Telco Cuba, Inc. - Annual Report: 2014 (Form 10-K)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-K
ý | Annual report pursuant section 13 or 15(d) of the Securities Exchange Act of 1934 For the fiscal year ended November 30, 2014 |
r | Transition report pursuant section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from ________________ to ________________ |
Commission file number 000-53157 |
Telco Cuba Inc.
(Exact name of small business issuer as specified in its charter)
Nevada (State of Incorporation) | 98-0546544 (I.R.S. Employer Identification No.) |
1530 Atwood Ave. #19652, Johnston, RI 02919 Tel: (401) 648-0805 |
(Address and telephone number of Registrant's principal executive offices and principal place of business) |
Securities registered pursuant to Section 12(b) of the Act: |
| None |
Securities registered pursuant to Section 12(g) of the Act: |
| Common Stock, par value $0.001 |
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
Yes r No ý
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 r No ý
Note - Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Exchange Act from their obligations under those Sections.
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 ý No r
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
Yes r No ý
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K 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.
r
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer r Non-accelerated filer r (Do not check if a smaller reporting company) | Accelerated filer r Smaller reporting company ý |
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes q No ý
The number of shares of Common Stock held by non-affiliates, as of June 18, 2015 was 25,099,245 shares, all of one class of common stock, $0.001 par value, having an aggregate market value of $163,145 based on the closing price of the Registrant's common stock of $0.0045 on June 18, 2015 as quoted on the Electronic Over-the-Counter Bulletin Board ("OTCPK").
Indicate the number of shares outstanding of each of the registrant's classes of common stock, as of the latest practicable date.
| Class: common stock - $0.001 par value |
| Outstanding at June 18, 2015: 25,099,245 |
DOCUMENTS INCORPORATED BY REFERENCE
None
Table of Contents
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 11
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE 15
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE 20
PART I
ITEM 1.
DESCRIPTION OF BUSINESS
How our company is organized
On June 15, 2015, the Company effectuated an amendment to its articles of incorporation to change its name from CaerVision Global, Inc. to Telco Cuba, Inc.
CaerVision Global, Inc. fka American Mineral Group Inc. (the "Company") was incorporated under the laws of the State of Nevada on August 10, 2007.
Where you can find us
We are located at 1629 Warwick Ave3., Warwick, RI 02889. Our telephone number is (401) 648-0800, our facsimile number is (401) 648-0699, our e-mail address is info@caservision.com, and our homepage on the world-wide web is at http://www.caeervisionglobal.com.
About Our Company
Telco Cuba, Inc. (formerly CaerVision Global, Inc. fka American Mineral Group Inc.) was an early stage Mining and Exploration Company throughout the fiscal year ended November 30, 2014 and 2013. We sought to acquire, develop, and manage various oil, gas, and mineral properties and resources.
In August 2009, the Company entered into an agreement to acquire the mineral rights to 331 unpatented lode mining claims known as the Conglomerate Mesa, located in Inyo County, California. In March 2011, the Company added an additional 217 unpatented lode mining claims. In fiscal year 2012, the Company determined that the effort and cost of developing these claims required more resources that could be more effectively used on other opportunities, and abandoned the Conglomerate Mesa project.
In February 2013, the Company acquired a 28% Working Interest in the Grand Chenier oil and gas prospect in Louisiana. The property contains an estimate 9.0 million barrels of oil and was in production until approximately 2009 when the then operator failed to manage the interests and certain repairs were not made leading to the cessation of production. The Company believes that with approximately $2.0 million in capital, the field can be returned to production and additional wells within the prospect can then be brought online increasing production to a profitable level.
In November 2014, the Company returned the working interest in the Grand Chenier oil and gas prospect to the original holders due to its failure to raise the capital required to work over the existing wells.
Simultaneously with divesting the Grand Chenier prospect, the Company entered into negotiations to acquire Vitall, Inc. and was renamed CaerVision Global, Inc., and closed on this deal in January 2015. The newly renamed Company had 60 days to close on a minimum $500,000 in debt or equity financing to support the new direction. When this was not achieved, the prior owner invoked a rescission clause and terminated the deal.
Subsequently, the Company (see Subsequent Events) entered into an agreement with Amgentech Inc.s Telco Cuba division whereby they acquired a majority interest in the Company and will pursue telecom opportunities in the newly emerging Cuban market. The Company has filed an amendment to its articles of incorporation to change its name to Telocuba, Inc.
Governmental Regulations and Environmental Compliance
The Companys operations if and when they begin, will be subject to various federal, state, and local permitting and environmental regulations. With cancellation of the Mineral Lease for the Conglomerate Mesa project, the Company is pursuing other oil, gas, and mining and opportunities and therefore expects to encounter additional regulatory and compliance oversight.
Plan of Operation
About Telco Cuba, Inc.: Founded in 2001, Amgentech -- the parent company of Telco Cuba has been providing internet based solutions and services for over 14 years. Amgentech has generated over 7 million dollars in revenue. Telco Cuba is launching best of breed communication services including, but not limited to VoIP, Calling Cards and direct SMS messaging in the US and between the US and Cuba. For more information visit (http://www.telcocuba.com & http://pr.telcocuba.com)
Employees
We presently have one employee, our Chief Executive Officer / President / Chief Financial Officer / Treasurer / Secretary, who also serves as the sole director of the Company. We expect that as we begin development of any potential project, additional personnel will be added. We believe that our relationship with employees is satisfactory. We have not suffered any labor problems during the last two years.
ITEM 1A. RISK FACTORS
Investment in our securities involves a high degree of risk. We are subject to various risks that may materially harm our business, financial condition and results of operations. You should carefully consider the risks and uncertainties described below and the other information in this filing before deciding to purchase our common stock. If any of these risks or uncertainties actually occurs, our business, financial condition or operating results could be materially harmed. In that case, the trading price of our common stock could decline and you could lose all or part of your investment.
We are an Exploration Company, as such; you cannot evaluate the investment merits of our Company because we have no operating history.
Our Company has no operating history since it was organized, which makes it difficult to evaluate the investment merits of our Company. Our Company was organized on August 10, 2007 as a start-up, Exploration Stage Company. We have no operating history and we did not have any business prior to our organization.
We may not be able to continue as a going concern if we do not obtain additional financing.
Because of our lack of sufficient funds and short operating history incurring only expenses, and no revenues, our independent auditors report states that there is substantial doubt about our ability to continue as a going concern. Since we have incurred only losses since our inception, it raises substantial doubt about our ability to continue as a going concern. Therefore, our ability to continue as a going concern is highly dependent upon obtaining additional financing for our planned operations. As of the date hereof, cash has been raised from the issuance of securities and promissory notes.
Our Negative Cash Flow, Operating Losses, Lack of Revenue, And Limited Operating History Makes It Difficult or Impossible To Evaluate Our Performance And Make Predictions About The Future.
We have not generated revenue, nor are we likely to generate revenue within the next twelve to eighteen months. We are an exploration stage company. Consequently, there is no meaningful historical operating or financial information about our business upon which to evaluate future performance.
We cannot assure generation of significant revenues, sustained profitability or generation of positive cash flow from operating activities in the future. If we cannot generate enough revenue, our business may not succeed and our Common Stock may have little or no value.
We Are Subject To A Working Capital Deficit, Which Means That Our Current Assets On November 30, 2014 Were Not Sufficient To Satisfy Our Current Liabilities.
As of November 30, 2014, we have incurred substantial operating losses. Since we have no revenue, we have generated negative free cash flow and expect to continue to experience negative free cash flow at least through our exploration phase. We have current liabilities of $2,428,421 and current assets of $2 at November 30, 2014, and a working capital deficiency of $2,428,419. If we cannot meet our current liabilities we may have to curtail or cease business operations.
In Prior Fiscal Years We Have Been The Subject Of A Going Concern Opinion And Expect That Upon Completion Of Our Audits For November 30, 2014 and 2013, We Will Receive A Going Concern Opinion Which Means That We May Not Be Able To Continue Operations Unless We Obtain Additional Funding.
The Company was previous audited for the years ended November 30, 2011 and 2010 whereby our independent auditors added an explanatory paragraph to their audit report. We believe, that upon completion of a two year audit for the years ended November 30, 2014 and 2013, an independent auditor will once again as part of their audit report issue a similar explanatory paragraph in connection with our financial statements. We have incurred losses of $347,190 and $569,693 for the years ended November 30, 2014 and 2013 respectively, and a cumulative loss of $14,824,879, and we had a working capital deficiency of $2,428,419 at November 30, 2014. These conditions raise substantial doubt about the Company's ability to continue as a going concern. Our financial statements do not include any adjustments that might result from the outcome of this uncertainty.
If we do not obtain additional financing, our business will fail because we cannot fund our business objectives.
We need to raise money to meet our general and administrative expenses, and we need to raise money to achieve our business objective to pursue telecom opportunities in the newly emerging Cuban market.. As of November 30, 2014, we had cash in the amount of $2, and current liabilities of $2,428,421. We currently do not have any operations and we have no income. We currently do not have any arrangements for financing and we may not be able to obtain financing when required. Obtaining additional financing would be subject to a number of factors, including the fact that we have no business and the present financial market conditions may make obtaining additional financing difficult. These factors may make the timing, amount, terms or conditions of additional financing unavailable to us.
We Could Fail To Attract Or Retain Key Personnel
Our success largely depends on the efforts and abilities of our key executive and consultants, including William Sanchez, our Chief Executive Officer, President and Chief Financial Officer. The loss of the services of any of these individuals could materially harm our business because of the cost and time necessary to replace and train a replacement. Such loss would also divert management attention away from operational issues. We do not presently maintain key-man life insurance policies on any executive. In addition, we need to attract additional high quality geological, investor relations, and consulting personnel. To the extent that we are smaller than our competitors and have fewer resources we may not be able to attract the sufficient number and quality of staff.
