HST Global, Inc 10-K for FY2019
HST Global, Inc. (HSTC)
About this 10-K
HST Global, Inc filed this 10-K on April 9, 2020, covering the fiscal year ended December 31, 2019 (FY2019).
Headline figures
Fiscal year ended December 31, 2019, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Revenue
- $0
- compared with $0 a year earlier
- Net income
- $426.57K
- compared with a net loss of $178.34K a year earlier
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
Mark One)
[x] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended |
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from |
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Commission file number
(Exact name of registrant as specified in its charter) |
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(State or other jurisdiction of incorporation or organization) |
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(Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code |
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
None |
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Securities registered pursuant to Section 12(g) of the Act: |
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Common Stock |
(Title of Class) |
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(Title of Class) |
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. | Yes [ ] No [X] | |
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. | Yes [ ] No [X] | |
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. | Yes [x] No [ ] | |
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). | Yes [x] No [ ] | |
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. | [X] | |
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act. |
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Large accelerated filer [ ] | Accelerated filer [ ] | |
Non-accelerated filer [x] | Smaller reporting company [x] 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 Ex-change Act. | [ ] | |
Indicate by check mark whether the registrant is a shell company (as defined in rule 12b-2 of the Exchange Act). | Yes [ ] No [x] | |
State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant’s most recently completed second fiscal quarter. | $ | |
As of April 9, 2020 the number of shares of the registrant’s common stock outstanding was | ||
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HST Global, Inc.
TABLE OF CONTENTS
Part I
Forward Looking Statements4
Item 1.Business4
Item 1A.Risk Factors4
Item 1B.Unresolved Staff Comments4
Item 2.Properties4
Item 3.Legal Proceedings4
Item 4.Mine Safety Disclosures4
Part II
Item 5.Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities5
Item 6.Selected Financial Data5
Item 7.Management’s Discussion and Analysis of Financial Condition and Results of Operations6
Item 7A.Quantitative and Qualitative Disclosures About Market Risk7
Item 8.Financial Statements and Supplementary Data7
Item 9.Changes in and Disagreements with Accountants on Accounting and Financial Disclosure20
Item 9A.Controls and Procedures20
Item 9B.Other Information21
Part III
Item 10.Directors, Executive Officers, and Corporate Governance22
Item 11.Executive Compensation23
Item 12.Security Ownership of Certain Beneficial Owners and Management27
Item 13.Certain Relationships and Related Transactions, and Director Independence27
Item 14.Principal Accounting Fees and Services28
Part IV
Item 15.Exhibits and Financial Statement Schedules29
Signatures29
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PART I
ITEM 1. BUSINESS
A. BUSINESS DEVELOPMENT
There have been no changes to our business development since our last annual report on Form 10-K. We are still in the start-up stage and have not begun to earn any revenue.
B. FINANCIAL INFORMATION ABOUT SEGMENTS
As defined by generally accepted accounting principles ("GAAP"), we do not have any segments separate and apart from our business as a whole. Accordingly, there are no measures of revenue from external customers, profit and loss, or total assets aside from what is reported in the Financial Statements attached to this Form 10-K.
C. BUSINESS OF THE COMPANY
HST Global, Inc. is an Integrated Health and Wellness Biotechnology company that is developing and /or acquiring a network of Wellness Centers worldwide that are primarily focused on the homeopathic and alternative treatment of late stage cancer. In addition, the company intends to acquire innovative products for the treatment of individual health challenges. In this regard, the company primarily focuses on homeopathic and alternative product candidates that are undergoing or have already completed significant clinical testing.
There have been no changes to our business since our last annual report on Form 10-K. We are still in the start-up stage and have not begun to earn any revenue.
In August 2019, we entered into an Asset Purchase Agreement (“APA”) with Orbital Group, Inc to purchase certain assets and marketing rights (detailed below). However, on January 7, 2020 the APA was terminated.
We continue to seek opportunities to implement our business plan and/or acquire additional acquisition or merger opportunities as previously reported.
ITEM 1A. RISK FACTORS
Not required by smaller reporting companies.
ITEM 1B. UNRESOLVED STAFF COMMENTS
None.
ITEM 2. PROPERTIES
The Company's executive offices are located at 150 Research Dr., Hampton VA. We currently share these offices with The Health Network, Inc. ("THN"), of which Ron Howell is President. We have no formal sublease or rental agreement with THN; however, we are currently renting the space at no cost. The combined office and warehouse space is 42,600 square feet, of which we use a small portion.
ITEM 3. LEGAL PROCEEDINGS
None.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable to the Company.
Page 4
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
Market Information
Our common stock is quoted in United States markets on the Over-The-Counter Bulletin Boards ("OTC BB"), under the symbol "HSTC.OB." There is no assurance that the common stock will continue to be traded on the OTC BB or that any liquidity exists for our shareholders.
Penny Stock Regulations
Our common stock is quoted in United States markets on the OTC BB under the symbol "HSTC.OB." The sale price of our common stock has been reported as low as $0.001 per share. As such, the Company's common stock may be subject to provisions of Section 15(g) and Rule 15g-9 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), commonly referred to as the "penny stock rule."
Section 15(g) sets forth certain requirements for transactions in penny stocks, and Rule 15g-9(d) incorporates the definition of "penny stock" that is found in Rule 3a51-1 of the Exchange Act. The SEC generally defines "penny stock" to be any equity security that has a market price less than $5.00 per share, subject to certain exceptions. As long as the Company's common stock is deemed to be a penny stock, trading in the shares will be subject to additional sales practice requirements on broker-dealers who sell penny stocks to persons other than established customers and accredited investors.
Dividends
The Company has not issued any dividends on the common stock to date, and does not intend to issue any dividends on the common stock in the near future. We currently intend to use all profits to further the growth and development of the Company.
