualitative Disclosures About Market Risk                                                   | 26  
|Item 8.    | Financial Statements and Supplementary Data                                                                  | 27  
|Item 9.    | Changes In and Disagreements with Accountants On Accounting and Financial Disclosure                         | 27  
|Item 9A    | Controls and Procedures                                                                                      | 27  
|Item 9B.   | Other Information                                                                                            | 28  
|           |                                                                                                              |     
|           | PART III                                                                                                     |     
|           |                                                                                                              |     
|Item 10.   | Directors, Executive Officers and Corporate Governance                                                       | 29  
|Item 11.   | Executive Compensation                                                                                       | 31  
|Item 12.   | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters               | 33  
|Item 13.   | Certain Relationships and Related Transactions, and Director Independence                                    | 34  
|Item 14.   | Principal Accountant Fees and Services                                                                       | 34  
|           |                                                                                                              |     
|           | PART IV                                                                                                      |     
|           |                                                                                                              |     
|Item 15.   | Exhibits and Financial Statement Schedules                                                                   | 36  
|           |                                                                                                              |     
|SIGNATURES |                                                                                                              | 37  













---





CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS



Certain statements in this annual report on Form 10-K

A-2

 contain or may contain forward-looking statements that are subject to known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Generally, the words "believes", "anticipates," "may," "will," "should," "expect," "intend," "estimate," "continue," and similar expressions or comparable terminology are intended to identify forward-looking statements which include, but are not limited to, statements concerning the our expectations regarding our working capital requirements, financing requirements, business prospects, and other statements of expectations, beliefs, future plans and strategies, anticipated events or trends, and similar expressions concerning matters that are not historical facts. These forward-looking statements were based on various factors and were derived utilizing numerous assumptions and other factors that could cause our actual results to differ materially from those in the forward-looking statements. These factors include, but are not limited to, economic, political and market conditions and fluctuations, government and industry regulation, interest rate risk, U.S. and global competition, and other factors. Most of these factors are difficult to predict accurately and are generally beyond our control. You should consider all of the material risks in connection with any forward-looking statements that may be made herein.



Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this report. Readers should carefully review this annual report in its entirety, including but not limited to our financial statements and the notes thereto. Except for our ongoing obligations to disclose material information under the federal securities laws, we undertake no obligation to release publicly any revisions to any forward-looking statements, to report events or to report the occurrence of unanticipated events.



EXPLANATORY NOTE



This Amendment Number

2

to the Companys Form 10-K filed with the Securities and Exchange Commission on April 14, 2015 is being filed in response to a Comment Letter received from the Securities and Exchange Commission.



This Amendment No.

2

should be read in conjunction with the original filing of our Form 10-K and our other filings made with the Securities and Exchange Commission subsequent to the filing of the original Annual Report filed on Form 10-K.









---





PART I



Item 1. Business.



Overview



Mindesta Inc. ("Mindesta," "the Company," "our" or "we") is a Delaware Corporation, was incorporated on November 6, 1996 under the name Winchester Mining Corp. The name of the Company was changed to PNW Capital, Inc. on May 16, 2000. In 2002, PNW Capital, Inc. acquired Industrial Minerals Incorporated, a private Nevada Corporation, and changed its name to Industrial Minerals, Inc. Effective July 26, 2011, the Company adopted the new name of "Mindesta Inc.". In conjunction with this action, the Company consolidated its stock on a 20:1 basis.



Due to financial difficulties and the inability to secure financing, the Company ceased operations in 2013.



On September 9, 2014 the Company Mindesta, Inc. entered into a Share Exchange Agreement (the " Exchange Agreement") with CTT Pharmaceuticals, Inc., f/k/a Fenwafe Inc., an entity organized under the Canadian Corporations Business Act in March 2007 ("CTT" or "CTT Pharma"), and the shareholders of CTT Pharma whereby Mindesta acquired all of the issued and outstanding shares of common stock of CTT Pharma in consideration for the issuance of 149,183,285 shares of Mindesta common stock of which CTT Pharma instructed Mindesta to issue 8,444,337 to Capital Financial. (The shares of common stock issued to Capital Financial was an obligation incurred by CTT Pharma.)



The 149,183,285 restricted Mindesta common stock issued at closing represented approximately 80% of the then issued and outstanding common stock of Mindesta.



CTT is now a wholly owned subsidiary of Mindesta and is now the exclusive focus of Mindesta's business operations. Mindesta has abandoned all of its previous business operations. CTT Pharma is a development stage company with limited operations to date focused on developing an oral delivery system of medication contained on a disposable film.



CTT PHARMA



CTT Pharma specializes in drug delivery systems technology within the pharmaceutical industry. CTT Pharma's focus is fast dissolving drug delivery systems. The company's technology platform includes the development of advanced oral delivery thin wafers infused with both natural and/or synthetic cannabis extracts (THC, annabinoids, Terpenes) to deliver treatment as an alternate to smoking and ingestion.



CTT Pharma is a developmental stage company which has had limited operations to date. Its principal asset is a patented orally administered wafer (the "Wafer").



On November 9, 2010 Pankaj Modi was issued Canadian Patent CA 2624110 C and subsequently on January 7, 2014, Pankaj Modi, our Chief Executive Officer (CEO), was issued US Patent Number 8,823,401 B2 in connection with the wafer formulation. On August 29, 2013 these was subsequently assigned to CTT Pharmaceutical Inc., f/k/a Fenwafe Inc.



The Wafer is an orally administrable wafer comprising at least one physiologically acceptable film forming agent. The wafer is formed by mixing the film-forming agent with an aqueous solution to form a gel and exposing the gel to a plurality of heating and cooling cycles. The wafer formulation relates to a rapidly dissolving formulation suitable for oral administration.



The wafer is treated with a pharmaceutical agent designed to reduce or treat a medical condition.



It is anticipated that CTT Pharma will develop a cannabis based wafer formulated for pain relief and the side effects of cancer treatment. While management has broad discretion as to the Wafer's formulation, we believe that delivery of cannabis extract represents a unique opportunity in a niche market. The Wafer is a safer, faster delivery system which eliminates the unpleasant effect of rolling and smoking marijuana cigarettes. However, regulatory compliance and testing for a new product delivery system as well as issues surrounding the use of cannabis creates a significant financial burden.



The Company does not believe that it will be cost effective to pursue regulatory approval in the United States at this time as costs and timing will be a major hindrance in bringing a cannabis or cannabis/opiate wafer to the market. Rather, the Company will discuss a joint venture or licensing agreement with several large pharmaceutical companies in the United States that have the financial capacity to secure FDA approval. We do not anticipate this process to start for at least 24 months.



1



---





Canada has recently passed legislation permitting licensed companies to produce and export cannabis products.



PAIN MANAGEMENT



Medical efforts to treat pain, known as "pain management", address a large market, as clinical pain is a worldwide problem with serious health and economic consequences. The extent of the chronic pain problem poses a significant economic burden for patients, health services and societies alike. The economic impact of pain is greater than most health conditions due to its effects on rates of absenteeism, reduced level of productivity and increased risk of leaving the work force.



In a 2012 report from health economists from John Hopkins University published a report in The Journal of Pain (Volume 13, No.8 2012) researchers estimated that the annual cost of chronic pain is as high as $635 billion per year. Researchers estimated that the annual economic costs of chronic pain assessed the incremental costs of health care related to the chronic pain and the indirect costs of chronic pain from lower productivity. For those with persistent pain, it limits their functional status and adversely impacts their quality of life.



Drugs are a key element in the treatment of pain. The pain management market has grown immensely in recent years and is expected to continue to grow significantly. This is likely due to a number of factors, such as, a rapidly aging population, patient demand for rapid effective pain relief, increasing recognition of the therapeutic and economic benefits of rapid and effective pain management by physicians, healthcare providers and payers, and longer survival times for patients with painful chronic conditions, such as cancer and AIDS.



Many different kinds of pain exist including acute, chronic, persistent and breakthrough pain. As well, there exist different approaches to treat pain. Opiates are typically prescribed to manage moderate-to-severe acute or chronic breakthrough pain due to the fact that fast-acting, short-lived opiates can provide rapid delivery. The most common acute use of opioids is for post-surgical pain. Opiates drugs used to treat acute pan include intravenous fentanyl, hyd rocodone and oral oxycodone, which provide rapid pain relief but pose a huge risk of addiction and dependency. We believe that our cannabis Wafers can provide the same type of pain relief as opiates without the risks of addiction.



The route of administration of any medication is an important consideration. Although many patients prefer oral administration of medications, oral medication is not always "fast-acting", a property which is clearly desirable in the treatment of acute breakthrough pain. Also, orally administrable medications are generally provided in the form of solid shaped articles such as tablets, pills, caplets and capsules that retain their shape under moderate pressure. Some patients, particularly pediatric and geriatric patients, have difficulty administering an oral medication due to inability to swallow, nausea or other gastrointestinal problems. Breakthrough pain medications can be taken in other ways, including by injection, under the tongue (sublingual), rectally, or transmucosally absorbed in the mouth but not swallowed; however, these forms of administration are often not as "fast-acting" as would be desired.



Liquid, syrups or suspensions are an alternative to solid dosage forms and are often preferred for pediatric and geriatric patients who have problems swallowing tablets.



However, these dosage forms can be difficult to measure accurately and administer easily. Liquid formulations often deteriorate rapidly upon exposure to heat or other atmospheric conditions and consequently have a relatively short shelf life. Furthermore, liquid formulations require a relatively large volume and are bulky to store.



The bitter after-taste of many drugs which are orally administered, such as tablets, capsules or suspensions, often contributes to patient non-compliance in taking medicine. Apart from the taste of a chewable nutritional supplement, the 'mouth-feel' of the supplement must also be taken into account. 'Mouth-feel' is a concept that encompasses non-taste-related aspects of the sensation experienced by a person while chewing or swallowing a nutritional supplement. Aspects of mouth-feel include the hardness and brittleness of a composition, whether the composition is chewy, gritty, oily, creamy, watery, sticky, easily dissolved, astringent, effervescent, and the like, and the size, shape, and form (tablet, powder, gel, etc.) of the composition.



In view of the foregoing, there remains a need to develop a formulation for the oral delivery of a pharmaceutical agent that overcomes at least one of the disadvantages of prior formulations. CTT Pharma's wafer technology has overcome many of these problems.



A "pharmaceutical agent" refers to any compound useful to treat or reduce the symptoms of a medical condition. Examples of pharmaceutical agents include:



·

antimicrobial agents, such as triclosan,

·

non-steroidal anti-inflammatory drugs, such as aspirin, acetaminophen and ibuprofen;



2



---





·

decongestants, such as pseudoephedrine hydrochloride and phenylepherine;

·

anti-histamines, such as brompheniramine maleate and chlorpheniramine maleate,

·

expectorants, such as guaifenesin, ipecac, potassium iodide, terpin; anti-diarrheals, such a loperamide;

·

general nonselective CNS depressants, such as barbiturates;

·

general nonselective CNS stimulants such as caffeine and nicotine;

·

antiparkinsonism drugs such as levodopa;

·

opioid analgesics such as codeine, morphine, fentanyl, heroin, hydrocodone,normorphine, opium, oxycodone, and oxymorphine; analgesic-antipyretics such as salycilates and phenylbutazone;

·

psychopharmacological drugs such as chlorpromazine and methotrimeprazine; and

·

hypnotics, sedatives, antiepileptics, awakening agents



Thus, a wafer formulation is an effective tool in the treatment of many diseases.



THE WAFER



Our wafer is an orally administrable paper-thin polymer films used as carriers for pharmaceutical agents. The Wafer rapidly dissolves to release the pharmaceutical agent as soon as it comes in contact with saliva, thus obviating the need for water during administration. This attribute makes the wafer highly attractive for pediatric and geriatric patients due to the difficulty in swallowing conventional tablets and capsules.



The wafer is advantageously stable but readily dissolves on oral administration. Accordingly, the wafer is suitable for the oral administration of a compound such as a pharmaceutical agent to permit rapid release and onset of activity of the compound incorporated within the wafer. Our orally administered wafer comprises at least one physiologically acceptable film forming agent and an aqueous solvent characterized by a dissolution rate of at least about 2 mg/s in an aqueous environment. Our intent is to focus on cannabis as a physiologically acceptable film forming agent.



There are several different aspects to our orally administered agents:



·

At least one physiologically acceptable film forming agent, wherein said wafer is formed by exposing an aqueous mixture of the film forming agent to a plurality of heating and cooling cycles.

·

A pharmaceutical agent and at least one physiologically acceptable film forming agent, wherein the pharmaceutical agent is present in a pre-defined quantity.



To incorporate a pharmaceutical agent into a wafer according to the invention, the pharmaceutical agent is dissolved in an aqueous solution and added to a gel formed by an aqueous mixture of a selected film-forming agent. The wafer-forming heating and cooling cycles are then applied to the admixture of the pharmaceutical agent.



Delivery of a pharmaceutical agent via an orally administrable wafer provides a mechanism for rapid access to the activity of the pharmaceutical agent in comparison with currently available orally administrable formulations. The wafer exhibits a very rapid rate of dissolution in an aqueous environment and, thus, provides expedited delivery of a pharmaceutical agent which translates into accelerated access to the activity of the pharmaceutical agent.



In addition, the present wafer formulation provides a rapidly dissolving oral dosage form comprising a defined quantity or dose of pharmaceutical agent not previously attainable. While prior batch extrusion methods for making film-like products cannot be used to generate dosage forms comprising a defined quantity of pharmaceutical agent, the heating/cooling cycling method of making the present wafer provides this capability.



Our Wafer is superior to other pharmaceutical delivery systems in that these delivery systems are limited due to poor bioavailability, slow on-set of action or variable absorption. In those cases, our technology may increase the benefit of the therapy by improving bioavailability or absorption or by decreasing time to onset of action.



