We are not required to provide the information required by this Item 6 as we are a smaller reporting company.
We were incorporated in the State of Florida on April 8, 2013, with a fiscal year end of April 30. Until June 2017, we had not established any business operations and had not achieved any revenues. Until then, we were in the process of identifying and evaluating feasible business opportunities in the consumer products and technology industries. Currently, the Company is evaluating the development of a technology business in digital currency applications and mining.
On August 24, 2019, the Company entered into a Software License Agreement (“License Agreement”) with Charteris, Mackie, Baillie & Cummins Limited (“CMBC”) to acquire a non-exclusive license for Black Cactus blockchain development software platform and related intellectual property (“Software”) which are licensed to CMBC from Black Cactus LLC. As consideration, the License Agreement provides for the payment of a royalty to CMBC in the amount of five percent (5%) of the gross revenue received from the sublicense of the Software (“royalty”), due on a quarterly basis, and issue or assign an equivalent number of common shares to CMBC that will represent 60% of the then issued shares of the Company. In addition, the License Agreement provides for the issuance of an option for CMBC to acquire additional shares at par value ($0.0001) per share up to 60% of any shares issued under the existing Securities Purchase Agreements with Bellridge Capital LP (“Bellridge”). The closing of the License Agreement was subject to, among certain other conditions: (1) the Company obtaining a written agreement with Bellridge to increase its line of credit from $1,500,000 to $5,000,000; (2) the resignation of all the directors of the Company serving on the Board, during the quarterly period ended July 31, 2019, which was satisfied by the resignation of all of such directors on September 13, 2019, and the appointment of Lawrence P. Cummins, Karyn Augustinus and three non-executive independent Directors nominated by CMBC Limited; (3) the resignation of all the officers of the Company serving, during the quarterly period ended July 31, 2019, which was satisfied by the resignation of all of such officers on September 13, 2019, and the appointment of Lawrence P. Cummins as its President (after undertaking a review of the future plans of the Company, the Board of Directors will appoint a Chief Executive Officer); (4) proof satisfactory to CMBC Limited that fair resolutions have been entered into with certain persons, including Harpreet Sangha, the former Chairman of the Board and Chief Financial Officer of the Company, along with his family and known associates for the cancellation of the shares of the Company currently owned by them; (5) CMBC Limited is satisfied with the possibility of lifting the Cease Trade Order issued by the British Columbia Securities Commission on May 6, 2016, to the Company, ordering all persons to cease trading in the Company’s securities until the Company files the required records completed in accordance with the Securities Act, R.S.B.C. 1996 and the Executive Director revokes the Order; (6) the cancellation of $350,000 amount allegedly outstanding under the terms of the Definitive Acquisition Agreement, dated as of June 18, 2017, between the Company and the selling shareholders of BitReturn.ca; (7) repayment by the majority shareholder of the Company of $169,729 owed by such shareholder to the Company; and (8) the Company’s becoming current in its periodic filing with the SEC.
On November 15, 2019, the Company entered into an Assignment Agreement with CMBC in connection with the assignment of a nonexclusive software License (the “Assignment”) for Software from Benchmark Advisors Limited, the closing of which was subject to many of the same conditions for the closing of the License Agreement.
CMBC waived most of the conditions for closing the License Agreement and the Assignment, the Company became current in its filings of periodic reports with the Securities and Exchange Commission, and the closing was consummated on June 29, 2020. See Business - Recent Developments.
The following discussion of the Company’s financial condition and the results of operations should be read in conjunction with the Financial Statements and Notes thereto appearing elsewhere in this document.
There is no historical financial information about us upon which to base an evaluation of our performance. We have incurred losses of $596,565 and $4,294,852 in our operations for the years ended April 30, 2020 and 2019, respectively.
We did not generate any revenues from our operations for the years ended April 30, 2020 or 2019. We cannot guarantee we will be successful in our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including the financial risks associated with the limited capital resources currently available to us for the implementation of our business strategies.
Since inception, the majority of our time has been spent refining its business plan and preparing for a primary financial offering.
