WHLT 10-Q
Chase Packaging Corp (WHLT)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from _________ to _________
Commission File Number:
(Exact name of registrant as specified in its charter) |
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(State or other jurisdiction of incorporation or organization) |
| (I.R.S. Employer Identification No.) |
(Address of principal executive offices) (Zip Code)
(
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act: None
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.
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).
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.
Large accelerated filer | ☐ | Accelerated filer | ☐ |
☒ | Smaller reporting company | ||
| 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. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act. Yes
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
Class |
| Outstanding at July 30, 2020 |
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Table of Contents
- INDEX –
| 2 |
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements.
CHASE PACKAGING CORPORATION
CONDENSED BALANCE SHEETS
(Unaudited)
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| June 30, |
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| December 31, |
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ASSETS |
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CURRENT ASSETS: |
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Cash and cash equivalents |
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TOTAL ASSETS |
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CURRENT LIABILITIES: |
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Accounts payable and accrued expenses |
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TOTAL CURRENT LIABILITIES |
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COMMITMENTS AND CONTINGENCIES |
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STOCKHOLDERS’ EQUITY: |
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Preferred stock, $ |
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Common stock, $ |
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Treasury stock, $ |
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Additional paid-in capital |
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Accumulated deficit |
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TOTAL STOCKHOLDERS’ EQUITY |
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TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY |
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See notes to interim condensed unaudited financial statements.
| 3 |
| Table of Contents |
CHASE PACKAGING CORPORATION
CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
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| Three Months Ended |
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NET SALES |
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EXPENSES: |
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General and administrative expense |
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LOSS FROM OPERATIONS |
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OTHER INCOME (EXPENSE) |
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Interest and other income |
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TOTAL OTHER INCOME (EXPENSE) |
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LOSS BEFORE INCOME TAXES |
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Provision for income taxes |
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NET LOSS |
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BASIC AND DILUTED LOSS PER COMMON SHARE |
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WEIGHTED AVERAGE COMMON SHARES OUTSTANDING – BASIC AND DILUTED |
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See notes to interim condensed unaudited financial statements.
| 4 |
| Table of Contents |
CHASE PACKAGING CORPORATION
CONDENSED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY
FOR THE SIX MONTHS ENDED JUNE 30, 2020 AND 2019
(Unaudited)
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| Preferred |
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| Common |
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| Additional Paid-in |
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| Accumulated |
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| Treasury Stock |
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| Shares |
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| Amount |
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| Shares |
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| Amount |
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| Capital |
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| Deficit |
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| Amount |
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| Total |
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For the Six Months Ended June 30, 2019 |
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Balance at December 31, 2018 |
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Net loss for the three months ended March 31, 2019 |
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| - |
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Balance at March 31, 2019 |
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Shares held in escrow |
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| - |
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Net loss for the three months ended June 30, 2019 |
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Balance at June 30, 2019 |
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For the Six Months Ended June 30, 2020 |
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Balance at December 31, 2019 |
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Net loss for the three months ended March 31, 2020 |
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Balance at March 31, 2020 |
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Stock Based Compensation Expense |
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Net loss for the three months ended June 30, 2020 |
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Balance at June 30, 2020 |
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See notes to interim condensed unaudited financial statements.
| 5 |
| Table of Contents |
CHASE PACKAGING CORPORATION
CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
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| Six Months Ended |
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CASH FLOWS FROM OPERATING ACTIVITIES: |
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Net loss |
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Adjustment to reconcile to net loss to net cash used in operating activities: |
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Stock based compensation |
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Change in operating assets and liabilities: |
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Accounts payable and accrued expenses |
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Net cash used in operating activities |
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CASH FLOWS FROM INVESTING ACTIVITIES |
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CASH FLOWS FROM FINANCING ACTIVITIES |
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NET DECREASE IN CASH |
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Cash, beginning of period |
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CASH, END OF PERIOD |
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SUPPLEMENTAL CASH FLOW INFORMATION: |
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Cash paid for: |
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Interest |
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Income taxes |
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SCHEDULE OF NON-CASH INVESTING & FINANCING ACTIVITIES: |
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Shares issued and held in escrow |
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See notes to interim condensed unaudited financial statements.
