We have audited the accompanying consolidated balance sheets Future Healthcare of America and subsidiaries (the Company) as of and , and the related consolidated statements of operations, stockholders equity (deficit), and cash flows for each of the years in the two year period ended and the related notes (collectively referred to as the consolidated financial statements). In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of and , and the results of its operations and its cash flows for each of the years in the two year period ended , in conformity with accounting principles generally accepted in the United States of America.
The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the consolidated financial statements, the Company has suffered net losses since inception, an accumulated significant deficit and has a short-term note payable in excess of assets. These factors raise substantial doubt about its ability to continue as a going concern. Managements plans in regard to these matters are also described in Note 2. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.
These consolidated financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on the Companys consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal security laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud.
Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our Audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.
See accompanying notes to these unaudited consolidated financial statements.
See accompanying notes to these unaudited consolidated financial statements.
See accompanying notes to these unaudited consolidated financial statements.
The accompanying notes are an integral part of these consolidated financial statements.
NOTES TO FINANCIAL STATEMENTS
NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization
Future Healthcare of America (FHA), a Wyoming corporation, was formed on June 22, 2012. On November 14, 2014, FHA organized Future Healthcare Services Corp. (FHS), and transferred all the shares of Interim to FHS. Interim Healthcare of Wyoming, Inc. (Interim), a Wyoming corporation, a wholly owned subsidiary of FHS, was organized on September 30, 1991. Interim operates primarily in the home healthcare and healthcare staffing services in Wyoming and Montana. On April 3, 2007, Interim purchased the operations of Professional Personnel, Inc., d.b.a., Professional Nursing Personnel Pool.
Consolidation
- The financial statements presented reflect the accounts of FHA, FHS and Interim. All inter-company transactions have been eliminated in consolidation.
Accounting Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Management made assumptions and estimates for determining reserve for accounts receivable, accrued liabilities, contingent liabilities and the fair market value of derivative liabilities. Actual results could differ from those estimated by management.
Cash and Cash Equivalents
The Company considers all highly liquid investments with an original maturity date of three months or less when purchased to be cash equivalents. At December 31, 2017, the Company had no cash balances in excess of federally insured limits.
Accounts Receivable
Accounts receivable consist of trade receivables arising in the normal course of business. At December 31, 2017 and 2016, the Company has an allowance for doubtful accounts of $20,200 and $20,200, respectively, which reflects the Companys best estimate of probable losses inherent in the accounts receivable balance. The Company determines the allowance based on known troubled accounts, historical experience, and other currently available evidence. During the years ended December 31, 2017 and 2016, the Company adjusted the allowance for bad debt by $0.
Depreciation
Depreciation of property and equipment is provided on the straight-line method over the estimated useful lives.
Long-lived intangible assets
FHA evaluates its long-lived assets for impairment whenever events or change in circumstances indicate that the carrying amount of such assets may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of the asset to the future net undiscounted cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is the excess of the carrying amount over the fair value of the asset.
Leases
The Company accounts for leases in accordance with Accounting Standards Codification (ASC) Topic 840, (formerly Statement of Financial Accounting Standards SFAS No. 13 "Accounting for Leases"). Leases that meet one or more of the capital lease criteria of standard are recorded as a capital lease, all other leases are operating leases.
Loss Per Share
The Company computes loss per share in accordance with FASB ASC Topic 260 Earnings Per Share, which requires the Company to present basic earnings per share and diluted earnings per share when the effect is dilutive (see Note 11).
Income Taxes
The Company accounts for income taxes in accordance with FASB ASC Topic 740 Accounting for Income Taxes. This topic requires an asset and liability approach for accounting for income taxes (see Note 9).
Advertising Costs
Advertising costs are expensed as incurred and amounted to $37,499 and $35,454 for the periods ending December 31, 2017 and 2016, respectively.
21
FUTURE HEALTHCARE OF AMERICA AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued
Fair Value of Financial Instruments
The Company accounts for fair value measurements for financial assets and financial liabilities in accordance with FASB ASC Topic 820. The authoritative guidance, which, among other things, defines fair value, establishes a consistent framework for measuring fair value and expands disclosure for each major asset and liability category measured at fair value on either a recurring or nonrecurring basis. Fair value is defined as the exit price, representing the amount that would either be received to sell an asset or be paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the guidance establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows:
Level 1. Observable inputs such as quoted prices in active markets for identical assets or liabilities;
Level 2. Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and
Level 3. Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.