We Are Subject To Municipal and Other Local Regulation
Municipalities may require us to obtain various permits and licenses in order to install or operate equipment in various locations where we seek to explore or develop mineral deposits. A municipalitys decision to require us to obtain permits or licenses could delay or impede the development of a revenue model, as well as force us to incur additional costs.
No Expectation of Dividends on Common Stock.
We have never paid cash dividends on our Common Stock and we do not expect to pay cash dividends on our Common Stock at any time in the foreseeable future. The future payment of dividends directly depends upon the future earnings, capital requirements, financial requirements and other factors that our Board of Directors will consider. Since we do not anticipate paying cash dividends on our Common Stock, the return on investment on our Common Stock will depend solely on an increase, if any, in the market value of the Common Stock.
Our Common Stock May Lack Liquidity And Be Affected By Limited Trading Volume.
Our Common Stock is traded on the OTC Markets Pink Sheets. There can be no assurance that an active trading market for our common stock will be maintained. An absence of an active trading market could adversely affect our shareholders' ability to sell our common stock in short time periods, or possibly at all. Our common stock has experienced, and is likely to experience in the future, significant price and volume fluctuations, which could adversely affect the market price of our common stock without regard to our operating performance. In addition, we believe that factors such as quarterly fluctuations in our financial results and changes in the overall economy or the condition of the financial markets could cause the price of our common stock to fluctuate substantially. We cannot predict the actions of market participants and, therefore, can offer no assurances that the market for our stock will be stable or appreciate over time.
The Volatility Of Stock Prices May Adversely Affect The Market Price Of Our Common Stock.
The market for our Common Stock is highly volatile. The trading price of our Common Stock could be subject to wide fluctuations in response to, among other things:
(i)
quarterly variations in operating and financial results;
(ii)
changes in our revenue and revenue growth rates; and
(iii)
marketing and advertising.
Statements or changes in opinions, ratings, or earnings estimates made by brokerage firms or industry analysts relating to the market in which we do business or related to it could result in an immediate effect in the market price of our Common Stock. In addition, the stock market has from time to time experienced extreme price and volume fluctuations which have particularly affected the market price for the securities of many mining and exploration companies and which often have been unrelated to the operating performance of these companies. These broad market fluctuations may adversely affect the market price of our Common Stock.
Risks Relating to Financing Arrangements - The Conversion Price Feature of Notes, Preferred Stock, and Debentures May Encourage Short Sales in the Companys Common Stock.
The Company has issued convertible debentures in connection with its financing needs. These debentures are convertible at a variable price that is computed at an average of sixty percent of the average of the lowest three days closing bid price prior to the date of conversion.
The downward pressure on the price of the common stock as the selling stockholders under both these financings convert and sell amounts of common stock could encourage short sales by investors. This could place further downward pressure on the price of the common stock. The selling stockholders could sell common stock into the market in anticipation of covering the short sale by converting their securities, which could cause the further downward pressure on the stock price. In addition, not only the sale of shares issued upon conversion or exercise of notes and related warrants, and Series B preferred stock, but also the mere perception that these sales could occur, may adversely affect the market price of the common stock.
Rules of the Securities and Exchange Commission concerning low priced securities may limit the ability of shareholders to sell their shares
The Companys common stock is subject to Rule 15g-9 of the Securities and Exchange Commission which regulates broker/dealer practices in connection with transactions in "penny stocks". Penny stocks generally are equity securities with a price of less than $5.00, other than securities registered on certain national securities exchanges or quoted on the NASDAQ system, provided that current price and volume information with respect to transactions in that security are provided by the exchange or system. The penny stock rules require a broker/dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document prepared by the Commission that provides information about penny stocks and the nature and level or risks in the penny stock market. The broker/dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker/dealer and its salesperson in the transaction, and if the broker/dealer is the sole market-maker, the broker/dealer must disclose this fact and the broker/dealers presumed control over the market. This information must be provided to the customer orally or in writing before or with the written confirmation of trade sent to the customer. The bid and offer quotations, and the broker/dealer and its salesperson compensation information, must be given to the customer in writing before or with the customer's confirmation. The broker/dealer must make a special suitability determination for purchasers of the securities and receive the purchaser's written agreement to the transaction prior to sale. Monthly statements must be sent by the broker/dealer to the customer disclosing recent price information for the penny stock held in the account and information on the limited market in penny stocks. These disclosure requirements may reduce the level of trading activity in the market for American Mineral Group's common stock and may limit the ability of investors in this offering to sell American Mineral Group's common stock in the secondary market.
The limited public market for American Mineral Group's common stock may limit the ability of shareholders to sell their shares.
There has been only a limited public market for our common stock. An active trading market for American Mineral Group's stock may not develop and purchasers of the shares may not be able to resell their securities at prices equal to or greater than the price paid for these shares. The market price of our common stock may decline as the result of announcements by American Mineral Group or its competitors, variations in American Mineral Group's results of operations, and market conditions in the real estate and commodities markets in general.
The Depository Trust Company has placed a Chill on Deposits of the Common Shares of the Company
In November 2011, the Company became aware that the Depository Trust Company (DTC) had placed a Chill on deposit of its common shares into the automated settlement system which they maintain. This chill makes it more difficult for investors to acquire and deposit shares of the Companys Common Stock into many brokerage accounts it does NOT prevent trading on existing shares, and there are alternate companies that provide deposit and settlement services albeit at an increased price and which take more time. Upon inquiry, the Company was advised that it was a precaution and that for deposits through DTC to be resumed would require an audit and representation by a DTC participating broker dealer as to the accuracy of its shares outstanding. The Company intends to pursue this matter in the coming months as funding permits.
Rules of the Securities and Exchange Commission concerning late report filings
Originally quoted on FINRAs OTCBB American Mineral Group's common stock is currently quoted on the OTC Markets Pink Sheets under the trading symbol SUGO. With this filing, the Company is current with its filings, and expects to provide audited statements in the next few months.
ITEM 1B UNRESOLVED STAFF COMMENTS
None.
ITEM 2. PROPERTIES
Currently, the Company occupies approximately 200 SF of office space provided by one of its officers gratis.
ITEM 3. LEGAL PROCEEDINGS
In August, 2009, trading in the Companys stock was temporarily suspended in British Columbia, Canada by the British Columbia Securities Commission (BCSC). The temporary suspension was the result of what the BCSC termed suspicious trading activity due to a significant increase in the share price of the Companys stock price. Various shareholders, and the former CEO and President, Malkeet Bains have been interviewed and several have been either charged with or accepted please in connection with violations of Canadian securities laws.
The Cease Trade Order is still in effect regarding trading in British Columbia, Canada only, and specifically affects the residents thereof.
The case outlined above does not involve the Company or any of its current officers or directors.
ITEM 4. Mine Safety Disclosures
As the Company currently has no operating mining operations, there are no is mine safety issues to disclose.
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
As of March 18, 2015, there were approximately 657 owners of record of the Company's common stock. The Company's common stock is traded on the OTC Bulletin Board under the symbol "SUGO". Set forth below are the range of high and low bid quotations for the periods indicated as reported by the OTC Bulletin Board. The market quotations reflect inter-dealer prices, without retail mark-up, mark-down or commissions and may not necessarily represent actual transactions. The following table reports high and low closing prices, on a quarterly basis, for the Company's common stock:
Dividend Policy
We have never declared or paid any cash dividends on our common stock. We currently intend to retain future earnings, if any, to finance the expansion of our business. As a result, we do not anticipate paying any cash dividends in the foreseeable future.
Recent Sales of Unregistered Securities
The following sets forth certain information regarding sales of, and other transactions with respect to, our securities, which sales and other transactions were not registered pursuant to the Securities Act of 1933, during the last three years. Unless otherwise indicated, no underwriters were involved in such transactions.
In December 2012, the Company issued 78,333,333 common shares in connection with the conversion of $4,700 of convertible debentures and accrued interest. The conversions had an average price of $0.00006 per share.
In January 2013, the Company issued 78,333,333 common shares in connection with the conversion of $4,700 of convertible debentures and accrued interest. The conversions had an average price of $0.00006 per share.
In January 2013, the Company issued 85,000,000 common shares in connection with the conversion of $2,125 of convertible debentures and accrued interest. The conversions had an average price of $0.00003 per share.
There were no share issuances during the fiscal year ended November 31, 2014.
In January 2015, the Company issued 791,176 common shares in connection with the conversion of $1,345 of convertible debentures and accrued interest. The conversions had an average price of $0.0017 per share.
In January 2015, the Company issued 791,593 common shares in connection with the conversion of $4,280 of convertible debentures and accrued interest. The conversions had an average price of $0.0054 per share.
In January 2015, the Company issued 831,481 common shares in connection with the conversion of $4,490 of convertible debentures and accrued interest. The conversions had an average price of $0.0054 per share.
In January 2015, the Company issued 831,481 common shares in connection with the conversion of $4,490 of convertible debentures and accrued interest. The conversions had an average price of $0.0054 per share.
In February 2015, the Company issued 832,075 common shares in connection with the conversion of $4,490 of convertible debentures and accrued interest. The conversions had an average price of $0.0053 per share.
In February 2015, the Company issued 832,250 common shares in connection with the conversion of $3,325 of convertible debentures and accrued interest. The conversions had an average price of $0.0040 per share.
In February 2015, the Company issued 832,250 common shares in connection with the conversion of $3,325 of convertible debentures and accrued interest. The conversions had an average price of $0.0040 per share.
In February 2015, the Company issued 2,560,000 common shares in connection with the conversion of 512 shares of Preferred B Shares.
In March 2015, the Company issued 831,633 common shares in connection with the conversion of $4,075 of convertible debentures and accrued interest. The conversions had an average price of $0.0049 per share.
In March 2015, the Company issued 832,075 common shares in connection with the conversion of $4,660 of convertible debentures and accrued interest. The conversions had an average price of $0.0056 per share.