| 6 |
| Table of Contents |
CHASE PACKAGING CORPORATION
NOTES TO INTERIM CONDENSED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED JUNE 30, 2020
(Unaudited)
NOTE 1 - BASIS OF PRESENTATION:
Chase Packaging Corporation (“the Company”), a Delaware Corporation, previously manufactured woven paper mesh for industrial applications, polypropylene mesh fabric bags for agricultural use, and distributed agricultural packaging manufactured by other companies. Management’s plans for the Company include securing a merger or acquisition, raising additional capital, and other strategies designed to optimize shareholder value. However, no assurance can be given that management will be successful in its efforts. The failure to achieve these plans will have a material adverse effect on the Company’s financial position, results of operations, and ability to continue as a going concern.
The interim condensed financial statements included herein have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures normally included in the financial statements prepared in accordance with generally accepted accounting principles (“U.S. GAAP”) have been condensed or omitted pursuant to such rules and regulations, although we believe that the disclosures made are adequate to provide for fair presentation and a reasonable understanding of the information presented. The Interim Condensed Financial Statements and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in this Form 10-Q should be read in conjunction with the financial statements and the related notes, as well as Management’s Discussion and Analysis of Financial Condition and Results of Operations, included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019, previously filed with the SEC.
In the opinion of management, all adjustments (which include normal recurring adjustments) necessary to present a fair statement of financial position as of June 30, 2020, results of operations for the six months and three months ended June 30, 2020 and 2019, and cash flows for the six months ended June 30, 2020 and 2019, as applicable, have been made. The results of operations for the six months and three months ended June 30, 2020 are not necessarily indicative of the operating results for the full fiscal year or any future periods.
The accounting policies followed by the Company are set forth in Note 3 to the Company’s financial statements included in its Annual Report on Form 10-K for the year ended December 31, 2019, which is incorporated herein by reference. Specific reference is made to that report for a description of the Company’s securities and the notes to financial statements.
NOTE 2 - NEW ACCOUNTING PRONOUNCEMENTS:
Recently Adopted Accounting Pronouncements
Compensation – Stock Compensation — In June 2018, the FASB issued ASU 2018-07, Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. ASU 2018-07 allows companies to account for nonemployee awards in the same manner as employee awards. The guidance is effective for fiscal years beginning after December 15, 2018, and interim periods within those annual periods. The Company adopted this ASU on January 1, 2019. The adoption of ASU 2018-07 did not have a material impact on the Company’s financial position, results of operations or cash flows.
| 7 |
| Table of Contents |
NOTE 3 –SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Use of Estimates:
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Cash and Cash Equivalents
The Company considers all highly liquid investments that are readily convertible into cash with a remaining maturity of three months or less at the time of acquisition to be cash equivalents. The Company maintains its cash and cash equivalents balances with high credit quality financial institutions. As of June 30, 2020, and December 31, 2019, the Company had cash in insured accounts in the amount of $
Income Taxes
The asset and liability method is used in accounting for income taxes. Under this method, deferred tax assets and liabilities are recognized for operating loss and tax credit carry forwards and for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured assuming enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. A valuation allowance is recorded to reduce the carrying amounts of deferred tax assets unless it is more likely than not that such asset will be realized.
The Company adopted FASB Interpretation of “Accounting for Uncertainty in Income Taxes.” There was no impact on the Company’s financial position, results of operations, or cash flows as a result of implementing this guidance. At June 30, 2020 and December 31, 2019, the Company evaluated its tax positions and did not have any unrecognized tax benefits. The Company’s practice is to recognize interest and/or penalties related to income tax matters in income tax expense. The Company currently has no federal or state tax examinations in progress.
| 8 |
| Table of Contents |
Accounting for Stock-Based Compensation
The stock-based compensation expense incurred by the Company for employees and directors in connection with its stock option plan is based on the employee model of ASC 718, and the fair market value of the options is measured at the grant date. Under ASC 718 employee is defined as “An individual over whom the grantor of a share-based compensation award exercises or has the right to exercise sufficient control to establish an employer-employee relationship based on common law as illustrated in case law and currently under U.S. “tax regulations.” Our consultants do not meet the employer-employee relationship as defined by the IRS and therefore were accounted for under ASC 505-50 through December 31, 2018. Effective January 1, 2019, the Company adopted ASU 2018-07, Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting.
