CAPC 8-K
Capstone Companies, Inc. (CAPC)
UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
CURRENT REPORT
PURSUANT
TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date
of Report: January 23, 2025
(Earliest Event Date requiring this Report:
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
| |
||
| (State of Incorporation or Organization) | (Commission File Number) | (I.R.S. Employer Identification No.) |
(Address of principal executive offices)
(
(Registrant’s telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2. below):
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate
by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405
of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2 of this chapter). Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Securities registered pursuant to Section 12(b) of the Act: None
| Title of Class of Securities. | Trading Symbol(s). | Name of exchange on which registered |
| N/A | N/A | N/A |
The Registrant’s Common Stock is quoted on the OTCQB Venture Market of the OTC Markets Group, Inc. under the trading symbol “CAPC.”
Item 1.01 Entry into a Material Definitive Agreement. On January 22, 2025, Capstone Companies, Inc. (“Company”) entered into an engagement agreement (“Engagement Agreement”) with Eschenburg Perez, CPA LLC (“EPEC”) for continued provision of outsourced chief financial officer and related accounting services, which services are primarily provided by EPEC principal Dana Eschenburg Perez as interim/fractional chief financial officer. Engagement Agreement provides for an hourly bill rate of $275 for following services:
-Assist with year-end audit of December 31, 2024, subsequent Form 10Q’s for each quarter, signing and
filing as the Company’s acting chief financial/accounting officer.
- Liaison with the Company and public auditor team for requested schedules, supporting documentation, etc.
- Review and approve supporting audit schedules and internal control assessments and updating
as necessary.
- Prepare technical memos regarding complex or unusual accounting transactions, as necessary.
- Prepare, review and approve proposed journal entries as necessary.
- Perform ad-hoc accounting duties as requested by Chief Executive Officer.
- Oversee and review work prepared by any outsourced Controller.
The Engagement Agreement continues the services provided to the Company by EPEC and Ms. Perez since February 6, 2022. A copy of the Engagement Agreement is attached as Exhibit 10.2 to this Current Report of Form 8-K (“Form 8-K”) and the above summary of the Engagement Agreement is qualified in its entirety by reference to the Engagement Agreement filed as Exhibit 10.2 to this Form 8-K.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Appointment of a Director. On January 20, 2025, Brian Rosen was appointed as a non-employee director of Capstone Companies, Inc. (the “Company”). His appointment fills an existing vacancy on the Company’s Board of Directors. The Company and Mr. Rosen signed an Offer Letter, dated January 10, 2025, (”Offer Letter”) for his appointment as a director, which appointment was effective upon ratification by Company’s Board of Directors Offer Letter on January 20, 2025. The Offer Letter is filed as Exhibit 10.1 to this Current Report of Form 8-K (“Form 8-K”).
Mr. Rosen served as Senior Vice President of Global Government Affairs, Market Access & Advocacy for Novavax, Inc. (NASDAQ: NVAX), a publicly held biotechnology and vaccine company in Gaithersburg, Maryland, from 2015 to 2023. He had responsibility for leading commercial strategy efforts instrumental to ensuring patient access to Novavax vaccines. During the COVID-19 pandemic, he served as the point person at Novavax to lead negotiations with all relevant domestic and international government agencies and non-government organizations. He led negotiations and secured a $1.6 billion funding agreement with Operation Warp Speed, $388 million in funding from the Coalition for Epidemic Preparedness Innovations and a $60 million agreement with U.S. Department of Defense. From 2013 to 2015, he served in public policy, regulatory affairs and legislative capacities with the Leukemia & Lymphoma Society, Washington, D.C. Mr. Rosen was Senior Director, Government Affairs, Advocacy and Policy (2005 - 2011) and Director, Government Affairs (2002 - 2005) at MedImmune, a wholly owned subsidiary of AstraZenca plc (NASDAQ: AZ), a multinational public pharmaceutical company.
Mr. Rosen has Juris Doctor from Hofstra University School of Law (1994) and a Bachelor of Arts, History and Psychology, Tufts University, Medford, Massachusetts (1991).
Director Appointee’s Interests. There are no family relationships between Mr. Rosen and the Company’s existing directors and officers. Mr. Rosen is an investor in a social club/pickle ball business owned by Alexander Jacobs, the Company’s current Chief Executive Officer.
Director Compensation. The compensation of Mr. Rosen as a director will be incentive stock-based compensation to be determined by the Compensation and Nomination Committee of the Company’s Board of Directors in early 2025.
Outsourced Chief Financial Officer Services. As reported in Item 1.01 above, the Company has entered into the Engagement Agreement to continue the services of EPEC and Dana Perez for chief financial/accounting officer services.
Item 7.01 Regulation FD Disclosure.
On January 23, 2025, the Company issued a press release announcing the appointment of Brian Rosen as a director. A copy of the press release is attached as Exhibit 99.1 to this Form 8-K.
As provided in General Instruction B.2 to Form 8-K, the information furnished in this Item 7.01 and in Exhibit 99.1 to this Current Report on Form 8-K shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, and such information shall not be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
Item 9.01 Financials and Exhibits.