In March 2015, the Company issued 328,182 common shares in connection with the conversion of $1,805 of convertible debentures and accrued interest. The conversions had an average price of $0.0055 per share.
In March 2015, the Company issued 503,636 common shares in connection with the conversion of $4,575 of convertible debentures and accrued interest. The conversions had an average price of $0.0055 per share.
In March 2015, the Company issued 2,545,000 common shares in connection with the conversion of 509 shares of Preferred B Shares.
In April 2015, the Company issued 3,395,000 common shares in connection with the conversion of 679 shares of Preferred B Shares.
In March 2015, the Company issued 3,730,000 common shares in connection with the conversion of 746 shares of Preferred B Shares.
In April 2015, the Company issued 2,067,073 common shares in connection with the conversion of $1,695 of convertible debentures and accrued interest. The conversions had an average price of $0.0008 per share.
ITEM 6. SELECTED FINANCIAL DATA
Not applicable.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The financial data presented below should be read in conjunction with the more detailed financial statements and related notes, which are included elsewhere in this report. Information discussed herein, as well as elsewhere in this Annual Report on Form 10-K, includes forward-looking statements or opinions regarding future events or the future financial performance of the Company, and are subject to a number of risks and other factors which could cause the actual results to differ materially from those contained in forward-looking statements. Among such factors are general business and economic conditions, and risk factors as listed in this Form 10-K or listed from time to time in documents filed by the Company with the Securities and Exchange Commission.
Financial Condition
As of November 30, 2014, American Mineral Group had total current assets of $2 and total current liabilities of $2,428,421 for a net working capital deficit of $2,428,419. We need to raise additional money to meet our general and administrative expenses, and we need to raise money to achieve our business objective to pursue telecom opportunities in the newly emerging Cuban market. The additional funding will come from equity financing from the sale of our common stock. If we are successful in completing an equity financing, existing shareholders will experience dilution of their interest. The Company does not have any financing arranged and we cannot provide investors with any assurance that we will be able to raise sufficient funding from the sale of its common stock. In the absence of such financing, the Company will fail.
Based on the nature of our business, management anticipates incurring operating losses in the foreseeable future. Management bases this expectation, in part, on the fact that to pursue telecom opportunities in the newly emerging Cuban market will likely take several years before we are capable of generating revenues. Our future financial results are also uncertain due to a number of factors, some of which are outside its control. These factors include, but are not limited to:
Our ability to raise additional funding;
Our ability to identify and successfully negotiate the acquisition of potential properties or assets; and
If such opportunities or businesses acquired will be profitable.
Due to the Companys lack of operating history and present inability to generate revenues, the Companys independent auditors have added an explanatory paragraph to their audit opinion issued in connection with our financial statements for 2011 indicating substantial doubt about the Companys ability to continue as a going concern. This means that there is substantial doubt whether the Company can continue as an ongoing business for the next 12 months unless we obtain additional capital to pay our bills.
Liquidity
The Companys internal sources of liquidity will be loans that may be available from management. Although the Company has no written arrangements with its management, The Company expects that the officers may provide the Company with nominal liquidity, when and if it is required.
The Company's external sources of liquidity will be private placements for equity and debt financing.
Between December 2012 and November 2013, the Company borrowed $21,888 from a non-affiliated accredited investor. The Notes carry interest at a rate of 15% per year and are due on demand.
Between December 2013 and November 2014, the Company borrowed $200 from a non-affiliated accredited investor. The Notes carry interest at a rate of 15% per year and are due on demand.
For the periods ended November 30, 2014 and 2013, the Company borrowed $0 and $359 from its CFO. The notes are due on demand and carry no interest.
There are no assurances that the Company will be able to achieve further sales of its common stock or any other form of additional financing. If the Company is unable to achieve the financing necessary it will fail to execute its future plan of operations which are to pursue telecom opportunities in the newly emerging Cuban market.
Capital Resources
As of November 30, 2014, the Company had total assets of $ 2, total liabilities of $2,428,421 and a working capital deficit of $2,428,419, compared with a net working capital deficit of $3,581,228 as of November 30, 2013. The assets are comprised of cash of $2, and in FY 2013 mineral rights and oil field equipment for which the Company paid $2.0 million in common stock and notes. The liabilities consisted mainly of accounting, audit and legal fees, convertible debentures, demand notes, officer loans, and accrued expenses.
While the Company is attempting to commence operations and generate revenues, the Companys cash position is not significant enough to support the Companys daily operations. Management intends to raise additional funds to support future operations. Management believes that the actions presently being taken to further implement its business plan and generate revenues provide the opportunity for the Company to continue as a going concern. While management believes in the viability of its strategy to generate revenues and in its ability to raise additional funds, there can be no assurances to that effect. The ability of the Company to continue as a going concern is dependent upon the Companys ability to further implement its business plan and generate revenues.
Results of Operations
We did not earn any revenues for the fiscal years ended November 30, 2014 and 2013.
We incurred total expenses in the amount of $347,190 during the fiscal year ended November 30, 2014, and total expenses in the amount of $569,693 during the fiscal year ended November 30, 2013.
|
| Years Ended November 30, | ||
Expense Item |
| 2014 |
| 2013 |
Royalty Payments |
| $ - |
| $ - |
Consulting |
| 380,779 |
| 373,134 |
Accounting |
| (6,000) |
| 36,000 |
Legal |
| - |
| 1,069 |
Interest expense |
| (26,377) |
| 157,245 |
Other |
| (1,212) |
| 2,245 |
Total | $ | $ 347,190 |
| $ 569,693 |
Off-Balance Sheet Arrangements
The Company has no off-balance sheet arrangements.
Material Agreements
In July 2009, the Company entered into a Consulting and Fee Agreement for business development, strategic planning, technology implementation, public relations, and mergers and acquisitions. The agreement calls for the payment of ten percent (10%) of the gross value of any projects to which the Company is introduced by the consultant and which is ultimately closed by the Company.
Subsequent Events
Management has evaluated subsequent events pursuant to the requirements of ASC Topic 855 and has determined that other than listed below, no material subsequent events exist.
On January 9, 2015, the outstanding shareholders of the Company voted to change the name of the Company from American Mineral Group, Inc. to CaerVision Global, Inc. in order to better reflect the planned change in the Companys future operations.
On January 26, 2015, the Company entered into a stock purchase definitive agreement with Vitall, Inc., a Delaware corporation, whereby the Company will issue 15,000,000 shares of common stock for 100% of the issued and outstanding capital of Vitall, Inc. On March 17, 2015, Vitall, Inc. terminated the merger agreement due to non-performance on the part of the Company. As a result, the name CaerVision Global, Inc. will be surrendered back to its original owner.
On June 12, 2015, the Company consummated a share exchange agreement with Amgentech Inc./Telco Cuba, Inc., a Florida corporation, whereby the Company issued 75,000,000 shares of common stock previously issued to third parties in exchange for 100% of the issued and outstanding capital of Amgentech Inc./Telco Cuba, Inc. Amgentech Inc./Telco Cuba, Inc. will be the surviving entity and focus on opportunities in the Cuban telecommunications market. The Company has filed an amendment to its articles of incorporation to change its name to Telocuba, Inc.
On June 15, 2015, the Company effectuated an amendment to its articles of incorporation to change its name from CaerVision Global, Inc. to Telco Cuba, Inc.
On June 15, 2015, the Company effectuated an amendment to its articles of incorporation to appoint William Sanchez to the position of CEO, CFO, President, Treasurer and Secretary. In the same amendment to our articles of incorporation, Erwin Vahlsing Jr., Thomas J Craft Jr. and Frederick J Puccillo Jr., resigned their positions as officers and directors of the Company.
The Company had the following issuances of stock subsequent to November 30, 2014;
In January 2015, the Company issued 791,176 common shares in connection with the conversion of $1,345 of convertible debentures and accrued interest. The conversions had an average price of $0.0017 per share.
In January 2015, the Company issued 791,593 common shares in connection with the conversion of $4,280 of convertible debentures and accrued interest. The conversions had an average price of $0.0054 per share.
In January 2015, the Company issued 831,481 common shares in connection with the conversion of $4,490 of convertible debentures and accrued interest. The conversions had an average price of $0.0054 per share.
In January 2015, the Company issued 831,481 common shares in connection with the conversion of $4,490 of convertible debentures and accrued interest. The conversions had an average price of $0.0054 per share.
In February 2015, the Company issued 832,075 common shares in connection with the conversion of $4,490 of convertible debentures and accrued interest. The conversions had an average price of $0.0053 per share.
In February 2015, the Company issued 832,250 common shares in connection with the conversion of $3,325 of convertible debentures and accrued interest. The conversions had an average price of $0.0040 per share.
In February 2015, the Company issued 832,250 common shares in connection with the conversion of $3,325 of convertible debentures and accrued interest. The conversions had an average price of $0.0040 per share.
In February 2015, the Company issued 2,560,000 common shares in connection with the conversion of 512 shares of Preferred B Shares.
In March 2015, the Company issued 831,633 common shares in connection with the conversion of $4,075 of convertible debentures and accrued interest. The conversions had an average price of $0.0049 per share.
In March 2015, the Company issued 832,075 common shares in connection with the conversion of $4,660 of convertible debentures and accrued interest. The conversions had an average price of $0.0056 per share.
In March 2015, the Company issued 328,182 common shares in connection with the conversion of $1,805 of convertible debentures and accrued interest. The conversions had an average price of $0.0055 per share.
In March 2015, the Company issued 503,636 common shares in connection with the conversion of $4,575 of convertible debentures and accrued interest. The conversions had an average price of $0.0055 per share.
In March 2015, the Company issued 2,545,000 common shares in connection with the conversion of 509 shares of Preferred B Shares.
In April 2015, the Company issued 3,395,000 common shares in connection with the conversion of 679 shares of Preferred B Shares.
In March 2015, the Company issued 3,730,000 common shares in connection with the conversion of 746 shares of Preferred B Shares.