Our results of operations are summarized below:
| | | | | | | |
| | For the Year Ended April 30, 2020 | | For the Year Ended April 30, 2019 | |
Revenue | | | — | | | — | |
Operating Expenses | | $ | 96,411 | | $ | 2,241,840 | |
Net Loss and Comprehensive Loss | | $ | (596,565 | ) | $ | (4,294,852 | ) |
Net Loss per Common Share - Basic and Diluted | | | (0.00 | ) | | (0.02 | ) |
Weighted Average Number of Common Shares Outstanding - Basic and Diluted | | | 166,073,296 | | | 194,033,844 | |
Operating Expenses
We had operating expenses for the year ended April 30, 2020 of $96,411 compared to operating expenses of $2,241,840 for the year ended April 30, 2019, which reflects a reduction in operating expenses of $2,145,429 between those two periods. The reason for this substantial reduction in operating expenses was as a result of the Company being inactive during this period.
Net Loss and Comprehensive Loss
We had net loss and comprehensive loss for the year ended April 30, 2020 of $596,565 compared to net loss and comprehensive loss of $4,294,852 for the year ended April 30, 2019, which reflects a reduction in net loss and comprehensive loss of $3,698,287 between those two periods. The reason for this substantial reduction in net loss and comprehensive loss was a result of the Company being inactive during this period.
Management’s Plan of Operation
We do not have adequate funds to satisfy our working capital requirements for the next twelve months. We have borrowed a total of $1,000,000 from Bellridge to fund our planned plan of operations in digital currency mining. We sold Bellridge our Senior, Secured Convertible Promissory Notes (the “Notes”). Thus far, Bellridge has purchased $1,000,000 in Notes. Pursuant to the terms of our agreements with Bellridge, we were required to file a registration statement with the SEC to register the shares of Common Stock to be issued under those agreements. We filed the registration statement on April 24, 2018 but it has not yet been declared effective. We may not receive the fourth and final tranche of $500,000 unless and until the registration statement is declared effective by the SEC. We cannot estimate when our registration statement will be declared effective by the SEC. Under certain conditions, Bellridge may not have to purchase the fourth Note. These conditions include any acts constituting default under any of the Notes or the agreements entered into at the time of the first purchase of the Note issued on November 27, 2017. Until such time as we receive the final $500,000 of funding from Bellridge, in the interim, we may not be able to completely implement and commence our proposed plan of operations.
In February 2020, we entered into a securities purchase agreement with Bellridge, pursuant to which we issued a convertible promissory note in the principal amount of $54,271. The funds were used for operating expenses during the year ended April 30, 2020.
As of April 30, 2020, we had not yet had any revenues from our services in the digital currency mining field.
Liquidity and Capital Resources
As of April 30, 2020, we had not generated any revenues from our business operations. As at April 30, 2020, there were 166,073,296 shares of common stock issued and outstanding. Total cash proceeds received from common share issuance since inception to April 30, 2020 is $90,500.
As of April 30, 2020, and 2019, we had no cash on hand. As of April 30, 2020, we had a working capital deficiency of $2,905,112 and an accumulated deficit of $11,082,293 compared to $2,352,884 and $10,485,728, respectively as of April 30, 2019. Our cash is not sufficient to meet the obligations associated with being a company that is fully reporting with the SEC. We believe we will require additional financing in the form of share issuance proceeds or advances from our directors. We also may sell additional secured, convertible promissory notes.
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Our business expansion will require significant capital resources that may be funded through the issuance of common stock or of notes payable or other debt arrangements that may affect our debt structure. Despite our current financial status, we believe that we may be able to issue notes payable or debt instruments in order to start executing our business plan. However, there can be no assurance that we will be able to raise money in this fashion and have not entered into any agreements that would obligate a third party to provide us with capital.
During the year ended April 30, 2020, we spent $596,565 on general and administrative operating expenses. We relied on loans to fund general and administrative operating expenses. As of April 30, 2020, we had no working capital.
As of April 30, 2020, the Company had no external sources of liquidity such as arrangements with credit institutions or off-balance sheet arrangements that will have or are reasonably likely to have a current or future effect on our financial condition or immediate access to capital.