Unless otherwise disclosed, the fair value of the Companys financial instruments including cash, accounts receivable, prepaid expenses, and accounts payable and accrued expenses approximates their recorded values due to their short-term maturities.
Revenue Recognition
Revenue is generated from various payers including Medicare, Medicaid, Insurance Companies, and various other entities and individuals. In accordance with FASB ASC Topic 605, Revenue is recognized when persuasive evidence of an arrangement exists, services have been provided, the price of services is fixed or determinable, and collection is reasonably assured. Payments received prior to services being provided are recorded as a liability (deferred revenue) until such services are performed. Revenue is recorded as net revenue where contractual adjustments and discounts are deducted from Gross Revenue to determine net revenue.
Derivative Financial Instruments
The Company is required to recognize all of its derivative instruments as either assets or liabilities in the Consolidated Balance Sheets at fair value. The accounting for changes in the fair value (i.e., gains or losses) of a derivative instrument depends on whether it has been designated, and is effective, as a hedge and further, on the type of hedging relationship. For those derivative instruments that are designated and qualify as hedging instruments, a company must designate the hedging instrument, based upon the exposure being hedged, as a fair value hedge, or cash flow hedge. Gains and losses related to a hedge are either recognized in income immediately to offset the gain or loss on the hedged item or are deferred and reported as a component of Accumulated Other Comprehensive Income in the Stockholders' Equity and subsequently recognized in Net income when the hedged item affects Net income. The change in fair value of the ineffective portion of a financial instrument is recognized in Net income immediately. The gain or loss related to financial instruments that are not designated as hedges are recognized immediately in Net income.
Recently Enacted Accounting Standards -
In May 2014, the Financial Accounting Standards Board (FASB) issued a new standard to achieve a consistent application of revenue recognition within the U.S., resulting in a single revenue model to be applied by reporting companies under U.S. generally accepted accounting principles. Under the new model, recognition of revenue occurs when a customer obtains control of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In addition, the new standard requires that reporting companies disclose the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. On July 9, 2015, the FASB agreed to delay the effective date by one year; accordingly, the new standard is effective for us beginning in the first quarter of 2018 and we expect to adopt it at that time. The new standard is required to be applied retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying it recognized at the date of initial application. Management does not believe the adoption of the standard will have a material impact on the Companys present or future financial statements
22
FUTURE HEALTHCARE OF AMERICA AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued
In February 2016, the FASB issued changes to the accounting for leases that primarily affect presentation and disclosure requirements. The new standard will require the recognition of a right to use asset and underlying lease liability for operating leases with an initial life in excess of one year. This standard is effective for us beginning in the first quarter of 2019. We have not yet determined the impact of the new standard on our consolidated financial statements.
Other recent accounting pronouncements issued by the FASB did not or are not believed by management to have a material impact on the Companys present or future financial statements.
NOTE 2 - GOING CONCERN
The accompanying consolidated financial statements have been prepared in conformity with generally accepted accounting principles of the United States of America, which contemplate continuation of the Company as a going concern. However, the Company has incurred losses, an accumulated deficit and has a short-term note payable in excess of assets. These factors raise substantial doubt about the ability of the Company to continue as a going concern. There is no assurance that the Company will be successful in achieving profitable operations. The financial statements do not include any adjustments that might result from the outcome of these uncertainties.
NOTE 3 - PROPERTY & EQUIPMENT
The following is a summary of property and equipment at:
|
|
|
|
| |
|
Life
|
|
December 31,
2017
|
|
December 31,
2016
|
|
|
|
|
|
|
Furniture, fixtures and equipment
|
2-10 yrs
|
$
|
36,384
|
$
|
36,384
|
|
|
|
36,384
|
|
36,384
|
Less: Accumulated depreciation
|
|
|
(36,384)
|
|
(36,384)
|
Property & equipment, net
|
|
$
|
-
|
$
|
-
|
Depreciation expense for the periods ended December 31, 2017 and 2016 was $0 and $36, respectively.