Number of Shares Outstanding
As of December 31, 2019, the Company had 200,000,000 shares of common stock authorized with 4,247,993 issued and outstanding. These shares were held by approximately 596 shareholders of record. The Company had 10,000,000 shares of preferred stock authorized with no shares issued or outstanding.
Recent Sales of Unregistered Securities
None.
Purchases of Equity Securities
None.
ITEM 6. SELECTED FINANCIAL DATA
Not required by smaller reporting companies.
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ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION
Forward-Looking Statements
Statements about our future expectations are "forward-looking statements" within the meaning of applicable Federal Securities Laws, and are not guarantees of future performance. When used herein, the words "may," "will," "should," "anticipate," "believe," "appear," "intend," "plan," "expect," "estimate," "approximate," and similar expressions are intended to identify such forward-looking statements. These statements involve risks and uncertainties inherent in our business, including those set forth under the caption "Risk Factors" in other filings with the SEC, and are subject to change at any time. Our actual results could differ materially from these forward-looking statements. We undertake no obligation to update publicly any forward-looking statement.
Overview
HST Global, Inc. is an Integrated Health and Wellness Biotechnology company with a plan to develop and /or acquire a network of Wellness Centers worldwide that would be primarily focused on the homeopathic and alternative treatment of late stage cancer. In addition, the company intends to acquire innovative products for the treatment of individual health challenges. In this regard, the company primarily focuses on homeopathic and alternative product candidates that are undergoing or have already completed significant clinical testing.
To date we have been unable to initiate our original business plan. While we are continuing to seek opportunities to do so, we are also seeking other opportunities to integrate assets, rights, or other potential revenue streams.
Plan of Operation
General and administrative expenses consist primarily of salaries and related personnel costs, professional fees, business insurance, rent, general legal activities, and other corporate expenses.
We have never been profitable and do not anticipate having net income unless and until we develop and/or acquire our wellness centers and/or develop new channels of distribution. With respect to our current activities, this is not likely to occur until we obtain significant additional funding. We cannot provide any assurance that we will be able to achieve profitability on a sustained basis, if at all, obtain the required funding, obtain, or complete additional corporate partnering or acquisition transactions.
Accordingly, we will need to raise additional funds or pursue strategic transactions or other strategic alternatives. To date, we have financed our operations primarily through private sales of our equity securities, and we expect to continue obtaining required capital in a similar manner.
Results of Operations
The Company had no revenues and no cost of revenues for the years ended December 31, 2019 and 2018.
The Company incurred operating expenses of $151,554 for the year ended December 31, 2019, compared to $142,587 in 2018. The increase in expenses in 2019 was primarily a result of an increase in administrative expenses, primarily due to an attempted acquisition of certain assets described below. We do not believe these costs are indicative of future years, and we cannot at this time predict our costs if and when we begin earning revenues and exit the start-up stage.
The Company had net income of $426,572 for the year ended December 31, 2019 compared to a net loss of $178,335 in 2018. This is primarily a result of gain on extinguishment of debt, offset partially by an increase in operating expenses as described above.
Page 6
Liquidity and Capital Resources
Our capital requirements are principally related to our efforts to implement our business plan. Our cash balance as of December 31, 2019 was $1,955.
Cash Flows
| Year Ended | Year Ended |
| December 31, 2019 | December 31, 2018 |
Net cash used in operating activities | $ (91,905) | $(21,091) |
Net cash used in investing activities | - | - |
Net cash provided by financing activities | 93,860 | 20,800 |
Net change in cash and cash equivalents | $ 1,955 | $(291) |
The Company does not currently have sufficient capital in its accounts, nor sufficient firm commitments for capital to assure its ability to meet its current obligations or to continue its planned operations. The Company is continuing to pursue working capital and additional revenue through the seeking of the capital it needs to carry on its planned operations. There is no assurance that any of the planned activities will be successful.
Off-Balance Sheet Arrangements
None.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
None.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
DescriptionPage
Report of Independent Registered Public Accounting Firm8
Consolidated Balance Sheets9
Consolidated Statements of Operations10
Consolidated Statements of Stockholders' Deficit11
Consolidated Statements of Cash Flows12
Notes to Consolidated Financial Statements13
Page 7
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Shareholders of :
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of HST Global, Inc. (“the Company”) as of December 31, 2019 and 2018, the related consolidated statements of operations, stockholders’ deficit, and cash flows for each of the years in the two-year period ended December 31, 2019 and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2019 and 2018, and the results of its operations and its cash flows for each of the years in the two-year period ended December 31, 2019, in conformity with accounting principles generally accepted in the United States of America.
Explanatory Paragraph Regarding Going Concern
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 3 to the financial statements, the Company has suffered recurring losses from operations and has a net capital deficiency which raises substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 3. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
/s/ Sadler, Gibb & Associates, LLC
We have served as the Company’s auditor since 2013.
Salt Lake City, UT
April 9, 2020
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HST Global, Inc.
CONSOLIDATED BALANCE SHEETS
| December 31, 2019 |
| December 31, 2018 |
ASSETS |
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Current Assets |
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Cash and cash equivalents | $ |
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Total Current Assets |
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Total Assets | $ |
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LIABILITIES AND STOCKHOLDERS' DEFICIT |
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Current Liabilities |
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Bank overdraft payable |
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Accounts payable and accrued expenses |
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Accounts payable and accrued expenses - related parties |
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Accrued officer compensation |
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Accrued related party interest |
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Notes payable - related party |
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Total Current Liabilities |
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Total Liabilities |
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Stockholders' Deficit |
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Preferred stock; |
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Common stock; | |
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Additional paid-in capital |
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Accumulated deficit | ( |
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Total Stockholders' Deficit | ( |
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Total Liabilities and Stockholders' Deficit | $ |
| $ |
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The notes are an integral part of the consolidated financial statements
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HST Global, Inc.