Our independent auditor has expressed substantial doubt about our ability to continue as a going concern and believes that our ability is dependent on our ability to implement our business plan, raise capital and generate revenues. See Note 2 of our financial statements.
Off-Balance Sheet Arrangements
The Company has no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect or change on the Company’s financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors. The term “off-balance sheet arrangement” generally means any transaction, agreement or other contractual arrangement to which an entity unconsolidated with the Company is a party, under which the Company has (i) any obligation under a guarantee contract that has any of the characteristics identified in FASB ASC paragraph 460-10-15-4 (Guarantees Topic), as may be modified or supplemented, and that is not excluded from the initial recognition and measurement provisions of FASB ASC paragraphs 460-10-15-7, 460-10-25-1, and 460-10-30-1; (ii) a retained or contingent interest in assets transferred to an unconsolidated entity or similar arrangement that serves as credit, liquidity or market risk support to such entity for such assets; (iii) any obligation, including a contingent obligation, under a contract that would be accounted for as a derivative instrument, except that it is both indexed to the registrant’s own stock and classified in stockholders’ equity in the registrant’s statement of financial position, and therefore excluded from the scope of FASB ASC Topic 815, Derivatives and Hedging, pursuant to FASB ASC subparagraph 815-10-15-74(a), as may be modified or supplemented; or (iv) any obligation, including a contingent obligation, arising out of a variable interest (as defined in the FASB ASC Master Glossary), as may be modified or supplemented) in an unconsolidated entity that is held by, and material to, the registrant, where such entity provides financing, liquidity, market risk or credit risk support to, or engages in leasing, hedging or research and development services with, the registrant.
Critical Accounting Policies
See “Footnotes” section to the financial statements for a complete summary of the significant accounting policies used in the presentation of our financial statements. The summary is presented to assist the reader in understanding the financial statements. The accounting policies used conform to accounting principles generally accepted in the United States of America and have been consistently applied in the preparation of the financial statements. Because of our election to not opt out of the extended transition period for complying with new or revised accounting standards pursuant to Section 107(b) of the JOBS Act, our financial statements may not be comparable to companies that comply with public company effective dates.
Concentrations, Risks, and Uncertainties
The Company did not have a concentration of business with suppliers or customers constituting greater than 10% of the Company’s gross sales during the reporting period.
Stock Based Compensation
For purposes of determining the variables used in the calculation of stock compensation expense under the provisions of FASB ASC Topic 505, “Equity” and FASB ASC Topic 718, “Compensation — Stock Compensation,” management would perform an analysis of current market data and historical company data to calculate an estimate of implied volatility, the expected term of the option and the expected forfeiture rate. With the exception of the expected forfeiture rate, which is not an input, management uses these estimates as variables in the Black-Scholes option pricing model. Depending upon the number of stock options granted, any fluctuations in these calculations could have a material effect on the results presented in the Company’s statement of operations and other comprehensive income. In addition, any differences between estimated forfeitures and actual forfeitures could also have a material impact on the Company’s financial statements.
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Recently Issued Accounting Standards:
The Company has implemented all new mandatory accounting pronouncements that are in effect and there has been no significant impact on its financial statements. The Company does not believe that there are any new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk.
We are not required to provide the information required by this Item 7A as we are a smaller reporting company.
Item 8. Financial Statements and Supplementary Data.
The financial statements required by this Item 8 are included at the end of this Annual Report on Form 10-K beginning on page F-1.
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.
None.
Item 9A. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures
We maintain disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act that are designed to ensure that information required to be disclosed in our reports filed or submitted to the SEC under the Exchange Act is recorded, processed, summarized and reported within the time periods specified by the SEC’s rules and forms, and that information is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures. Our Chief Executive Officer and Chief Financial Officer evaluated the effectiveness of disclosure controls and procedures as of April 30, 2020 pursuant to Rule 13a-15(b) under the Exchange Act. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of the end of the period covered by this report, the Company’s disclosure controls and procedures were not effective to ensure that information required to be included in our periodic SEC filings is recorded, processed, summarized, and reported within the time periods specified in the SEC rules and forms.