NOTE 4 VARIABLE RATE SENIOR SECURED CONVERTIBLE DEBENTURE
On September 9, 2013, the Company closed a Subscription Agreement by which one institutional investor purchased a) a Variable Rate Senior Secured Convertible Note payable having a total principal amount of $1,010,000, convertible into common shares of the Company at $0.25 per share and maturing March 9, 2015; b) Warrants to purchase a total of 3,030,000 shares of common stock, at $0.50 per share, exercisable for four years, and c) a greenshoe to purchase a total of 2,000,000 shares of common stock at $0.25 per share, exercisable for one year from the closing date. On September 9, 2014 the greenshoe expired unexercised. On March 9, 2015, the Note matured. As the note has not been paid nor extended, the outstanding principal, plus accrued but unpaid interest, liquidated damages and other amounts, became due and payable at the election of the holder. The holder has not made such an election. Effective December 14, 2017, the conversion price was reduced from $0.25 per share to $0.10 per share.
The fair value of the beneficial conversion feature of the warrants and greenshoe totaled $952,254 and was recorded as a derivative liability. The Company recorded a discount on the note for beneficial conversion feature of the note. The $952,254 discount on the beneficial conversion feature was amortized as interest expense over the term of the note. As of September 30, 2015, the Company amortized $952,254 of the discount, with no remaining unamortized discount being offset against the outstanding balance of the note in the accompanying balance sheet. As of December 31, 2017 and 2016, the Company had accrued interest payable on the debenture of $334,802 and $233,802.
23
FUTURE HEALTHCARE OF AMERICA AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
NOTE 5 DERIVATIVE FINANCIAL INSTRUMENTS
The Company entered into a variable rate senior secured convertible debenture, wherein the Company agreed to register the underlying share, warrants and greenshoe. The fair value of the beneficial conversion feature of the warrants and greenshoe was estimated using the Black Scholes pricing model and totaled $952,254 upon issuance and was recorded as a derivative liability until the registration of the shares becomes effective. As of December 31, 2017, the fair value of warrants based on a binomial model using the following assumptions (Life 0.69 years, risk free interest rate 1.53%, volatility of 219.6%; stock price of $.05 and exercise price of $.50) was $43,726, resulting in the recording of a gain totaling $9,762 during 2017.
NOTE 6 FAIR VALUE OF FINANCIAL INSTRUMENTS
The Fair Value Measurement and Disclosure Topic of FASB and ASC:
·
Defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, and establishes a framework for measuring fair value;
·
Establishes a three-level hierarchy for fair value measurement based upon the transparency of inputs to the valuation as of the measurement date;
·
Expands disclosures about financial instruments measured at fair value.
Financial assets and financial liabilities record on the Balance sheet at fair value are categorized based on the reliability of inputs to the valuation techniques as follows:
Level 1: Financial assets and financial liabilities whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market that the Company can access.
Level 2: Financial assets and financial liabilities whose values are based on the following:
Quoted prices for similar assets or liabilities in active markets; Quoted prices for identical or similar assets or liabilities in non-active markets or Valuation models whose inputs are observable, directly or indirectly, for substantially the full term of the assets or liability.
Level 3: Financial assets and financial liabilities whose values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. These inputs may reflect our estimates of the assumptions that market participants would use in valuing the financial assets and financial liabilities.
The following tables summarize Level 1, 2 and 3 financial assets and financial (liabilities) by their classification in the Consolidated Balance Sheet:
Level 1
Level 2
Level 3
As of December 31, 2017
Derivative liability - Registration rights of
Debenture and warrants
-
-
(43,726)
NOTE 7 - CAPITAL STOCK
Common Stock
- The Company has authorized 200,000,000 shares of common stock, $0.001 par value. As of December 31, 2017, 11,265,631 shares were issued and outstanding.
24
FUTURE HEALTHCARE OF AMERICA AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
NOTE 8 WARRANTS
A summary of the status of the warrants granted is presented below for the twelve months ended:
|
|
|
|
|
|
| |
|
December 31, 2017
|
|
December 31, 2016
|
|
Shares
|
|
Weighted Average Exercise
Price
|
|
Shares
|
|
Weighted Average Exercise
Price
|
Outstanding at beginning of period
|
3,030,000
|
$
|
0.50
|
|
3,030,000
|
$
|
0.50
|
Granted
|
-
|
|
-
|
|
-
|
|
-
|
Exercised
|
-
|
|
-
|
|
-
|
|
-
|
Forfeited
|
-
|
|
-
|
|
-
|
|
-
|
Expired
|
-
|
|
-
|
|
-
|
|
-
|
Outstanding at end of period
|
3,030,000
|
$
|
0.50
|
|
3,030,000
|
$
|
0.50
|
On September 9, 2013, the Company closed a Subscription Agreement wherein the Company granted warrants to purchase a total of 3,030,000 shares of common stock, at $0.50 per share, exercisable for four years. On September 9, 2017 the expiration date of the warrants was extended to September 9, 2018.