CONSOLIDATED STATEMENTS OF OPERATIONS
| Year Ended December 31, 2019 |
| Year Ended December 31, 2018 |
Revenues | $ |
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Operating Expenses: |
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Consulting |
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General and administrative |
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Total Operating Expenses | $ |
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Net Loss from Operations | $( |
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Other Income (Expense) |
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Interest expense | $( |
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Gain on extinguishment of debt |
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Total Other Income (Expense) |
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NET INCOME/LOSS | $ |
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Earnings (Loss) Per Share: Basic and Diluted - Common | $ |
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Weighted Average Shares Outstanding: Basic and Diluted - Common |
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The notes are an integral part of the consolidated financial statements
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HST Global, Inc.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT
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Preferred Stock | Common Stock | Additional Paid-in | Accumulated | Total Stockholder’s | |||
| Shares | Amount | Shares | Amount | Capital | Deficit | Deficit |
Balance, December 31, 2017 | - | $- | 2,447,991 | $2,448 | $2,419,096 | $(5,614,151) | $(3,192,607) |
Net Income (Loss) | - | - | - | - | - | (178,335) | (178,335) |
Balance, December 31, 2018 | - | $- | $ | $ | $( | $(3,370,942)
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Conversion related party debt | - | - | 2,494,976 | ||||
Common stock issued for cash |
| - | 80,000 | ||||
Derecognition of related party debt | - | - | 365,964 | ||||
Net Income (Loss) | - | - | 426,572 | ||||
Balance, December 31, 2019 | - | $- | $ | $ | $( | $(3,430) | |
The notes are an integral part of the consolidated financial statements
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HST Global, Inc.
CONSOLIDATED STATEMENTS OF CASH FLOWS
| Year Ended December 31, 2019 |
| Year Ended December 31, 2018 |
Cash Flows from Operating Activities: |
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Net income (loss) | $ |
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Adjustments to reconcile net income (loss) to net cash used in operating activities: |
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Gain on extinguishment of debt | ( |
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Changes in operating assets and liabilities: |
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Bank overdraft payable | ( |
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Accounts payable and accrued expenses |
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Accrued officer compensation |
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Accrued related party interest |
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Net Cash used in Operating Activities | ( |
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Cash Flows from Investing Activities: |
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Net Cash used in Investing Activities |
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Cash Flows from Financing Activities: |
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Proceeds from sale of common stock |
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Proceeds from notes payable - related party |
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Net cash provided by financing activities |
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Net change in cash |
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Cash at Beginning of Period |
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Cash at End of Period | $ |
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Supplemental Disclosures of Cash Flow Information |
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Cash paid for interest | $ |
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Cash paid for taxes | $ |
| $ |
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Supplemental schedule of non-cash investing and financing activities: |
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Accounts payable and accrued expenses converted to common stock | $ |
| $ |
Notes payable and accrued interest converted to common stock | $ |
| $ |
Derecognition of related party debt | $ |
| $ |
The notes are an integral part of the consolidated financial statements
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HST Global, Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the Years Ended December 31, 2019 and 2018
The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.
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Cash and Cash Equivalents
We maintain cash balances in non-interest-bearing accounts, which do not currently exceed federally insured limits. For the purpose of the statements of cash flows, all highly liquid investments with an original maturity of three months or less are considered to be cash equivalents.
Income Taxes
The Company accounts for income taxes in accordance with accounting guidance now codified as FASB ASC 740, "Income Taxes," which requires that the Company recognize deferred tax liabilities and assets based on the differences between the financial statement carrying amounts and the tax bases of assets and liabilities, using enacted tax rates in effect in the years the differences are expected to reverse. Deferred income tax benefit (expense) results from the change in net deferred tax assets or deferred tax liabilities. A valuation allowance is recorded when it is more likely than not that some or all deferred tax assets will not be realized.
The Company applies the provisions of ASC 740, “Accounting for Uncertainty in Income Taxes”. The ASC clarifies the accounting for uncertainty in income taxes recognized in an enterprise's financial statements. The ASC prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The ASC provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. The Company did not identify any material uncertain tax positions on returns that have been filed or that will be filed. The Company did not recognize any interest or penalties for unrecognized tax benefits during the years ended December 31, 2019 and 2018, nor were any interest or penalties accrued as of December 31, 2019 and 2018.
Basic and Diluted Loss Per Share
The computations of basic loss per share of common stock are based on the weighted average number of shares outstanding at the date of the financial statements. The Company computes net income (loss) per share in accordance with ASC 260. ASC 260 requires presentation of both basic and diluted earnings per share (EPS) on the face of the income statement. Basic EPS is computed by dividing net income (loss) available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing Diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is antidilutive. The Company had no common stock equivalents outstanding as of December 31, 2019 and 2018.
Stock-Based Compensation
The Company adopted ASC 718, “Stock Compensation”, upon inception at August 6, 2007. Under ASC 718, all share-based payments to employees, including grants of employee stock options, are to be recognized in the income statement based on their fair values. As of December 31, 2019, the Company has not issued any employer stock options.
Fair Value of Financial Instruments
ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price). The standard outlines a valuation framework and creates a fair value hierarchy in order to increase the consistency and comparability of fair value measurements and the related disclosures. Under this standard certain assets and liabilities must be measured at fair value, and disclosures are required for items measured at fair value.
The Company currently does not have non-financial assets or non-financial liabilities that are required to be measured at fair value on a recurring basis. The Company’s financial assets and liabilities are measured using inputs from the three levels of the fair value hierarchy. The three levels are as follows:
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Level 1 - Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. The fair value of the Company’s cash is based on quoted prices and therefore classified as Level 1.