Management’s Annual Report on Internal Control over Financial Reporting
Our management is responsible for the preparation of our consolidated financial statements and related information. Management uses its best judgment to ensure that the consolidated financial statements present fairly, in material respects, our financial position and results of operations in conformity with generally accepted accounting principles. Management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in the Exchange Act. These internal controls are designed to provide reasonable assurance that the reported financial information is presented fairly, that disclosures are adequate and that the judgments inherent in the preparation of financial statements are reasonable. There are inherent limitations in the effectiveness of any system of internal controls including the possibility of human error and overriding of controls. Consequently, an effective internal control system can only provide reasonable, not absolute, assurance with respect to reporting financial information.
Our internal control over financial reporting includes policies and procedures that: (i) pertain to maintaining records that, in reasonable detail, accurately and fairly reflect our transactions; (ii) provide reasonable assurance that transactions are recorded as necessary for preparation of our financial statements in accordance with generally accepted accounting principles and that the receipts and expenditures of company assets are made in accordance with our management and directors authorization; and (iii) provide reasonable assurance regarding the prevention of or timely detection of unauthorized acquisition, use or disposition of assets that could have a material effect on our financial statements.
Under the supervision of management, including our Chief Executive Officer and our Chief Financial Officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control — Integrated Framework (2013 framework) issued by the Committee of Sponsoring Organizations of the Treadway Commission and subsequent guidance prepared by the Commission specifically for smaller public companies. Based on that evaluation, our management concluded that our internal control over financial reporting was not effective as of April 30, 2020, primarily as a result of the fact that, as of April 30, 2020, we had limited resources, including the absence of a financial staff with accounting and financial expertise.
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To the extent reasonably possible, given our limited resources, our goal is to bring on additional financial staff and expand our current board of directors to include additional individuals willing to perform directorial functions. Since the recited remedial actions will require that we hire or engage additional personnel, this material weakness may not be overcome in the near term due to our limited financial resources. Until such remedial actions can be realized, we will continue to rely on the advice of outside professionals and consultants.
This Report does not include an attestation report of the Company’s registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by the Company’s registered public accounting firm as we are neither an accelerated filer nor a large accelerated filer and are not required to provide the report.
Changes in Internal Control over Financial Reporting
There have been no changes in our internal controls over financial reporting that occurred during the year ended April 30, 2020 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Item 9B. Other Information.
None.
Part III
Item 10. Directors, Executive Officers and Corporate Governance.
Officers and Directors
Our directors will serve until their successors are elected and qualified. Our officers are appointed by the board of directors to a term of one year and serve until their successor is duly appointed, or until they are removed from office. The Board has no nominating, auditing or compensation committees.
The name, address, age and position of our president, secretary/treasurer, directors and vice president is set forth below:
| | | | | | |
NAME | | AGE | | POSITION(S) | | Date of Appointment or Election |
| | | | | | |
Jeremy Towning (1) | | 48 | | Director, Chief Financial Officer | | Director: September 13, 2019; Chief Financial Officer: September 19, 2019 |
Lawrence P. Cummins | | 58 | | Director, Chief Executive Officer | | June 29, 2020 |
Karyn Augustinus | | 51 | | Director | | June 29, 2020 |
Lawrence C. Cummins | | 29 | | Vice President | | June 29, 2020 |
__________
| |
(1) | On September 13, 2019, the Company accepted Harpreet Sangha’s resignation from his position as Chairman of the Board and Chief Financial Officer, Dr. Ramesh Para’s resignation from his position as Chief Executive Officer and member of the Board, Dr, Ravindranath Kancheria from his position as a member of the Board, and Dr. Pruthvinath Kancheria as a member of the Board, effective immediately. In connection with this transition, on September 13, 2019, the Board appointed Jeremy Towning as a member of the Board. Mr. Towning was also appointed as Chief Executive Officer and Chief Financial Officer, but resigned as Chief Executive Officer upon the appointment of Lawrence P. Cummins as Chief Executive Officer on June 29, 2020. |
Business Experience
Jeremy Towning
Jeremy Towning, 48, has served as a director and Chief Financial Officer of the Company since September 2019, Mr. Towning also served as the Chief Executive Officer of the Company from September 2019 to June 2020. In 2008, Mr. Towning began working in the acquisition, development and management of real estate for his family’s private company, Swissreal Investments Ltd. In 2017, Mr. Towning began investigating the potential of joining in the acquisition of potential medical marijuana facilities in Canada. There are no arrangements or understandings between Mr. Towning and any other persons pursuant to which he was selected as a director, Chief Executive Officer, or Chief Financial Officer.
