Business Context and Reporting Period
This Form 8-K is a current report filed by bBooth, Inc. (not TON Strategy Co) on August 15, 2016, covering events occurring on August 8, 2016. The company is incorporated in Nevada and is based in Los Angeles, California. The filing primarily discloses the entry into a material definitive agreement for investor relations and corporate finance advisory services.
Key Financial Metrics
The filing does not provide standard financial statements, revenue, profit, cash flow, or debt metrics. The only financial data disclosed relates to the compensation structure of the new service agreement:
- Monthly Retainer: $5,000 per month (deferred and accruing).
- Equity Compensation: 1,600,000 shares of common stock.
- Share Allocation: 800,000 shares issued immediately (vested) and 800,000 shares payable 90 days later (unvested).
Material Changes
The material change reported is the execution of an engagement agreement with International Monetary ("IM"). This agreement establishes a six-month term for services including investor relations, capital formation, business development, and assistance with up-listing to major exchanges (NYSE Amex or Nasdaq). Additionally, the company issued 800,000 restricted common shares to IM effective August 15, 2016, relying on exemptions under Rule 506 of Regulation D and Section 4(a)(2) of the Securities Act.
Guidance, Outlook, and Risks
Management Commentary: The company is actively pursuing strategies to maximize shareholder value, specifically focusing on corporate governance requirements necessary for an up-listing to a major listed exchange. The engagement with IM is intended to facilitate capital formation and enhance investor awareness.
Risks and Contingencies: The agreement is terminable sooner than the six-month term as provided therein. The equity compensation involves the issuance of restricted securities, which are subject to Rule 144 limitations. The filing does not explicitly list other material risks or contingencies beyond the terms of this specific agreement.
Investor Verification Checklist
- Verify the total number of outstanding shares to assess the dilution impact of the 1,600,000 shares issued to International Monetary.
- Confirm the current stock price to calculate the fair market value of the deferred $5,000 monthly retainer and the equity grant.
- Review the full text of the Engagement Agreement (Exhibit 10.1) for specific termination clauses and performance milestones.
- Check subsequent filings to confirm the issuance of the second allotment of 800,000 shares after the 90-day period.
- Investigate the company's current progress toward the stated goal of up-listing to NYSE Amex or Nasdaq.