Level 2 - Inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs).
Level 3 - Unobservable inputs that reflect our assumptions about the assumptions that market participants would use in pricing the asset or liability.
Recently Issued Accounting Pronouncements
Management has considered all recent accounting pronouncements issued since the last audit of our consolidated financial statements. The Company’s management believes that these recent pronouncements will not have a material effect on the Company’s consolidated financial statements.
NOTE 3 – GOING CONCERN
The Company’s consolidated financial statements are prepared using generally accepted accounting principles in the United States of America applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business within one year after the date these financial statements were issued. The Company has not yet established an ongoing source of revenues sufficient to cover its operating costs and allow it to continue as a going concern. There is substantial doubt that the Company can continue as a going concern for a period of one year from the issuance of these financial statements. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations.
Management’s plan to support the Company in its operations and to maintain its business strategy is to raise funds through public offerings and to rely on officers and directors to perform essential functions with minimal compensation. If the Company does not raise all of the money it needs from public offerings, it will have to find alternative sources, such as a second public offering, a private placement of securities, or loans from its officers, directors or others. If the Company requires additional cash and is unable to raise it, it will either have to suspend operations until the cash is raised, or cease business entirely.
The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph and eventually secure other sources of financing and attain profitable operations. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
NOTE 4 – PROPOSED ASSET PURCHASE AGREEMENT
On August 9, 2019, we entered into an Asset Purchase Agreement (the “APA”) with Orbital Group, Inc., a Nevada corporation (the “Orbital”) to purchase Orbital’s contract rights to a revenue sharing agreement between Orbital and VeraClaim, Ltd (“VeraClaim”). Orbital had limited rights to market services and products known as and based on the RevSource Platform and its associated products and services owned by VeraClaim, globally.
Based on the terms of the APA, we conducted various recapitalization measures including a reverse stock split and an increase in our authorized capital, further described in Note 8. The APA also required issuance of 19,500,000 shares of our common stock in consideration for the acquisition.
On January 7, 2020, we terminated the APA due to nonpayment.
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NOTE 5 – ACCOUNTS PAYABLE AND ACCURED EXPENSES – RELATED PARTIES
Accounts payable and accrued expenses - related parties consist of the following at December 31, 2019 and 2018:
| December 31, 2019 | December 31, 2018 |
The Health Network, Inc. | $1,475 | $365,462 |
Ronald Howell | - | 43,770 |
Eric Clemons | - | 96,727 |
Total | $1,475 | $505,959 |
Please see Note 6 for further explanation of these liabilities.
NOTE 6 - RELATED PARTY TRANSACTIONS
Notes Payable – Related Parties
During the year ended December 31, 2019, the Company received $13,860 in additional cash loans from various related parties.
During the year ended December 31, 2018, the Company received $20,800 in additional cash loans from various related parties.
As of December 31, 2018, the Company had $1,372,169 in related party notes payable, which were converted into shares of common stock as part of the transaction described below in the section entitled “Related Party Debt Conversion.” As of December 31, 2019, the Company had $0 in related party notes payable.
Total related party notes payable as of December 31, 2019 were $
Executive Offices
Consulting Agreements
Related Party Debt Conversion
Pursuant to an agreement entered into on
1.The Company issued 745,662 Post-split shares of restricted common shares to Ron Howell CEO for conversion of $1,860,407 owed to him by the Company for loans, consulting fees, reimbursements or other payables to equity in full payment of all obligations.
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2.The Company issued 242,640 Post-split shares of Common stock to The Health Network, Inc., a company controlled by Ron Howell, CEO of the Company for conversion of $605,379, the total amount of money owed to The Health Network, Inc. by the Company for loans, fees, reimbursements or other payables in full payment of all obligations.
3.The Company issued 7,800 Post-split shares of Common stock of HST Global, Inc. shares of Common stock to LIFT, LLC., a company controlled by Ron Howell, CEO of the Company to convert $19,460 the total amount of money owed to LIFT, LLC by the Company for loans, fees, reimbursements or other payables in full payment of all obligations.
4.The Company issued 3,900 Post-split shares of Common stock of HST Global, Inc. shares of restricted Common stock to Biolifecycle, LLC., a company controlled by Ron Howell, CEO of the Company to convert $9,729 the total amount of money owed to Biolifecycle, LLC by the Company for loans, fees, reimbursements or other payables in full payment of all obligations.
The value of the shares based on the trading price on June 26, 2019 was $130,000. The Company determined the difference between the debt amount and the value of the shares, $2,364,976, was a capital transaction and was recorded in Additional Paid in Capital due to the related party nature of the transactions.
Debt obligations owed by the following were declassified as debt and were written off. The declassified debt included; (i) accrued former officer compensation pursuant to a consulting arrangement dated October 1, 2007 of $70,000; (ii) accounts payable for amounts due prior to 2010 in the amount of approximately $96,718; (iii) subscription for securities dated May 13, 2008 stock and a promissory note in the amount of $200,000 as the obligation was extinguished by a third party; (iv) a promissory Note dated November 29, 2009 for $200,000; (v) a promissory Note dated May 7, 2008 and due June 20, 2008 for $100,000, together with accrued loan penalties of approximately $50,000; (vi) certain stockholder loans prior to 2010 for approximately $121,300; (vii) accrued related party interest for obligations prior to 2010 for $77,176; and (viii) accrued former related party interest for obligations prior to 2010 by other offices of approximately $46,000. Of the $961,204 in extinguished debt and payables, the company realized a total gain of $596,000, and has recorded $365,204 as additional paid in capital for related parties.