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Lawrence P. Cummins
Lawrence P. Cummins, 58, has served as a director and Chief Executive Officer of the Company since June 2020. Mr. Cummins previously served as the Company’s Chief Executive Officer and as a director from December 2017 to April 2018. Mr. Cummins founded CMBC in 1999. His primary focus at CMBC has been the development of blockchain based commercial solutions using AI, machine learning, IoT, big data, analytics and predictive analysis for financial transactions that encompass both fiat and crypto currencies. In 2015, Lawrence P. Cummins joined Black Cactus Holdings Pty Ltd as a director. In 2017, Lawrence P. Cummins joined Black Cactus Holdings LLC as a director.. He left the Company in April 2018 to pursue consultancy opportunities through his equity interest in CMBC.
Karyn Augustinus
Karyn Augustinus, 51, has served as a director of the Company since June 2020. Ms. Augustinus has been a director of Black Cactus Holdings Pty Ltd., since March 1996 and a director of CMBC, since July 2016. Ms. Augustinus has more than 20 years of experience in the areas of customer, supplier and client management across several industries, including banking and international logistics. She also has over 15 years of experience working with businesses in the gaming, loyalty and incentive industries.
Lawrence C. Cummins
Lawrence C. Cummins, 29, has served as a Vice President of the Company since June 2020. Mr. Cummins was a research grant assistant for the University of Illinois Chicago’s School of Design on a joint project with the National Aeronautics and Space Administration in 2015. He joined CMBC as a Project Manager in 2016. His primary focus at CMBC is the design and development of CMBC’s web platforms. From 2016 to 2017, Mr. Cummins was a Project Manager of Black Cactus Holdings Pty Ltd where he managed the development and implementation of the music distribution platform. From 2016 to 2017, Mr. Cummins was a Media Design Manager at Nexstar Global, a joint venture between Milestone Group PLC, and Black Cactus Holdings Pty Ltd. His Focus at Nexstar Global was to develop Nexstar’s media publishing and distribution platform, as well as all branding related projects.
Family Relationships
Lawrence P. Cummins and Lawrence C. Cummins are father and son. There are no other family relationships between any of the Company’s directors or officers.
Board of Directors
The Board of Directors oversees our business affairs and monitors the performance of our management. In accordance with our corporate governance principles, the Board does not involve itself in day-to-day operations. The directors keep themselves informed through discussions with the Chief Executive Officer, other key executives and by reading the reports and other materials sent to them and by participating in Board and committee meetings. Our directors hold office until the next Annual Meeting of Stockholders and until their successors are elected and qualified or until their earlier resignation or removal, or if for some other reason they are unable to serve in the capacity of director.
Our Board currently consists of three (3) members: Jeremy Towning, Lawrence P. Cummins, and Karyn Augustinus. Our directors will serve until our next Annual Meeting of Stockholders and until their successor are duly elected and qualified or until their earlier resignation or removal.
