UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act
July 11, 2019
Date of Report (Date of Earliest Event Reported)
Phoenix Life Sciences International Limited
(Exact name of registrant as specified in its charter)
| Nevada | 333-167275 | 46-0525378 | ||
| (State or other jurisdiction | (Commission File Number) | (IRS Employer | ||
| of Incorporation) | Identification Number) | |||
|
3000 Lawrence Street Denver, CO 80205 |
(Address, including zip code, and telephone number, including area code,
of registrant’s principal executive offices)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Phoenix Life Sciences International Limited is referred to herein as “we”, “our”, or “us.
Explanatory Note
On July 11, 2019, we filed a Form 8-K report disclosing that on July 8, 2019 our Board of Directors (the “Board”) placed Martin Tindall on indefinite, unpaid suspension from his position as Chief Executive Officer and removed him from all authority positions. Concurrently, our Board appointed Janelle Marsden as our Chief Executive Officer. Since assuming her role as Chief Executive Officer, Janelle Marsden has conducted an investigation of Martin Tindall’s activities while he was our Chief Executive Officer, which investigation is ongoing. Chief Executive Officer Janelle Marsden has discovered material matters previously unknown to our Board or our management that are disclosed herein under Item 8.01 (a)-(c).
Other corporate actions are disclosed below under Items 3.02, 5.02, 7.01, and (d) under Item 8.01.
Item 3.02
Unregistered Sales of Equity Securities
On August 22, 2019, we issued 40,000 Series B Preferred Shares (the "Preferred Shares") to each of the five members of a Special Committee composed of our Board Members and Stacey Jenkins, and not including Martin Tindall, that are convertible into a total of 20,000,000 common stock shares. The Special Committee was established on June 26, 2019 to take appropriate corporate actions in connection with Martin Tindall's actions as our officer. The 20,000,000 common stock shares (the "20 Million Shares") that may be converted from the Preferred Shares constitutes 65.06% of our 30,739,730 outstanding shares, which shares are subject the following terms and restrictions: (a) the 20 Million Shares are ineligible for conversion for 12 months from the date of issuance, which date of issuance was August 22, 2019; (b) at the conclusion of the first year of holding the 20 Million Shares, 25% of such shares may be converted, with an additional 25% available for conversion each quarter thereafter, such that the entirety of such shares may be converted within 24 months of issuance (the "Conversion Blackout"); (b) following the expiration of the Conversion Backout, no holder of the converted securities may sell more than 10% of the 30 day average daily volume of the common stock for the period ended one trading day prior to the date of such sale; (c) we have the right to require the holder of Preferred Shares or the Converted Common Stock to sell such securities back to us at a price of not less than 75% of the ninety (90) day average common stock trading price for the period ended one trading day prior to the date of such sale, provided however that we may not compel such sale within thirty (30) days of our most recent filing of Forms 10-K, 10-Q, or 8-K announcing our financial performance.
Item 5.02
Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On August 27, 2019, pursuant to provision 4.5 of our bylaws and a Board meeting of that same date, our Board permanently removed Martin Tindall as our Chief Executive Officer and/or any other of our officer positions or that of our subsidiaries. .
Item 7.01
Regulation FD Disclosure
On August 27, 2019, our Board of Directors adopted the following:
a) Audit Committee Charter (attached as Exhibit 99.1)
b) Nominating Committee Charter (attached as Exhibit 99.1)
c) Compensation Committee Charter (attached as Exhibit 99.3)
d) Code of Ethics (attached as Exhibit 99.4)
e) Insider Trading Policy (attached as Exhibit 99.5)
On August 27, 2019, our Board of Directors appointed the following Board Members to our Audit Committee, Compensation Committee, and Nominating Committee:
Audit Committee
Lewis Humer
Geoff Boynton
Compensation Committee
Lewis Humer
Stephen Cornford
Nominating Committee
Lewis Humer
Janelle Marsden
2
Item 8.01
Other Events
(a) Share Cancellation
Our present Chief Executive Officer, Janelle Marsden, learned that our then Chief Executive Officer Martin Tindall had used an unregistered and unexecuted trust to issue 22,500,000 common stock shares to said Trust (the “Shares”); accordingly, on August 23, 2019, we affected through our transfer agent, the cancellation of the Shares (the “Cancellation”). Through the Cancellation, we have reduced the current number of outstanding shares by 22,500,000 to 10,739,430 outstanding shares, which amount does not include 200,000 Class B Preferred Shares issued to members of the Special Committee that are convertible into 20,000,000 common stock shares as described above in Item 3.02.