Upon the adoption of ASU 2018-07, the Company measured the fair value of equity instruments for non-employee based payment awards on the grant date.
NOTE 4 - BASIC AND DILUTED NET LOSS PER COMMON SHARE:
Basic loss per common share is computed by dividing the net loss by the weighted-average number of shares of common stock outstanding. Diluted loss per share is computed by dividing the net loss by the sum of the weighted-average number of shares of common stock outstanding plus the dilutive effect of shares issuable through the exercise of common stock equivalents.
We have excluded
NOTE 5 - WARRANTS AND PREFERRED STOCKS:
Warrants
2019 Extension of Warrant Terms
On July 9, 2019,
Average risk-free interest rate |
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Average expected life-years |
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Expected volatility |
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Expected dividends |
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| 9 |
| Table of Contents |
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| Number of Warrants |
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Outstanding at December 31, 2019 |
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Granted |
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Extended |
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Exercised |
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Forfeited/expired |
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Outstanding at June 30, 2020 |
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Exercisable at June 30, 2020 |
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As of June 30, 2020 and December 31, 2019, the average remaining contractual life of the outstanding warrants was
Series A 10% Convertible Preferred Stock
The Company has authorized
NOTE 6 – EQUITY TRANSACTION:
On April 20, 2020, the Board of Directors authorized the issuance of
On April 23, 2020, the Board of Directors authorized a consulting fee to be paid to William R. Cast in the form of
NOTE 7 – FAIR VALUE MEASUREMENTS:
ASC 820, “Fair Value Measurements and Disclosure,” (“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, not adjusted for transaction costs. ASC 820 also establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels giving the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3).
The three levels are described below:
Level 1 Inputs — Unadjusted quoted prices in active markets for identical assets or liabilities that is accessible by the Company;
Level 2 Inputs — Quoted prices in markets that are not active or financial instruments for which all significant inputs are observable, either directly or indirectly;
Level 3 Inputs — Unobservable inputs for the asset or liability including significant assumptions of the Company and other market participants.
| 10 |
| Table of Contents |
There were no transfers in or out of any level during the six months ended June 30, 2020 nor the year ended December 31, 2019.
Except for those assets and liabilities which are required by authoritative accounting guidance to be recorded at fair value in the Company’s balance sheets, the Company has elected not to record any other assets or liabilities at fair value, as permitted by ASC 820. No events occurred during the six months ended June 30, 2020 or the year ended December 31, 2019 which would require adjustment to the recognized balances of assets or liabilities which are recorded at fair value on a nonrecurring basis.
The Company determines fair values for its investment assets as follows:
Cash equivalents at fair value — the Company’s cash equivalents, at fair value, consist of money market funds — marked to market. The Company’s money market funds are classified within Level 1 of the fair value hierarchy since they are valued using quoted market prices from an exchange.
The following tables provide information on those assets measured at fair value on a recurring basis as of June 30, 2020 and December 31, 2019, respectively:
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| Carrying Amount In Balance Sheet June 30, |
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| Fair Value June 30, |
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| Fair Value Measurement Using |
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| Level 1 |
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Assets: |
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Treasury and government securities |
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Money market funds |
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|
|
|
|
|
| |
|
| |
| |||||
Total Assets |
| $ |
|
| $ |
|
| $ |
|
| $ |
|
| $ |
| |||||
|
| Carrying Amount In Balance Sheet December 31, |
|
| Fair Value December 31, |
|
| Fair Value Measurement Using |
| |||||||||||
|
| 2019 |
|
| 2019 |
|
| Level 1 |
|
| Level 2 |
|
| Level 3 |
| |||||
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Treasury and government securities |
| $ |
|
| $ |
|
| $ |
|
| |
|
| |
| |||||
Money market funds |
|
|
|
|
|
|
|
|
|
| |
|
| |
| |||||
Total Assets |
| $ |
|
| $ |
|
| $ |
|
| $ |
|
| $ |
| |||||
NOTE 8 - COMMITMENTS AND CONTINGENCIES:
The Company’s Board of Directors has agreed to pay the Company’s Chief Financial Officer an annual salary of $
NOTE 9 – SUBSEQUENT EVENTS:
The Company has evaluated events from June 30, 2020, through the date whereupon the financial statements were issued and has determined that there are no other material events that need to be disclosed except for those listed below:
Effective on August 5, 2020, the Company’s trading symbol is being changed to WHLT.