Director Independence
Our Board currently has one independent director, Karyn Augustinus. From May 1, 2019, until June 29, 2020, we did not have any independent directors. Prior to their resignations on September 13, 2019, Harpreet Sangha and Dr. Ramash Para were both executive officers and Dr. Ravindranath Kancherla and Dr, Pruthvinath Kancherla, has each been issued 12,500,000 shares of the Company’s common stock in April 2018, as compensation for services unrelated to their services as directors of the Company. As a result none of them were considered independent directors. Additionally, Mr. Towning, as our sole director and Chief Executive Officer until June 29, 2020, also was not an independent director, during that period. Because our Common Stock is not currently listed on a national securities exchange, we have used the definition of “independence” of The NASDAQ Stock Market to make this determination. NASDAQ Listing Rule 5605(a)(2) provides that an “independent director” is a person other than an officer or employee of the company or any other individual having a relationship, which in the opinion of the Company’s Board of Directors, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. The NASDAQ listing rules provide that a director cannot be considered independent if:
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| | |
| ● | the director is, or at any time during the past three years was, an employee of the company; |
| | |
| ● | the director or a family member of the director accepted any compensation from the company in excess of $120,000 during any period of 12 consecutive months within the three years preceding the independence determination (subject to certain exclusions, including, among other things, compensation for Board or Board committee service); |
| | |
| ● | a family member of the director is, or at any time during the past three years was, an executive officer of the company; |
| | |
| ● | the director or a family member of the director is a partner in, controlling stockholder of, or an executive officer of an entity to which the company made, or from which the company received, payments in the current or any of the past three fiscal years that exceed 5% of the recipient’s consolidated gross revenue for that year or $200,000, whichever is greater (subject to certain exclusions); |
| | |
| ● | the director or a family member of the director is employed as an executive officer of an entity where, at any time during the past three years, any of the executive officers of the company served on the compensation committee of such other entity; or |
| | |
| ● | the director or a family member of the director is a current partner of the company’s outside auditor, or at any time during the past three years was a partner or employee of the company’s outside auditor, and who worked on the company’s audit. |
Annual Meeting Attendance
The Company did not hold an Annual Meeting of Stockholders during the year ended April 30, 2020.
Stockholder Communications with the Board
Stockholders wishing to communicate with the Board, the non-management directors, or with an individual Board member may do so by writing to the Board, to the non-management directors, or to the particular Board member, and mailing the correspondence to: c/o Lawrence P. Cummins, Chief Executive Officer, Black Cactus Global, Inc., 2027 W. Division Street, Suite 137, Chicago, Illinois 60622. The envelope should indicate that it contains a stockholder communication. All such stockholder communications will be forwarded to the director or directors to whom the communications are addressed.
Board Committees
Audit Committee
Our Board has not yet formed a separate standing audit committee, as a result of the limited operations of the Company, to date. To date, our entire Board has performed the functions of an audit committee. The functions of the audit committee have not been carried out by a majority of independent directors. From May 1, 2019 through September 13, 2019, none of our four directors who resigned were independent directors. From September 13, 2019 through June 29, 2020, Jeremy Towning was our sole director and was also the Chief Executive Officer and Chief Financial Officer of the Company. Since June 29, 2020, Lawrence P. Cummins, as our Chief Executive Officer and Mr. Towning, as our Chief Financial Officer, are not considered independent directors. Therefore, Karyn Augustinus is currently the only independent director performing the functions of a member of an audit committee. Additionally, none of our directors is considered an “audit committee financial expert” as defined in Item 5(a)(ii) and (iii) of Regulation S-K. The Board has performed the type of services that would normally be provided by an “audit committee financial expert.” Audit committee functions include:
| | |
| ● | selecting a qualified firm to serve as the independent registered public accounting firm to audit our financial statements; |
| | |
| ● | helping to ensure the independence and performance of the independent registered public accounting firm; |
| | |
| ● | discussing the scope and results of the audit with the independent registered public accounting firm, and reviewing, with management and the independent registered public accounting firm, our interim and year-end operating results; |
| | |
| ● | reviewing our policies on risk assessment and risk management; |
| | |
| ● | reviewing related party transactions; |
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| | |
| ● | obtaining and reviewing a report by the independent registered public accounting firm at least annually, that describes our internal control procedures, any material weaknesses with such procedures, and any steps taken to deal with such material weaknesses when required by applicable law; and |
| | |
| ● | approving (or, as permitted, pre-approving) all audit and all permissible non-audit services, other than de minimis non-audit services, to be performed by the independent registered public accounting firm. |
We intend to establish a separate standing audit committee comprised of independent directors and appoint an “audit committee financial expert” to that committee, as soon as the Company commences more than limited business operations.