NOTE 9 - INCOME TAXES
The Company accounts for income taxes in accordance with FASB ASC Topic 740, Accounting for Income Taxes which requires the Company to provide a net deferred tax asset or liability equal to the expected future tax benefit or expense of temporary reporting differences between book and tax accounting and any available operating loss or tax credit carryforwards. At December 31, 2017 and 2016, the total of all deferred tax assets was $939,351 and $1,296,820, respectively, and the total of the deferred liabilities was $0 and $0, respectively. The amount of and ultimate realization of the benefits from the deferred tax assets for income tax purposes is dependent, in part, upon the tax laws in effect, the Companys future earnings, and other future events, the effects of which cannot be determined. . Because of the uncertainty surrounding the realization of the deferred tax assets the Company has established a valuation allowance of $939,351 and $1,296,820 for the years ended December 31, 2017 and 2016. The change in the valuation allowance for the year ended December 31, 2017 and 2016 was $357,468 and $141,931, respectively.
The components of income tax expense (benefit) from continuing operations for the Years ended December 31, 2017 and 2016 consist of the following:
|
|
|
| |
|
|
For the Years Ended
|
|
|
December 31,
|
|
|
2017
|
|
2016
|
Current tax expense:
|
|
|
|
|
Federal
|
$
|
-
|
$
|
-
|
State
|
|
-
|
|
-
|
Current tax expense
|
|
-
|
|
-
|
|
|
|
|
|
Deferred tax expense (benefit):
|
|
|
|
|
Wage Accrual
|
|
(38.999)
|
|
-
|
Goodwill
|
|
46,383
|
|
46,383
|
Revaluation of deferred tax asset
|
|
498,576
|
|
-
|
Valuation Allowance
|
|
(357,468)
|
|
141,931
|
Net operating loss carryforward
|
|
(148,492)
|
|
(188,314)
|
Subtotal deferred tax expense/(benefit)
|
|
-
|
|
-
|
Income tax expense/(benefit)
|
$
|
-
|
$
|
-
|
25
FUTURE HEALTHCARE OF AMERICA AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
NOTE 9 - INCOME TAXES Continued
Deferred income tax expense/(benefit) results primarily from the reversal of temporary timing differences between tax and financial statement income. A reconciliation of income tax expense at the federal statutory rate to income tax expense at the companys effective rate is as follows:
|
|
|
| |
|
|
For the Years Ended
|
|
|
December 31,
|
|
|
2017
|
|
2016
|
|
|
|
|
|
Computed tax at the expected statutory rate
|
$
|
(129,390)
|
$
|
(96,449)
|
State and local income taxes, net of federal
|
|
47,494
|
|
(8,727)
|
Other non-deductible expenses
|
|
(3,042)
|
|
(36,755)
|
Change in federal corporate tax rate
|
|
498,576
|
|
-
|
Other items
|
|
(56,170)
|
|
-
|
Valuation Allowance
|
|
(357,468)
|
|
141,931
|
Income tax expense/(benefit)
|
$
|
-
|
$
|
-
|
The temporary differences, tax credits and carryforwards gave rise to the following deferred tax asset December 31, 2017 and 2016:
|
|
|
| |
|
|
December 31,
|
|
December 31,
|
|
|
2017
|
|
2016
|
Deferred tax assets (liabilities):
|
|
|
|
|
Allowance for doubtful accounts
|
$
|
4,781
|
$
|
7,318
|
Accrued wages
|
|
25,476
|
|
-
|
Goodwill - impaired
|
|
454,507
|
|
695,744
|
Goodwill tax amortization
|
|
(346,687)
|
|
(484,313)
|
Depreciation
|
|
73
|
|
112
|
Net operating loss carryforward
|
|
801,201
|
|
1,077,959
|
Valuation allowance
|
|
(939,351)
|
|
(1,296,820)
|
Net term deferred tax assets (liabilities)
|
$
|
-
|
$
|
-
|
At December 31, 2017, the company has loss carryforwards of approximately $3,375,920 that expire in various years through 2037.