The wafer formulations can be enhanced in a number of ways to include:



·

Saliva stimulating agents

·

Plasticizing agents

·

Cooling agents

·

Stabilizing agents

·

Thickening agents



3



---





·

Artificial sweeteners

·

Binding agents

·

Colorants



A "pharmaceutical agent" refers to any compound useful to treat or reduce the symptoms of a medical condition. Examples of pharmaceutical agents include:



·

antimicrobial agents, such as triclosan,

·

non-steroidal anti-inflammatory drugs, such as aspirin, acetaminophen and ibuprofen;

·

decongestants, such as pseudoephedrine hydrochloride and phenylepherine;

·

anti-histamines, such as brompheniramine maleate and chlorpheniramine maleate;

·

expectorants, such as guaifenesin, ipecac, potassium iodide, terpin;

·

anti-diarrheals, such a loperamide;

·

general nonselective CNS depressants, such as barbiturates;

·

general nonselective CNS stimulants such as caffeine and nicotine;

·

antiparkinsonism drugs such as levodopa;

·

opioid analgesics such as codeine, morphine, fentanyl, heroin, hydrocodone, normorphine, opium, oxycodone, and oxymorphine; analgesic-antipyretics such as salycilates and phenylbutazone;

·

psychopharmacological drugs such as chlorpromazine and methotrimeprazine; and

·

hypnotics, sedatives, antiepileptics, awakening agents



Thus, a wafer formulation is an effective tool in the treatment of many diseases.



To incorporate a pharmaceutical agent into a wafer, the pharmaceutical agent is dissolved in an aqueous solution and added to a gel formed by an aqueous mixture of a selected film-forming agent. The wafer-forming heating and cooling cycles are then applied to the admixture of the pharmaceutical agent.



Delivery of a pharmaceutical agent via an orally administrable wafer provides a mechanism for rapid access to the activity of the pharmaceutical agent in comparison with currently available orally administrable formulations. The wafer exhibits a very rapid rate of dissolution in an aqueous environment and, thus, provides expedited delivery of a pharmaceutical agent which translates into accelerated access to the activity of the pharmaceutical agent.



In addition, the present wafer formulation provides a rapidly dissolving oral dosage form comprising a defined quantity or dose of pharmaceutical agent not previously attainable. While prior batch extrusion methods for making film-like products cannot be used to generate dosage forms comprising a defined quantity of pharmaceutical agent, the heating/cooling cycling method of making the present wafer provides this capability.



The wafer formulations can be enhanced in a number of ways to include:



·

Saliva stimulating agents

·

Plasticizing agents

·

Cooling agents

·

Stabilizing agents

·

Thickening agents

·

Artificial sweeteners

·

Binding agents

·

Colorants



Preparing the wafer comprises the following steps:



1. Mixing at least one physiologically acceptable film forming agent with an aqueous solution to form a gel; and

2. Exposing the gel to cycles of heating and cooling to transform the gel mixture.





4



---





An orally administrable wafer may be made using one or more physiologically acceptable film forming agents. The term "physiologically acceptable" refers to film-forming agents that are acceptable for consumption and that exhibit minimal or no adverse side effects on consumption. Suitable film-forming agents for use to make the wafer include pullulan, hydroxypropylmethyl cellulose, hydroxyethyl cellulose, hydroxypropyl cellulose, alcohol, high amylase starch, dextrin, pectin, chitin, chitosan, levan, elsinan and mixtures thereof. A preferred film forming agent is pullulan. Another preferred film forming agent is a mixture of pullulan, PEG and poly vinyl alcohol and carrageenan.



Secondary film forming agents may be added to the formulation to optimize wafer characteristics such as tensile strength, stability, flexibility and brittleness including agents such xanthan gum, tragacanth gum, guar gum, acacia gum, arabic gum, collagen, gelatin, zein, gluten, soy protein isolate, whey protein isolate, casein and mixtures thereof. The amount of secondary film forming agent will vary depending on the primary film forming agent used as well as the desired properties of the wafer.



The one or more selected film-forming agents are dissolved in an aqueous solution to form a gel. The aqueous solution may simply be water, or a water-based solution such as mixtures of water and ethyl alcohol. Generally, a gel is formed by mixing a 4:1 ratio of film forming agent to aqueous solution. One of skill in the art will appreciate that this may vary with the selected film forming agent and aqueous solution.



To form the wafer, a novel method is employed comprising exposing the gel to a plurality of heating and cooling cycles. Thus, the gel is exposed to a period of heating in which the gel is rapidly heated to a temperature of up to about 90 °C. Following the heating period, the gel is exposed to a cooling or non-heating period. This cycle may be repeated multiple times.



The result of the multiple heating and cooling cycles on the gel is a wafer having unique morphological characteristics that confer on it a very high rate of dissolution that exceeds the dissolution rate of other film-like formulations. The rapid dissolution rate of the wafer results in very rapid absorption of the components makes it a suitable means to orally deliver a pharmaceutical agent. Thus, the wafer exhibits maximum or peak absorption of a component therein within about 5-10 minutes which is at least comparable or less than the absorption time for a component administered intravenously.



The wafer is extremely thin which contributes to its rapid dissolution and ease of administration.



Overview of Drug Delivery Industry



The drug delivery industry develops technologies for the improved administration of drugs. Drug delivery companies may seek to develop products on their own that would be patent-protected by applying proprietary technologies to off-patent pharmaceutical products. Primarily, drug delivery technologies are focused on improving safety, efficacy, ease of patient use and/or patient compliance. Pharmaceutical and biotechnology companies consider improved drug delivery as a means of gaining competitive advantage over their peers.



Pain management is a prime target for the drug delivery industry for a number of reasons. Most delivery systems are administered by injection, transdermal or traditional oral delivery systems. Many of these delivery systems address large markets for which there is an established medical need. Alternative delivery systems for pharmaceutical agents are widely used, as physicians are familiar with them and accustomed to prescribing them. However, therapeutic benefits vary significantly.



Poor patient acceptance of other delivery systems, especially injection therapies can lead to medical complications. In addition, injections can often require incremental costs associated with administration in hospitals or doctors' offices.



We believe that patient acceptance of and adherence to a dosing regimen is higher for orally delivered medications than it is for non-orally delivered medications. Our business strategy is partly based upon our belief that our Wafer is an efficient and safe delivery system which represents a significant commercial opportunity.



Leading Current Approaches to Drug Delivery



Transdermal (via the skin) and "Needleless" Injection



Penetration into or through the skin is neither efficient nor ineffective. Some pharmaceutical agents can be transported across the skin barrier into the bloodstream. However absorption rates are significantly less than with our Wafer.





5



---





Nasal (via the nose)



The nasal route (through the membranes of the nasal passage) of drug administration has been limited by low and variable bioavailability for proteins and peptides. As a result, penetration enhancers often are used with nasal delivery to increase bioavailability. These enhancers may cause local irritation to the nasal tissue and may result in safety concerns with long-term use.



Pulmonary (via the lung)



Pulmonary delivery (through the membranes of the lungs) of drugs is emerging as a delivery route for large molecules. Although local delivery of respiratory drugs to the lungs is common, the systemic delivery (i.e., delivery of the drugs to the peripheral vasculature) of macromolecular drugs is less common because it requires new formulations and delivery technologies to achieve efficient, safe and reproducible dosing.



Intraoral (via the membranes in the mouth)



Intraoral delivery is also emerging as a delivery route for large molecules. Buccal delivery (through the membrane of the cheek) and sublingual delivery (through the membrane under the tongue) are forms of intraoral delivery.



Oral (via the mouth)



We believe that the oral method of administration is the most patient-friendly option, in that it offers convenience, is a familiar method of administration that enables increased compliance and, for some therapies, may be considered the most physiologically appropriate. We, and other drug delivery and pharmaceutical companies, have developed or are developing technologies for oral delivery of drugs. We believe that our Wafer provides an important competitive advantage in the oral route of administration because it does not alter the chemical composition of the therapeutic macromolecules. Further, we believe that our Wafer will be preferred to oral delivery systems because of the quantity or frequency of the dosage, the physical size of the capsule or tablet being swallowed or the taste. For example, in an oral liquid formulation, patient compliance was hindered by patients' distaste for the liquid being administered. In addition, patients and the marketplace will more likely respond favorably to improvements in absorption, efficacy, safety, or other attributes of our Wafer.



Patents and Other Forms of Intellectual Property



Our success depends, in part, on our ability to obtain patents, maintain trade secret protection, and operate without infringing the proprietary rights of others (please refer to Part I, Item 1A "Risk Factors" for further discussion of how our business will suffer if we cannot adequately protect our patent and proprietary rights"). We seek patent protection on various aspects of our proprietary chemical and pharmaceutical delivery technologies, including the delivery agent compounds and the structures which encompass our Wafer. Its method of preparation and the combination of our compounds with a pharmaceutical agent.



On January 7, 2014 the United States Patent and Trademark Office issued Patent Number 8,623,401 B2 to Panka Modi for his wafer formulation. On November 9, 2010 the Canadian Intellectual Property Office issued Patent Number 2,624,110 to Dr, Modi for his wafer formulation. Both patents were subsequently assigned to CTT Pharma.



We intend to file additional patent applications when appropriate and to aggressively prosecute, enforce, and defend our patents and other proprietary technology.



We also rely on trade secrets, know-how, and continuing innovation in an effort to develop and maintain our competitive position. Patent law relating to the patentability and scope of claims in the biotechnology and pharmaceutical fields is evolving and our patent rights are subject to this additional uncertainty.



Others may independently develop similar product candidates or technologies or, if patents are issued to us, design around any products or processes covered by our patents. We expect to continue, when appropriate, to file product and other patent applications with respect to our inventions. However, we may not file any such applications or, if filed, the patents may not be issued. Patents issued to or licensed by us may be infringed by the products or processes of others.





6



---





Defense and enforcement of our intellectual property rights can be expensive and time consuming, even if the outcome is favorable to us. It is possible that the patents issued to or licensed to us will be successfully challenged, that a court may find that we are infringing validly issued patents of third parties, or that we may have to alter or discontinue the development of our products or pay licensing fees to take into account patent rights of third parties.



Our delivery agents will be manufactured by third parties. Although there are a limited number of duly licensed manufacturing facilities which will be licensed to produced a cannabis wafer, we do not believe that there will be difficulty in securing a manufacturer.



PRODUCT DEVELOPMENT AND MILESTONES



We intend to enter into an agreement with a company capable of extracting purified cannabis extracts such as THC CBD and CBG and then testing the cannabis extracts tested for their potency. The Company will then enter into an agreement with a supplier to produce the wafer. Until such time as we are satisfied with the quality of the wafer, the wafer will be produced without the cannabis. Once the wafer meets our quality control standards, the wafer will then be treated with the cannabis extract to create a rapidly dissolving formulation suitable for oral administration.



If we are not able to enter these agreements, or we experience delays in the development of our product, our business will be adversely affected.



Once we reach agreements for the extraction and production process, it will take approximately two months and cost approximately $35,000.



Once the wafers have been produced, we will conduct a test of the efficacy of the wafers with dogs or cats. We will submit a trial protocol test to Canada Health for approval. We anticipate that the trials and laboratory analysis will take approximately five months The primary goal of this testing will be to demonstrate the rapid absorption of the cannabis in the bloodstream. We estimate that this testing stage will take approximately three to four months to complete and cost approximately $180,000.



During the final six months of the year we will file for a patent for the medical marijuana wafer. Professional fees for attorneys, consultants will total approximately $50,000 and regulatory compliance matters will total $50,000.



During the Company's first year of operations, general and administrative expenses including salaries and travel will be approximately $285,000.



We estimate our total expenses in year one inclusive of salaries, overhead and travel will be approximately $600,000.



Subject to regulatory approval from Canada Health, human trials will then begin. We estimate that these trials will begin in approximately one year and will cost $830,000 inclusive of all required laboratory testing. These trials will be very specific and indication oriented to give us a specific results. The trials will be done with four way arms protocol. This will involved the following dosing schedules to achieve our results directed toward quantitative measurements of efficacy (effects) of the doses, blood levels of drug or cannabis contents, side effects evaluation. We believe that these trials will take three to six months to complete.



MANUFACTURING



We will rely on third party manufacturers to produce our Wafers for at least two years following the initial production of the Wafer. Subject to sufficient cash flow, available working capital, market conditions and any governmental regulations, we may build our own manufacturing facility. However, costs constraints and sufficient working capital will likely restrict our ability to build a facility for at least two years in which case we will continue to rely on third party manufacturers.



If we build a manufacturing facility in Canada, of which there can be no assurance, we estimate the cost to build and equip this facility will be approximately $600,000. If we do not build a manufacturing facility, we will allocate these funds to general working capital.



The facilities and equipment required to complete the facility will include:



1)

Walk-in vault to comply with the Health Canada Security Directives for Controlled Substances;



7



---





2)

Building security, including access control, video surveillance and motion detectors;

3)

Equipment to produce the wafers and

4)

Laboratory equipment to monitor and test product quality



If we build our own facility, of which there can be no assurance, the facility will be subject to Good Manufacturing Practices. ("GMP"). GMP is the national standard for the production of pharmaceuticals. A GMP facility is under strict environmental control to assure manufacturing of sterile, potent and uncontaminated products for human therapies.



It is not enough to build a GMP facility, it is critically important that it also operate at current Good Manufacturing Practice levels. It must have standard operating procedures (SOPs) in place to ensure proper manufacturing, record keeping and retention, environmental cleaning, and facility and equipment monitoring.



In order to produce the cannabis wafer in Canada, we will apply to become a licensed dealer under the Marijuana for Medical Purposes Regulations ("MMPR"). A licensed dealer is authorized to have a narcotic in their possession for the purpose of exporting the narcotic from Canada. The annual quota allocated to us or our contract manufacturers for the active ingredient in any product may not be sufficient to meet commercial demand or complete clinical trials. Consequently, any delay or refusal by Canada Health in establishing our procurement and/or production quota for controlled substances could delay or stop our product launches, which could have a material adverse effect on our business, financial position and operations.