Compensation Committee
Our Board has not yet formed a separate standing compensation committee, as a result of the limited operations of the Company, to date. To date, our entire Board has performed the functions of a compensation committee. For the same reasons as provided above relating to audit committee functions, compensation committee functions have not been carried out by a majority of independent directors. Compensation committee functions include:
| | |
| ● | reviewing and approving the compensation of our executive officers; |
| | |
| ● | reviewing the compensation of our directors; |
| | |
| ● | reviewing the terms of compensatory arrangements with our executive officers; |
| | |
| ● | administering our stock and equity incentive plans; |
| | |
| ● | reviewing incentive compensation and equity plans; and |
| | |
| ● | reviewing and establishing general policies relating to compensation and benefits of our employees and reviewing our overall compensation philosophy. |
We intend to establish a separate standing compensation committee comprised of independent directors, as soon as the Company commences more than limited business operations.
Nominating Committee and Corporate Governance Committee
Our Board has not yet formed a separate standing compensation committee, as a result of the limited operations of the Company, to date. To date, our entire Board has performed the functions of a compensation committee. For the same reasons as provided above relating to audit committee functions, functions relating to nominating and corporate governance have not been carried out by a majority of independent directors. When considering whether directors and nominees have the experience, qualifications, attributes and skills, taken as a whole, to enable the Board of Directors to satisfy its oversight responsibilities effectively in light of the Company’s business and structure, the Board of Directors focuses primarily on each person’s background and experience as reflected in the information discussed in each of the directors’ individual biographies set forth above. We search for directors who possess relevant knowledge and experience in the finance, accounting and business fields generally. These functions also include:
| | |
| ● | Identifying, evaluating and selecting nominees for election to our Board; |
| | |
| ● | evaluating the performance of our Board and of individual directors; |
| | |
| ● | considering the composition of our Board; |
| | |
| ● | reviewing developments in corporate governance practices; |
| | |
| ● | evaluating the adequacy of our corporate governance practices and reporting; |
| | |
| ● | developing corporate governance guidelines and matters; and |
| | |
| ● | overseeing an annual evaluation of the Board’s performance. |
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We intend to establish a separate standing compensation committee comprised of independent directors, as soon as the Company commences more than limited business operations.
Code of Ethics
The Board adopted a Code of Ethics for the Company on April 8, 2013. We require all employees, directors and officers, including our principal executive officer and principal financial officer to adhere to the Code of Ethics in addressing legal and ethical issues encountered in conducting their work. The Code of Ethics requires that these individuals avoid conflicts of interest, comply with all laws and other legal requirements, conduct business in an honest and ethical manner and otherwise act with integrity and in our best interest. The Code of Ethics contains additional provisions that apply specifically to our Chief Executive Officer, Chief Financial Officer and other finance department personnel with respect to full and accurate reporting.
Delinquent Section 16(a) Reports
Section 16(a) of the Exchange Act requires the Company’s directors and executive officers, and persons who own more than ten percent (10%) of the Common Stock, to file with the SEC the initial reports of ownership and reports of changes in ownership of Common Stock. Officers, directors and greater than ten percent (10%) stockholders are required by SEC regulation to furnish the Company with copies of all Section 16(a) forms they file. Specific due dates for such reports have been established by the SEC, and the Company is required to disclose in this Proxy Statement any failure to file reports by such dates during fiscal year ended April 30, 2020. Based solely on its review of the copies of such reports received by it, or written representations from certain reporting persons that no Forms 5 were required for such persons, the Company believes that during the fiscal year ended April 30, 2020, there was no failure to comply with Section 16(a) filing requirements applicable to its executive officers, directors or greater than ten percent (10%) stockholders other than as listed in the table below:
| | | | |
Name | | Number
of Late
Reports | | Description |
Jeremy Towning | | 1 | | 1 report was not filed on a timely basis upon Mr. Towning’s appointment as a member of the Board of Directors. |
Item 11. Executive Compensation.