We file U.S. federal, and U.S. states returns, and we are generally no longer subject to tax examinations for years prior to 2014 for U.S. federal and U.S. states tax returns.
NOTE 10 - LEASES
Operating Lease
- The Company leases office space in Casper, Wyoming for $4,892 a month through June 2018. The Company further leases space in Billings, Montana for $1,525 a month through May 2020.
The future minimum lease payments for non-cancelable operating leases having remaining terms in excess of one year as of December 31, 2017 are as follows:
|
|
| |
Year ending December 31:
|
|
|
Lease Payments
|
2018
|
|
|
47,652
|
2019
|
|
|
18,300
|
2020
|
|
|
7,625
|
Thereafter
|
|
|
-
|
Total Minimum Lease Payment
|
|
$
|
73,577
|
26
FUTURE HEALTHCARE OF AMERICA AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
NOTE 10 LEASES Continued
Lease expense charged to operations was $76,829 and $76,584 for the periods ended December 31, 2017 and 2016, respectively.
NOTE 11 LOSS PER SHARE
The following data shows the amounts used in computing loss per share and the weighted average number of shares of common stock outstanding for the periods presented for the periods ended:
|
|
|
| |
|
|
December 31, 2017
|
|
December 31, 2016
|
|
|
|
|
|
Loss from continuing operations available to common stockholders (numerator)
|
$
|
(380,559)
|
$
|
(283,673)
|
Loss available to common stockholders (numerator)
|
|
(380,559)
|
|
(283,673)
|
Weighted average number of common shares outstanding during the period used in loss per share (denominator)
|
|
11,265,631
|
|
11,265,631
|
At December 31, 2017 and 2016, the Company had 3,030,000 and 3,030,000, respectively warrants to purchase common stock of the Company at $0.50 per share, and a convertible debenture payable wherein the holder could convert the note and underlying accrued interest into a minimum of 14,241,759 and 6,568,564, respectively shares of common stock which were not included in the loss per share computation because their effect would be anti-dilutive.
NOTE 12 COMMITEMENTS AND CONTINGENCIES
On June 17, 2016 and June 30, 2016 two complaints were filed with the Federal Equal Employment Opportunity Commission (EEOC) and the Wyoming State Department of Labor against the Company, alleging discrimination on the basis of sex and disability. The complaints do not seek any specific monetary relief. The complaints are being mediated by the Wyoming State Department of Labor. The Wyoming State Department of Labor issued a notice of dismissal for one of the complaints. After reviewing the facts and circumstances, the Company believes the claims made are weak, at best, and the Company has retained counsel and intends to continue a vigorous defense. At this time, management cannot reasonably estimate the cost to defend or the outcome of the complaints, and we do not expect it will have a material financial impact on the Company.
On February 9, 2018, a former employee filed a lawsuit against Interim Healthcare of Wyoming, claiming wrongful termination.
On March 6, 2018, a complaint was filed with the Wyoming Court of Natrona county, alleging violation of the Wyoming Fair Employment Practices Act of 1965 for discrimination based upon sex, disability and retaliation. The complaint does not seek any specific monetary relief. At this time, management cannot reasonably estimate the cost to defend or the outcome of the complaints.
27
FUTURE HEALTHCARE OF AMERICA AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
NOTE 13 - CONCENTRATION OF REVENUES
For 2017 and 2016, Medicare and Medicaid reimbursement was 37% and 36% of revenue, respectively.
The following is a break out of revenue by major customer:
|
|
| |
|
|
|
|
|
2017
|
|
2016
|
Medicare
|
$ 879,841
|
|
$ 736,046
|
Medicaid
|
471,059
|
|
639,844
|
All Other
|
2,262,762
|
|
2,464,242
|
Total Sales
|
$ 3,613,662
|
|
$ 3,840,132
|
|
|
|
|
NOTE 14 - SUBSEQUENT EVENTS
Management has evaluated subsequent events through the date of the filing of this report
On February 9, 2018, a former employee filed a lawsuit against Interim Healthcare of Wyoming, claiming wrongful termination.