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NOTE 7 – COMMON STOCK
On June 26, 2019, the Company held a special meeting of shareholders based on the request of the Board of Directors. A majority of shareholders voted to approve and provide majority consent to authorize the officers of the Corporations to (i)
As stated in Note 6, a total of 1,000,000 shares of common stock were issued to the Company’s CEO and entities controlled by him in consideration for the extinguishment of $2,494,976 in debt and payables.
In the three months period from July 1, 2019 to September 30, 2019, the company agreed to issue
The securities described above were issued to investors in reliance upon the exemption from registration requirements of the Securities Act, as set forth in Section 4(2) under the Securities Act and Regulation D promulgated thereunder relating to transactions by an issuer not involving any public offering. No commissions were paid and no agreements to register shares were offered in the private placements. All Purchasers of shares described above represented to us in connection with their purchase that they were accredited investors and were acquiring the shares for their own account for investment purposes only and not with a view to, or for sale in connection with, any distribution thereof. The purchasers received written disclosures that the securities had not been registered under the Securities Act and that any resale must be made pursuant to a registration statement or an available exemption from such registration.
As of December 31, 2019 there were 4,247,993 shares of our common stock issued and outstanding. Subject to preferences that may be applicable to any preferred stock outstanding at the time. The holders of common stock are entitled to receive dividends out of legally available assets at such times and in such amounts as our Board of Directors may from time to time determine. There are no Preferred shares issued at the time of this filing. Each stockholder is entitled to one vote for each share of common stock held on all matters submitted to a vote of stockholders. Cumulative voting for the election of directors is not authorized.
Our common stock is not subject to conversion or redemption and holders of common stock are not entitled to preemptive rights. Upon the liquidation, dissolution or winding up of the Company, the remaining assets legally available for distribution to stockholders, after payment of claims of creditors and payment of liquidation preferences, if any, on outstanding preferred stock, are distributable ratable among the holders of common stock and any participating preferred stock outstanding at that time. Each outstanding share of common stock is fully paid and non-assessable. Our Board of Directors has the authority to issue authorized but unissued shares of common stock without any action by our stockholders.
The Company follows ASC 740, under which deferred income taxes reflect the net effect of (a) temporary difference between carrying amounts of assets and liabilities for financial purposes and the amounts used for income tax reporting purposes, and (b) net operating loss carry-forwards. No net provision for refundable Federal income tax has been made
Page 18
in the accompanying statement of loss because no recoverable taxes were paid previously. Similarly, no deferred tax asset attributable to the net operating loss carry-forward has been recognized, as it is not deemed likely to be realized.
The cumulative tax effect at the expected rate of 21 percent of significant items comprising our net deferred tax amount is as follows:
| Year ended December 31, 2019 |
| Year ended December 31, 2018 |
Income tax benefit attributable to: |
|
|
|
Net operating loss | $ |
| $( |
Change in valuation allowance | ( |
| |
Net refundable amount | $ |
| $ |
The cumulative tax effect at the expected rate of 21 percent (for 2019 & 2018) of significant items comprising our net deferred tax amount is as follows:
| December 31, 2019 |
| December 31, 2018 |
Deferred tax asset attributable to: |
|
|
|
Net operating loss carry forwards | $( |
| $( |
Common stock issued for services |
| ||
Valuation allowance |
| ||
Net deferred tax asset | $ |
| $ |
At December 31, 2019, the Company had an unused net operating loss carry-forward of approximately $4,926,389 that is available to offset future taxable income; the loss carry-forward will begin to expire in 2027.
NOTE 9 – SUBSEQUENT EVENTS
In accordance with ASC 855, Company management reviewed all material events through the date of this report and determined that there are no other material subsequent events to report.
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ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURES
None.
ITEM 9A. CONTROLS AND PROCEDURES
(a) Evaluation of disclosure controls and procedures
Our management, including our Principal Executive and Principal Financial Officer, evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Securities Exchange Act Rules 13a-15(e) and 15d-15(e)) as of December 31, 2019. Our disclosure controls and procedures are designed to ensure that information required to be disclosed by the issuer in the reports that it files or submits under the Act (15 U.S.C. 78a et seq.) is recorded, processed, summarized, and reported, within the time periods specified in the Commission's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Act is accumulated and communicated to the issuer's management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Based on this evaluation, our Chief Executive and Principal Financial Officer concluded that our disclosure controls and procedures were not effective as of December 31, 2019 for the reasons discussed below.
(b) Management's Report on Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-a5(f) under the Exchange Act. Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. GAAP. Our internal control over financial reporting includes those policies and procedures that: (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use of disposition of our assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Under the supervision of our Chief Executive Officer and Chief Financial Officer, our management assessed the effectiveness of our internal control over financial reporting as of December 31, 2019. In making this assessment, management used the criteria set forth in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this assessment, our management has concluded that our internal control over financial reporting was not effective as of December 31, 2019 and there are material weaknesses in our internal control over financial reporting. A material weakness is a deficiency, or a combination of control deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.
The material weaknesses relate to the limited number of persons responsible for the recording and reporting of financial information, the lack of separation of financial reporting duties, and the limited size of our management team in general. We are in the process evaluating methods of improving our internal control over financial reporting, including the possible addition of financial reporting staff and the increased separation of financial reporting responsibility, and intend to implement such steps as are necessary and possible to correct these material weaknesses.
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(c) Change in Internal Controls
There were no changes in our internal control over financial reporting during the year ended December 31, 2019, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
ITEM 9B. OTHER INFORMATION
None
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PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE
Director and Executive Officer Summary
The following table sets forth the names, ages, and principal offices and positions of our current directors, executive officers, and persons we consider to be significant employees. The Board of Directors elects our executive officers annually. Our directors serve one-year terms or until their successors are elected, qualified and accept their positions. The executive officers serve terms of one year or until their death, resignation or removal by the Board of Directors. There are no family relationships or understandings between any of the directors and executive officers. In addition, there was no arrangement or understanding between any executive officer and any other person pursuant to which any person was selected as an executive officer.