| 11 |
| Table of Contents |
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
Forward-Looking Statements
The information in this report on Form 10-Q contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. This Act provides a “safe harbor” for forward-looking statements to encourage companies to provide prospective information about themselves provided they identify these statements as forward looking and provide meaningful cautionary statements identifying important factors that could cause actual results to differ from the projected results. All statements other than statements of historical fact made in this report are forward looking. In particular, the statements herein regarding future results of operations or financial position are forward-looking statements. Forward-looking statements reflect management’s current expectations and are inherently uncertain. The Company’s actual results may differ significantly from management’s expectations as a result of many factors.
You should read the following discussion and analysis in conjunction with the financial statements of the Company, and notes thereto, included herewith. This discussion should not be construed to imply that the results discussed herein will necessarily continue into the future or that any conclusion reached herein will necessarily be indicative of actual operating results in the future. Such discussion represents only the best present assessment of management. The Company assumes no obligations to update any of these forward-looking statements.
Company Overview
Chase Packaging Corporation, (the “Company) is a Delaware corporation which, prior to 1998, was engaged in the specialty packaging business, primarily as a supplier of packaging products to the agricultural industry. During 1997, the Company commenced an orderly liquidation of its assets (described below) which was completed in 1997. At present, management of the Company is seeking to secure a suitable merger partner wishing to go public or to acquire private companies to create investment value for the Company. Although the Company is not considered a BDC (Business Development Company) it may invest in startup and emerging growth companies to which its Board of Directors and others will apply significant management experience.For purposes of Rule 12b-2 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the Company is considered a shell company.
Results of Operations
For the three months ended June 30, 2020 and 2019
Revenue
The Company had no operations and no revenue for the three months ended June 30, 2020 and 2019, and its only income was from nominal interest income on its short-term investments which are classified as cash and cash equivalents.
| 12 |
| Table of Contents |
Operating Expenses
The following table presents our total operating expenses for the three months ended June 30, 2020 and 2019.
|
| Three Months Ended June 30, |
| |||||
|
| 2020 |
|
| 2019 |
| ||
Audit and accounting fees |
|
| 9,140 |
|
|
| 4,980 |
|
Payroll |
|
| 5,062 |
|
|
| 5,056 |
|
Other general and administrative expense |
|
| 92,292 |
|
|
| 1,821 |
|
|
| $ | 106,494 |
|
| $ | 11,857 |
|
Operating expenses consist mostly of audit and accounting fees and payroll. Other general and administrative expenses are comprised of transfer agent and EDGAR filer services and other services, and a $90,000 stock-based, non-cash compensation expense. These expenses were directly related to the maintenance of the corporate entity and the preparation and filing of reports with the Securities and Exchange Commission. The increase in operating expenses in 2020 was mainly due to the increase in stock-based compensation expense.
Loss from Operation
The Company incurred loss from operation of $106,494 and $11,857 for the three months ended June 30, 2020 and 2019, respectively.