In April 2015, the Company issued 2,067,073 common shares in connection with the conversion of $1,695 of convertible debentures and accrued interest. The conversions had an average price of $0.0008 per share.
Critical Accounting Policies
Accounting Principles
The accounting and reporting policies of the Company conform to United States generally accepted accounting principles applicable to exploration stage enterprises.
Cautionary Statement Regarding Forward-Looking Statements
This annual report contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These include statements about our expectations, beliefs, intentions or strategies for the future, which we indicate by words or phrases such as "anticipate," "expect," "intend," "plan," "will," "we believe," "our company believes," "management believes" and similar language. These forward-looking statements are based on our current expectations and are subject to certain risks, uncertainties and assumptions, including those set forth in the following discussion, including under the heading "Risk Factors". Our actual results may differ materially from results anticipated in these forward-looking statements. We base our forward-looking statements on information currently available to us, and we assume no obligation to update them. In addition, our historical financial performance is not necessarily indicative of the results that may be expected in the future and we believe that such comparisons cannot be relied upon as indicators of future performance. Other important factors that could cause actual results to differ materially include the following: business conditions, the price of precious metals, ability to attract and retain personnel; the price of the Company's stock; and the risk factors set forth from time to time in the Company's SEC reports, including but not limited to its annual report on Form 10-K; its quarterly reports on Form 10-Q; and any current reports on Form 8-K. In addition, the Company disclaims any obligation to update or correct any forward-looking statements in all the Company's annual reports and SEC filings to reflect events or circumstances after the date hereof.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not applicable.
ITEM 8. FINANCIAL STATEMENTS OF SMALLER REPORTING COMPANIES
The financial statements and related notes are included as part of this report as indexed in the appendix on page F-1.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.
ITEM 9A. CONTROLS AND PROCEDURES
Disclosure Controls and Procedures
Under the supervision and with the participation of the Company's management, including the Company's principal executive officer and principal financial officer, the Company has evaluated the effectiveness of the design and operation of its disclosure controls and procedures pursuant to Exchange Act Rule 13a-15(e) and Rule 15d-15(e) as of the end of the fiscal year covered by this annual report. Based on that evaluation, the principal executive officer and principal financial officer believe the disclosure controls and procedures are effective to ensure that information required to be disclosed by us in the reports we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission's rules and forms and that our disclosure and controls are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive officer and principal financial officer, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. There were no significant changes in the Company's internal controls or in other factors that could significantly affect internal controls subsequent to the date of their evaluation and there were no corrective actions with regard to significant deficiencies and material weaknesses.
Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Internal control over financial reporting is a process designed under the supervision of our principal executive and principal financial officers 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. All internal control systems, no matter how well designed, have inherent limitations. Even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation.
Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting as of November 30, 2014 based on the framework established in Internal Control Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on managements assessment, management concluded that, as of November 30, 2014, the Companys internal control over financial reporting was effective.
This Annual Report does not include an attestation report of the Companys registered public accounting firm regarding internal control over financial reporting. Managements report was not subject to attestation by the Companys registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit the Company to provide only managements report in this Annual Report.
ITEM 9B. OTHER INFORMATION
None
PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
Executive Officers And Directors
The following table sets forth the directors and executive officers of our Company, their ages and positions with our Company. Pursuant to our bylaws, our directors are elected at our annual meeting of stockholders and each director holds office until his successor is elected and qualified. Officers are elected by our Board of Directors and hold office until an officer's successor has been duly appointed and qualified unless an officer sooner dies, resigns or is removed by the Board.
There are no arrangements or understandings regarding the length of time a director of our company is to serve in such a capacity.
The following table sets forth information about our executive officers and directors as of the filing date.
Name and Address | Age | Position |
Frederick J. Pucillo, Jr. Warwick, RI | 64 | Director, President and CEO, up until his resignation on June 15, 2015 |
Erwin Vahlsing, Jr. Warwick, RI | 58 | Director, Chief Financial Officer, Treasurer, and Secretary, up until his resignation on June 15, 2015 |
Thomas Craft, Jr. Warwick, RI
| 49 | Director, up until his resignation on June 15, 2015 |
William Sanchez | 42 | Director, CEO, CFO, Secretary and Treasurer from June 15, 2015 to present
|
Frederick J. Pucillo, Jr. has served as our President, Chief Executive Officer and Director from December 2009 to June 15, 2015. Mr. Pucillo has over twenty years experience serving mid-size to Fortune 100 companies in the banking and finance area, having managed a $110 million loan portfolio with 10,000 accounts, and other capital funding and business development opportunities. Mr. Pucillo was the CFO for Atlantic Fire Protection, LLC from 2007 through 2009, and previously, was CFO for Zammido Automotive Group from 2000 through 2007. He is thoroughly familiar with finance, cash flow analysis and budgeting, as well as negotiation of promising opportunities.
Erwin Vahlsing, Jr. has served as our Chief Financial Officer, Secretary, Treasurer, and Director from September 2009 to June 15, 2015. Mr. Vahlsing is a financial executive with domestic and international experience managing finance departments in the manufacturing, service, and construction industries. Mr. Vahlsing has acted as Chief Financial Officer to ICOA, Inc. since 2001. He acted as a Consultant to E&M Advertising for SEC compliance and due diligence. Mr. Vahlsing received an MBA from the University of Rhode Island in 1986 and a Bachelors degree in Accounting from the University of Connecticut.
Thomas J. Craft, Jr., has served as a Director of the Company up until June 15, 2015. Mr. Craft is a Florida attorney, specializing in federal securities law and mergers and acquisitions. He practices securities law in Florida. Mr. Craft has more than 15 years of experience in federal securities matters as well as the public markets generally. Mr. Craft has served on the board of directors of several public companies prior to joining the Company's board of directors on November 22, 2002. Mr. Craft has served as a member of our Audit Committee since 2002 and in April 2007 Mr. Craft was appointed as a member of our Compensation Committee and Nominating Committee. Mr. Craft has served as an officer and a director of Peregrine Industries, Inc., a public reporting company, since March 2004.
William Sanchez, took over as Chief Executive Officer, Chief Financial Officer, President, Treasurer and Secretary of the Company as of June 15, 2015. Mr. Sanchez has over 23 years of experience in the internet and telecommunications space. He has been involved as a systems engineer and architect during the inception of various nascent companies, such as SportsLine (www.sportsline.com), StarMedia (www.starmedia.com), and SportsAdvisors (www.sportsadvisors.com). For the last 15 years, he has been president of Amgentech, Inc., a full service technology solutions company. At Amgentech, Mr. Sanchez was retained to create the technical process and procedures as well as the internet components of well over 20 companies
Committees of the Board of Directors
We do not currently have an Audit, Executive, Finance, Compensation, or Nominating Committee, or any other committee of the board of directors.
Code of Ethics
We have adopted a code of ethics that applies to our Chief Executive Officer, Chief Financial Officer, Principal Executive Officer, Principal Financial Officer, Principal Accounting Officer, Controller and persons performing similar functions within the Company. A copy of the code of ethics is filed with the SEC as an exhibit to the Company's Form S-1 filed on February 22, 2008. If we make any substantive amendments to the Code of Ethics or grant any waiver, including any implicit waiver, from a provision of the Code of Ethics to our directors, officers and employees, we will disclose the nature of such amendment or waiver in a report on Form 8-K.
Family Relationships
There are no family relationships between any two or more of our directors or executive officers. There is no arrangement or understanding between any of our directors or executive officers and any other person pursuant to which any director or officer was or is to be selected as a director or officer, and there is no arrangement, plan or understanding as to whether non-management shareholders will exercise their voting rights to continue to elect the current board of directors. There are also no arrangements, agreements or understandings to our knowledge between non-management shareholders that may directly or indirectly participate in or influence the management of our affairs.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 requires directors, executive officers and 10% or greater shareholders of the Company ("Reporting Persons") to file with the Securities and Exchange Commission initial reports of ownership (Form 3) and reports of changes in ownership of equity securities of the Company (Form 4 and Form 5) and to provide copies of all such forms as filed to the Company. With the exception of the CFO, who has completed his Form 3 report but which as of the date of this filing had not been filed with the Commission, he also has not completed a Form 4 to update his holdings. Aside from this, the Company is not aware of any Reporting Persons that have failed to file reports on a timely basis.
Mr. Pucillo has completed and filed his Form 3 indicating he is currently the owner of 24,156 common shares, and 12,500 Preferred B shares.
At the time of Mr. Vahlsing hiring, he completed his Form 3. It appears the Company filed it on the Canadian, SEDA system and failed to file it on the SECs Edgar database. The report is being updated with current information and will be filed subsequent to the date of this report. Mr. Vahlsing is the owner of 24,000 common shares and 12,500 Preferred B shares at the period end covered by this report.
Significant Personnel
We have no significant personnel other than our sole officer and director. We presently rely on consultants and other third party contractors to perform administrative services for the Company. We have no formal contracts with any of these consultants and contractors.
ITEM 11. EXECUTIVE COMPENSATION
To date, our directors do not currently receive and have never received any compensation for serving as a director of the Company. Presently, our officers are paid on a consulting basis for the time and efforts spent on behalf of the Company. Effective September 2, 2010 the Company entered into Employment Agreements with our CEO, CFO, and Investor Relations.
The following table sets forth all compensation awarded to, earned by, or paid for services rendered to us in all capacities by the officers for the last three fiscal years.