Summary Compensation Table
The table below summarizes all compensation awarded to, earned by, or paid to each named executive officer for our last two completed fiscal years for all services rendered to us.
| | | | | | | | | | | | | | | | | | |
SUMMARY COMPENSATION TABLE |
Name and
principal
position | | Year | | Salary
($) | | Bonus
($) | | Stock
Awards
($) | | Option
Awards
($) | | Non-Equity
Incentive Plan
Compensation
($) | | Nonqualified
Deferred
Compensation
Earnings
($) | | All Other
Compensation
($) | | Total
($) |
Jeremy Towning, | | 2020 | | 0 | | 0 | | 0 | | 0 | | 0 | | 0 | | 0 | | 0 |
CEO, CFO (1) | | | | | | | | | | | | | | | | | | |
Harpreet Sangha, | | 2020 | | 0 | | 0 | | 0 | | 0 | | 0 | | 0 | | 0 | | 0 |
CFO (1) | | 2019 | | 0 | | 0 | | 0 | | 0 | | 0 | | 0 | | 0 | | 0 |
Dr. Ramesh Para, | | 2020 | | 0 | | 0 | | 0 | | 0 | | 0 | | 0 | | 0 | | 0 |
CEO (1) | | 2019 | | 0 | | 0 | | 468,750 | | 0 | | 0 | | 0 | | 0 | | 468,750 |
__________
(1) Mr. Towning commenced as Chief Executive Officer and Chief Financial Officer on September 30, 2019.
(2) Mr. Sangha and Dr. Para each resigned as executive officers of the Company on September 13, 2019.
We do not have employment agreements with any of our executive officers. We also do not have pension, health, annuity, insurance, stock options, profit sharing, or similar benefit plans. However, we may adopt plans in the future.
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Employment Agreements
We do not have employment agreements with any of our executive officers.
Outstanding Equity Awards At Fiscal Year-end Table
At the end of our last completed fiscal year, our named executive officers did not have any outstanding unexercised options, stock that have not vested, or equity incentive plan awards.
Compensation of Directors
Our directors did not receive any compensation for their services as a director of the Company. We do not have compensation agreements with any of our directors.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.
The following table sets forth certain information regarding the beneficial ownership of our common stock as of July 28, 2020 by (a) each shareholder who is known to us to own beneficially 5% or more of our outstanding common stock; (b) all directors; (c) our executive officers; and (d) all executive officers and directors as a group. Except as otherwise indicated, all persons listed below have (i) sole voting power and investment power with respect to their shares of common stock, except to the extent that authority is shared by spouses under applicable law, and (ii) record and beneficial ownership with respect to their shares of common stock.
For purposes of this table, a person or group of persons is deemed to have “beneficial ownership” of any shares of common stock that such person has the right to acquire within sixty (60) days of July 28, 2020. For purposes of computing the percentage of outstanding shares of our common stock held by each person or group of persons named above, any shares that such person or persons has the right to acquire within sixty (60) days of July 28, 2020 is deemed to be outstanding, but is not deemed to be outstanding for the purpose of computing the percentage ownership of any other person. The inclusion herein of any shares listed as beneficially owned does not constitute an admission of beneficial ownership. Unless otherwise identified, the address of our directors and executive officers is c/o Black Cactus Global, Inc., 2027 W. Division Street, Suite 137, Chicago, Illinois 60622.
| | | | | |
Name and Address of Shareholders | | Amount and Nature of
Shareholders Ownership | | Percent
of Class (1) | |
| | | | | |
5% or greater shareholders | | | | | |
| | | | | |
Black Cactus Holdings LLC (2) | | 234,210,244 | | 58.51% | |
| | | | | |
Bellridge Capital, L.P. (3) | | 44,470,970 | | 9.99% | |
| | | | | |
Harpreet Sangha (4) | | 23,200,000 | | 5.80% | |
| | | | | |
Directors and executive officers (5) | | | | | |
| | | | | |
Jeremy Towning | | — | | — | |
| | | | | |
Lawrence P. Cummins (6) | | 234,210,244 | | 58.51% | |
| | | | | |
Lawrence C. Cummins | | — | | — | |
| | | | | |
Karyn Augustinus | | — | | — | |
| | | | | |
All officers and directors as a group (1 person) | | 234,211,244 | | 58.51% | |
__________