(b) Gauntlet Holdings Litigation
Pursuant to Chief Executive Officer Marsden’s investigation, she learned that on October 29, 2018, Gauntlet Holdings, LLC (“Gauntlet”) and NMS Capital Advisors, LLC (“NMS”) filed a lawsuit against us and our then Chief Executive Officer, Martin Tindall and us, for breach of contract and fraudulent misrepresentation in connection with an alleged default upon a Secured Promissory Note (Gauntlet Holdings, LLC et al vs. Kronos International, Phoenix Life Sciences International Limited, Medijane Holdings, Martin Tindall, Vincent Coviello, Superior Court of California, Los Angeles-Central District) (the “Gauntlet Litigation”). Then Chief Executive Officer Martin Tindall failed to disclose the Gauntlet litigation to our Board of Directors or our management. On August 29, 2019, we settled the Gauntlet Litigation for payment of 1,000,000 common stock shares each to Gauntlet and NMS, which shares are subject to a leak out agreement providing that Gauntlet and NMS will each sell no more than 10,000 of our common stock shares per trading day with a sales price of no less than 95% (ninety-five percent) Volume Weighted Average Price of the preceding 10 (ten) trading days. We granted piggyback registration rights to both Gauntlet and NMS.
(c) Terrence Roderick Hannam Litigation
Chief Executive Officer Marsden’s investigation’s revealed that on January 30, 2019, Terrence Roderick Hannam filed a lawsuit against us for breach of contract in connection with an agreement that we would acquire all shares of Silver Holdings, Ltd. (Terrence Roderick Hannam v. Phoenix Life Sciences International, Limited, Civil Case No. A7 of 2019, Supreme Court of Republic of Vanuatu. “). Then Chief Executive Officer Martin Tindall failed to disclose the Hamman Litigation to our Board or our management. We have filed a Motion to Dismiss regarding this litigation.
(d) Arrest of Martin Tindall
We have learned that Martin Tindall, individually, has been arrested on 32 counts of securities fraud in Boulder, Colorado.
Item 9.01
Financial Statements and Exhibits.
(d) Exhibits.
3
| Exhibit Number | Description |
| 99.1 | Audit Committee Charter |
| 99.2 | Nominating Committee Charter |
| 99.3 | Compensation Committee Charter |
| 99.4 | Code of Ethics |
| 99.5 | Insider Trading Policy |
4
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Company has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
|
Phoenix Life Science International Limited | ||
| Date: August 29, 2019 | By: | /s/ Janelle Marsden |
| Janelle Marsden | ||
| Chief Executive Officer | ||
5
Phoenix Life Sciences International Limited - 8-K
Exhibit 99.1
PHOENIX LIFE SCIENCES INTERNATIONAL LIMITED
AUDIT COMMITTEE CHARTER
A. Purpose. The purpose of the Audit Committee (the “Committee”) of the Board of Directors (the “Board”) of Phoenix Sciences International Limited, a Nevada corporation (the “Company”), is to assist the Board in its oversight of (i) the integrity of the Company’s financial statements, (ii) the Company’s compliance with legal and regulatory requirements, (iii) the qualifications and independence of the Company’s independent registered public accounting firm (the “Independent Accounting Firm”), and (iv) performance of the Company’s internal auditing department (“Internal Audit”) and the Independent Accounting Firm.