Summary Compensation Table
| None. |
| Annual Compensation | Long-Term Compensation | |||||||
Name & | Fiscal Year Nov 30, | Salary | Bonus | Other Annual Compensation (2) | Restricted Stock Awards in US$(1) |
| Options/SARs | LTIP Payouts | All Other Compensation(2) |
|
|
|
|
|
|
|
|
|
|
Frederick J. Pucillo, Jr. | 2014 | $ 0 | $0 | $139,933 | $ 0 |
| 0 | 0 | 0 |
Former Chief Executive Officer, | 2013 | $ 0 | $0 | $134,551 | $ 0 |
| 0 | 0 | 0 |
President, Director (3) | 2012 | $ 0 | $0 | $129,376 | $31,250 |
| 0 | 0 | 0 |
|
|
|
|
|
|
|
|
|
|
Erwin Vahlsing, Jr | 2014 | $ 0 | $0 | $136,933 | $ 0 |
| 0 | 0 | 0 |
Former Chief Financial Officer, | 2013 | $ 0 | $0 | $134,551 | $ 0 |
| 0 | 0 | 0 |
Secretary, Treasurer, | 2012 | $ 0 | $0 | $129,376 | $ 31,250 |
| 0 | 0 | 0 |
Director (4) |
|
|
|
|
|
|
|
|
|
See notes below:
(1)
The named executive officers received grants of restricted stock in connection with entry into 5 year employment agreements.
(2)
Salary was accrued in 2014 with only partial payment made during the years 2013 and 2012. The balance may be paid either in cash or stock.
(3)
On June 15, 2015, Frederick J. Pucillo, Jr. resigned his position of CEO, President and Director of the Company. He was replaced by William Sanchez.
(4)
On June 15, 2015, Erwin Vahlsing, Jr. resigned his position of CFO, Secretary and Treasurer of the Company. He was replaced by William Sanchez.
Employment Agreements
In September 2010, the Company entered into five year Employment Contracts with its three employees.
Below is a summary of the basic terms of the Agreements:
·
Base Salary for the CEO and CFO
$120,000 per year
·
Base Salary for Investor relations
$100,000 per year
·
The officers received stock grants in connection with the contracts of:
o
CEO
1,500,000 common shares
o
CFO
1,000,000 common shares
o
Investor Relations
1,000,000 common shares
·
4% annual increases in Base Salary
·
Bonus provision if and when the Company reaches profitability
·
Other normal benefits provided such as health insurance as negotiated by the Company
As of November 30, 2014 and 2013, the Company had an accrued payroll liability balance of $1,319,194 and $938,415.
Stock Options
We do not presently have a stock option plan but intend to develop an incentive based stock option plan for our officers and directors in the future and may reserve up to ten percent of our outstanding shares of common stock for that purpose.
Compensation Committee
We do not have a compensation committee. The functions of the compensation committee are currently carried out by our Board of Directors.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
Securities authorized for issuance under equity compensation plans
The Company has no securities authorized for issuance under equity compensation plans.
Security Ownership of Certain Beneficial Owners and Management
The following table sets forth certain information as of June 18, 2015 with respect to the beneficial ownership of our Company's common stock with respect to each named director and executive officer of our Company, each person known to our Company to be the beneficial owner of more than 5% of said securities, and all directors and executive officers of our Company as a group:
Name and Address | Title of Class | Amount and Nature of Beneficial Ownership | Percentage |
Frederick J. Pucillo, Jr. Chief Executive Officer, President, and Director | Common Preferred B(2) | 24,156 62,500,000 | 0.2% 80.5% |
Erwin Vahlsing, Jr. Chief Financial Officer, Treasurer, Secretary, and Director | Common Preferred B(2) | 24,000 62,500,000 | 0.2% 80.5% |
Thomas Craft, Jr. Director | Preferred B(2) | 62,500,000 | 80.5% |
Martin Bolodian Investor Relations | Common | 12,000 | 0.1% |
Internet Marketing Solutions, Inc. | Preferred B(2) | 250,000,000 | 94.3% |
All officers, directors, and beneficial owners as a group | Common Preferred B(2) | 260,156 437,500,000 | 1.7% 96.7% |
(1) The percentage of common shares is based on 1,891,903,870 shares of common stock outstanding as of June 18, 2015.
(2) Percentage is based on current common stock outstanding as of June 18, 2015 plus beneficial amount owned by the individual holder, on an As Converted basis.
The persons named above have full voting and investment power with respect to the shares indicated. Under the rules of the Securities and Exchange Commission, a person (or group of persons) is deemed to be a "beneficial owner" of a security if he or she, directly or indirectly, has or shares the power to vote or to direct the voting of such security, or the power to dispose of or to direct the disposition of such security. Accordingly, more than one person may be deemed to be a beneficial owner of the same security. A person is also deemed to be a beneficial owner of any security, which that person has the right to acquire within 60 days, such as options or warrants to purchase our common stock.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
Since the beginning of the Company's last fiscal year, no director, executive officer, security holder, or any immediate family of such director, executive officer, or security holder owing more than 5% of our shares of common stock has had any direct or indirect material interest in any transaction or currently proposed transaction, which the Company was or is to be a participant, that exceeded the lesser of (1) $120,000, or (2) 1% of the average of The Company's total assets at year end for the last two completed fiscal years.
In September 2010, the Company entered into 5 year employment agreements with its three employees. Below is a summary of the basic terms of the Agreements:
·
Base Salary for the CEO and CFO
$120,000 per year
·
Base Salary for Investor relations
$100,000 per year
·
The officers received stock grants in connection with the contracts of:
o
CEO
1,500,000 common shares
o
CFO
1,000,000 common shares
o
Investor Relations
1,000,000 common shares
·
4% annual increases in Base Salary
·
Bonus provision if and when the Company reaches profitability
·
Other normal benefits provided such as health insurance as negotiated by the Company
As of November 30, 2014 and 2013, the Company had an accrued payroll liability balance of $1,319,194 and $938,415.
From time to time, our former CEO, Mal Bains lloaned money to the Company. At November 30, 2014 and 2013 the balance owed was $17,950 (CAD) respectively. The balance does not bear interest and is due on demand. For financial statement purposes, the balance is adjusted based on the exchange rate on the date of the statements.
Our CEO and CFO have from time to time loaned money to the Company. At November 30, 2014 and 2013, they had a balance owed to them of $1,384 and $1,384 respectively. The balances do not bear interest and are due on demand.
The Company's transactions with its officers, directors and affiliates have been and such future transactions will be, on terms no less favorable to the Company than could have been realized by the Company in arm's length transactions with non-affiliated persons and will be approved by a majority of the independent disinterested directors.
Directors Independence
The only director on our board that is independent is Thomas Craft, Jr., our other two directors Mr. Pucillo and Mr. Vahlsing, are not independent, pursuant to the definition of an "independent director" set forth in Rule 5605(a)(2) of the NASDAQ Manual. In summary, an "independent director" means a person other than an executive officer or employee of the issuer or any other individual having a relationship which, in the opinion of the issuer's board of directors, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director.
The Company intends to add members to the Board of Directors who are independent during the fiscal year 2015.
We do not have a compensation committee, nominating committee or audit committee; the functions of these committees are performed by our directors and Chief Financial Officer.
The Company is currently traded on the OTC Market Pink Sheet, which does not require that a majority of the Board be independent.
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
The fees billed to the Company for the fiscal years ending November 30, 2014 and 2013 were as follows:
| Year ended | Year ended |
Audit Fees | $0 | $0 |
Audit-Related Fees | $0 | $0 |
Tax Fees | $0 | $0 |
All Other Fees | $0 | $0 |
Because the Company does not have an audit committee, it has not instituted pre-approval policies and procedures as described in paragraph (c)(7)(i) of Rule 2-01 of regulation S-X.
PART IV
ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
Financial Statements and Schedules
The financial statements are set forth under Item 8 of this Annual Report on Form 10-K. Financial statement schedules have been omitted since they are either not required, not applicable, or the information is otherwise included.
Exhibit Listing
|
|
| Incorporated by reference | ||
Exhibit No. | Description of Exhibit | Filed herewith | Form | Exhibit | Filing date |
3.1 | Articles of Incorporation |
| S-1 | 3.1 | 02/22/08 |
3.2 | Certificate of Change dated July 20, 2009 |
| 8-K | 3.1 | 08/03/09 |
3.3 | Bylaws |
| S-1 | 3.2 | 02/22/08 |
4.1 | Specimen Stock Certificate |
| S-1 | 4.1 | 02/22/08 |
10.6 | Consulting and Fee Agreement dated July 1, 2009 between Internet Marketing Solutions, Inc. and American Mineral Group |
| 10-K | 10.6 | 03/17/10 |
10.7 | Employment Agreement dated September 2, 2010 between Frederick Pucillo, Jr. and American Mineral Group |
| 10-K | 10.7 |
|
10.8 | Employment Agreement dated September 2, 2010 between Erwin Vahlsing, Jr. and American Mineral Group |
| 10-K | 10.8 |
|
14 | Code of Ethics |
| S-1 | 14 | 02/22/08 |
31.1 | Certifications of Principal Executive Officer and Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | X |
|
|
|
32.1 | Certifications of Principal Executive Officer and Principal Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | X |
|
|
|
Telco Cuba Inc.
(Formerly CaerVision Global, Inc. and
American Mineral Group, Inc.)