Total expenses in year two (following the initial production of the Wafer) are estimated to be $1,580,000. If we do not build a manufacturing facility, expenses otherwise allocated for the construction of a manufacturing facility will be allocated to general working capital.



Distribution



Once the Company proves the medical efficacy of its cannabis wafer, the Company intends to solicit companies in multiple countries for the exclusive right to distribute the Company's cannabis wafers. There can be no assurance that the Company will be successful in negotiating licensing agreements.



Commercialization



We believe that the Wafer positions us as a viable commercial-stage entity, anchored by our pain management film and cannabis wafer. As we transition to this strategy, we remain dedicated to further realizing the full potential and commercial value of our patented technology.



We recognize, however, that further development, exploration and commercialization of our technology entails substantial risk and requires significant operational expenditures. We continue to refocus our efforts on strategic development initiatives to reduce non-strategic spending aggressively, and seek to obtain the funding necessary to implement our new corporate strategy. There can be no assurances, however, that the Company will be able to secure adequate funding to meet its current obligations and successfully pursue its strategic direction. Furthermore, despite our optimism regarding the Wafer, even in the event that the Company is adequately funded, there is no guarantee that any of our products or product candidates will perform as hoped or that such products can be successfully commercialized.



Competition



Our success depends in part upon maintaining a competitive position in the development of pharmaceutical agents suitable for our delivery system. We compete in an evolving field in which developments are expected to continue at a rapid pace. We compete with other drug delivery, biotechnology and pharmaceutical companies, research organizations, individual scientists and non-profit organizations engaged in the development of alternative drug delivery technologies or new drug research and testing, and with entities developing new drugs that may be orally active. Our product candidates compete against alternative therapies or alternative delivery systems for each of the medical conditions our product candidates address, independent of the means of delivery. Many of our competitors have substantially greater research and development capabilities, experience, marketing, financial and managerial resources than we have.





8



---





The pharmaceutical and biotechnology industry is characterized by intense competition, rapid product development and technological change. Most of our potential competitors are large, well established pharmaceutical, chemical or healthcare companies with considerably greater financial, marketing, sales and technical resources than are available to us. Additionally, many of our potential competitors have research and development capabilities that may allow such competitors to develop new or improved products that may compete with our Wafers. Our Wafers could be made uneconomical by the development of new products to treat the conditions to be addressed by our developments, technological advances affecting the cost of production, or marketing or pricing actions by one or more of our potential competitors. Our business, financial condition and results of operation could be materially adversely affected by any one or more of such developments. We cannot assure you that we will be able to compete successfully against current or future competitors or that competition will not have a material adverse effect on our business, financial condition and results of operations. Academic institutions, governmental agencies and other public and private research organizations are also conducting research activities and seeking patent protection and may commercialize products on their own or with the assistance of major health care companies in areas where we are developing product candidates. We are aware of certain development projects for products to treat or prevent certain diseases targeted by us, and the existence of these potential products or other products or treatments of which we are not aware, or products or treatments that may be developed in the future, may adversely affect the marketability of products developed by us.



In the area of advanced drug delivery, a number of companies are developing or evaluating enhanced drug delivery systems. We expect that technological developments will occur at a rapid rate and that competition is likely to intensify as various alternative delivery system technologies achieve similar if not identical advantages. Many of our competitors have greater financial and other resources, including larger research and development, marketing and manufacturing organizations. As a result, our competitors may successfully develop technologies and drugs that are more effective or less costly than any that we are developing or which would render our technology and future products obsolete and noncompetitive.



Our Operations



We have limited operations to date. We do not have a manufacturing facility. We will rely on third party manufacturers to produce our Wafers for at least the next two years.



Research and Development



During the fiscal years ended December 31, 2014 and 2013, we did not incur expenses for research and development.



Employees



Except for our officers and directors, as of December 31, 2014, we had no full time employees. We do have two part time employees. We anticipate adding additional employees, when adequate funds are available, and will continue using independent contractors, consultants, attorneys and accountants as necessary, to complement services rendered by our employees.



Consultants



We have retained consultants to assist us with implementing our business plan and create market awareness for our products. We do not and did not have sufficient cash to compensate these consultants with cash compensation and in lieu thereof have issued these consultants shares of our common stock for services rendered. Following is a brief summary of these consulting agreements. You are urged to review the consulting agreements in their entirety for a clear understanding of the rights and responsibilities of the Company and the Consultants. Each of the consulting agreements describe below is attaché as an exhibit to this annual report.



Graham Wong:



On October 1, 2014 we entered into a two year consulting agreement with Mr. Wong and in consideration for the services to be provided, we issued Mr. Wong 6 million shares of our common stock. Mr. Wongs responsibilities include: strategic planning, corporate positioning, market communications, product management and developing strategic alliances.



Lesley Leroux:



On December 1, 2014 we entered into a twelve month consulting agreement with Lesley Leroux. In consideration for the services to be provided we issued Lesley Leroux 125,000 shares of our common stock.





9



---





Tracey Albert:



On October 1, 2014 we entered into a two year consulting agreement with Tracy Albert. The agreement calls for the issuance of 600,000 shares of common stock, 300,000 on execution and 300,000 on the first year anniversary of the agreement. Ms. Alberts principal activities are to assist with the Companys accounting functions. She is responsible for maintaining the Companys financial records, handling accounts payable and receivable, invoicing customers and assisting with the preparation of financial statements.



Mathew Harrington:



On October 1, 2014 we entered into a two year consulting agreement with Mr. Harrington. In consideration for the services to be provided, we issued Mr. Harrington 7 million shares of our common stock. Mr. Harringtons principal responsibilities are corporate development, investor relations, compliance issues, review and distribution of press releases and undertaking due diligence with respect to prospective board members and officers.



Woodcliff Capital:



On October 1, 2014 we entered into a one year consulting agreement with Woodcliff Capital. In consideration for the services to be provided, we issued Woodcliff Capital one million shares of our common stock. Woodcliffs Capitals responsibilities include developing and maintaining broker relations, investor relations and preparation of press releases, introduction and meetings with market makers and brokerage firms.



Dwayne McLeod:



On October 1, 2014 we entered into a two year consulting agreement with Dwayne McLeod. In consideration for the services to be provided, we issued Mr. McLeod 500,000 shares of our common stock. Mr. McLeod provides videography and photography services. He assists with pre production and post production editing and works on our marketing brochures.



Tony Zacconi:



On October 1, 2014 we entered into a two year consulting agreement with Mr. Zacconi. In consideration for the services to be provided, we issued Mr. Zacconi 1.2 million shares of our common stock. The agreement provides in part for Mr. Zacconni to host and arrange for up to ten investor conferences.



Government Regulation of cannabis



In Canada, and most developed countries, cannabis is a controlled substance. TheControlled Drugs and Substances Act(CDSA) isCanada's federal drug control statute. The CDSA prohibits activities related to controlled substances, including marijuana. Researchers (physicians, veterinarians and other researchers affiliated to universities and private industry) requiring a controlled substance for research purposes, administration to animals or human clinical trials must be issued a license from Health Canada. The license allows the individual only to possess a specified quantity of the controlled substance and to administer the controlled substance to human subjects or animals for the purpose of research. Recognizing that marijuana for medical purposes Canada Health and Parliament has enacted new guidelines for medical marijuana.



The use of marijuana for medical purposes in Canada is governed by the Marijuana for Medical Purposes Regulations (MMPR). MMPR deals exclusively with the medical use of marijuana and does not address the issue of legalizing marijuana for general use.



Dried marijuana is not an approved drug or medicine in Canada. The Government of Canada does not endorse the use of marijuana, but the courts have required reasonable access to a legal source of marijuana when authorized by a physician.



MMPR also sets forth the requirements for licensed producers of medical marijuana. These regulations include:



·

Physical Security Measures

·

Good Production Practices

·

Packaging, Labeling and Shipping Requirements

·

Import and Export permit, if applicable

·

Security Clearance





10



---





Physical Security Measures



Production sites need to be located indoors, and not in a private dwelling.



The MMPR sets out physical security requirements that are necessary to secure sites where licensed producers conduct activities with marijuana other than storage.



Health Canada has established security requirements for the storage of all controlled substances including dried marijuana by licensed producers.



All applicants for a producer's license have to demonstrate to Health Canada that they meet these security requirements. Licensed producer sites are subject to compliance and enforcement measures, including regular audits and inspections by Health Canada.



Good Production Practices



Licensed producers are subject to Good Production Practices that are meant, among other things, to ensure the cleanliness of the premises and equipment. The licensed producer is required to employ a quality assurance person with appropriate training, experience, and technical knowledge to approve the quality of dried marihuana prior to making it available for sale.



Product Quality



One of the requirements under Good Production Practices is that licensed producers must test dried marihuana for microbial and chemical contaminants.



Other requirements



Licensed producers must also meet other requirements under Good Production Practices under the Marijuana for Medical Purposes Regulations including, but not limited to:



Sanitation Program



Standard Operating Procedures



Establishment of a Recall System



Packaging, Labeling and Shipping- Consumer Information



Dried marijuana must be packaged in a tamper-evident and child-resistant container, and contain standard information about the product (including but not limited to, the weight in grams and the packaging date). In addition, all licensed producers are required to attach a client-specific label, similar to a patient-specific prescription drug label, to the package of dried marijuana.



Import and Export permit



A licensed producer must obtain a permit from the Minister of Health prior to importing or exporting marijuana.



Security Clearance



The following individuals are required to have a valid security clearance under the Marihuana for Medical Purposes Regulations:



·

the applicant (if an individual)

·

all officers and directors of a corporate applicant

·

the proposed Senior Person in Charge

·

the proposed Responsible Person in Charge

·

the proposed Alternate Person(s) in Charge





11



---





Health Canada has imposed no limits on the number of licensed producers.



In addition to compliance with statutory guidelines prescribed at the federal level, controlled substances are also subject to regulation at the provincial level. Though provincial-controlled substances laws often mirror federal law, because the provinces are separate jurisdictions, they may separately schedule any product candidates as well. While some Canadian provinces automatically schedule a drug based on federal action, other provinces schedule drugs through rulemaking or a legislative action. Provincial scheduling may delay commercial sale of any product for which we obtain federal regulatory approval and adverse scheduling could have a material adverse effect on the commercial attractiveness of such product. We will need to obtain separate, permits or licenses in order to be able to obtain, handle, and distribute controlled substances for clinical trials or commercial sale, and failure to meet applicable regulatory requirements could lead to enforcement and sanctions by the provinces or Health Canada.



We do not currently manufacture any commercial products ourselves, if we did, we would bear additional cost of Canada Health compliance.



To date, the Company has not submitted any licensing applications with Canada Health.



The use of cannabis as a pharmaceutical agent in our Wafers



MEDICAL MARIJUANA



As discussed above, the Company's wafers can address a myriad of medical issues. With increased awareness of the medicinal benefits of cannabis, the Company's initial focus will be a cannabis wafer.



In Canada, and most developed countries, cannabis is a controlled substance. Our Wafers will be categorized as a controlled substance under the federal Controlled Substances Act of 1970, or CSA. Controlled substances that are pharmaceutical products are subject to a high degree of regulation under the CSA, which establishes, among other things, certain registration, manufacturing quotas, security, recordkeeping, reporting, import, export and other requirements administered by the DEA. The DEA classifies controlled substances into five schedules: Schedule I, II, III, IV or V substances. Schedule I substances by definition have a high potential for abuse, not currently "accepted medical use" in the United States, lack accepted safety for use under medical supervision, and may not be prescribed, marketed or sold in the United States. Pharmaceutical products approved for use in the United States may be listed as Schedule II, III, IV or V, with Schedule II substances considered to present the highest potential for abuse or dependence and Schedule V substances the lowest relative risk of abuse among such substances. Schedule I and II drugs are subject to the strictest controls under the CSA, including manufacturing and procurement quotas, security requirements and criteria for importation. In addition, dispensing of Schedule II drugs is further restricted. For example, they may not be refilled without a new prescription.



While cannabis is a Schedule I controlled substance, products approved for medical use that contain cannabis or cannabis extracts may be required to be placed in Schedules IIV, since approval by the FDA satisfies the "accepted medical use" requirement. Consequently, its manufacture, importation, exportation, domestic distribution, storage, sale and legitimate use may be subject to a significant degree of regulation.



Facilities conducting research, manufacturing, distributing, importing or exporting, or dispensing controlled substances must be registered (licensed) to perform these activities and have the security, control, recordkeeping, reporting and inventory mechanisms required to prevent drug loss and diversion. Obtaining the necessary registrations may result in delay of the importation, manufacturing or distribution of any products.



Furthermore, failure to maintain compliance with Canada Health, particularly non-compliance resulting in loss or diversion, can result in regulatory action that could have a material adverse effect on our business, financial condition and results of operations. Canada Health may seek civil penalties, refuse to renew necessary registrations, or initiate proceedings to restrict, suspend or revoke those registrations. In certain circumstances, violations could lead to criminal proceedings.





12



---





Controlled substances are also subject to regulation at the provincial level. Though provincial-controlled substances laws often mirror federal law, because the provinces are separate jurisdictions, they may separately schedule any product candidates as well. While some Canadian provinces automatically schedule a drug based on federal action, other provinces schedule drugs through rulemaking or a legislative action. Provincial scheduling may delay commercial sale of any product for which we obtain federal regulatory approval and adverse scheduling could have a material adverse effect on the commercial attractiveness of such product. We will need to obtain separate, permits or licenses in order to be able to obtain, handle, and distribute controlled substances for clinical trials or commercial sale, and failure to meet applicable regulatory requirements could lead to enforcement and sanctions by the provinces or Canada Health.