Membership. The Committee’s membership is determined by the Board and consists of at least two directors. At a future date, when the Company has independent directors, the members of the Committee shall meet the independence and experience requirements of the listing standards of NASDAQ and the requirements for audit committee service set forth in the Securities Exchange Act of 1934, as amended (the “Act”), and the rules and regulations of the Securities and Exchange Commission (“SEC”). Unless otherwise waived by the Board, at least one member of the Committee shall be an “audit committee financial expert” as determined by the Board in compliance with criteria established by the SEC. Committee members shall not serve on the audit committees of more than two other public companies unless the Board determines that such service does not impair the member’s ability to serve effectively on the Audit Committee. Notwithstanding any of the forgoing, until the securities of the Company are listed on a national exchange, the Board may waive any of the foregoing requirements.
C. Roles and Responsibilities. The Committee’s responsibility is one of oversight. The management of the Company is responsible for the preparation of complete and accurate annual and quarterly consolidated financial statements (“financial statements”) in accordance with generally accepted accounting principles in the United States and for maintaining appropriate accounting and financial reporting principles and policies and internal controls designed to assure compliance with accounting standards and laws and regulations. The Independent Accounting Firm is responsible for planning and conducting in accordance with the standards of the Public Company Accounting Oversight Board (the “PCAOB”) an audit of the Company’s annual consolidated financial statements and a review of the Company’s quarterly financial statements. The Committee shall have the authority to take any and all acts that it deems necessary to carry out its oversight function, including but not limited to:
1. Financial Reporting and Disclosure
(a) Review and discuss the annual audited financial statements and quarterly financial statements with management and the Independent Accounting Firm, including the disclosures under the caption “Management Discussion and Analysis of Financial Condition and Results of Operations.” The Committee shall make a recommendation to the Board as to whether the audited financial statements should be included in the Company’s Annual Report on Form 10-K.
(b) Review the Company’s financial reporting processes, disclosure and internal controls and procedures, and the process for the CEO and CFO quarterly certifications required by the SEC with respect to financial statements and the Company’s disclosure and internal controls and procedures. Such review shall include a consideration of major issues regarding accounting principles and financial statement presentations, including any significant changes in the Company’s selection or application of accounting principles, and any reports by the CEO and CFO regarding major issues as to the adequacy of the Company’s disclosure and internal controls and procedures and any special audit steps adopted in light of identified deficiencies.
.
(c) Review and discuss with management (including the senior internal audit executive) and the Independent Accounting Firm the Company’s internal controls report and, when required, the Independent Accounting Firm’s attestation of the report prior to filing of the Company’s Form 10-K.
(d) Obtain and periodically review a report from the Independent Accounting Firm, describing (i) all critical accounting policies and practices to be used in the financial statements; (ii) all alternative treatments of financial information within generally accepted accounting principles that have been discussed with management, ramifications of the use of such alternative disclosures and treatments, and the treatment preferred by the Independent Accounting Firm; and (iii) other material written communications between the Independent Accounting Firm and management, such as any management letter or schedule of unadjusted differences. Review any reports on such topics or similar topics prepared by management, including any significant financial reporting issues and judgments made in connection with the preparation of the financial statements. Discuss with the Independent Accounting Firm any material issues raised in such reports.
(e) Discuss earnings press releases, as well as financial information and earnings guidance provided to analysts and rating agencies, provided that such discussions may be done generally (i.e., by discussing the types of information to be disclosed and the type of presentation to be made). The management will review with the chair of the Committee (the “Chair”) earnings press releases prior to issuance.
(f) Discuss with management and the Independent Accounting Firm the effect of regulatory and accounting initiatives, as well as off-balance sheet structures, if any, on the Company’s financial statements.
2. Internal Audit
(a) Review the charter, annual plan and scope of work of Internal Audit, including its responsibilities and staffing.
(b) Review, as appropriate, the results of internal audits and discuss related significant internal control matters with the Company’s internal auditor and Company management.
(c) Discuss the adequacy of the Company’s internal controls with Internal Audit.