Other Income (Expense)
The following table presents our total Other Income (Expense) for the three months ended June 30, 2020 and 2019.
|
| Three Months Ended June 30, |
| |||||
|
| 2020 |
|
| 2019 |
| ||
|
|
|
|
|
|
| ||
Interest and other income |
| $ | 16 |
|
| $ | 2,354 |
|
Other Income (Expense), net |
| $ | 16 |
|
| $ | 2,354 |
|
Income (Expense) decreased by $2,338 for the three months ended June 30, 2020 as compared to the three months ended June 30, 2019. The decrease in other income (expense) was related to the decrease in interest and other income for the three months ended June 30, 2020
Net Loss
The Company had a net loss of $106,478 for the three months ended June 30, 2020, compared with a net loss of $9,503 for the three months ended June 30, 2019. Increase in net loss was due primarily to the increase in general and administrative expense due to a $90,000 stock-based, non-cash compensation expense.
| 13 |
| Table of Contents |
Loss per share for the three months ended June 30, 2020 and 2019 was approximately $(0.00) and $(0.00) based on the weighted-average shares issued and outstanding.
It is anticipated that future operating expenses will decrease as the Company complies with its periodic reporting requirements and effects a business combination, although there can be no assurance that the Company will be successful in effecting a business combination.
For the six months ended June 30, 2020 and 2019
Revenue
The Company had no operations and no revenue for the six months ended June 30, 2020 and 2019, and its only income was from nominal interest income on its short-term investments which are classified as cash and cash equivalents.
Operating Expenses
The following table presents our total operating expenses for the six months ended June 30, 2020 and 2019.
|
| Six months Ended June 30, |
| |||||
|
| 2020 |
|
| 2019 |
| ||
Audit and accounting fees |
|
| 25,784 |
|
|
| 21,664 |
|
Payroll |
|
| 10,235 |
|
|
| 10,219 |
|
Other general and administrative expense |
|
| 97,309 |
|
|
| 5,080 |
|
|
| $ | 133,328 |
|
| $ | 36,963 |
|
Operating expenses consist mostly of audit and accounting fees and payroll. Other general and administrative expenses are comprised of transfer agent and EDGAR filer services and other services (directly related to the maintenance of the corporate entity and the preparation and filing of reports with the Securities and Exchange Commission) and stock-based compensation expense. The increase in operating expenses in 2020 was mainly due to an April 2020, $90,000 stock-based, non-cash compensation expense.
Loss from Operation
The Company incurred loss from operation of $133,328 and $36,963 for the six months ended June 30, 2020 and 2019, respectively.
Other Income (Expense)
The following table presents our total Other Income (Expense) for the six months ended June 30, 2020 and 2019.
|
| Six months Ended June 30, |
| |||||
|
| 2020 |
|
| 2019 |
| ||
|
|
|
|
|
|
| ||
Interest and other income |
| $ | 973 |
|
| $ | 4,484 |
|
Other Income (Expense), net |
| $ | 973 |
|
| $ | 4,484 |
|
Income (Expense) decreased by $3,511 for the six months ended June 30, 2020 as compared to the six months ended June 30, 2019. The decrease in other income (expense) was related to the decrease in interest and other income for the six months ended June 30, 2020
| 14 |
| Table of Contents |
Net Loss
The Company had a net loss of $132,355 for the six months ended June 30, 2020, compared with a net loss of $32,479 for the six months ended June 30, 2019. Increase in net loss was due primarily to the increase of general and administrative expense resulting from stock-based, non-cash compensation.
Loss per share for the six months ended June 30, 2020 and 2019 was approximately $(0.00) and $(0.00) based on the weighted-average shares issued and outstanding.
It is anticipated that future operating expenses will decrease as the Company complies with its periodic reporting requirements and effects a business combination, although there can be no assurance that the Company will be successful in effecting a business combination.
Liquidity and Capital Resources
At June 30, 2020, the Company had cash and cash equivalents of approximately $627,000 consisting mostly of money market funds and U.S. Treasury and government securities. Management believes that its cash and cash equivalents are sufficient for its business activities for at least the next twelve months and for the costs of seeking an acquisition of an operating business.
The following table provides detailed information about our net cash flow for all financial statements years presented in this Report.