VETERINARIAN MEDICINE



Our orally dissolving wafers are an excellent fast dissolving drug delivery system which can be used by veterinarians to treat dogs, cats and other animals who would ordinarily be given a pill or injection.



The wafers will be much easier to administer than traditional delivery systems such as pills or injections. The wafers will dissolve on contact with saliva and will be flavored with chicken, meat or fish.



Like with humans the therapeutic benefits of the medication will be absorbed a significantly faster rate than through traditional delivery systems. Further, our wafers will save time and money as the wafers can be administered easily by the staff or pet owner.



Item 1A. Risk Factors.



RISK FACTORS



THE RISKS AND UNCERTAINTIES DESCRIBED BELOW ARE NOT THE ONLY ONES WE FACE. ADDITIONAL RISKS AND UNCERTAINTIES NOT PRESENTLY KNOWN OR THAT WE CURRENTLY DEEM IMMATERIAL MAY ALSO IMPAIR OUR BUSINESS OPERATIONS. IF ANY OF THE FOLLOWING RISKS ACTUALLY OCCUR, OUR BUSINESS COULD BE MATERIALLY ADVERSELY AFFECTED. IN SUCH CASE, WE MAY NOT BE ABLE TO PROCEED WITH OUR PLANNED OPERATIONS AND YOUR INVESTMENT MAY BE LOST ENTIRELY.



We have a limited operating history, and may not be successful in developing profitable business operations.



With the acquisition of CTT Pharma, we abandoned our previous business ventures and adopted the business of CTT Pharma. CTT Pharma is a development stage company focused in developing an oral delivery system for medications on dispersable film. CTT Pharma was organized in March 8, 2007. Accordingly, we have a limited operating history. Our business operations must be considered in light of the risks, expenses and difficulties frequently encountered in establishing a new delivery system for medications including cannabis. As of the date of this report, we have not generated any revenues and have limited assets. There is nothing at this time on which to base an assumption that our business operations will be successful in the long-term. Our future operating results will depend on many factors, including:



·

our ability to raise adequate working capital;

·

success of in developing and marketing the oral delivery system;

·

demand for an oral delivery system;

·

increased legalization of cannabis for medical and recreational usage;

·

offer a larger variety of medications utilizing the oral delivery system;

·

the level of our competition; and

·

our ability to attract and maintain key management and employees.



While our officers and directors have significant experience in the medical field, there can be no assurance that this experience will help us fully implement our business plan. Our prospects for success must be considered in the context of a new company in a highly competitive industry with few barriers to entry.





13



---





We have limited capital and will need to raise additional capital in the future.



We do not currently have sufficient capital to fund both our continuing operations and our planned growth. We will require additional capital to continue to expand our oral delivery system which makes use of a dispersable film. We may be unable to obtain additional capital when required. Future business development activities, as well as our administrative requirements (such as salaries, insurance expenses and general overhead expenses, as well as legal compliance costs and accounting expenses) will require a substantial amount of additional capital and cash flow.



We may pursue sources of additional capital through various financing transactions or arrangements, including joint venturing of projects, debt financing, equity financing or other means. We may not be successful in identifying suitable financing transactions in the time period required or at all, and we may not obtain the capital we require by other means. If we do not succeed in raising additional capital, our resources may not be sufficient to fund our planned operations.



Any additional capital raised through the sale of equity may dilute the ownership percentage of our stockholders. Raising any such capital could also result in a decrease in the fair market value of our equity securities because our assets would be owned by a larger pool of outstanding equity. The terms of securities we issue in future capital transactions may be more favorable to our new investors, and may include preferences, superior voting rights and the issuance of other derivative securities, and issuances of incentive awards under equity employee incentive plans, which may have a further dilutive effect.



Our ability to obtain financing, if and when necessary, may be impaired by such factors as the capital markets (both generally and in our industry in particular), our limited operating history, national unemployment rates and the departure of key employees. Further, economic downturns will likely decrease our revenues may increase our requirements for capital. If the amount of capital we are able to raise from financing activities, together with our revenues from operations, is not sufficient to satisfy our capital needs (even to the extent that we reduce our operations), we may be required to cease our operations, divest our assets at unattractive prices or obtain financing on unattractive terms.



There is substantial doubt about our ability to continue as a going concern



We have not generated any revenues to date while continuing to incur significant operating expenses.We expect to incur further losses in the development of our business, all of which casts substantial doubt about our ability to continue as a going concern. Our ability to continue as a going concern is dependent upon our ability to generate future profitable operations and/or to obtain the necessary financing to meet our obligations and repay our liabilities arising from normal business operations when they come due. Management's plan to address our ability to continue as a going concern includes: (1) obtaining debt or equity funding from private placement or institutional sources; (2) obtaining loans from financial institutions, where possible, or (3) participating in joint venture transactions with third parties. Although we believe that we will be able to obtain the necessary funding to allow us to remain a going concern through the methods described above, there can be no assurances that such methods will prove successful. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty.



We have not generated operating revenues and may never attain profitability.



To date, both Mindesta and CTT Pharma have financed their operations primarily through private sales of common stock and shareholder loans. Our ability to generate revenues will depend upon our ability to secure additional funding and successfully manufacture and market our Wafers.



We are not expecting any significant revenues in the short-term. Furthermore, we may not be able to ever successfully identify, develop, commercialize, manufacture, obtain required regulatory approvals and market our Wafers. Moreover, even if we do identify, develop, commercialize, manufacture, and obtain required regulatory approvals, we may not generate revenues or royalties from commercial sales of these products for a significant number of years, if at all. Therefore, our proposed operations are subject to all the risks inherent in the establishment of a new business enterprise.



Regulatory restrictions on the use or distribution of medical marijuana will impact our operations.



The medical marijuana industry is our primary target market. While many jurisdictions have been decriminalizing or legalizing the use of medical marijuana, if this trend stops or is reversed, demand for our cannabis wafers will diminish. This would have a a negative impact on our business, operations and financial condition,





14



---





We may be unable to successfully develop, market, or commercialize our Wafers without establishing new relationships and maintaining current relationships and our ability to successfully commercialize, and market our Wafers.



Our strategy for the research, development and commercialization of our Wafers may require us to enter into various arrangements with licensees and others, in addition to our existing relationships with other parties. Specifically, we may seek to joint venture, sublicense or enter other marketing arrangements with parties that have an established marketing capability or we may choose to pursue the commercialization of such products on our own. We may, however, be unable to establish such additional collaborative arrangements, license agreements, or marketing agreements as we may deem necessary to develop, commercialize and market our Wafers on acceptable terms. Furthermore, if we maintain and establish arrangements or relationships with third parties, our business may depend upon the successful performance by these third parties of their responsibilities under those arrangements and relationships.



We will be subject to extensive governmental regulation which increases our cost of doing business and may affect our ability to commercially produce the Wafers.



Canada Health and comparable agencies in foreign countries impose substantial requirements on the production and distribution of our Wafers, especially any wafers using cannabis as the pharmaceutical agent. Satisfaction of these requirements can be costly.



Government regulation also affects the manufacturing and marketing of the Wafer. Government regulations may delay marketing of the Wafer, impose costly procedural requirements upon our activities and furnish a competitive advantage to larger companies or companies more experienced in regulatory affairs. Delays in obtaining governmental regulatory approval could adversely affect our marketing as well as our ability to generate significant revenues from commercial sales. Moreover, if regulatory approval of our Wafer is granted, such approval may impose limitations on the indicated use for which the Wafer be marketed. Regulatory standards are stringently applied and failure to comply with regulatory standards can, among other things, result in fines, denial or withdrawal of regulatory approvals, product recalls or seizures, operating restrictions and criminal prosecution.



The regulatory approval process presents several risks to us:



·

Delays or rejections may be encountered during any stage of the regulatory process based upon the failure of the clinical or other data to demonstrate compliance with, or upon the failure of the product to meet, a regulatory agency's requirements for safety, efficacy, and quality.

·

Requirements for approval may become more stringent due to changes in regulatory agency policy or the adoption of new regulations or guidelines.

·

New guidelines can have an effect on the regulatory decisions made in previous years.

·

The scope of any regulatory approval, when obtained, may significantly limit the indicated uses for which a product may be marketed and may impose significant limitations in the nature of warnings, precautions, and contraindications that could materially affect revenues.

·

Our wafers and our manufacturers, are subject to continuing and ongoing review, and discovery of problems with these products or the failure to adhere to manufacturing or quality control requirements may result in restrictions on their manufacture, sale or use or in their withdrawal from the market

·

Regulatory authorities and agencies may promulgate additional regulations restricting the sale of pain relief wafers.



We may incur substantial product liability expenses due to the use or misuse of our Wafer for which we may be unable to obtain insurance coverage.



Our business exposes us to potential liability risks that are inherent in the testing, manufacturing and marketing of a pharmaceutical delivery process. These risks will expand with respect to our drug candidates, if any, that receive regulatory approval for commercial sale and we may face substantial liability for damages in the event of adverse side effects or product defects identified with any of our products that are used in clinical tests or marketed to the public. Product liability insurance for the biotechnology industry is generally expensive, if available at all, and as a result, we may be unable to obtain insurance coverage at acceptable costs or in a sufficient amount in the future, if at all. We may be unable to satisfy any claims for which we may be held liable as a result of the use or misuse of products which we developed, manufactured or sold and any such product liability claim could adversely affect our business, operating results or financial condition.



Intense competition may limit our ability to successfully develop and market the Wafer.



The biotechnology and pharmaceutical industries are intensely competitive and subject to rapid and significant technological change. Our competitors in the United States and elsewhere are numerous and include, among others, major multinational pharmaceutical and chemical companies, specialized biotechnology firms and universities and other research institutions.



15



---





Many of our competitors have and employ greater financial and other resources, including larger research and development, marketing and manufacturing organizations. As a result, our competitors may successfully develop technologies that are more effective or less costly than any that we are developing or which would render our technology and future products obsolete and noncompetitive.



Our business will suffer if we fail or are delayed in commercializing the Wafer.



Our inability or delay in commercializing the Wafer and any combination of pharmaceutical agents could have a significant material adverse effect on our business.



To commercialize our product, especially in the pain management sector, we will be required to develop a market introduction plan, and possibly obtain financing to support our commercialization efforts, among other things. We cannot assure you that we will succeed in these efforts as these involve activities (or portions of activities) that we have not previously completed. We have no current commercial capabilities. Therefore, we would be entering a highly competitive market with an untested, newly-established commercial capability. This outline of risks involved in the commercialization of our Wafer is not exhaustive, but illustrative. For example, it does not include additional competitive, intellectual property, commercial, product liability, and commercial risks involved in a launch of the pharmaceutically based Wafer.



We will be dependent on third parties to manufacture, distribute, and sell our products.



The success of our commercial operations is dependent upon the ability of these vendors to provide a high level of service and support at an economical price. If we fail to attract and retain such professions or services at a reasonable price, or if third parties do not successfully carry out their contractual obligations, meet expected deadlines or conduct our activities in accordance with applicable regulatory requirements or our stated specifications, we may not be able to, or may be delayed in our efforts to, successfully execute upon our commercial strategy.



We cannot be certain that any pharmaceutical wafers will be suitable for commercial purposes.



To be profitable, we must successfully research, develop, obtain regulatory approval for, manufacture, introduce, market, and distribute our Wafers under development, or secure a partner to provide financial and other assistance with these steps. The time necessary to achieve these goals for any individual pharmaceutical product is uncertain. We have never successfully commercialized a drug or a nonprescription candidate and we cannot be certain that we or our future partners will be able to do so.



Our business will suffer if we cannot adequately protect our patent and proprietary rights.



Although our Wafer delivery system is patented there can be no assurance that the patent will provide us with meaningful protection from competition, or that we will possess the financial resources necessary to enforce any of our patents. Also, we cannot be certain that any products that we (or a licensee) develop will not infringe upon any patent or other intellectual property right of a third party. We also rely upon trade secrets, know-how, and continuing technological advances to develop and maintain our competitive position.



We are dependent on third parties to manufacture our Wafers.



Currently, we have no manufacturing facilities for production. The availability of manufacturers is limited by both the capacity of such manufacturers and their regulatory compliance. Among the conditions for Canada Health approval is the requirement that the prospective manufacturer's quality control and manufacturing procedures continually conform with current GMP (GMP are regulations established by Canada Health and other regulatory bodies that govern the manufacture, processing, packing, storage and testing of drugs intended for human use). In complying with GMP, manufacturers must devote extensive time, money, and effort in the area of production and quality control and quality assurance to maintain full technical compliance. Manufacturing facilities and company records are subject to periodic inspections to ensure compliance. If a manufacturing facility is not in substantial compliance with these requirements, regulatory enforcement action may be taken, which may include seeking an injunction against shipment of products from the facility and recall of products previously shipped from the facility. Such actions could severely delay our ability to obtain product from that particular source.





16



---





We face rapid technological change and intense competition.



Our success depends, in part, upon maintaining a competitive position in the development of products and technologies in an evolving field in which developments are expected to continue at a rapid pace. We compete with other drug delivery, biotechnology and pharmaceutical companies, research organizations, individual scientists, and non-profit organizations engaged in the development of alternative drug delivery technologies or new drug research and testing, as well as with entities developing new drugs that may be orally active. Many of these competitors have greater research and development capabilities, experience, and marketing, financial, and managerial resources than we have, and, therefore, represent significant competition.



We may not be able to successfully manage our growth, which could lead to our inability to implement our business plan.



Our growth is expected to place a significant strain on our managerial, operational and financial resources, especially considering that we currently only have a small number of executive officers, employees and advisors. Further, as we enter into various contracts or other transactions, we will be required to manage multiple relationships with various consultants, businesses and other third parties. These requirements will be exacerbated in the event of our further growth or in the event that the number of websites we operate increases. There can be no assurance that our systems, procedures and/or controls will be adequate to support our operations or that our management will be able to achieve the rapid execution necessary to successfully implement our business plan. If we are unable to manage our growth effectively, our business, results of operations and financial condition will be adversely affected, which could lead to us being forced to abandon or curtail our business plan and operations.