On March 6, 2018, a complaint was filed with the Wyoming Court of Natrona county, alleging violation of the Wyoming Fair Employment Practices Act of 1965 for discrimination based upon sex, disability and retaliation. The complaint does not seek any specific monetary relief. At this time, management cannot reasonably estimate the cost to defend or the outcome of the complaints.
28
PART III
Item 10. Directors, Executive Officers, and Corporate Governance.
DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth:
·
the names of our current directors and executive officers,
·
their ages as of March 27, 2018, which is the date for filing of this 10-K; and
·
the capacities in which they currently serve FHA :
|
|
|
|
|
| |
Name
|
|
Age
|
|
Position(s)
|
|
Served in Position Since
|
Christopher J. Spencer
|
|
49
|
|
Chief Executive Officer and Chairman of the Board
|
|
2012
|
John Busshaus
|
|
54
|
|
Chief Financial Officer
|
|
2012
|
Denis Yevstifeyev
|
|
36
|
|
Director
|
|
2012
|
Douglas Polinsky
|
|
58
|
|
Director
|
|
2012
|
J. Gregory Smith
|
|
48
|
|
Director
|
|
2012
|
Christopher Spencer
has served as our Chief Executive Officer, President and as a director of FHA since its inception on June 22, 2012. Mr. Spencer has been responsible for our overall direction since our inception and has been instrumental in leading us to our current position in the home healthcare industry. From 2015 to present, Mr. Spencer serves as Chief Executive Officer and director of Liberated Syndication Inc., an issuer with securities registered under Section 12 of the Exchange Act. From 1996 to present, Mr. Spencer serves as Chief Executive Officer and director of FAB Universal Corp, an issuer with securities registered under Section 12 of the Exchange Act. Mr. Spencer also served as a member of the Board of Directors for Anpath Group Inc. from February, 2013, through November, 2015. From 1994 until 1996, Mr. Spencer founded and worked for ChinaWire, Inc., a high-technology company engaged in financial remittance between international locations and China. Mr. Spencer worked for Lotto USA, Inc. from 1992-1994, where he was founder and Chief Executive Officer for the Pennsylvania computer networking company. From 1990 until 1992, Mr. Spencer worked for John Valiant, Inc., and was responsible for business concept development and obtaining financing.
John Busshaus
has served as our Chief Financial Officer of FHA since its inception on June 22, 2012. Mr. Busshaus has been responsible for our overall accounting and financial reporting functions since joining FAB Universal, an issuer with securities registered under Section 12 of the Exchange Act, in April 2006 and currently serves as Chief Financial officer for FAB Universal Corp. From 2004 to 2006, Mr. Busshaus was an independent business consultant. Mr. Busshaus efforts were assisting organizations with the implementation of Sarbanes Oxley, filing of SEC reports, and taking a company through an IPO. Mr. Busshaus worked for Talanga International from 2001 to 2004, where he was the Chief Financial Officer for the company. From 1999 to 2000, Mr. Busshaus worked for Mellon Bank as Controller and Vice President, and was responsible
30
for strategic planning and managing the annual and monthly budgeting within Global Security Services. From 1994 to 1998, Mr. Busshaus worked for PepsiCo as Senior Business Planner, and was responsible for annual and quarterly budgets planning, as well as weekly, monthly and quarterly reporting of results. As a member of management, Mr. Busshaus' efforts contributed to the revenue growth and market share increases in a market that was categorized as saturated.
Douglas Polinsky
has served as a Director of FHA since its inception on June 22, 2012. Mr. Polinsky currently serves as a director for FAB Universal Corp. and Liberated Syndication Inc., a subsidiary of FAB Universal Corp. Mr. Polinsky serves as the President of Great North Capital Corp., a Minnesota-based financial services company he founded in 1995. Great North advises corporate clients on capital formation and other transaction-related financial matters. Mr. Polinsky earned a Bachelor of Science degree in Hotel Administration at the University of Nevada at Las Vegas.
