Business Context and Reporting Period
This Form 8-K is filed by bBooth, Inc. (noted as TON Strategy Co in metadata) for the reporting period of July 12, 2016. The filing discloses the entry into a material definitive agreement with celebrity Nick Cannon and the appointment of a new Chief Financial Officer.
Key Financial Metrics
The filing text does not provide specific values for revenue, profit, cash flow, margins, debt, or liquidity. This report focuses on corporate governance and contractual agreements rather than financial performance data.
Material Changes and Agreements
- Agreement with Nick Cannon: Effective July 12, 2016, the Board approved a term sheet appointing Nick Cannon as "bBooth Global Brand Ambassador."
- Compensation: 5,000,000 restricted common shares (12-month lock-up, vesting over 3 years) and cash compensation equal to 50% of "net revenue" generated through a specific wholly owned subsidiary.
- Expenses: The company will provide up to $100,000 in recoverable expenses to facilitate initiatives.
- Role: Cannon will utilize bBooth technology across various verticals, promote the company, and provide industry counsel.
- Appointment of CFO: Effective July 15, 2016, Jeff Clayborne was appointed Chief Financial Officer.
- Compensation: Nominal cash salary until sufficient cash flow is generated; 1,500,000 stock options (100,000 vest immediately, remainder over 3 years).
Outlook, Risks, and Contingencies
The agreement with Nick Cannon is subject to approval in the event of conflicts under existing studio and network contracts. The term sheet serves as the basis for definitive documents to be created later. The company anticipates generating sufficient cash flow in the future to support the CFO's full salary, though no specific timeline is provided.
Investor Verification Checklist
- Verify the exact terms of the "net revenue" definition for the Nick Cannon subsidiary revenue share.
- Confirm the status of the definitive agreement execution following the term sheet.
- Review the company's current cash position to assess the ability to fund the $100,000 recoverable expenses.
- Check for any potential conflicts of interest regarding Nick Cannon's existing contracts with Viacom or RadioShack.