Our executive officers and key employees will be crucial to our business, and we may not be able to recruit, integrate and retain the personnel we need to succeed



Our future success is dependent, in a large part, on retaining the services of Dean Hanish, Dr. Pankaj Modi and Allen Greenspan. The knowledge, leadership and technical expertise of management would be difficult to replace. While no director has plans to leave or retire in the near future, the loss of any of our directors could have a material adverse effect on our operating and financial performance, including our ability to develop and execute our long The loss of the services of any key personnel, or our inability to attract, integrate and retain highly skilled technical, management, sales and marketing personnel could result in significant disruption to our operations, including our inability or limited success in developing our job verticals, completion of our initiatives, including growth plans and the results of our operations. Any failure by us to find suitable replacements for our key management may be disruptive to our operations. Competition for such personnel can be intense, and we may be unable to attract, integrate and retain such personnel successfully.



To date, we do not have any independent directors and have not implemented various corporate governance measures, in the absence of which, stockholders may have more limited protections against interested director transactions, conflicts of interest and similar matters.



As of the date of this report, we do not have any independent directors to evaluate our decisions nor have we adopted corporate governance measures. Although not required by rules or regulations applicable to us, corporate governance measures such as the presence of independent directors, or the establishment of an audit and other independent committees of our Board of Directors, would be beneficial to our stockholders. We do not presently maintain any of these protections for our stockholders. It is possible that if our Board of Directors included independent directors and if we were to adopt corporate governance measures, stockholders would benefit from greater assurance that decisions were being made with impartiality by directors and that policies had been implemented to define conduct of our management and board members. For example, in the absence of audit, nominating and compensation committees comprised of at least a majority of independent directors, decisions concerning matters such as compensation packages to our officers and recommendations for director nominees may be made by existing members of the Board of Directors, who may have a direct interest in the outcome. Although we anticipate expanding the Board of Directors to include independent directors at some point in the future, when and if this will occur is uncertain.



Our management controls a significant percentage of our current outstanding common stock.



As of the date of this report, our officers and directors collectively and beneficially own approximately 45% of our outstanding common stock. This concentration of voting control gives management substantial influence over any matters which require a stockholder vote, including without limitation the election of directors and approval of merger and/or acquisition transactions, even if their interests may conflict with those of other stockholders. It could have the effect of delaying or preventing a change in control of, or otherwise discouraging, a potential acquirer from attempting to obtain control of the company. This could have a material adverse effect on the market price of our common stock or prevent our stockholders from realizing a premium over the then prevailing market prices for their shares of common stock.





17



---





We are vulnerable to intellectual property infringement claims brought against us by others.



Successful intellectual property infringement claims against us could result in monetary liability or a material disruption in the conduct of our business. We cannot be certain that our products, content and brand names do not or will not infringe valid patents, trademarks, copyrights or other intellectual property rights held by third parties. We expect that infringement claims in our markets will increase in number. We may be subject to legal proceedings and claims from time to time relating to the intellectual property of others in the ordinary course of our business. If we were found to have infringed the intellectual property rights of a third party, we could be liable to that party for license fees, royalty payments, lost profits or other damages, and the owner of the intellectual property might be able to obtain injunctive relief to prevent us from using the technology or software in the future. If the amounts of these payments were significant or we were prevented from incorporating certain technology into our products, our business could be significantly harmed. We may incur substantial expenses in defending against these third party infringement claims, regardless of their merit. As a result, due to the diversion of management time, the expense required to defend against any claim and the potential liability associated with any lawsuit, any significant litigation could significantly harm our business, financial condition and results of operations.



If we are unable to protect our patented technology, proprietary rights or maintain our rights to use key technologies of third parties, our business may be harmed.



We have been awarded a patent for our oral delivery wafer system. This patent and any patents issued to us in the future (if we make such applications) may be later challenged, invalidated or circumvented, and the rights granted under patents may not provide us with a competitive advantage. We may also face risks associated with any trademarks to which we own the rights. Policing unauthorized use of our patented, proprietary technology and other intellectual property rights could involve significant expense and could be difficult or impossible, particularly given the global nature of the Internet and the fact that the laws of certain other countries may afford us little or no effective protection of our intellectual property.



We may incur significant increased costs as a result of operating as a public company, and our management may be required to devote substantial time to new compliance initiatives.



In the future, we may incur significant legal, accounting and other expenses as a result of operating as a public company. The Sarbanes-Oxley Act of 2002 (the "Sarbanes-Oxley Act"), as well as new rules subsequently implemented by the SEC, have imposed various new requirements on public companies, including requiring changes in corporate governance practices. Our management and other personnel will need to devote a substantial amount of time to these new compliance initiatives. Moreover, these rules and regulations will increase our legal and financial compliance costs and will make some activities more time-consuming and costly. For example, we expect these new rules and regulations to make it more difficult and more expensive for us to obtain director and officer liability insurance, and we may be required to incur substantial costs to maintain the same or similar coverage.



In addition, the Sarbanes-Oxley Act requires, among other things, that we maintain effective internal controls for financial reporting and disclosure controls and procedures. In particular, we are required to perform system and process evaluation and testing on the effectiveness of our internal controls over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act. Our testing may reveal deficiencies in our internal controls over financial reporting that are deemed to be material weaknesses. Our compliance with Section 404 will require that we incur substantial accounting expense and expend significant management efforts. We currently do not have an internal audit group, and we will need to hire additional accounting and financial staff with appropriate public company experience and technical accounting knowledge. Moreover, if we are not able to comply with the requirements of Section 404 in a timely manner, or if we or our independent registered public accounting firm identifies deficiencies in our internal controls over financial reporting that are deemed to be material weaknesses, the market price of our stock could decline, and we could be subject to sanctions or investigations by the SEC or other regulatory authorities, which would require additional financial and management resources.



Risks related to the use of cannabis as a pharmaceutical agent in our Wafers:



Controlled substance legislation differs between countries and legislation in certain countries may restrict or limit our ability to sell our products.



Most countries are parties to the Single Convention on Narcotic Drugs 1961, which governs international trade and domestic control of narcotic substances, including cannabis extracts. This Convention aims to combat drug abuse by coordinated international action. There are two forms of intervention and control that work together. First, it seeks to limit the possession, use, trade in, distribution, import, export, manufacture and production of drugs exclusively to medical and scientific purposes. Second, it combats drug trafficking through international cooperation to deter and discourage drug traffickers.



18



---





Since the Single Convention is not self-executing, each country must pass laws to carry out its provisions. While there is a high degree of conformity with the Single Convention and its supplementary treaties, the 1971 Convention on Psychotropic Substances and the 1988 United Nations Convention Against Illicit Traffic in Narcotic Drugs and Psychotropic Substances, guidelines vary from country to country especially with respect to the production, distribution and use of cannabis.



Countries may interpret and implement their treaty obligations in a way that creates a legal obstacle to our project developers obtaining marketing approval for their products in those countries. For example, even though cannabis is classified as a narcotic under the treaty, possession of cannabis may be illegal, decriminalized or legal depending on the jurisdiction. With multiple jurisdictions addressing cannabis in different ways, it is unlikely that countries will be willing or able to amend or otherwise modify their laws and regulations to permit uniformity in the manner in which cannabis is treated, marketed or distributed. Further amendments to existing laws and regulations may take a prolonged period of time and limit our ability or the ability of any joint partner to sell the cannabis wafer.



Our proposed business expansion is dependent on laws pertaining to various industries including the legal marijuana industry.



Our cannabis wafers could subject us to increased scrutiny by the regulators because, among other things, cannabis is a schedule-I controlled substance as set forth in the Single Convention of Narcotic Drugs. To the extent that individual nations do not liberalize their drug laws, the Company may not be able to sell or distribute the wafers in these jurisdictions. Further, if we choose to manufacture the cannabis wafer in Canada we will be required to become a licensed dealer under the Marijuana for Medical Purposes Regulations. Changes to these regulations and compliance with Good Manufacturing Practices may create delays and unexpected costs in implementing our business plan.



Our failure to adequately manage the risk associated with these businesses and adequately manage the requirements of the regulators can adversely affect our business and our status as a reporting company. Further, any adverse pronouncements from the regulators about businesses related to the legal cannabis sector could adversely affect our stock price, if we are perceived to be in a company in that sector.



Risks related to our common stock:



There presently is a limited market for our common stock, and the price of our common stock may be volatile.



Our common stock is currently quoted on OTCQB. We have, however, a very limited trading history. If a market for our common stock ever develops, there could be volatility in the volume and market price of our common stock. This volatility may be caused by a variety of factors, including the lack of readily available quotations, the absence of consistent administrative supervision of "bid" and "ask" quotations and generally lower trading volume. In addition, factors such as quarterly variations in our operating results, changes in financial estimates by securities analysts or our failure to meet our or their projected financial and operating results, litigation involving us, factors relating to our industry, actions by governmental agencies, national economic and stock market considerations as well as other events and circumstances beyond our control could have a significant impact on the future market price of our common stock and the relative volatility of such market price.



Offers or availability for sale of a substantial number of shares of our common stock may cause the price of our common stock to decline.



Our stockholders could sell substantial amounts of common stock in the public market, including shares upon the expiration of any statutory holding period under Rule 144 of the Securities Act of 1933 (the "Securities Act"), if available, or upon trading limitation periods. Such volume could create a circumstance commonly referred to as an "overhang" and in anticipation of which the market price of our common stock could fall. The existence of an overhang, whether or not sales have occurred or are occurring, also could make it more difficult for us to secure additional financing through the sale of equity or equity-related securities in the future at a time and price that we deem reasonable or appropriate.





19



---





Our directors and officers have rights to indemnification.



We will indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that such person is or was our director or officer, or who is or was serving at our request as a director or officer of another corporation, partnership, joint venture, trust or other enterprise, against expenses, including attorneys' fees, judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with the action, suit or proceeding, to the full extent permitted by Delaware law. The inclusion of these provisions in our Articles may have the effect of reducing the likelihood of derivative litigation against directors and officers, and may discourage or deter stockholders or management from bringing a lawsuit against directors and officers for breach of their duty of care, even though such an action, if successful, might otherwise have benefited us and our stockholders.



We do not anticipate paying any cash dividends.



We do not anticipate paying cash dividends on our common stock for the foreseeable future. The payment of dividends, if any, would be contingent upon our revenues and earnings, if any, capital requirements, and general financial condition. The payment of any dividends will be within the discretion of our Board of Directors. We presently intend to retain all earnings, if any, to implement our business strategy; accordingly, we do not anticipate the declaration of any dividends in the foreseeable future.



We may be subject to penny stock regulations and restrictions, and you may have difficulty selling shares of our common stock.



The SEC has adopted regulations which generally define a "penny stock" as an equity security that has a market price less than $5.00 per share or an exercise price of less than $5.00 per share, subject to certain exemptions. Our common stock is a "penny stock" and is subject to Rule 15g-9 under the Exchange Act, or the "Penny Stock Rule." This rule imposes additional sales practice requirements on broker-dealers that sell such securities to persons other than established customers and "accredited investors" (generally, individuals with a net worth in excess of $1,000,000 or annual incomes exceeding $200,000, or $300,000 together with their spouses). For transactions covered by Rule 15g-9, a broker-dealer must make a special suitability determination for the purchaser and have received the purchaser's written consent to the transaction prior to sale. As a result, this rule may affect the ability of broker-dealers to sell our securities and may affect the ability of purchasers to sell any of our securities in the secondary market, thus possibly making it more difficult for us to raise additional capital.



For any transaction involving a penny stock, unless exempt, the rules require delivery, prior to any transaction in penny stock, of a disclosure schedule required by the SEC relating to the penny stock market. Disclosure is also required to be made about sales commissions payable to both the broker-dealer and the registered representative and current quotations for the securities. Finally, monthly statements are required to be sent disclosing recent price information for the penny stock held in the account and information on the limited market of penny stocks.



There can be no assurance that our common stock will qualify for exemption from the Penny Stock Rule. In any event, even if our common stock were exempt from the Penny Stock Rule, we would remain subject to Section 15(b)(6) of the Exchange Act, which gives the SEC the authority to restrict persons from participating in a distribution of a penny stock, under certain circumstances, if the SEC finds that such a restriction would be in the public interest.



THE RISKS SET FORTH ABOVE SHOULD NOT BE CONSTRUED AS A COMPLETE LIST OF THE RISKS WHICH MAY AFFECT THE COMPANY'S BUSINESS, THE OFFERING OR THE RISKS WHICH YOU FACE AS A PROSPECTIVE INVESTOR. THE SECURITIES OFFERED INVOLVE A HIGH DEGREE OF RISK AND MAY RESULT IN THE LOSS OF YOUR ENTIRE INVESTMENT. ANY PERSON CONSIDERING THE PURCHASE OF THESE SECURITIES SHOULD BE AWARE OF THESE AND OTHER FACTORS SET FORTH IN THIS MEMORANDUM AND SHOULD CONSULT WITH HIS, HER OR ITS LEGAL, TAX AND FINANCIAL ADVISORS PRIOR TO MAKING AN INVESTMENT IN SECURITIES. THE SECURITIES SHOULD ONLY BE PURCHASED BY PERSONS WHO CAN AFFORD TO LOSE ALL OF THEIR INVESTMENT.



Item 1B. Unresolved Staff Comments.



The Company has received several comment letters from the Staff of the Securities and Exchange Commission in connection with the filing of this Annual Report. The most recent comment letter is dated June 24, 2015. We have addressed these comments in this Form 10-K A-2.





20



---





Item 2. Properties.