FINANCIAL STATEMENTS
(Unaudited)
INDEX
| Page Number |
FINANCIAL STATEMENTS |
|
Balance Sheets (Unaudited) | F-1 |
Statements of Operations (Unaudited) | F-2 |
Statements of Stockholders Deficit (Unaudited) | F-3 |
Statements of Cash Flows (Unaudited) | F-4 |
Notes to Financial Statements (Unaudited) | F-5 to F-22 |
Telco Cuba Inc. (Formerly CaerVision Global, Inc. and American Mineral Group, Inc.) | |||
BALANCE SHEETS | |||
(Unaudited) | |||
|
|
|
|
ASSETS |
|
|
|
| November 30, 2014 |
| November 30, 2013 |
CURRENT ASSETS: |
|
|
|
Cash | $ 2 |
| $ 2 |
TOTAL CURRENT ASSETS | 2 |
| 2 |
|
|
|
|
MINERAL RIGHTS and PROPERTIES |
|
|
|
Working Interest in Grand Chenier oil & gas prospect | - |
| 800,000 |
Oil field equipment | - |
| 1,200,000 |
TOTAL MINERAL AND FIXED ASSETS | - |
| 2,000,000 |
|
|
|
|
| $ 2 |
| $ 2,000,002 |
|
|
|
|
LIABILITIES AND STOCKHOLDERS' DEFICIT |
|
|
|
|
|
|
|
CURRENT LIABILITIES: |
|
|
|
Accounts payable | $ 101,390 |
| $ 106,644 |
Accrued expenses | 271,596 |
| 298,811 |
Accrued payroll | 1,319,194 |
| 938,415 |
Convertible debentures (net of debt discount of $0 and $0) | 241,925 |
| 241,925 |
Notes payable (net of debt discount of $0 and $0) | 283,332 |
| 1,783,132 |
Due to former CEO | 17,476 |
| 18,796 |
Due to officers | 1,384 |
| 1,384 |
Derivative liability | 192,123 |
| 192,123 |
TOTAL CURRENT LIABILITIES | 2,428,421 |
| 3,581,230 |
|
|
|
|
STOCKHOLDERS' DEFICIT: |
|
|
|
Preferred A stock, $.001 par value; authorized shares - 100,000 shares; 3,000 and 3,000 issued and outstanding | 3 |
| 3 |
Preferred B stock, $.001 par value; authorized shares - 100,000 shares; 87,500 and 87,500 issued and outstanding | 88 |
| 88 |
Preferred C Stock to be issued | - |
| 250 |
Common stock, $.001 par value; authorized shares - 500,000,000 shares; 15,135,231 and 15,135,231 shares issued and outstanding | 15,135 |
| 15,135 |
Additional paid-in capital | 12,381,235 |
| 12,880,985 |
Deficit accumulated during the exploration stage | (14,824,879) |
| (14,477,689) |
TOTAL STOCKHOLDERS' DEFICIT | (2,428,418) |
| (1,581,228) |
|
|
|
|
| $ 2 |
| $ 2,000,002 |
|
|
|
|
See notes to unaudited financial statements
| |||
F-1 |
| |||
Telco Cuba Inc. (Formerly CaerVision Global, Inc. and American Mineral Group, Inc.) | |||
STATEMENTS OF OPERATIONS | |||
(Unaudited) | |||
|
|
|
|
| For the Years ended | ||
| November 30, 2014 |
| November 30, 2013 |
|
|
|
|
OPERATING EXPENSES: |
|
|
|
General and administrative | $ 376,164 |
| $ 422,743 |
Bank charges and interest | - |
| 132 |
Foreign exchange (gain) loss | (2,597) |
| (2,015) |
Mineral claim maintenance and geological costs | - |
| - |
TOTAL OPERATING EXPENSES | $ 373,567 |
| 420,860 |
|
|
|
|
OPERATING LOSS | (373,567) |
| (420,860) |
|
|
|
|
Interest expense | ( 26,377) |
| 157,245 |
Change in fair value of derivative liability | - |
| (8,412) |
Amortization of debt discount | - |
| - |
Loss of mineral rights | - |
| - |
|
|
|
|
NET LOSS | $ (347,190) |
| $ (569,693) |
|
|
|
|
BASIC AND DILUTED - LOSS PER SHARE | $ (0.02) |
| $ (0.04) |
|
|
|
|
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING |
|
|
|
Basic and Diluted | 15,135,231 |
| 15,026,342 |
|
|
|
|
See notes to unaudited financial statements |
F-2
Telco Cuba Inc. (Formerly CaerVision Global, Inc. and American Mineral Group, Inc.) | ||||||||||||||||||
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT | ||||||||||||||||||
(Unaudited) | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Preferred A Stock | Preferred B Stock | Preferred C Stock | Common Stock |
| Additional |
|
|
| Total | ||||||||
| ($.0001 par value) | ($.0001 par value) | ($.0001 par value) | ($.001 par value) |
| Paid-In |
| Accumulated |
| Stockholders' | ||||||||
| Shares |
| Amount | Shares |
| Amount | Shares |
| Amount | Shares |
| Amount |
| Capital |
| Deficit |
| Equity (Deficit) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, November 30, 2012 | 3,000 | $ | 3 | 87,500 | $ | 88 | - | $ | - | 1,650,267,204 | $ | 1,650,267 | $ | 10,734,547 | $ | (13,907,996) | $ | (1,523,091) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance of stock for: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Conversion of debentures |
|
|
|
|
|
|
|
|
| 241,666,666 |
| 241,667 |
| (230,111) |
|
|
| 11,556 |
Preferred C Stock to be issued |
|
|
|
|
| - | 250,000 |
| 250 |
|
|
|
| 499,750 |
|
|
| 500,000 |
Adjustment for 1:125 reverse stock split April 24, 2013 |
|
|
|
|
|
|
|
|
| (1,876,798,639) |
| (1,876,799) |
| 1,876,799 |
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss |
|
| - |
|
| - |
|
| - | - |
| - |
|
|
| (569,693) |
| (569,693) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, November 30, 2013 | 3,000 |
| 3 | 87,500 |
| 88 | 250,000 |
| 250 | 15,135,231 |
| 15,135 |
| 12,880,985 |
| (14,477,689) |
| (1,581,228) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred C Stock to be issued |
|
|
|
|
| - | (250,000) |
| (250) |
|
|
|
| 499,750 |
|
|
| 500,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss |
|
| - |
|
| - |
|
| - | - |
| - |
|
|
| (347190) |
| (347190) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, November 30, 2013 | 3,000 | $ | 3 | 87,500 | $ | 88 | - | $ | - | 15,135,231 | $ | 15,135 | $ | 12,381,235 | $ | (14,824,879) | $ | (2,428,418) |
F-3
Telco Cuba Inc. (Formerly CaerVision Global, Inc. and American Mineral Group, Inc.) | |||
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) | |||
|
|
|
|
| For the years ended | ||
| November 30, |
| November 30, |
| 2014 |
| 2013 |
| (unaudited) |
| (unaudited) |
CASH FLOWS FROM OPERATING ACTIVITIES: |
|
|
|
Net loss | $ (347,190) |
| $ (569,693) |
Adjustments to reconcile net loss to net cash used in operating activities: |
|
|
|
Change in fair value of derivative | - |
| (8,412) |
|
|
|
|
Changes in assets and liabilities: |
|
|
|
Prepaid expenses | - |
| 3,500 |
Accounts payable and accrued expenses | 346,990 |
| 551,890 |
NET CASH USED IN OPERATING ACTIVITIES | (200) |
| (22,715) |
|
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES |
|
|
|
Payments on acquisition of Mineral Rights Agreement | - |
| - |
Acquisition of additional claims | - |
| - |
NET CASH USED IN INVESTING ACTIVITIES | - |
| - |
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
Proceeds from expenses paid by stockholder | - |
| - |
Proceeds from notes payable | 200 |
| 21,888 |
Proceeds from /(Payments) to officer and prior CEO | - |
| 359 |
|
|
|
|
NET CASH PROVIDED BY FINANCING ACTIVITIES | 200 |
| 22,247 |
|
|
|
|
NET INCREASE (DECREASE) IN CASH | 0 |
| (468) |
|
|
|
|
CASH - BEGINNING OF PERIOD | 2 |
| 470 |
|
|
|
|
CASH - END OF PERIOD | $ 2 |
| $ 2 |
|
|
|
|
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: |
|
| |
Cash paid for interest | $ - |
| $ - |
|
|
|
|
NON-CASH INVESTING AND FINANCING ACTIVITIES: |
|
|
|
Preferred C Stock issued to acquire oil and gas interests | $ - |
| $ 500,000 |
Stock issued in connection with conversion of debentures | $ - |
| $ 11,525 |
Notes issued in connection with oil & gas acquisition | $ - |
| $ 1,500,000 |
|
|
|
|
See notes to unaudited financial statements | |||
F-4 |
Telco Cuba Inc.
(Formerly CaerVision Global, Inc. and
American Mineral Group, Inc.)
Notes to the Unaudited Financial Statements
November 30, 2014 and 2013
(Unaudited)
1. Nature of Operations and Going Concern
Telco Cuba Inc., (Formerly CaerVision Global, Inc. fka American Mineral Group Minerals Inc.) (the "Company") was incorporated in the State of Nevada on August 10, 2007. In the fiscal year ended November 30, 2014 and 2013, the Company was engaged in the exploration, development, and acquisition of mineral properties. As a subsequent event to these financial statements herein, on June 12, 2015, the Company consummated a share exchange agreement with Amgentech Inc./Telco Cuba, Inc., a Florida corporation, whereby the Company issued 75,000,000 shares of common stock previously issued to third parties in exchange for 100% of the issued and outstanding capital of Amgentech Inc./Telco Cuba, Inc. Amgentech Inc./Telco Cuba, Inc. will be the surviving entity and focus on opportunities in the Cuban telecommunications market.
The accompanying financial statements have been prepared on the basis of accounting principles applicable to a going concern; accordingly, they do not give effect to adjustment that would be necessary should the Company be unable to continue as a going concern and therefore be required to realize its assets and retire its liabilities in other than the normal course of business and at amounts different from those in the accompanying financial statements. As shown in the accompanying financial statements, the Company incurred a net loss of $347,190 for the year ended November 30, 2014, and has an accumulated deficit of $14,824,879. Management plans to raise cash from public or private debt or equity financing, on an as needed basis and in the longer term, to generate revenues from the acquisition, exploration and development of mineral interests, if found. The Company's ability to continue as a going concern is dependent upon achieving profitable operations and/or upon obtaining additional financing. The outcome of these matters cannot be predicted at this time.