(d) Exhibits.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
CAPSTONE COMPANIES, INC., A FLORIDA CORPORATION
By: /s/ Stewart Wallach
Stewart Wallach, Chair of Board of Directors
Dated: January 23, 2025
EXHIBIT INDEX
Exhibit 99.1
FOR IMMEDIATE RELEASE
January 23, 2025
BRIAN ROSEN, COMMERCIAL STRATEGY SENIOR EXECUTIVE, APPOINTED AS DIRECTOR OF CAPSTONE COMPANIES, INC.
Deerfield Beach, FL (Business Wire) – Capstone Companies, Inc. (OTCQB: CAPC) announced today the appointment of Brian Rosen as a non-employee director, effective January 20, 2025.
Mr. Rosen has extensive experience in marketing, business development, contract negotiation and government relations as well as experience as a member of two public companies’ management. He served as Senior Vice President, Global Market Access, Public Policy & Alliances (2021 – 2023), Senior Vice President, Commercial Strategy (2018 - 2021) and Vice President, Market Access, Policy, & Government Affairs (2015 - 2017) with Novavax, Inc. (NASDAQ: NVAX). Before Novavax, Inc., Mr. Rosen served as Chief Policy, Advocacy & Patient Services Officer (2014 - 2015), Senior Vice President, Public Policy (2013 - 2014) and Vice President, Legislative and Regulatory Affairs (2012 - 2013) for the Leukemia & Lymphoma Society, Washington, D.C. He also has a J.D. degree from Hofstra University School of Law.
“Brian is skilled at pursuing new business opportunities and developing resulting revenue streams and in negotiating contracts. He has a record of accomplishment in the pursuit of revenue generating opportunities. I believe his skills, coupled with government relations and public company experience, will prove valuable to Capstone Companies’ efforts to establish a new business line and pursue a growth strategy for year-round social, fitness and health programs and facilities,” said Stewart Wallach, Chair of the Company’s Board of Directors.
About Capstone Companies, Inc. Capstone Companies, Inc. is an SEC reporting company with its common stock quoted on OTC QB market. Formerly engaged in producing LED and Smart Mirror consumer products, Company ended its consumer product operations due to declining sales and has been seeking to establish a new business line and revenue generating operations through internal development, merger, acquisition or a combination of those actions. The Company currently has no revenue generating operations. The appointment of a new CEO and appointment of directors is part of the Company’s efforts to establish revenue generating operations by bringing in new management members with experience in industries other than the Company’s former industry as well as a proven ability to build, arrange funding or assist in creating sustainable, new business lines.
FORWARD LOOKING STATEMENTS. Except for statements of historical fact in this press release, the information contained above contains forward-looking statements, which statements are characterized by words like “should,” “may,” “intend,” “expect,” “hope,” “believe,” “anticipate” and similar words. Forward looking statements are not guarantees of future performance and undue reliance should not be placed on them. Forward-looking statements necessarily involve known and unknown risks and uncertainties, which may cause actual performance and financial results in future periods to differ materially from any statements about future performance or results expressed or implied by such forward-looking statements. Capstone Companies, Inc. (“Company”) is a public shell company without revenue generating revenues and relies on working capital funding from third parties to sustain its corporate existence and fund the compliance requirements as an SEC reporting company with its stock quoted on the OTC QB Venture Market. The Company is also a “penny stock” company with limited public market liquidity and no primary market makers. As such, Company may be unable to develop a new business line, or acquire or merge with an existing operating company, or, even if a new business line or revenue generating operation is established, to fund and successfully operate that new business line or operation. The capabilities or prior performance or contributions of any officer or director with other companies is not to be taken as indicative of his or her performance or contributions as an officer or director of the Company. Further, the public auditors of the Company have expressed doubt as to the Company as a going concern. Company may be unable to obtain adequate, affordable and timely funding to sustain any new business line or existing operations. There is substantial doubt about the Company’s ability to establish a new business line or sustain an operation. There is no existing agreement by the Company and a third party for a merger or acquisition of a company or assets. Any investment in the common stock of the Company is a highly risky investment that is not suitable for investors who cannot afford the total loss of the investment and the inability to liquidate the investment. The risk factors in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023, and other filings with the SEC should be carefully considered prior to any investment decision. The Company undertakes no obligation to update forward-looking statements if circumstances or management’s estimates or opinions should change, except as required by applicable securities laws. The reader is cautioned not to place undue reliance on forward-looking statements.
CONTACT information and media inquiries:
Telephone: (954) 570-8889, ext. 315
Exhibit 10.1
CERTAIN INFORMATION [INDICATED BY BRACKETS] HAS BEEN OMITTED DUE TO ITS CONFIDENTIAL NATURE AND BECAUSE IT IS CONSIDERED "NOT MATERIAL"
Date: January 10, 2025
To: Brian Rosen
[REDACTED ADDRESS, EMAIL ADDRESS AND TELEPHONE NUMBER]
Re: Offer Letter – Director of Capstone Companies, Inc.