Our principal executive offices are located at 429 Kent Street unit 112, Ottawa, Ontario, Canada K2P 2B4. We lease approximately. We lease approximately 500 square feet of space. Our monthly rent is $1,000.00. We do not anticipate any problems in securing additional office space if needed.



Item 3. Legal Proceedings.



None.



Item 4. Mine Safety Disclosures.



Not applicable.









21



---





PART II



Item 5. Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.



Our common stock is quoted on the OTC Bulletin Board under the symbol "MDST." Trading in our common stock in the over-the-counter market has been very limited and the quotations set forth below are not necessarily indicative of actual market conditions. The high and low sales prices for our common stock for each quarter of the fiscal years ended December 31, 2014 and 2013 according to OTC Markets Group Inc., were as follows:





|                   |  |      |      |  |     |   |      | 
|------------------ |  | ---- | ---- |  | --- | - | ---- | 
|Quarter Ended      |  | High |      |  | Low |  
|December 31, 2014  |  | $    | 0.08 |  |     | $ | 0.02 | 
|September 30, 2014 |  | $    | 0.15 |  |     | $ | 0.01 | 
|June 30, 2014      |  | $    | 0.03 |  |     | $ | 0.01 | 
|March 31, 2014     |  | $    | 0.03 |  |     | $ | 0.01 | 
|December 31, 2013  |  | $    | 0.03 |  |     | $ | 0.01 | 
|September 30, 2013 |  | $    | 0.02 |  |     | $ | 0.01 | 
|June 30, 2013      |  | $    | 0.04 |  |     | $ | 0.01 | 
|March 31, 2013     |  | $    | 0.12 |  |     | $ | 0.01 | 



As of June 8, 2015 the closing price of our common stock was $0.04 per share, according to OTC Markets Group Inc.



Record Holders



As of April 8, 2015 there were approximately 330 record holding our common stock, which does not include an undetermined number of beneficial stockholders who hold their shares in "street name" through a brokerage or other institution. The holders of our common stock are entitled to one vote for each share held of record on all matters submitted to a vote of stockholders. Holders of our common stock have no preemptive rights and no right to convert their common stock into any other securities. There are no redemption or sinking fund provisions applicable to our common stock.



Dividends



We have not declared any cash dividends since inception and do not anticipate paying any such dividends in the future. The payment of dividends is within the discretion of our Board of Directors and will depend on our earnings, capital requirements, financial condition, and other relevant factors. There are no restrictions that currently limit our ability to pay dividends on common stock other than those generally imposed by applicable state law.



Equity Compensation Plan Information



On October 15, 2014 the Company's Board of Directors established the 2014 Stock Incentive and Compensation Plan. (the "Plan"). The purpose of the Plan is to enhance the profitability and value of the Company for the benefit of its stockholders by enabling the Company to attract, retain and reward directors, employees and consultants (collectively, "Participants") and strengthen the mutuality of interests between such persons and the Company's stockholders.



Pursuant to the Plan, the Company may issue non-qualified stock options, incentive stock options, stock appreciation rights and common stock (collectively, the "Awards") to eligible Participants.



The aggregate number of shares of Common Stock which may be issued under the Plan with respect to which Awards may be granted shall not exceed 10,000,000 shares of Common Stock.



The Plan will be administered by a Compensation Committee. If no Compensation Committee has been established, the Plan will be administered by the Company's Board of Directors. The Board will have full authority, among other things, to: (a) select the eligible employees and consultants to whom the Awards may from time to time be granted; (b) determine, in accordance with the terms of the Plan, the number of shares of Common Stock to be covered by each Award to an eligible employee or consultant granted; and (c) determine the terms and conditions of any Award granted hereunder, including, but not limited to, the exercise or purchase price (if any), any restriction or limitation, any vesting schedule or acceleration thereof, or any forfeiture restrictions or waiver thereof, regarding any Stock Option or other Award, and the Common Stock relating thereto, based on such factors, if any, as the Committee shall determine, in its sole discretion.



22



---





The Board may at any time amend, in whole or in part, any or all of the provisions of the Plan, or suspend or terminate the Plan entirely. Provided, however, that, unless otherwise required by law or specifically provided in the Plan, the rights of a Participant with respect to Awards granted prior to such amendment, suspension or termination, may not be impaired without the consent of such Participant.



Sale of Unregistered Securities:



On September 9, 2014, Mindesta, Inc. entered into a Share Exchange Agreement (the " Exchange Agreement") with CTT Pharmaceuticals, Inc., f/k/a Fenwafe Inc., an entity organized under the Canadian Corporations Business Act in March 2007 ("CTT" or "CTT Pharma"), and the shareholders of CTT Pharma whereby Mindesta acquired all of the issued and outstanding shares of common stock of CTT Pharma in consideration for the issuance of 149,183,285 shares of Mindesta common stock. We also issued an additional 8,444,337 shares in connection with the same transaction.



Prior to the Exchange Agreement, on May 20, 2014, the Company completed a non brokered private placement consisting of the sale of 15,783,332 units at a price of US$0.015 per unit for total proceeds of US$236,750. Each unit consists of one common share and one half of a share purchase warrant. Each whole warrant entitles the holder to purchase one common share at a price of $0.0175 until December 31, 2016. We used the net proceeds of this offering for general working capital purposes. We also issued 10,700,000 to our former president for cancellation of indebtedness.



With respect to the sale of the securities identified above, we relied on the exemption provisions of Section 4(2), of the Securities Act, as amended.



At all relevant times, the securities were offered subject to the following terms and conditions:



·

The sale was made to a sophisticated or accredited investor, as defined in Rule 502 or were issued pursuant to a specific exemption;

·

We gave the purchaser the opportunity to ask questions and receive answers concerning the terms and conditions of the offering and to obtain any additional information which we possessed or could acquire without unreasonable effort or expense that is necessary to verify the accuracy of information furnished;

·

At a reasonable time prior to the sale of securities, we advised the purchaser of the limitations on resale in the manner contained in Rule 502(d)2; and

·

Neither we nor any person acting on our behalf sold the securities by any form of general solicitation or general advertising.



Item 6. Selected Financial Data.



Not Applicable.



Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operations.



The following discussion of our financial condition and results of operations should be read in conjunction with the audited financial statements and notes thereto for the years ended December 31, 2014 and 2013 found in this 10-K report.



In addition to historical information, the following discussion contains forward-looking statements that involve risks, uncertainties and assumptions. Where possible, we have tried to identify these forward looking statements by using words such as "anticipate," "believe," "intends," or similar expressions. Our actual results could differ materially from those anticipated by the forward-looking statements due to important factors and risks.



General



The following analysis of our financial condition and results of operations should be read in conjunction with the financial statements, including footnotes, and other information presented elsewhere in this report on Form 10-K.



The following Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") is intended to help the reader understand our results of operations and financial condition.





23



---





Overview



Mindesta, through its wholly owned subsidiary, CTT Pharma, specializes in drug delivery systems technology within the pharmaceutical industry. CTT Pharma's focus is fast dissolving drug delivery systems. The company's technology platform includes the development of advanced oral delivery thin wafers infused with both natural and/or synthetic cannabis extracts (THC, annabinoids, Terpenes) for pain management and treatment. CTT Pharma has no revenues to date and is unlikely to generate cash flows from operations in the immediate future.



We will need a significant infusion of capital, whether in the form of debt or equity financing to finance ongoing operations and to implement our business plan. We have no commitment for additional funding. For the year ended December 31, 2014, we incurred a net loss before other items of $672,162, negative cash flows from operations of $72,250 and have no current sources of revenue. This raises substantial doubt regarding our ability to continue as a going concern. Without this capital infusion, it is highly unlikely that we will be able to fully implement our business plan.



On September 9, 2014, Mindesta, Inc. entered into a Share Exchange Agreement (the " Exchange Agreement") with CTT Pharmaceuticals, Inc., f/k/a Fenwafe Inc., an entity organized under the Canadian Corporations Business Act in March 2007 ("CTT" or "CTT Pharma"), and the shareholders of CTT Pharma whereby Mindesta acquired all of the issued and outstanding shares of common stock of CTT Pharma in consideration for the issuance of 149,183,285 shares of Mindesta common stock.



The 140,738,948 restricted shares of Mindesta common stock issued to former CTT Pharma stockholders and the 8,444,337 shares of Mindesta restricted shares issued at closing represent approximately 80% of the then issued and outstanding common stock of Mindesta.



As a result of the transactions effected by the Exchange Agreement, at closing CTT Pharma became a wholly owned subsidiary of Mindesta and Mindesta has abandoned all of its previous business operations with the business of CTT Pharma now being Mindesta's sole business. CTT Pharma is a development stage company with limited operations to date focused on developing an oral delivery system of medication contained on a disposable film.



The Exchange Agreement was accounted for as a reverse acquisition and recapitalization of the Company and as a result, the consolidated financial statements of the Company (the legal acquirer) are, in substance, those of CTT Pharma (the accounting acquirer), with the assets and liabilities, and expenses of the Company being included effective from the date of the Exchange Agreement. As the Exchange Agreement was accounted for as a reverse acquisition and recapitalization, there was no gain or loss recognized on the transaction. The transaction is in substance a capital transaction, rather than a business combination, thus no goodwill or other intangible assets have been recorded. The significant components of the transaction are as follows:



|                     |  |   |         |  
|-------------------- |  | - | ------- | -
|Assets acquired:     |  | $ | 1,867   |  
|Liabilities assumed: |  |   | (31,767 | )
|Net                  |  | $ | (29,900 | )



The historical financial statements for periods prior to the Exchange Agreement are those of CTT Pharma, except that the equity section and earnings per share have been retroactively restated to reflect the Exchange Agreement. As a result of the Exchange Agreement, the Company has ceased mineral exploration and focuses on oral drug delivery systems.



Results of Operations  Years ended December 31, 2014 and 2013



RESULTS OF OPERATIONS:



For the twelve months ended December 31, 2014, the Company recorded a Net income of $227,838 or $0.01 per share, as compared to a Net loss of $18,911 for the twelve months ended December 31, 2013, or ($0.01) per share. The net income in 2014 can be attributable solely to the gain on contracts settled through the issuance of common stock.



The Company had no revenues for the periods ended December 31, 2014 and 2013.



For the twelve months ended December 31, 2014, expenses totaled $672,162 compared to $18,911for the twelve months ended December 31, 2013. Our largest expenses for 2014 were $483,377 for investor relations and $126,760 for marketing and promotion. Our sole expenses for 2013 were $3,884 for office and administrative expenses and $15,067 in professional fees.





24



---





Except for our officers and directors, as of December 31, 2014, we had no full time employees. We do have two part time employees. We anticipate adding additional employees, when adequate funds are available, and will continue using independent contractors, consultants, attorneys and accountants as necessary, to complement services rendered by our employees.



LIQUIDITY AND CAPITAL RESOURCES:



At December 31, 2014 the Company had cash of $81,179. The Company had no cash or any other assets at December 31, 2013. The principal source of our funds during 2014 were through the sale of equity securities and officer loans. On May 20, 2014, we completed a non brokered private placement consisting of the sale of 15,783,332 units at a price of US$0.015 per unit for total proceeds of $236,750. Each unit consists of one common share and one half of a share purchase warrant. Each whole warrant entitles the holder to purchase one common share at a price of $0.0175 until December 31, 2016.



At December 31, 2014 we had prepaid expenses attributable to current assets of $963,125 and accounts receivable totaling $5,430. Current assets totaled $1,049,734. We have also recorded as a long term asset, prepaid expenses totaling $612,637. As a result, our total assets were $1,662,370. There were no company assets at December 31, 2013.



Current liabilities:



Current liabilities at December 31, 2014 totaled $1,075,740 including a liability of $906,250 for the issuance of common stock, $147,240 due related parties and $22,250 in accounts payable and accrued liabilities.



We have a working capital deficit of $26,006.



The Company will require additional funding to continue operations and there is no assurance that such financing will be available or will be available on terms acceptable to the Company.



Going Concern Consideration



The Company's ability to continue as a going concern is dependent upon its ability to raise additional capital to pay expenses and carry out any further product development, market program, market acceptance of its products and achieving profitability. The Company will require significant financing to continue its operations and fund any further activities.



Our continuation as a going concern is dependent upon, amongst other things, continued financial support from our shareholders, attaining a satisfactory revenue level, attainment of profitable operations and the generation of cash from operations and the ability to secure new financing arrangements and new capital to carry out our business plan. These matters are dependent on a number of items outside of our control and there exists material uncertainties that may cast significant doubt about our ability to continue as a going concern. There are no assurances that we will achieve profitability or be capable of sustaining profitable operations. Our consolidated financial statements do not include any adjustments relating to the recoverability and classification of the carrying amounts of assets or the amount and classification of liabilities that might result if we are unable to continue as a going concern. These factors raise substantial doubt regarding our ability to continue as a going concern.



Current and Future Financing Needs



We have a stockholders' deficit of approximately $26,006 at December 31, 2014.



We estimate our total expenses for the next year to implement our business plan inclusive of salaries, overhead and travel will be approximately $600,000.



Off-Balance Sheet Arrangements



We are not currently a party to, or otherwise involved with, any off-balance sheet arrangements that have or are reasonably likely to have a current or future material effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.





25



---





CRITICAL ACCOUNTING ESTIMATES



The consolidated financial statements of Mindesta, Inc. are prepared in conformity with GAAP, which requires the use of estimates, judgments, and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the periods presented. An accounting estimate is considered critical if the estimate requires management to make assumptions about matters that were highly uncertain at the time the estimate was made, different estimates reasonably could have been used, or if changes in the estimate that would have a material impact on the Company's financial condition or results of operations are reasonably likely to occur from period to period. Management believes that the accounting estimates employed are appropriate and resulting balances are reasonable. However, actual results could differ from the original estimates, requiring adjustments to these balances in future periods. The Company's Board of Directors, has reviewed the Company's disclosures relating to these estimates.



