Business Context and Reporting Period
This Form 10-K covers the fiscal year ended December 31, 2010, for Cactus Ventures, Inc. (Note: The input metadata references "Actinium Pharmaceuticals," but the filing text explicitly identifies the registrant as Cactus Ventures, Inc., a Nevada corporation). The company is classified as a shell company and a "blank check" entity. It ceased its previous operations (marketing sunglasses) and is currently seeking a business combination, merger, or acquisition with a target company to become an operating entity. The company has no employees, no specific business plan, and relies on the personal contacts of its sole officer and director, Diane S. Button.
Key Financial Metrics
| Metric | 2010 | 2009 |
|---|---|---|
| Revenue | $0 | $0 |
| Net Income (Loss) | $1,674 | $(22,331) |
| Total Expenses | $26,053 | $16,025 |
| Cash and Cash Equivalents | $150 | $2,122 |
| Total Assets | $150 | $2,122 |
| Total Liabilities | $94,768 | $98,414 |
| Shareholders' Deficit | $(94,618) | $(96,292) |
| Working Capital | $(27,778) | $(27,778) |
Debt and Liquidity: The company has significant liabilities, primarily consisting of $58,707 in notes payable to related parties and $21,247 in accrued interest. Liquidity is critically low with only $150 in cash on hand. The company relies entirely on advances from its president to cover operating costs.
Material Changes vs. Prior Period
- Profitability: The company reported a net income of $1,674 in 2010, a reversal from the net loss of $(22,331) in 2009. This improvement was driven entirely by a non-operating gain on retention of deposit of $35,000, which offset operating expenses and interest costs.
- Expenses: Operating expenses increased by approximately 63% from $16,025 in 2009 to $26,053 in 2010, primarily due to higher professional fees ($25,405 in 2010 vs. $14,535 in 2009).
- Cash Position: Cash reserves declined significantly from $2,122 to $150, despite the net income, due to the repayment of related party notes ($24,120) and operating cash outflows.
- Debt: The principal amount of notes payable to related parties decreased from $68,514 to $58,707 due to repayments, though accrued interest increased by $6,440.
Outlook, Risks, and Management Commentary
Outlook and Guidance: Management anticipates incurring losses in the coming year due to legal, accounting, and acquisition search expenses. The company expects to continue operating at a loss until a business combination is consummated. There is no assurance that a suitable target will be found or that the company will be able to generate revenue.
Risks and Contingencies:
- Going Concern: The independent auditor has issued a report stating that the company's accumulated losses and negative working capital raise substantial doubt about its ability to continue as a going concern. Continued operations depend on related party funding.
- Liquidity: The company has no line of credit and minimal cash. It relies on the willingness of its president to extend further credit.
- Stock Liquidity: The stock trades on the OTCBB under symbol "CTVN" but has had no trading volume in 2010 or 2009. It is subject to "Penny Stock" rules, which severely restrict resale and liquidity.
- Management Concentration: The company has no employees and relies solely on Diane S. Button, who devotes limited time to the company and has no written employment agreement.
Investor Verification Checklist
- Identity Verification: Confirm the registrant is Cactus Ventures, Inc. (CTVN), not Actinium Pharmaceuticals, as the filing text contradicts the metadata provided.
- Going Concern Status: Verify the company's ability to fund operations beyond the current $150 cash balance, given the auditor's "substantial doubt" warning.
- Related Party Dependence: Assess the risk associated with the company's reliance on the sole officer for funding ($58,707 in debt) and office space.
- Stock Liquidity: Confirm the lack of an active market for the stock and the implications of Penny Stock regulations on the ability to sell shares.
- Acquisition Timeline: Note that there are no pending negotiations or identified targets; the business plan is speculative with no defined timeline for a merger.