2. Significant Accounting Policies
a) Accounting Principles
The accounting and reporting policies of the Company conform to United States generally accepted accounting principles applicable to exploration stage enterprises.
b) Basic and Diluted Loss Per Share
Basic and diluted loss per share is based on the weighted average number of shares outstanding. Potential common shares includable in the computation of fully diluted per share results are not presented in the financial statements as their effect would be anti-dilutive.
c) Fair Value Measurements
Valuation Hierarchy
ASC 820 establishes a valuation hierarchy for disclosure of the inputs to valuation used to measure fair value. This hierarchy prioritizes the inputs into three broad levels as follows. Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument. Level 3 inputs are unobservable inputs based on the Companys own assumptions used to measure assets and liabilities at fair value. A financial asset or liabilitys classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement.
The following tables provides the assets and liabilities carried at fair value measured on a recurring and non-recurring basis as of November 30, 2014 and November 30, 2013:
|
|
|
|
| Fair Value Measurements at November 30, 2014 |
| ||||||
|
|
|
|
| Quoted prices |
|
| Significant |
|
|
|
|
|
| Total Carrying |
|
| in active |
|
| other |
|
| Significant |
|
|
| Value at |
|
| markets |
|
| observable |
|
| unobservable |
|
|
| November 30, 2014 |
|
| (Level 1) |
|
| inputs (Level 2) |
|
| inputs (Level 3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Derivative liabilities | $ | 192,123 |
| $ | - |
| $ | - |
| $ | 192,123 |
|
|
|
|
|
| Fair Value Measurements at November 30, 2013 |
| ||||||
|
|
|
|
| Quoted prices |
|
| Significant |
|
|
|
|
|
| Total Carrying |
|
| in active |
|
| other |
|
| Significant |
|
|
| Value at |
|
| markets |
|
| observable |
|
| unobservable |
|
|
| November 30, 2013 |
|
| (Level 1) |
|
| inputs (Level 2) |
|
| inputs (Level 3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Derivative liabilities | $ | 192,123 |
| $ | - |
| $ | - |
| $ | 192,123 |
|
The derivative liabilities are measured at fair value using quoted market prices and estimated volatility factors based on historical quoted market prices for the Companys common stock, and are classified within Level 3 of the valuation hierarchy.
The following is a reconciliation of the beginning and ending balances for assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3):
| November 30, 2014 |
| November 30, 2013 | ||
Beginning balance | $ | 192,123 |
| $ | 200,535 |
Derivative liabilities recorded |
| - |
|
| - |
Derivative liabilities converted |
| - |
|
| - |
Unrealized gain attributable to the change in liabilities still held |
| - |
|
| (8,412) |
Ending balance | $ | 192,123 |
| $ | 192,123 |
The fair value of the derivative liability at November 30, 2014 and November 30, 2013, totaling $192,123 and $192,123, respectively, was calculated using the Black-Scholes Option Pricing model under the assumptions detailed in Note 8. Gains and losses (realized and unrealized) included in earnings (to change in fair value of derivative liability) for the years ended November 30, 2013 and 2012, are reported in other expenses as follows:
| November 30, 2014 |
| November 30, 2013 | ||
(Gain) Loss on derivative liabilities recorded during the period | $ | - |
| $ | - |
Debt discount attributable to derivative liabilities recorded |
| - |
|
| - |
Derivative liabilities converted during the period |
| - |
|
| - |
Unrealized gain attributable to the change in liabilities still held |
| - |
|
| 8,412 |
Net unrealized (gain) loss included in earnings | $ | - |
| $ | 8,412 |
The Company did not have any Level 1 or Level 2 assets or liabilities as of November 30, 2014 and 2013, and had Level 3 liabilities consisting of notes payable. The carrying amount of the notes payable at November 30, 2014 and 2013, approximate their respective fair value based on the Companys incremental borrowing rate.
Telco Cuba Inc.
(Formerly CaerVision Global, Inc. and
American Mineral Group, Inc.)
Notes to the Unaudited Financial Statements
November 30, 2014 and 2013
(Unaudited)
2. Significant Accounting Policies (continued)
c) Fair Value Measurements (continued)
Cash and cash equivalents include money market securities that are considered to be highly liquid and easily tradable as of November 30, 2014 and 2013, respectively. These securities are valued using inputs observable in active markets for identical securities and are therefore classified as Level 1 within our fair value hierarchy.
In addition, FASB ASC 825-10-25 Fair Value Option was effective at the time of adoption. ASC 825-10-25 expands opportunities to use fair value measurements in financial reporting and permits entities to choose to measure many financial instruments and certain other items at fair value. The Company did not elect the fair value options for any of its qualifying financial instruments.
d) Income Taxes
Income taxes are accounted for in accordance with the provisions of FASB ASC 740, Accounting for Income Taxes. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using 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 income in the period that includes the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amounts expected to be realized.
e) Cash and Cash Equivalents
For purposes of the statement of cash flows, cash includes demand deposits, saving accounts and money market accounts. The Company considers all highly liquid instruments with maturities of three months or less when purchased to be cash equivalents.
f) Revenue Recognition
The Companies follow the guidance of the FASB ASC 605-10-S99 Revenue Recognition Overall SEC Materials. The Companies record revenue when persuasive evidence of an arrangement exists, product delivery has occurred, the sales price to the customer is fixed or determinable, and collectability is reasonably assured. Revenues consist primarily of product sales.
As at November 30, 2014, the Company had no revenues to report.
f) Estimates
The preparation of financial statements in conformity with US generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements, and the reported amounts of revenues and expenditures during the reporting period. Actual results could differ from those reported.
g) Accounts receivable and concentration of credit risk
The Company currently has no accounts receivable, no customers, and therefore, does not currently foresee a concentrated credit risk associated with trade receivables. If and when the Company commences operations that generate revenue, the Company will evaluate the receivable in light of the collectability in the normal course of business.
h) Reclassifications
Certain prior year financial statement balances have been reclassified to conform to the current year presentation. These reclassifications had no effect on the recorded net loss.
i) Recently Adopted Accounting Pronouncements
Management does not believe that any recently issued but not yet effective accounting pronouncements if currently adopted would have a material effect on the accompanying financial statements.
3. Mineral Property
In August 2009, the Company entered into an agreement to acquire the mineral rights to 331 unpatented lode mining claims known as the Conglomerate Mesa, located in Inyo County, California. In March 2011, the Company added an additional 217 unpatented lode mining claims. In fiscal year 2012, the Company determined that the effort and cost of developing these claims required more resources that could be more effectively used on other opportunities, and abandoned the Conglomerate Mesa project.
In February 2013, the Company acquired a 28% Working Interest in the Grand Chenier oil and gas prospect in Louisiana. The property contains an estimate 9.0 million barrels of oil and was in production until approximately 2009 when the then operator failed to manage the interests and certain repairs were not made leading to the cessation of production. The Company believes that with approximately $2.0 million in capital, the field can be returned to production and additional wells within the prospect can then be brought online increasing production to a profitable level.
In November 2014, the Company surrendered the Grand Chenier prospect back to its orginal owners in exchange for the cancellation of the notes and stock to be issued.
4. Capital Stock
a) Authorized
Authorized capital stock consists of:
500,000,000 common shares with a par value of $0.001 per share; and
1,000,000 preferred shares with a par value of $0.001 per share
b) Share Issuances
In December 2012, the Company issued 78,333,333 common shares in connection with the conversion of $4,700 of convertible debentures and accrued interest. The conversions had an average price of $0.00006 per share.
In January 2013, the Company issued 78,333,333 common shares in connection with the conversion of $4,700 of convertible debentures and accrued interest. The conversions had an average price of $0.00006 per share.
In January 2013, the Company issued 85,000,000 common shares in connection with the conversion of $2,125 of convertible debentures and accrued interest. The conversions had an average price of $0.00003 per share.
There were no share issuances in the fiscal year ended November 30, 2014
Telco Cuba Inc.
(Formerly CaerVision Global, Inc. and
American Mineral Group, Inc.)
Notes to the Unaudited Financial Statements
November 30, 2014 and 2013
(Unaudited)
5. Income Taxes
A reconciliation of income taxes at statutory rates with the reported income taxes is as follows:
Period ended November 30, |
| 2014 |
| 2013 |
Income tax benefit at Federal statutory rate of 35% | $ | 195,300 | $ | 199,400 |
State Income tax benefit, net of Federal effect |
| 28,000 |
| 28,500 |
Permanent differences (primarily stock-based compensation) |
| - |
| - |
Change in valuation allowance |
| (223,300) |
| (227,900) |
| $ | - | $ | - |
The significant components of the Company's deferred income tax assets are as follows:
As at November 30 |
| 2014 |
| 2013 |
|
|
|
|
|
Net Operating losses | $ | 2,794,400 | $ | 2,574,400 |
Loss on mineral rights |
| 2,838,000 |
| 2,838,000 |
Valuation allowance |
| (5,632,400) |
| (5,412,400) |
| $ | - | $ | - |
At November 30, 2014 the Company has available net operating losses of approximately $2,794,400 which may be carried forward to apply against future taxable income. These losses will expire in 2034. Deferred tax assets related to these losses have not been recorded due to uncertainty regarding their utilization.
6.
Derivative Liabilities
In June 2008, the FASB finalized ASC 815, Determining Whether an Instrument (or Embedded Feature) is indexed to an Entitys Own Stock. Under ASC 815, instruments which do not have fixed settlement provisions are deemed to be derivative instruments. The Company has determined that it needs to account for 15 convertible debentures (see note 3h) issued for its shares of common stock, as derivative liabilities, and apply the provisions of ASC 815. The instruments have a ratchet provision that adjust either the exercise price and/or quantity of the shares as the conversion price equals to 60% of the "market price" at the time of conversion, which "market price" will be calculated as the average of the three lowest "trading prices" for the Company's common stock during the ten day trading period prior to the date the conversion note is sent to the Company.