Item 7A. Quantitative and Qualitative Disclosures About Market Risk.



Foreign Currency Exchange Rate Risk



We hold cash balances in both U.S. and Canadian dollars. We transact most of our financing in U.S. dollars and operational business in Canadian dollars. Some of our operational expenses denominated in Canadian dollars include building costs, labor costs and materials and supplies. As a result, currency exchange fluctuations may impact our operating costs. We do not manage our foreign currency exchange rate risk through the use of financial or derivative instruments, forward contracts or hedging activities.



In general, we do not believe that any weakening or strengthening of the U.S. dollar as compared to the Canadian dollar will have a positive or adverse material effect on our results of operations.



Interest Rate Risk



Our investment policy for our cash and cash equivalents is focused on the preservation of capital and supporting our liquidity requirements. We do not use interest rate derivative instruments to manage exposure to interest rate changes. We do not believe that interest rate fluctuations will have any effect on our results of operations.



Cyber-security Risk



We do not believe that we are subject to any undue cyber-security risk that may have an adverse material effect on our results of operations.









26



---





Item 8. Financial Statements and Supplementary Data.



Our consolidated financial statements for the fiscal years ended December 31, 2014 and 2013 are attached hereto.



Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.



Not Applicable



Item 9A. Controls and Procedures.



Evaluation of Disclosure Controls and Procedures



Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we evaluated the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, as of December 31, 2014. Based on this evaluation, our principal executive officer and our principal financial officer concluded that, as of the end of the period covered by this report, our disclosure controls and procedures were effective and adequately designed to ensure that the information required to be disclosed by us in the reports we submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the applicable rules and forms and that such information was accumulated and communicated to our principal executive officer and principal financial officer, in a manner that allowed for timely decisions regarding disclosure.



Management's Annual Report on Internal Control over Financial Reporting.



Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act). Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States. Our internal control over financial reporting includes those policies and procedures that:



| |       |                                                                                                                                                 
| | ----- | ------------------------------------------------------------------------------------------------------------------------------------------------
| | (i)   | pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets;
| | (ii)  | provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements; and                     
| | (iii) | provide reasonable assurance regarding prevention or timely detection of unauthorized transactions.                                             



Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with policies or procedures may deteriorate.



In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control  Integrated Framework and Internal Control over Financial Reporting  Guidance for Smaller Public Companies.



Our management evaluated the effectiveness of our internal control over financial reporting as of December 31, 2014. Based on this evaluation, our management concluded that, as of June 30, 2014, we maintained effective internal control over financial reporting.



Changes in internal control over financial reporting



There were no changes in our internal control over financial reporting during the year ended December 31, 2014, that have materially affected, or are reasonably likely to materially affect our internal control over financial reporting.





27



---





Our management, including our principal executive officer and principal financial officer, does not expect that its disclosure controls or internal controls will prevent all error and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. In addition, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake.



Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people or by management's override of the control. The design of any systems of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, control may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of these inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected. Individual persons perform multiple tasks which normally would be allocated to separate persons and therefore extra diligence must be exercised during the period these tasks are combined.



Item 9B. Other Information.



Not Applicable.



28



---





PART III



Item 10. Directors, Executive Officers and Corporate Governance.



Our executive officers and directors are as follows:



|                     |  |     |  |                          
|-------------------- |  | --- |  | -------------------------
|Name                 |  | Age |  | Position(s) and Office(s)
|Dr. Pankaj Modi      |  | 60  |  | CEO/DIRECTOR             
|Dr. Allen Greenspoon |  | 60  |  | DIRECTOR                 
|Dean Hanisch         |  | 44  |  | PRESIDENT/SEC/ DIRECTOR  
|Lucie Letellier      |  | 54  |  | CHIEF FINANCIAL OFFICER  



Dr. Pankaj Modi: Since September 9, 2014 Dr. Modi has served as our Chief Executive Officer and Director.In 2007 Dr. Modi founded CTT Pharma. He was the original patent owner of our wafer and has been instrumental in formulating various uses for the wafer. In 2006 he founded Transdermal Tech



Dr. Pankaj Modi, MD, PhD is a clinician and research scientist with experience in numerous medical areas. He is founder and president of NeoMed Chemotherapeutics Corp, which is developing a cancer treatment option, founder and president of Transdermal Corp, a dermatological specialty products company, co-founder and president of SoftTouch Corp, which developed a minimally invasive micro-needle device for injectable drugs, and founder and president of Photodyne Therapeutics Corp, which developed a novel dermatological therapy. Dr. Modi was founder, director and VP, Research and Development, of Generex Biotechnology Corp, until 2005, which developed a spray formula for use in the treatment of diabetes.



Previously, Dr. Modi gained 11 years of clinical experience conducting numerous large-scale clinical studies for FDA approvals in areas including diabetes, thrombolysis, management of various skin diseases and aesthetic cosmetic dermatology. He holds more than 25 US and Canadian patents and more than 280-plus world patents on stabilized compositions, photosensitizer compounds, a topical anesthetic formulation, pharmaceutical compositions, devices and methods and drug and vaccine delivery systems. Dr. Modi has obtained FDA approval for 13 drugs successfully over the past five years and currently has seven applications in process. Among the seven pending FDA approvals are five novel wound healing formulations and devices and two generic drugs to treat diabetes.



Dr. Modi is an adjunct professor of Internal Medicine at OVC, University of Guelph, Canada; Instituto de Endocrinologia Metabolismo y Reproduction, SA, Ecuador; Universidad de Buenos Aires (UBA); Sociedad Argentina de Medicina Interna General, Cruz Roja Boliviana; Associação Médica Brasileira; Centro Universitario de Ciencias de la Salud, Mexico; and Facultad de Salud Pública y Nutrición, Universidad Autónoma de Nuevo León, Universidad Nacional de Asunción, UNA, Spain.



Dr. Pankaj Modi received his M.D. in internal medicine (diabetology) from the Instituto de Endocrinologia Metabolismo y Reproduction, SA/University of Florida and completed a post-doctoral fellowship in neuroscience at McMaster University in Hamilton, Canada. He earned a Ph.D. in chemistry, biochemistry and biomedical sciences from the University of Toronto, a M.S. in chemical engineering (polymer science) from New York University (formerly Brooklyn Polytechnic) and a B.Sc. in chemistry, biology and physics from the University of Bombay in India.



A Fellow with the Royal College of Medicine, UK, Dr. Modi is a member of the American Diabetes Association, American Endocrinology Society, American Pain Society, American Dermatological Association, Associação Médica Brasileira and Sociedad Argentina de Medicina Interna General. He received faculty teaching awards three years in a row and was awarded Best Researcher by Movement Disorders and Psychiatry, McMaster University, Canada.



Dr. Allen Greenspoon, MD. Since September 9, 2014, Dr. Greenspoon has served as a corporate director.Dr. Greenspoon has been a practicing physician specializing in obstetrics and occupational health for over 25 years working in Hamilton, Ontario. He has been conducted multiple clinical research studies related diabetes, lipids (cholesterol) management, dermatology, obesity, oncology related research and cardiovascular diseases. He is the founder of Wellington@Work and the owner of Wellington Medical Centre. He also serves as a director of several privately held biotech companies.





29



---





Dean Hanisch:Since September 9, 2014 Mr. Hanisch has served as our president, secretary and as a director.Mr. Hanisch has over 15 years experience in business and finance. He has worked for and served as a consultant to several public companies. Since October 2012 he has worked for Steenberg Financial as a consultant for the Company's North American brokerage services. Steenberg concentrates in mergers and acquisitions. From 2012 to 2013 he served as the Interim chief executive officer for Mazorro Resources, an exploration stage mining company. From 2006 through 2011 he served as the Director of Business Development and Strategy for Paramount Gold and Silver Corp,. an exploratory stage mining company trading on the NYSE (PZG), TSX (PZG) and Deutsche Borse (P6G). From 2001-2005 he served as president of Titan Consulting Group. a professional service firm. Frin 1995 to 2001 her served as the managing partner of HT Search Company LTD., a permanent staffing company. Mr. Hanisch attended Carleton University and received a degree in finance from Algonquin College.



Lucie Leteller: On November 23, 2014, Ms. Letellier was appointed the Company's chief financial officer. Ms. Letellier is a financial professional with specialization in finance and accounting. She has 25 years experience as a senior accountant in the office of a Chartered Professional Accountant. Her skills include financial reporting, tax compliance, corporate governance and securities laws financial reporting compliance.



She currently serves as the chief financial officer of Crestwell Resources Inc. In addition, since 2013 she has provided accounting services on a contract basis.



Prior thereto, she operated her own business.



Beginning in 2010 and continuing for two years as the Controller of Acculift Flooring Corp.



From 2005 to 2009 Ms. Letellier served as the Chief Financial Officer of Paramount Gold and Silver Corp. (NYSE/TSX: PZG) having contributed to the development of the company from a private enterprise through private capital formation and two public listings overseeing $30 million in equity financing.



During this time she also served as the treasurer for Wind Works Power Corp., f/k/a Ammex Gold Corp.



Involvement in Certain Legal Proceedings:



During the past ten years:



1. None of our officers or directors has been convicted in a criminal proceeding or is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses);



2. None of our officers or directors has been the subject of any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining any such officer or director from engaging in any activity in connection with the purchase or sale of securities or in connection with any violation of federal or state securities laws or federal commodities laws;



3. None of our officers or directors has been the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any federal or state authority.



4. None of our officers or directors has been found by a court of competent jurisdiction in a civil action or by the Securities and Exchange Commission to have violated any federal or state securities laws; or.



5. None of our officers or directors has been the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization





30



---





Code of Ethics



We have adopted a code of ethics that applies to its principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. For purposes of this Item, the term code of ethics means 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 reports and documents that we file with, or submit to, the Commission and in other public communications made by us; compliance with applicable governmental laws, rules and regulations; the prompt internal reporting of violations of the code to the board of directors or another appropriate person or persons; and accountability for adherence to the code. We undertake to provide by mail to any person without charge, upon request, a copy of such code of ethics if we receive the request in writing by mail to the Company's executive officers located at: 429 Kent Street unit 112, Ottawa, Ontario, Canada K2P 2B4.



Committees of Board of Directors.



We currently do not have any committees of our Board of Directors. Our entire Board of Directors carries out such responsibilities as required by an audit committee, nominating committee and compensation committee. At some point in the future we anticipated establishing committees of our Board of Directors.



Section 16(a) Beneficial Ownership Reporting Compliance



Compliance with Section 16(a) of the Securities Exchange Act of 1934



For companies registered pursuant to section 12(g) of the Exchange Act, Section 16(a) of the Exchange Act requires our executive officers and directors, and persons who beneficially own more than ten percent of our equity securities, to file reports of ownership and changes in ownership with the Securities and Exchange Commission. Officers, directors and greater than ten percent shareholders are required by SEC regulation to furnish us with copies of all Section 16(a) forms they file. As of the date of this report, Section 16(a) filings have not been made. The Company is undertaking to file the required Section 16(a) forms and has notified shareholders owning more than 10% of the Companys outstanding common stock of the filing requirements.



As of the date of this report, no current officer or director has either acquired or sold any shares of the Companys common stock since shares of common stock were issued to these individuals upon the acquisition of CTT Pharma.



Item 11. Executive Compensation.



Our compensation philosophy is based on our belief that our compensation programs should: be aligned with stockholders' interests and business objectives; reward performance; and be externally competitive and internally equitable. We seek to achieve three objectives, which serve as guidelines in making compensation decisions:



·

Providing a total compensation package which is competitive and therefore enables us

·

to attract and retain, high-caliber executive personnel;

·

Integrating compensation programs with our short-term and long-term strategic plan and business objectives; and

·

Encouraging achievement of business objectives and enhancement of stockholder value by providing executive management long-term incentive through equity ownership.



We may compensate our Officers with cash compensation, common stock and common stock options. We have not established any quantifiable criteria with respect to the level of compensation, stock grants or options. Rather, the Board of Directors will evaluate cash, stock grants and stock options paid by similar mining companies. We do not have a Compensation Committee of the Board of Directors.



With respect to stock grants and options which may be issued to the Company's Officers and Directors, the Board will consider an overall compensation package that includes both cash and stock based compensation which would be in line with the Company's overall operations and compensation levels paid to similarly situated companies.





31



---





The following table sets forth the compensation paid by us to our officers and directors for the fiscal years ended December 31, 2014 and 2013. This information includes the dollar value of base salaries, bonus awards and number of stock options granted, and certain other compensation, if any. The compensation discussed addresses all compensation awarded to, earned by, or paid or named executive officers.



Executive Officer Compensation Table



|                            |  |  |  |  |  |      |  |            |  |             |  |              |  |          
|--------------------------- |  |  |  |  |  | ---- |  | ---------- |  | ----------- |  | ------------ |  | ---------
|                            |  |  |  |  |  |      |  |            |  |             |  |              |  |          
|                            |  |  |  |  |  |      |  |            |  | Stock       |  | Option       |  |          
|Name and Position           |  |  |  |  |  | Year |  | Salary ($) |  | Awards

($) |  | Awards

 ($) |  | Total ($)
|                            |  |  |  |  |  |      |  |            |  |             |  |              |  |          
|Pankaj Modi                 |  |  |  |  |  | 2014 |  |           |  |            |  |             |  |         
|CEO/Director                |  |  |  |  |  | 2013 |  |           |  |            |  |             |  |         
|                            |  |  |  |  |  |      |  |            |  |             |  |              |  |          
|Dean Hanisch                |  |  |  |  |  | 2014 |  | 60,000     |  |            |  |             |  | 60,000   
|Pres/Sec/Director           |  |  |  |  |  | 2013 |  |           |  |            |  |             |  |         
|                            |  |  |  |  |  |      |  |            |  |             |  |              |  |          
|Lucie Letellier             |  |  |  |  |  | 2014 |  |           |  | 500,000     |  |             |  | 500,000  
|CFO                         |  |  |  |  |  | 2013 |  |           |  |            |  |             |  |         
|                            |  |  |  |  |  |      |  |            |  |             |  |              |  |          
|Allen Greenspoon            |  |  |  |  |  | 2014 |  |           |  |            |  | 110,243(1)   |  | 110,243  
|Director                    |  |  |  |  |  | 2013 |  |           |  |            |  |             |  |         
|                            |  |  |  |  |  |      |  |            |  |             |  |              |  |          
|Greg Bowes                  |  |  |  |  |  | 2014 |  |           |  |            |  |             |  |         
|Former officer and director |  |  |  |  |  | 2013 |  |           |  |            |  |             |  |         



(1)

Options are exercisable at $.10 per share.