Name of Director or Officer | Age | Position |
Ronald R. Howell
| 72 | Chief Executive Officer, Chairman of the Board of Directors and Interim Chief Financial Officer |
Executive Officer and Director Bios
Ronald R. Howell, Chief Executive Officer, Chairman and Interim Chief Financial Officer: Mr. Howell has over 30 years of diversified leadership experience. He has distinguished himself in various businesses and held executive positions in various industries including real estate, distribution, national and international sales, wholesale and retail marketing, financial service. Mr. Howell serves as the CEO and President of The Health Network, Inc. and has served in that capacity for over 5 years. The Health Network, Inc. is a direct sales and marketing company in the nutraceutical industry.
Holding a Bachelor's Degree in Management from the University of Maryland and an MBA from the Sellinger School of Business and Management at Loyola College, Mr. Howell has also taught as an Adjunct Professor at Loyola College in Baltimore, Maryland. Ron also served his country as a United States Marine.
Legal and Disciplinary History
No officer, director or control person of the Company has been the subject of:
1. A conviction in a criminal proceeding or named as a defendant in a pending criminal proceeding (excluding traffic violations and other minor offenses);
2. The entry of an order, judgment, or decree, not subsequently reversed, suspended or vacated, by a court of competent jurisdiction that permanently or temporarily enjoined, barred, suspended or otherwise limited such person's involvement in any type of business, securities, commodities, or banking activities;
3. A finding or judgment by a court of competent jurisdiction (in a civil action), the Securities and Exchange Commission, the Commodity Futures Trading Commission, or a state securities regulator of a violation of federal or state securities or commodities law, which finding or judgment has not been reversed, suspended, or vacated; or
4. The entry of an order by a self-regulatory organization that permanently or temporarily barred, suspended or otherwise limited such person's involvement in any type of business or securities activities.
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Section 16(A) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 (the "Exchange Act") requires our directors and officers, and persons who own more than ten percent of the Common Stock to file reports of ownership and changes in ownership with the Securities and Exchange Commission ("SEC") and the American Stock Exchange. SEC regulations require reporting persons to furnish us with copies of all Section 16(a) forms they file.
Based solely on our review of the copies of the Forms 3, 4 and 5 and amendments thereto furnished to us by the persons required to make such filings during fiscal 2019 and our own records, we believe that no director or officer failed to file timely any beneficial ownership report.
Corporate Governance.
We have not adopted a code of ethics do date. We are in the process of evaluating the standards of conduct necessary for the deterrence of malfeasance and the promotion of ethical conduct and accountability, and will determine whether a code of ethics is necessary based on our evaluation.
The Company does not have a standing Nominating Committee. There have been no changes to the procedures whereby security holders may recommend nominees to the registrant's board of directors.
The Company is not a "listed issuer" as defined by Rule 10A-3, and does not have a standing Audit Committee. We do not have a financial expert serving on our board of directors.
ITEM 11. EXECUTIVE COMPENSATION
COMPENSATION DISCUSSION AND ANALYSIS
Compensation Discussion and Analysis
We do not have a standing compensation committee. Our board of directors as a whole makes the decisions as to employee benefit programs and officer and employee compensation. The primary objectives of our executive compensation programs are to:
- attract, retain and motivate skilled and knowledgeable individuals;
- ensure that compensation is aligned with our corporate strategies and business objectives;
- promote the achievement of key strategic and financial performance measures by linking short-term and long-term cash and equity incentives to the achievement of measurable corporate and individual performance goals; and
-align executives' incentives with the creation of stockholder value.
To achieve these objectives, our board of directors evaluates our executive compensation program with the objective of setting compensation at levels they believe will allow us to attract and retain qualified executives. In addition, a portion of each executive's overall compensation is tied to key strategic, financial and operational goals set by our board of directors. We also generally provide a portion of our executive compensation in the form of options that vest over time, which we believe helps us retain our executives and align their interests with those of our stockholders by allowing the executives to participate in our longer term success as reflected in asset growth and stock price appreciation.
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Named Executive Officers
The following table identifies our principal executive officer, our principal financial officer and our most highly paid executive officers, who, for purposes of this Compensation Disclosure and Analysis only, are referred to herein as the "named executive officers."
Name |
| Corporate Office |
Ron Howell |
| Chief Executive Officer and Interim Chief Financial Officer |
Components of our Executive Compensation Program
The primary elements of our executive compensation program will be base salaries and option grant incentive awards, although the board of directors has the authority to award cash bonuses, benefits and other forms of compensation as it sees fit.
The Company has entered into a consulting agreement with Mr. Howell whereby the Company agreed to pay Mr. Howell $10,000 per month. Mr. Howell did not accrue these consulting fees from July, 2019 through December, 2019 due to the pendency of the APA with Orbital; however, Mr. Howell resumed accruing these consulting fees after termination of the APA in January, 2020. The Company intends to continue to engage Mr. Howell as a consultant until his consulting services are no longer required.
We do not have any formal or informal policy or target for allocating compensation between short-term and long-term compensation, between cash and non-cash compensation or among the different forms of non-cash compensation. Instead, we have determined subjectively on a case-by-case basis the appropriate level and mix of the various compensation components. Similarly, we do not rely on benchmarking against our competitors in making compensation related decisions.
Base salaries – Base salaries will be used to recognize the experience, skills, knowledge and responsibilities required of our named executive officers. Base salary, and other components of compensation, may be evaluated by our board of directors for adjustment based on an assessment of the individual's performance and compensation trends in our industry.
Equity Awards – Our stock option award program will be the primary vehicle for offering long-term incentives to our executives. To date, we have not issued any equity awards. We intend our equity awards to executives to generally be made in the form of warrants. We believe that equity grants in the form of warrants provide our executives with a direct link to our long-term performance, create an ownership culture, and align the interests of our executives and our stockholders.