(d) Review the appointment and periodically evaluate the performance of the senior internal auditing executive, who shall have direct access to the Committee.
3. Independent Accounting Firm
(a) Responsible for the appointment, retention, termination, compensation and oversight of the Independent Accounting Firm. The Committee shall also be responsible for the resolution of disagreements between management and the Independent Accounting Firm. The Independent Accounting Firm shall report directly to the Committee.
(b) Review the scope of the annual audit and services to be provided by the Independent Accounting Firm during the year. Pre-approve all auditing services, internal control-related services and permitted non-audit services to be provided to the Company by the Independent Accounting Firm, subject to any exceptions provided by the Act. The Chair may pre-approve any such services according to the procedures approved by the Committee, provided that any approval by the Chair must be presented to the Committee at its next meeting.
(c) Obtain and review, at least annually, a report from the Independent Accounting Firm describing: (i) the Independent Accounting Firm’s internal quality-control procedures; (ii) any material issues raised by the most recent internal quality-control review, or peer review, of the Independent Accounting Firm, or by any inquiry or investigation by governmental or professional authorities, within the preceding five years, respecting one or more independent audits carried out by the Independent Accounting Firm, and any steps taken to deal with any such issues; and (iii) all relationships between the Independent Accounting Firm and the Company, and the written independence disclosures required by applicable requirements of the PCAOB. Discuss with the Independent Accounting Firm any issues or relationships disclosed in such report that, in the judgment of the Committee, may have an impact on the competence or independence of the Independent Accounting Firm.
(d) Discuss with the Independent Accounting Firm the matters required to be discussed pursuant to the Statement on Auditing Standards No. 114 (formerly Statement on Auditing Standards No. 61), Communication with Audit Committees, as currently in effect, including any audit problems or difficulties encountered in performing the audit and management’s response, and disagreements with management.
(e) Obtain assurance from the Independent Accounting Firm that the audit was conducted in a manner consistent with Section 10A(b) of the Act.
(f) Review and periodically evaluate the performance of the lead audit partner of the Independent Accounting Firm and assure the regular rotation of the lead audit partner and the audit partner responsible for reviewing the audit as required by law.
(g) Establish policies for the Company’s hiring of employees or former employees of the Independent Accounting Firm who participated in any capacity in the audit of the Company.
4. Risk Management and Compliance
(a) Discuss policies and procedures with respect to risk assessment and risk management, the Company’s major risk exposures and the steps management has taken to monitor and mitigate such exposures.
(b) Review the effectiveness of the system for monitoring compliance with laws, regulations and the Company’s business conduct policies and the results of management’s investigation and follow-up on any fraudulent acts or accounting irregularities.
(c) Periodically obtain reports from management on compliance, and at least annually, on the implementation and effectiveness of the Company’s compliance and ethics program.
(d) Review with the Company’s legal counsel legal matters that may have a material impact on the consolidated financial statements and any material reports or inquiries received from regulators or governmental agencies regarding compliance.
(e) Establish procedures for (i) the receipt, retention, and treatment of complaints received by the Company regarding accounting, internal accounting controls, or auditing matters; and (ii) the confidential, anonymous submission by Company employees of concerns regarding questionable accounting or auditing matters. Review periodically with management and Internal Audit these procedures and any significant complaints received.
5. Meetings, Reports, Charter Review, Performance Evaluation and Outside Advisors
(a) The Committee shall meet with such frequency and at such intervals as it shall determine is necessary to carry out its duties and responsibilities, but in any case, not less than four times a year. Meetings shall be called by the Chair or by a majority of the members of the Committee. Notice of each meeting shall be furnished to each member by the Chair (which task may be delegated by the Chair to the secretary of the Committee, if any) not less than one business day prior to the scheduled meeting, provided that attendance at the meeting shall constitute waiver of notice unless otherwise designated by the member. Notice may be given in the same manner as provided for meetings of the Board. The Committee shall meet separately, periodically, with management, with internal auditors and with the Independent Accounting Firm. Unless otherwise provided in the Company’s Bylaws, a majority of the members shall constitute a quorum and a majority of the members present shall decide any matter brought before the Committee. The Chair may appoint a secretary to record and maintain minutes of any meeting of the Committee.