Cash Flow
|
| Six months Ended June 30, |
| |||||
|
| 2020 |
|
| 2019 |
| ||
Net cash used in operating activities |
| $ | (51,720 | ) |
| $ | (35,194 | ) |
Net cash provided by investing activities |
|
| - |
|
|
| - |
|
Net cash provided by financing activities |
|
| - |
|
|
| - |
|
Net cash outflow |
| $ | (51,720 | ) |
| $ | (35,194 | ) |
Net cash of $(51,720) and $(35,194) were used in operations during the six months period ended June 30, 2020 and 2019, respectively.
The use of cash of $(51,720) used in operating activities for the six months ended June 30, 2020, principally resulted from our net loss of $132,355, as adjusted for changes in our working capital accounts of $(9,365) and for the stock-based compensation of $90,000.
The use of cash of $(35,194) used in operating activities for the six months ended June 30, 2019, principally resulted from our net loss of $32,479, as adjusted for changes in our working capital accounts of $(2,715).
No cash flows were used in or provided by investing activities during the six months ended June 30, 2020 and 2019.
No cash proceeds were used in or provided by financing activities during the six months ended June 30, 2020 and 2019.
| 15 |
| Table of Contents |
New Accounting Pronouncements
Refer to the discussion of recently adopted/issued accounting pronouncements under Part I, Note 2: New Accounting Policies Pronouncements.
Factors Which May Affect Future Results
Future earnings of the Company are dependent on interest rates earned on the Company’s invested balances and expenses incurred. The Company expects to incur significant expenses in connection with its objective of identifying a merger partner or acquiring an operating business.
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
Not applicable.
Item 4. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures.
Our management, with the participation of our chief executive officer and chief financial officer, evaluated the effectiveness of our disclosure controls and procedures. The term “disclosure controls and procedures,” as defined in Rules 13a-15I and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports, such as this report, that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on that evaluation, our chief executive officer and chief financial officer concluded that as of June 30, 2020, our disclosure controls and procedures were effective.
Changes in Internal Controls over Financial Reporting.
We regularly review our system of internal control over financial reporting.
During the quarter ended June 30, 2020, there were no changes in our internal controls over financial reporting that have materially affected, or are reasonably likely to affect materially, our internal control over financial reporting.
| 16 |
| Table of Contents |
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.
None.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
On April 20, 2020, the Board of Directors authorized the issuance of 100,000 shares of restricted common stock each to 7 directors and to the CFO/Assistant Secretary, valued at approximately $10,000 each based on the closing bid price as quoted on the OTC on April 17, 2020 of $0.10 per share reflecting the last trade on April 8, 2020. On April 23, 2020, the Board of Directors authorized a consulting fee to be paid to William R. Cast in the form of 100,000 shares of restricted common stock valued at approximately $10,000 based on the closing bid price as quoted on the OTC on April 22, 2020 of $0.10 per share reflecting the last trade on April 8, 2020. There were no proceeds to the Company and no disclosure for any use of proceeds.
Item 3. Defaults upon Senior Securities.
None.
Item 4. Mine Safety Disclosures.
Not applicable.
Item 5. Other Information.
None.
Item 6. Exhibits.
Number |
| Description |
|
|
|
| ||
|
|
|
| ||
|
|
|
101.INS |
| Interactive data files pursuant to Rule 405 of Regulation S-T. |
|
|
|
101.SCH |
| Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document). |
|
|
|
101.CAL |
| Inline XBRL Taxonomy Extension Calculation Linkbase Document. |
|
|
|
101.DEF |
| Inline XBRL Taxonomy Extension Definition Linkbase Document. |
|
|
|
101.LAB |
| Inline XBRL Taxonomy Extension Labels Linkbase Document. |
|
|
|
101.PRE |
| Inline XBRL Taxonomy Extension Presentation Linkbase Document. |
|
|
|
104 |
| Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101). |
_____________
* Filed herewith
| 17 |
| Table of Contents |
SIGNATURES
Pursuant to the requirements 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.
| CHASE PACKAGING CORPORATION |
| |
|
|
|
|
Date: August 5, 2020 | By: | /s/ Ann C. W. Green |
|
|
| Ann C. W. Green |
|
|
| Chief Financial Officer and Assistant Secretary |
|
|
| (Principal Executive, Financial and Accounting Officer) |
|
| 18 |