Cash bonuses – Our board of directors has the discretion to award cash bonuses based on our financial performance and individual objectives. The corporate financial performance measures (revenues and profits) will be given the greatest weight in this bonus analysis. We have not yet granted any cash bonuses to any named executive officer nor have we yet developed any specific individual objectives while we wait to attain revenue and profitability levels sufficient to undertake any such bonuses.
Benefits and other compensation – Our named executive officers are permitted to participate in such health care, disability insurance, bonus and other employee benefits plans as may be in effect with the Company from time to time to the extent the executive is eligible under the terms of those plans. As of the date of this Registration Statement, with exception to health care, we have not implemented any such employee benefit plans.
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Description of Compensation Agreements and Arrangements
As discussed below, we have not agreed to pay the Named Executive Officers an annual salary. We will negotiate base salary in the near future. Base salary may be increased from time to time with the approval of the board of directors. The following table summarizes the agreed annual salary of each of the named executive officers:
Summary Annual Salary
Name |
| Annual Salary |
Ron Howell |
| 01 |
(1) Mr. Howell has agreed to defer receiving an annual salary. He accrued $10,000.00 per month from January 1, 2019 through June 30, 2019 from the Company pursuant to a consulting agreement (which was subsequently converted into common stock). See "Relationships and Related Transactions," below.
Ron Howell, Chief Executive Officer – Mr. Howell currently does not receive compensation for his services as Chief Executive Officer. He has agreed to defer compensation until the Company obtains sufficient financing. The Board of Directors will determine what level of compensation is appropriate to offer Mr. Howell in the near future.
Grants of Plan-Based Awards Table for Fiscal Year 2019
The Company currently does not participate in any equity award plan. During fiscal 2019, we did not grant any equity awards under any equity award plan.
Option Exercises for Fiscal 2019
During fiscal 2019, none of the named executive officers exercised options.
Nonqualified Deferred Compensation
To date, we currently offer no defined contribution or other plan that provides for the deferral of compensation on a basis that is not tax-qualified to any of our employees, including the named executive officers.
Compensation of Directors
We intend to use a combination of cash and equity-based compensation to attract and retain candidates to serve on our board of directors. We intend to compensate directors who are also our employees for their service on our board of directors. Therefore, Mr. Howell will receive compensation for his service on our board of directors, which compensation has not yet been determined.
Compensation Committee Interlocks and Insider Participation
We do not currently have a standing Compensation Committee. Our entire board of directors participated in deliberations concerning executive officer compensation.
Compensation Committee Report
The board of directors has reviewed and discussed the Compensation Discussion and Analysis required by Item 402(b) of Regulation S-K with management and, based on such review and discussions, the board of directors has recommended that this Compensation Discussion and Analysis be included in this Annual Report on Form 10-K.
Page 25
Summary Compensation Table
The following table sets forth the total compensation paid to, or accrued by, the Named Executive Officers and other employees earning over $100,000 per year during the fiscal years ended December 31, 2019 and 2018. No restricted stock awards, long-term incentive plan payout or other types of compensation, other than the compensation identified in the chart below and its accompanying notes, were paid to these executive officers during those fiscal years.
Named Executive Officer |
Year | Annual Compensation Salary ($) | Annual Compensation Bonus ($) | Other Annual Compensation | Compensation Restricted Stock | Long Term Compensation Options |
LTIP Payouts |
All Other |
Ron Howell | 2019 | 0 | 0 | 60,000 (1) | 0 | 0 | 0 | 0 |
Ron Howell | 2018 | 0 | 0 | 120,000(1) | 0 | 0 | 0 | 0 |
(1)Pursuant to consulting agreement.
Outstanding Equity Awards at Fiscal Year End Table
The following table sets forth information regarding the outstanding warrants held by our named officers as of December 31, 2019.
| Option Awards | ||||
Name | Number of Securities Underlying Unexercised Options (#) Exercisable | Number of Securities Underlying Unexercised Options (#) Unexercisable | Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options | Option Exercise Price ($) | Option Expiration Date |
|
|
|
|
|
|
Ron Howell
| - | - | - | - | - |
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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table shows the beneficial ownership of our common stock as of December 31, 2019. The table shows the amount of shares owned by:
Identity of Person or Group |
| Shares Beneficially Owned |
| Percent of Shares Beneficially Owned1 |
| Class |
Ronald R. Howell |
| 2,802,800(2) |
| 66.0% |
| Common |
|
|
|
|
|
|
|
All Directors and Officers as a Group |
| 2,802,800 |
| 66.0% |
| Common |
(1) The percentage of shares owned is based on 4,247,993 shares of common stock outstanding as of December 31, 2019. Where the beneficially owned shares of any individual or group in the following table includes any options, warrants, or other rights to purchase shares, the percentage of shares owned includes such shares as if the right to purchase had been duly exercised.
(2) Includes 1,570,460 held personally; 1,220,640 held by The Health Network, Inc.; 3,900 held by BioLifecycle; and 7,800 held by LIFT Wellness Centers, each of which are controlled by Mr. Howell.
Beneficial Ownership of Securities: Pursuant to Rule 13d-3 under the Securities Exchange Act of 1934, involving the determination of beneficial owners of securities, a beneficial owner of securities is person who directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise has, or shares, voting power and/or investment power with respect to the securities, and any person who has the right to acquire beneficial ownership of the security within sixty days through means including the exercise of any option, warrant or conversion of a security.
ITEM 13. CERTAIN RELATIONSHIPS, RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE
Executive Offices
The Company's executive offices are located at 150 Research Dr., Hampton VA. These offices are leased by The Health Network, Inc. ("THN"), of which Ron Howell is President. THN allows the Company to use the office space without a formal sublease or rental agreement.