Dear Mr. Rosen:
Capstone Companies, Inc., a Florida corporation, (“Company”) is pleased to offer to you an appointment to the Company’s Board of Directors (“Board”) as a non-employee director, subject to your acceptance of the following terms and conditions:
1. Term. The term of your appointment will commence upon date this offer letter is fully signed by the parties and the Board formally appoints you as a director and end upon election of a successor (which can include your re-election as a director). Company elects directors on an annual basis. The signed offer letter can be emailed to Stewart Wallach, Chair of the Board, at email: [email protected].
2. Duties. Besides serving as a director, the Board may ask that you serve as a member of the Compensation and Nomination Committee of the Board to review and approve compensation, including incentive compensation, of officers and other directors of the Company and review and report recommendations for prospective directors or senior officers of the Company.
3. Compensation. The Company intends to adopt an incentive option plan in early 2025 and compensation for directors would consist of incentive stock-based compensation issued under that plan. Company does not currently pay a cash fee to directors, but cash compensation might be considered when and if the Company has a steady operating cash flow.
4. Directors and Officers Liability Insurance. The Company has directors’ and officers’ liability insurance, and you would be added to the coverage upon assuming office.
5. Expenses. The Company reimburses directors’ expenses that are pre-approved by the Chair of the Board.
6. Public Company. The Company files periodic business and financial reports and other documents with the U.S. Securities and Exchange Commission or “SEC”, which filings may be viewed at www.sec.gov (click “Search EDGAR” and then enter the Company’s name in search box). A director, officer and employee may not trade in the common stock of the Company without first checking to see of any restrictions on trading of Company securities has been imposed by the Board.
8. Form 3. Within 10 days after becoming a director of the Company, you need to file a Form 3 notice with the SEC. The Company will assist you in filing this notice, which merely notifies the SEC that you are a director and states whether you own any shares of Company stock. There is no charge for the filing or Company assistance, but the Company does need your prompt cooperation in completing this filing, which is due 10 days after your appointment as a director.
9. Press Release. The Company may issue a press release about your appointment as a director, which press release will be reviewed and approved by you before any release to the public.
10. Fiduciary Duties. A director owes a duty of care (to make informed, impartial decisions) and a duty of loyalty (to place the interests of the Company and its public shareholders above the personal interests). Legal counsel to the Company can answer any questions about fiduciary duties.
We look forward to working with you as a director of the Company. Please sign and date below and return this signed offer letter to the email in Section 1 above.
| CAPSTONE COMPANIES, INC. | |||||||
| By: | /s/ Stewart Wallach | Date: January 10, 2025 | |||||
| Stewart Wallach, Chair of the Board of Directors | |||||||
| ACCEPTED AND AGREED BY: | |||||||
| Signature: | /s/Brian Rosen | Date: January 10, 2025 | |||||
| Brian Rosen | |||||||
Exhibit 10.2
January 21, 2025
Alex Jacobs
Capstone Companies, Inc.
144-V 10 Fairway Drive, Ste. 100
Deerfield Beach, FL 33441
Dear Alex,
I am pleased to confirm the understanding of the engagement for Eschenburg Perez, CPA LLC (Consultant) to provide to Capstone Companies, Inc. (Client) for outsourced Chief Financial Officer and other accounting assistance. This role would be effective from January 1, 2025, and end upon mutual termination by either party, upon a 14-day notice. Services are to include, but not necessarily limited to, providing support and guidance remotely via online access to the accounting system, to management and accounting team in order to reach the following objectives:
- Assist with year-end audit of December 31, 2024, subsequent 10Q’s for each quarter, signing and filing as the Company CFO.
- Liaison with the audit team for requested schedules, supporting documentation, etc.
- Review and approve supporting audit schedules and internal control assessments and updating as necessary.
- Prepare technical memos regarding complex or unusual accounting transactions, as necessary.
- Prepare, review and approve proposed journal entries as necessary.
- Perform ad-hoc accounting duties as requested by CEO.
- Oversee and review work prepared by outsourced Controller.
Services to be billed bi-weekly at an hourly rate of $275/hour for an estimated total billing of $35,000 for the Form 10-K filing, and $15,000 for each subsequent quarterly filing and accounting assistance. It is my responsibility to communicate with you as soon as reasonably possible when total hours are projected to exceed the stated fees above. Outsourced Controller fees are excluded from the quoted rates above and will be billed as a pass-through to the Company at $85/hr with no mark up. Estimated billing for Controller services is $15,000 for the year. Detailed bi-weekly invoices will be provided. Consultant will work under the supervision of Alex Jacobs, CEO and Stewart Wallach, Chairman of the Board, as applicable.
I appreciate the opportunity to be of service to you and believe this letter accurately summarizes the terms of engagement. If you have any questions, please let me know. If you agree to the terms as described, please sign below and return to me.
| Sincerely, | |||||
| /s/ Dana E. Perez | Date: January 21, 2025 | ||||
| Dana E. Perez, CPA | |||||
| Eschenburg Perez CPA, LLC | |||||
| /s/Alex Jacobs | Date: January 22, 2025 | ||||
| Alex Jacobs, Chief Executive Officer | |||||
| Capstone Companies, Inc. | |||||