There was no director compensation paid in 2014.



Employment Agreements



Currently, there are currently no employment agreements in place for any of our officers.



Outstanding Equity Awards at Fiscal Year End



There are a total of 14,150,000 outstanding options of which 13,500,000 have an exercise price of $0.015 per share and 650,000 have an exercise price of $.10 per share.



|                 |  |                                                                     |  |                                                                       |  |                                                                                                |  |                           |  |                        |  |                                                             |  |                                                                   |  |                                                                                                         |  |                              
|---------------- |  | ------------------------------------------------------------------- |  | --------------------------------------------------------------------- |  | ---------------------------------------------------------------------------------------------- |  | ------------------------- |  | ---------------------- |  | ----------------------------------------------------------- |  | ----------------------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------- |  | -----------------------------
|Name             |  | Number of securities underlying unexercised options (#) exercisable |  | Number of securities underlying unexercised options (#) unexercisable |  | Equity incentive plan awards: Number of securities underlying unexercised unearned options (#) |  | Option exercise price ($) |  | Option expiration date |  | Number of shares or units of stock that have not vested (#) |  | Market value of shares or units of stock that have not vested ($) |  | Equity incentive plan awards: Number of unearned shares, units or other rights that have not vested (#) |  | Share
Based Compen-sation
($)
|Steven Abboud    |  | 1,250,000                                                           |  | 625,000                                                               |  | 625,000                                                                                        |  | $0.015                    |  | 12/31/17               |  | 625,000                                                     |  | 9,375                                                             |  | 625,000                                                                                                 |  | 31,412                       
|Dana Allen       |  | 1,250,000                                                           |  | 625,000                                                               |  | 625,000                                                                                        |  | $0.015                    |  | 12/31/17               |  | 625,000                                                     |  | 9,375                                                             |  | 625,000                                                                                                 |  | 31,412                       
|Allen Greenspoon |  | 5,000,000                                                           |  | -0-                                                                   |  | -0-                                                                                            |  | $0.015                    |  | 12/31/17               |  | -0-                                                         |  | -0-                                                               |  | -0-                                                                                                     |  | 110,243                      
|Steven Hould     |  | 3,000,000                                                           |  | 1,500,000                                                             |  | 1,500,000                                                                                      |  | $0.015                    |  | 12/31/17               |  | 1,500,000                                                   |  | 22,500                                                            |  | 1,500,000                                                                                               |  | 67,686                       
|Michele Hamilton |  | 1,250,000                                                           |  | 625,000                                                               |  | 625,000                                                                                        |  | $0.015                    |  | 12/31/17               |  | 625,000                                                     |  | 9,375                                                             |  | 1,500,000                                                                                               |  | 28,203                       
|Gilles Derome    |  | 1,750,000                                                           |  | 875,000                                                               |  | 875,000                                                                                        |  | $0.015                    |  | 12/31/17               |  | 875,000                                                     |  | 13,125                                                            |  | 875,000                                                                                                 |  | 39,489                       
|Total            |  |                                                                     |  |                                                                       |  |                                                                                                |  |                           |  |                        |  |                                                             |  |                                                                   |  |                                                                                                         |  | 308,439                      



Compensation of Directors



At present, we do not pay our Directors for attending meetings of the Board of Directors, although we may adopt a director compensation policy in the future. We have no standard arrangement pursuant to which Directors are compensated for any services they provide or for committee participation or special assignments.





32



---





Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.



The table below sets forth the number and percentage of shares of our equity securities owned as of June 6, 2015, by the following persons: (i) stockholders known to us who own 5% or more of our outstanding shares, (ii) each of our executive officers and directors, and (iii) our executive officers and directors as a group. As of June 6, 2015, there were 213,493,022 shares of our common stock outstanding.



|                           |  |                 |  |               |  |            
|-------------------------- |  | --------------- |  | ------------- |  | -----------
|                           |  | No of Shares of |  | No. of        |  | Percent of 
|Name and Address           |  | Common Stock    |  | Options       |  | Class(1)(2)
|                           |  |                 |  |               |  |            
|Pankaj Modi                |  | 70,369,474      |  |              |  | 33.0%      
|519 Golf Links Road        |  |                 |  |               |  |            
|Ancaster, Ontario L9G 4X9  |  |                 |  |               |  |            
|                           |  |                 |  |               |  |            
|Dean Hanisch               |  | 14,078,894      |  |              |  | 6.6%       
|326 River Road             |  |                 |  |               |  |            
|Ottawa, Ontario  KIV 1H2   |  |                 |  |               |  |            
|                           |  |                 |  |               |  |            
|Heshan Osman               |  | 20,970,103      |  |              |  | 9.8%       
|716 Vermillion Drive       |  |                 |  |               |  |            
|Gloucester, Ontario        |  |                 |  |               |  |            
|K1B 1V9                    |  |                 |  |               |  |            
|                           |  |                 |  |               |  |            
|Capital Financial          |  | 28,471,489      |  |              |  | 13.3%      
|Camay Rabay, principal;    |  |                 |  |               |  |            
|SGBL Bank street,          |  |                 |  |               |  |            
|Beyrouth, Lebanon          |  |                 |  |               |  |            
|                           |  |                 |  |               |  |            
|Allen Greenspoon           |  | 3,333,333       |  | 5,000,000 (1) |  | 3.9%       
|M1-414 Victoria Ave. N.    |  |                 |  |               |  |            
|Hamilton, ON  L8L 5G8      |  |                 |  |               |  |            
|                           |  |                 |  |               |  |            
|Lucie Letellier            |  | 5,000,000       |  |              |  | 2.3%       
|88 Ramsay Road             |  |                 |  |               |  |            
|Chelseam Quebec, J9B 2J1   |  |                 |  |               |  |            
|                           |  |                 |  |               |  |            
|All officers and Directors |  |                 |  |               |  |            
|As a Group (3)             |  | 92,781,691      |  | 5,000,000     |  | 43.5%      



(1)

Options are exercisable at $.10 per share.



(2)

Under Rule 13d-3, a beneficial owner of a security includes any person who, directly or indirectly, through any contract, arrangement, understanding, relationship, or otherwise has or shares: (i) voting power, which includes the power to vote, or to direct the voting of shares; and (ii) investment power, which includes the power to dispose or direct the disposition of shares. Certain shares may be deemed to be beneficially owned by more than one person (if, for example, persons share the power to vote or the power to dispose of the shares). In addition, shares are deemed to be beneficially owned by a person if the person has the right to acquire the shares (for example, upon exercise of an option) within 60 days of the date as of which the information is provided. In computing the percentage ownership of any person, the amount of shares



(3)

Based on 213,493,022 issued and outstanding shares of common stock as at June 6, 2015.





33



---





Item 13. Certain Relationships and Related Transactions, and Director Independence.



Related Party Transactions



Except as described below, none of the following persons has any direct or indirect material interest in any transaction to which we are a party during the past two years, or in any proposed transaction to which the Company is proposed to be a party:



·

any director or officer;

·

any proposed nominee for election as a director;

·

any person who beneficially owns, directly or indirectly, shares carrying more than 5% of the voting rights attached to our common stock; or

·

any relative or spouse of any of the foregoing persons, or any relative of such spouse, who has the same house as such person or who is a director or officer of any parent or subsidiary.



A total of $87,240 is due our affiliated shareholders. Both Hesham Osman and Dean Hanisch each loaned the Company $8,620. Another $70,000 was loaned to the Company from Greg Bowes, a former officer and director.



Dean Hanisch, our president is owed $60,000 as a management fee for his services.



In addition, directors and shareholders of the Company paid professional fees on our behalf in the amount of $5,139. These amounts are not expected to be repaid and have been recorded as a contribution to surplus.



Director Independence.



We do not have an independent Board of Directors. Each of our Directors also serves as an Officer of the Company.



Item 14. Principal Accountant Fees and Services.



AUDIT FEES. The aggregate fees billed for professional services rendered was $20,000 and $7,472 for the audit of our annual financial statements for the fiscal years ended December 31, 2014 and 201 3, respectively, and $6,600 and $Nil for the reviews of the financial statements included in our Forms 10-Q for the fiscal years ended 2014 and 2013 respectively.



AUDIT-RELATED FEES. No fees were billed in each of the last two fiscal years for assurance and related services by the principal accountant that are reasonably related to the performance of the audit or review of our financial statements and not reported under the caption "Audit Fee."



TAX FEES. No fees were billed in each of the last two fiscal years for professional services rendered by the principal accountant for tax compliance, tax advice and tax planning services.



ALL OTHER FEES. Other than the services described above, there were no other services provided by our principal accountants for the fiscal years ended December 31, 2014 and 2013.



We do not have an Audit Committee. Therefore, our entire Board of Directors (the "Board") serves in the capacity of the Audit Committee. In discharging its oversight responsibility as to the audit process, our Board obtained from the independent auditors a formal written statement describing all relationships between the auditors and us that might bear on the auditors' independence as required by Independence Standards Board Standard No. 1,"Independence Discussions with Audit Committees."



Our Board discussed with the auditors any relationships that may impact their objectivity and independence, including fees for non-audit services, and satisfied itself as to the auditors' independence. The Board also discussed with management and the independent auditors the quality and adequacy of its internal controls. The Board reviewed with the independent auditors their management letter on internal controls.





34



---





Our Board discussed and reviewed with the independent auditors all matters required to be discussed by auditing standards generally accepted in the United States of America, including those described in Statement on Auditing Standards No. 61, as amended, "Communication with Audit Committees." Our entire Board, acting in the capacity of the Audit Committee reviewed the audited consolidated financial statements of the Company as of and for the year ended December 31, 2014 with the independent auditors. Management has the responsibility for the preparation of the Company's financial statements and the independent auditors have the responsibility for the examination of those statements. Based on the above-mentioned review and discussions with the independent auditors our Board of Directors approved the Company's audited consolidated financial statements and recommended that they be included in its Annual Report on Form 10-K for the year ended December 31, 2014, for filing with the Securities and Exchange Commission.



35



---





PART IV



Item 15. Exhibits and Financial Statement Schedules.



a)

The following report and consolidated financial statements are filed together with this Annual Report. (Previously filed)



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM



CONSOLIDATED BALANCE SHEETS AS OF DECEMBER 31, 2014 and 2013



CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS FOR THE YEARS ENDED DECEMBER 31, 2014 AND DECEMBER 31, 2013



CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY FOR THE YEARS ENDED DECEMBER 31, 2014 AND 2013



CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2014 AND 2013



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



b)

Index to Exhibits



|        |  |                                                                                                                      
|------- |  | ---------------------------------------------------------------------------------------------------------------------
|Exhibit |  | Exhibit                                                                                                              
|Number  |  | Description                                                                                                          
|        |  |                                                                                                                      
|10.1    |  | Consulting Agreement with Graham Wong

(Previously filed)                                                            
|10.2    |  | Consulting Agreement with Lesley Leroux

(Previously filed)                                                          
|10.3    |  | Consulting Agreement with Tracy Albert

(Previously filed)                                                           
|10.4    |  | Consulting Agreement with Mathew Harrington

(Previously filed)                                                      
|10.5    |  | Consulting Agreement with Woodcliff Capital

(Previously filed)                                                      
|10.6    |  | Consulting Agreement with Dwayne McLeod

(Previously filed)                                                          
|10.7    |  | Consulting Agreement with Tony Zacconi

(Previously filed)                                                           
|21      |  | Subsidiaries of Registrant (Previously filed)                                                                        
|23.1    |  | Consent of Independent Registered Public Accounting Firm (Previously filed)                                          
|31.1    |  | Officer's Certification Pursuant to Section 302 of Sarbanes Oxley Act                                                
|31.2    |  | Officer's Certification Pursuant to Section 302 of Sarbanes Oxley Act                                                
|32.1    |  | Certification Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|32.2    |  | Certification Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|101     |  | XBRL (Previously filed)                                                                                              







36



---







SIGNATURES



In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.



|                       |                |                                                      
|---------------------- | -------------- | -----------------------------------------------------
|                       | MINDESTA, INC.
|                       |                |                                                      
|Date:

July 20,

 2015 | By:            | /s/ Pankaj Modi                                      
|                       |                | Pankaj Modi                                          
|                       |                | Chief Executive Officer/Director                     
|                       |                |                                                      
|Date:

July 20,

 2015 | By:            | /s/ Lucie Letellier                                  
|                       |                | Lucie Letellier                                      
|                       |                | Chief Financial Officer/
Principal Accounting Officer



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.



|                       |     |                                 
|---------------------- | --- | --------------------------------
|Date:

July 20,

 2015 | By: | /s/ Pankaj Modi                 
|                       |     | Pankaj Modi                     
|                       |     | Chief Executive Officer/Director
|                       |     |                                 
|Date:

July 20,

 2015 | By: | /s/ Dean Hanisch                
|                       |     | Dean Hanisch                    
|                       |     | President/Director              
|                       |     |                                 
|Date:

July 20,

 2015 | By: | /s/ Allen Greenspoon            
|                       |     | Allen Greenspoon                
|                       |     | Director                        

















37