The Company currently pays The Health Network, Inc. $0.00 per month as a general operating fee, which covers use of the office space, use of certain equipment, and various other services.
Consulting Agreements
The Company has entered into a consulting agreement with Mr. Howell whereby the Company agreed to pay Mr. Howell $10,0000 per month. The consulting agreement may be terminated at will by the Company. The consulting agreement was suspended during the pendency of the APA with Orbital from July, 2019 to December, 2019, but resumed in January, 2020 after the APA was terminated. The Company intends to continue to engage Mr. Howell as a consultant until his consulting services are no longer required.
Director Independence
The Company is not listed on any national exchange, or quoted on any inter-dealer quotation service, that imposes independence requirements on any committee of the Company's directors, such as an audit, nominating or compensation committee. The company's Board of Directors consists of Ron Howell, who is not independent.
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ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
The following is a summary of the fees paid to Sadler, Gibb & Associates LLC, the Company's independent public accounting firm, during the fiscal years ended December 31, 2019 and 2018.
| 2019 |
| 2018 |
Audit fees | $14,500 |
| $10,500 |
Audit-related fees | - |
| - |
Tax fees | - |
| - |
All other fees | - |
| - |
Total | $14,500 |
| $10,500 |
Audit Committee Pre-Approval of Services of Principal Accountants
We do not currently have an audit committee appointed by the Board of Directors and the full Board of Directors did not vote on whether any non-audit services impacted our auditor's independence. We currently do not have any policy for approval of audit and permitted non-audit services by our independent auditor. We plan to appoint an audit committee by our Board of Directors and adopt procedures for approval of audit and non-audit services.
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PART IV
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
Financial Statements and Schedules.
The following consolidated financial statements of HST Global, Inc. are included herein beginning on page 8:
Report of Independent Registered Public Accounting Firm
Consolidated Balance Sheets as of December 31, 2019 and 2018
Consolidated Statements of Operations for the years ended December 31, 2019, and 2018
Consolidated Statements of Changes in Stockholders' Interest for the years ended December 31, 2019 and 2018
Consolidated Statements of Cash Flows for the years ended December 31, 2019 and 2018
Notes to Consolidated Financial Statements
Exhibits
The following Exhibits are included herein:
Exhibit No. |
| Description |
31.1 |
| Certification by the Chief Executive Officer of Competitive Technologies, Inc. pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (Rule 13a-14(a) or Rule 15d-14(a)). |
31.2 |
| Certification by the Chief Financial Officer of Competitive Technologies, Inc. pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (Rule 13a-14(a) or Rule 15d-14(a)). |
32.1 |
| Certification by the Chief Executive Officer of Competitive Technologies, Inc. pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350). |
32.2 |
| Certification by the Chief Financial Officer of Competitive Technologies, Inc. pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350). |
101 |
| Interactive Data Files |
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
HST GLOBAL, INC.
(the registrant)
By: \s\ Ron Howell
Ron Howell
Chief Executive Officer
Date: April 9, 2020
Page 29
Exhibit 31.1
CERTIFICATIONS
I, Ron Howell certify that:
1.
I have reviewed this Report on Form 10-K of HST Global, Inc. (the “Company”) for the period ending December 31, 2019;
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the periods presented in this report;
4.
I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company and have:
(a)
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c)
evaluated the effectiveness of the Company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d)
disclosed in this report any change in the Company’s internal control over financial reporting that occurred during the Company’s most recent fiscal quarter (the Company’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.
5.
I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the Company’s auditors and the audit committee of the Company’s Board of Directors (or persons performing the equivalent functions):
(a)
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Company’s ability to record, process, summarize and report financial information; and
(b)
any fraud, whether or not material, that involves management or other employees who have a significant role in the Company’s internal control over financial reporting.
Dated: April 9, 2020 | By: | \s\ Ron Howell | |
Ron Howell | |||
Chief Executive Officer | |||
Exhibit 31.2
CERTIFICATIONS
I, Ron Howell, certify that:
1.
I have reviewed this Report on Form 10-K of HST Global, Inc. (the “Company”) for the period ending December 31, 2019;
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the periods presented in this report;
4.
I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company and have:
(a)
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c)
evaluated the effectiveness of the Company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d)
disclosed in this report any change in the Company’s internal control over financial reporting that occurred during the Company’s most recent fiscal quarter (the Company’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.
5.
I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the Company’s auditors and the audit committee of the Company’s Board of Directors (or persons performing the equivalent functions):
(a)
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Company’s ability to record, process, summarize and report financial information; and
(b)
any fraud, whether or not material, that involves management or other employees who have a significant role in the Company’s internal control over financial reporting.
Dated: April 9, 2020 | By: | \s\ Ron Howell | |
Ron Howell | |||
Interim Chief Financial Officer | |||
Exhibit 32.1
CERTIFICATION PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
(18 U.S.C. 1350)
In connection with the Report of HST Global, Inc. (the “Company”) on Form 10-K for the year ended December 31, 2019, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Ron Howell, Chief Executive Officer and Chairman of the Company, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350), that to my knowledge:
1.
the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2.
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
Dated: April 9, 2020 | By: | \s\ Ron Howell | |
Ron Howell | |||
Chief Executive Officer | |||
Exhibit 32.2
CERTIFICATION PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
(18 U.S.C. 1350)
In connection with the Report of HST Global, Inc. (the “Company”) on Form 10-K for the year ended December 31, 2019, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Ron Howell, Interim Chief Financial Officer of the Company, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350), that to my knowledge:
1.
the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2.
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
Dated: April 9, 2020 | By: | \s\ Ron Howell | |
Ron Howell | |||
Interim Chief Financial Officer | |||