As a result, the instruments need to be accounted for as derivative liabilities. In accordance with ASC 815, these convertible debentures have been re-characterized as derivative liabilities. ASC 815, Accounting for Derivative Instruments and Hedging Activities (ASC 815) requires that the fair value of these liabilities be re-measured at the end of every reporting period with the change in fair value reported in the statement of operations.
| November 30, |
| November 30, |
| Date of |
| 2014 |
| 2013 |
| issuance |
|
|
|
|
|
|
$32,500 Debenture: |
|
|
|
|
|
Discount Rate Bond Equivalent Yield | 0.30% |
| 0.30% |
| 0.30% |
Annual rate of dividends | - |
| - |
| - |
Volatility | 347.18% |
| 196.41% |
| 319.58% |
Weighted Average life (months) | 0 |
| 0 |
| 9 |
|
|
|
|
|
|
$40,000 Debenture: |
|
|
|
|
|
Discount Rate Bond Equivalent Yield | 0.30% |
| 0.30% |
| 0.30% |
Annual rate of dividends | - |
| - |
| - |
Volatility | 347.18% |
| 196.41% |
| 319.58% |
Weighted Average life (months) | 0 |
| 0 |
| 9 |
|
|
|
|
|
|
$35,000 Debenture: |
|
|
|
|
|
Discount Rate Bond Equivalent Yield | 0.30% |
| 0.30% |
| 0.30% |
Annual rate of dividends | - |
| - |
| - |
Volatility | 347.18% |
| 196.41% |
| 262.42% |
Weighted Average life (months) | 0 |
| 0 |
| 9 |
|
|
|
|
|
|
$174,530 Debenture: |
|
|
|
|
|
Discount Rate Bond Equivalent Yield | 0.30% |
| 0.30% |
| 0.30% |
Annual rate of dividends | - |
| - |
| - |
Volatility | 347.18% |
| 196.41% |
| 262.42% |
Weighted Average life (months) | 0 |
| 0 |
| 6 |
|
|
|
|
|
|
Fair Value | $ 192,123 |
| $ 192,123 |
|
|
There were no new convertible debentures issued during the fiscal years ended November 30, 2014 and 2013.
At November 30, 2014, the Company reevaluated the derivative liability based on the fair value assumptions for the convertible debt that it had entered into in previous years. As of November 30, 2014, the derivative liability remained the same during the year then ended due to the conversion threshold being equivalent at this reporting date as compared to the previous fiscal year end.
7.
Notes Payable
For the years ended November 30, 2014 and 2013, the Company borrowed $200 and $21,888, respectively, from a non-affiliated accredited investor. The Notes carry interest at a rate of 15% per year and are due on demand.
The Company raised $0 and $359 in demand notes to from its CFO during the fiscal years ended November 30, 2014 and 2013, respectively.
Between December 2011 and November 2012, the Company borrowed $108,700 from a non-affiliated accredited investor. The Notes carry interest at a rate of 15% per year and are due on demand.
Telco Cuba Inc.
(Formerly CaerVision Global, Inc. and
American Mineral Group, Inc.)
Notes to the Unaudited Financial Statements
November 30, 2014 and 2013
(Unaudited)
8.
Related party transactions
Due to Officers
From time to time, our former CEO, Mal Bains loaned money to the Company. At November 30, 2014 and 2013 the balance owed was $17,476 and $18,796 respectively. The balance does not bear interest and is due on demand.
Our CEO and CFO have from time to time loaned money to the Company. At November 30, 2014 and 2013, they had a balance owed to them of $1,384 and $1,384 respectively. The balances do not bear interest and are due on demand.
Employment Contracts with Officers
In September 2010, the Company entered into five year Employment Contracts with its three officers (See Note 12). As of November 30, 2014 and 2013, the Company had an accrued payroll liability balance of $1,319,194 and $938,415.
9.
Commitments and Contingencies
In August, 2009, trading in the Companys stock was temporarily suspended in British Columbia, Canada by the British Columbia Securities Commission (BCSC). The temporary suspension was the result of what the BCSC termed suspicious trading activity due to a significant increase in the share price of the Companys stock price. Various shareholders, and the former CEO and President, Malkeet Bains have been interviewed and several have been either charged with or accepted please in connection with violations of Canadian securities laws.
The Cease Trade Order is still in effect regarding trading in British Columbia, Canada only, and specifically affects the residents thereof.
The case outlined above does not involve the Company or any of its current officers or directors.
A consulting agreement between American Mineral Group and Internet Marketing Solutions, Inc. (IMS) provides that IMS will receive a Consulting Fee of ten percent (10%) of the gross value of the project received by American Mineral Group including cash, stock and stock purchase warrants.
10.
Employment Contracts
In September 2010, the Company entered into five year Employment Contracts with its three employees.
Below is a summary of the basic terms of the Agreements:
·
Base Salary for the CEO and CFO
$120,000 per year
·
Base Salary for Investor relations
$100,000 per year
·
The officers received stock grants in connection with the contracts of:
o
CEO
1,500,000 common shares
o
CFO
1,000,000 common shares
o
Investor Relations
1,000,000 common shares
·
4% annual increases in Base Salary
·
Bonus provision if and when the Company reaches profitability
·
Other normal benefits provided such as health insurance as negotiated by the Company
As of November 30, 2014 and 2013, the Company had an accrued payroll liability balance of $1,319,194 and $938,415.
11.
Subsequent Events
Management has evaluated subsequent events pursuant to the requirements of ASC Topic 855 and has determined that other than listed below, no material subsequent events exist.
On January 9, 2015, the outstanding shareholders of the Company voted to change the name of the Company from American Mineral Group, Inc. to CaerVision Global, Inc. in order to better reflect the planned change in the Companys future operations.
On January 26, 2015, the Company entered into a stock purchase definitive agreement with Vitall, Inc., a Delaware corporation, whereby the Company will issue 15,000,000 shares of common stock for 100% of the issued and outstanding capital of Vitall, Inc. On March 17, 2015, Vitall, Inc. terminated the merger agreement due to non-performance on the part of the Company. As a result, the name CaerVision Global, Inc. will be surrendered back to its original owner.
On June 12, 2015, the Company consummated a share exchange agreement with Amgentech Inc./Telco Cuba, Inc., a Florida corporation, whereby the Company issued 75,000,000 shares of common stock previously issued to third parties in exchange for 100% of the issued and outstanding capital of Amgentech Inc./Telco Cuba, Inc. Amgentech Inc./Telco Cuba, Inc. will be the surviving entity and focus on opportunities in the Cuban telecommunications market.
On June 15, 2015, the Company effectuated an amendment to its articles of incorporation to change its name from CaerVision Global, Inc. to Telco Cuba, Inc.
On June 15, 2015, the Company effectuated an amendment to its articles of incorporation to appoint William Sanchez to the position of CEO, CFO, President, Treasurer and Secretary. In the same amendment to our articles of incorporation, Erwin Vahlsing Jr., Thomas J Craft Jr. and Frederick J Puccillo Jr., resigned their positions as officers and directors of the Company.
The Company had the following issuances of stock subsequent to November 30, 2014;
In January 2015, the Company issued 791,176 common shares in connection with the conversion of $1,345 of convertible debentures and accrued interest. The conversions had an average price of $0.0017 per share.
In January 2015, the Company issued 791,593 common shares in connection with the conversion of $4,280 of convertible debentures and accrued interest. The conversions had an average price of $0.0054 per share.
In January 2015, the Company issued 831,481 common shares in connection with the conversion of $4,490 of convertible debentures and accrued interest. The conversions had an average price of $0.0054 per share.
In January 2015, the Company issued 831,481 common shares in connection with the conversion of $4,490 of convertible debentures and accrued interest. The conversions had an average price of $0.0054 per share.
In February 2015, the Company issued 832,075 common shares in connection with the conversion of $4,490 of convertible debentures and accrued interest. The conversions had an average price of $0.0053 per share.
In February 2015, the Company issued 832,250 common shares in connection with the conversion of $3,325 of convertible debentures and accrued interest. The conversions had an average price of $0.0040 per share.
In February 2015, the Company issued 832,250 common shares in connection with the conversion of $3,325 of convertible debentures and accrued interest. The conversions had an average price of $0.0040 per share.
Telco Cuba Inc.
(Formerly CaerVision Global, Inc. and
American Mineral Group, Inc.)
Notes to the Unaudited Financial Statements
November 30, 2014 and 2013
(Unaudited)
11.
Subsequent Events (continued)
In February 2015, the Company issued 2,560,000 common shares in connection with the conversion of 512 shares of Preferred B Shares.
In March 2015, the Company issued 831,633 common shares in connection with the conversion of $4,075 of convertible debentures and accrued interest. The conversions had an average price of $0.0049 per share.
In March 2015, the Company issued 832,075 common shares in connection with the conversion of $4,660 of convertible debentures and accrued interest. The conversions had an average price of $0.0056 per share.
In March 2015, the Company issued 328,182 common shares in connection with the conversion of $1,805 of convertible debentures and accrued interest. The conversions had an average price of $0.0055 per share.
In March 2015, the Company issued 503,636 common shares in connection with the conversion of $4,575 of convertible debentures and accrued interest. The conversions had an average price of $0.0055 per share.
In March 2015, the Company issued 2,545,000 common shares in connection with the conversion of 509 shares of Preferred B Shares.
In April 2015, the Company issued 3,395,000 common shares in connection with the conversion of 679 shares of Preferred B Shares.
In March 2015, the Company issued 3,730,000 common shares in connection with the conversion of 746 shares of Preferred B Shares.
In April 2015, the Company issued 2,067,073 common shares in connection with the conversion of $1,695 of convertible debentures and accrued interest. The conversions had an average price of $0.0008 per share.
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.
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William Sanchez, Chief Executive Officer and President | |
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William Sanchez, Chief Financial Officer, Secretary, and Treasurer |
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of Registrant and in the capacities indicated on the dates indicated.
Date | Signature | Title |
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William Sanchez | ||
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William Sanchez |