Greg Smith
has served as a Director of FHA since its inception on June 22, 2012. Mr. Smith currently serves as a director for FAB Universal Corp. and Liberated Syndication Inc., a subsidiary of FAB Universal Corp. Mr. Smith is an award-winning producer and entrepreneur with over 10 years of experience in Non-Fiction Television. In 2000, Mr. Smith established The Solution Film Group, LLC and acts as the Companys President. Mr. Smith provides professional production and editorial support for various forms of non-fiction television entertainment, including the direction of media projects from development through production and post-production. His clients include Discovery Channel, Science Channel, Discovery HD Theater, Animal Planet, The Military Channel, PBS, and Discovery Networks International. Mr. Smith most recently won an Emmy in 2006 for the Discovery Channels animated special Before the Dinosaurs. His other awards for excellence in production and editing include Emmys for the Discovery Channels Walking with Prehistoric Beasts and Allosaurus: A Walking with Dinosaurs Special. From 1997 to 2000, Mr. Smith worked for Discovery Communications, Inc. in the capacity of Supervising Producer from January 1998 to November 2000, and Producer/Editor from October 1997 to January 1998. From 1995 to 1996, Mr. Smith worked for Discovery Channel Pictures serving as Assistant Editor from March 1996 to October 1997, and Production Assistant from September 1995 to March 1996. From 1994 to 1995, Mr. Smith worked for Crawford Communications in Atlanta, Georgia as a Manager of Satellite Services for The Learning Channel.
Denis Yevstifeyev
has served as a Director of FHA since its inception on June 22, 2012. Mr. Yevstifeyev currently serves as a director for FAB Universal Corp. and Liberated Syndication Inc., a subsidiary of FAB Universal Corp. From December 2017 to present, Mr. Yevstifeyev served as Vice President of Financial Planning & Analysis and Procurement for Dream Center Education Holdings. From 2009 to 2012, and from 2015 to 2017, Mr. Yevstifeyev served as the Director of Financial Planning & Analysis for Education Management Corporation. From 2012 to 2015, Mr. Yevstifeyev owned and operated his commercial printing company. From 2007 to 2008, Mr. Yevstifeyev served as Sr. Financial Reporting Analyst for American Eagle Outfitters, Inc, in Pittsburgh. His duties included: preparing and analyzing various internal and external financial reports; researching new accounting pronouncements and evaluating any impact on the financial statements. He also reviewed accounting workpapers and prepared the companys SEC filings for forms 8-K, 10-Q and 10-K. From 2005 to 2007, Mr. Yevstifeyev worked for Schneider Downs, Inc., where he worked on Sarbanes-Oxley compliance engagements. In 2005, Mr. Yevstifeyev graduated with a Bachelor of Science degree in Business from Washington and Jefferson College. He also graduated with honors from the Moscow Bank College of the Central Bank of Russia in Moscow with a degree in Finance in 2000. From 2002 to 2003, Mr. Yevstifeyev served as the Settlement Department Manager for SDM BANK in Moscow, where he dealt with domestic and international corresponding banks, among other responsibilities.
There are no non-officer employees who are expected to make a significant contribution to the business.
Family Relationships.
There are no family relationships between any of our directors or executive officers.
Involvement in Certain Legal Proceedings.
During the past ten years, none of our present or former directors, executive officers or persons nominated to become directors or executive officers:
(1) A petition under the Federal bankruptcy laws or any state insolvency law was filed by or against, or a receiver, fiscal agent or similar officer was appointed by a court for the business or property of such person, or any partnership in which he was a general partner at or within two years before the time of such filing, or any corporation or business association of which he was an executive officer at or within two years before the time of such filing;
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(2) Such person was convicted in a criminal proceeding or is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses);
(3) Such person was the subject of any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining him from, or otherwise limiting, the following activities:
(i) Acting as a futures commission merchant, introducing broker, commodity trading advisor, commodity pool operator, floor broker, leverage transaction merchant, any other person regulated by the Commodity Futures Trading Commission, or an associated person of any of the foregoing, or as an investment adviser, underwriter, broker or dealer in securities, or as an affiliated person, director or employee of any investment company, bank, savings and loan association or insurance company, or engaging in or continuing any conduct or practice in connection with such activity;
(ii) Engaging in any type of business practice; or
(iii) Engaging in any activity in connection with the purchase or sale of any security or commodity or in connection with any violation of Federal or State securities laws or Federal commodities laws;
(4) Such person was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any Federal or State authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any activity described in paragraph (f)(3)(i) of this section, or to be associated with persons engaged in any such activity;
(5) Such person was found by a court of competent jurisdiction in a civil action or by the Commission to have violated any Federal or State securities law, and the judgment in such civil action or finding by the Commission has not been subsequently reversed, suspended, or vacated;
(6) Such person was found by a court of competent jurisdiction in a civil action or by the Commodity Futures Trading Commission to have violated any Federal commodities law, and the judgment in such civil action or finding by the Commodity Futures Trading Commission has not been subsequently reversed, suspended or vacated;
(7) Such person was the subject of, or a party to, any Federal or State judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to an alleged violation of:
(i) Any Federal or State securities or commodities law or regulation; or
(ii) Any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order; or
(iii) Any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or
(8) Such person was the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act (15 U.S.C. 78c(a)(26))), any registered entity (as defined in Section 1(a)(29) of the Commodity Exchange Act (7 U.S.C. 1(a)(29))), or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORT COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires our officers and directors, and persons who own more than 10% of a registered class of our equity securities, to file reports of ownership and changes in ownership with the SEC. Officers, directors, and greater than 10% stockholders are required by SEC regulations to furnish us with copies of all Section 16(a) forms they file. Based solely on a review of the copies of such forms furnished to us with respect to fiscal 2017 and on representations that no other reports were required, we believe that during the 2017 fiscal year all applicable Section 16(a) filing requirements were met.
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CORPORATE GOVERNANCE
Code of Ethics
We uphold a set of basic values to guide our actions and are committed to maintaining the highest standards of business conduct and corporate governance. We have adopted a Code of Business Conduct and Ethics for directors, officers (including our principal executive officer and principal financial officer) and employees, which, in conjunction with our Certificate of Incorporation, Bylaws and Board of Directors committee charters, form the framework for governance of FHA. The Code of Ethics and Business Conduct, Board of Directors committee charters, Bylaws and Article of Incorporation are available at our corporate offices. Stockholders may request free printed copies of these documents from:
Future Healthcare of America
Attn: CFO
5001 Baum Blvd., Suite 770
Pittsburgh, PA 15213
Board of Directors Independence
The Board of Directors has determined that each of J. Gregory Smith, Denis Yevstifeyev and Douglas Polinsky has no material relationship with us (either directly or as a partner, stockholder or officer of an organization that has a relationship with us) and satisfies the independence requirements required by the SEC. The non-management independent directors meet in executive session, without management, at least annually. Mr. Polinsky, an independent non-management director, chairs all executive session meetings of directors.
Committees of the Board of Directors
The Board of Directors has adopted written charters for two standing committees: the Nominating Committee and the Audit Committee. The Board has determined that all members of the Nominating and Audit Committees are independent and satisfy the relevant SEC independence requirements for members of such committees.
Nominating Committee
. The Nominating Committee currently consists of Mr. Polinsky as chair, Mr. Yevstifeyev, and Mr. Smith. This committee provides assistance to the Board in identifies individuals qualified to become members of the Board of Directors consistent with Board criteria. The committee also oversees the evaluation of the Board of Directors and management. There have not been any material changes to the procedures by which stockholders recommend nominees to the Board of Directors.
Audit Committee
. The Audit Committee currently consists of Mr. Polinsky as chair, Mr. Yevstifeyev, and Mr. Smith. Mr. Yevstifeyev, the Board of Directors has determined, is an audit committee financial expert as defined under SEC rules. This committee oversees the integrity of our financial statements, disclosure controls and procedures, the systems of internal accounting and financial controls, compliance with legal and regulatory requirements, the qualifications and independence of the independent auditors and the performance of our internal audit function and independent auditors, and the quarterly reviews and annual independent audit of our financial statements. Gregory & Associates, our independent auditors, reports directly to the Audit Committee.
We will provide a free printed copy of any of the charters of any Board committee to any stockholder on request.
Compensation Committee
. The Compensation Committee currently consists of Mr. Polinsky as chair, Mr. Yevstifeyev, and Mr. Smith. This committee provides assistance to the Board of Directors in overseeing our compensation policies and practices. It reviews and approves the compensation levels and policies for the Board of Directors; reviews and approves corporate goals and objectives with respect to CEO compensation and, based upon these evaluations, determines and approves the CEOs compensation; makes recommendations to the Board of Directors with respect to non-CEO executive officer compensation. The Compensation Committee also has the responsibility to provide the report to stockholders on executive officer compensation, which appears below.
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