(b) Report regularly to the Board.
(c) Prepare the report of the Committee required to be included in the Company’s annual proxy statement, if applicable.
(d) Review the adequacy of this Charter at least annually and recommend any proposed changes to the Board for approval.
(e) Conduct an annual performance evaluation of the Committee.
(f) The Committee shall have the authority to retain such outside legal, accounting or other advisors, as the Committee may deem appropriate in its sole discretion. The Committee shall have sole authority to approve related fees and retention terms.
6. Whistle Blower Protection Procedures
(a) The Committee shall adopt an appropriate “Whistle Blower Protection Process” applicable to all employees of the Company and its subsidiaries and affiliated companies and shall develop procedures to review and process complaints that are forwarded to the Committee.
(b) The policy adopted by the Committee shall confirm that the Company will not tolerate harassment, retaliation or any type of discrimination against any employee (“whistleblower”) who (i) makes a good faith complaint about suspected Company or employee violation of law or company policies, including, without limitation, a conflict of interest, a breach of applicable law, regulation or rules or what appears to be unethical, fraudulent or other illegal behavior on the part of a colleague; (ii) makes a good faith complaint regarding accounting, internal accounting controls or audit matters that may lead to incorrect, or misrepresentation in, financial accounting; (iii) provides information (or causes information to be provided) or assists in any investigation regarding violations of law; or (iv) files, testifies or participates in a proceeding related to alleged violations of law.
(c) The Committee shall adopt suitable safeguards for whistleblowers and reasonable reporting processes by whistleblowers.
Phoenix Life Sciences International Limited - 8-K
Exhibit 99.2
PHOENIX LIFE SCIENCES INTERNATIONAL LTD.
(the “Company”)
Nominating Committee Charter (the “Charter”)
The responsibilities and powers of this Nominating Committee (the “Committee”) as delegated by the Company’s Board of Directors (the “Board”) are set forth in this charter. Whenever the Committee takes an action, it shall exercise its independent judgment on an informed basis that the action is in the best interests of the Company and its stockholders.
I.
PURPOSE
As set forth herein, the Committee shall, among other things, discharge the responsibilities of the Board relating to the appropriate size, functioning and needs of the Board including, but not limited to, identification, recommendation, recruitment and retention of high quality Board members and committee composition and structure.
II.
MEMBERSHIP
The Committee shall consist of at least two members of the Board as determined from time to time by the Board. Each member shall be “independent” in accordance with the listing standards of the NASDAQ Capital Market, as amended from time to time. This requirement may be waived until such time that the Company sufficient adopts its Corporate Governance plans.
The Board shall elect the members of this Committee at the first Board meeting or by Board resolution. Unless a chairman (the “Chair” or “Chairman”) is elected by the Board, the members of the Committee shall designate a Chair by majority vote of the full Committee membership.
A Committee member may resign by delivering his or her written resignation to the Chairman of the Board, or may be removed by majority vote of the Board by delivery to such member of written notice of removal, to take effect at a date specified therein, or upon delivery of such written notice to such member if no date is specified.
III.
MEETINGS AND COMMITTEE ACTION
The Committee shall meet at such times as it deems necessary to fulfill its responsibilities. Meetings of the Committee shall be called by the Chairman of the Committee upon such notice as is provided for in the by-laws of the Company with respect to meetings of the Board. A majority of the members shall constitute a quorum. Actions of the Committee may be taken in person at a meeting or in writing without a meeting. Actions taken at a meeting, to be valid, shall require the approval of a majority of the members present and voting. Actions taken in writing, to be valid, shall be signed by all members of the Committee. The Committee shall report its minutes from each meeting to the Board.
The Chairman of the Committee may establish such rules as may from time to time be necessary or appropriate for the conduct of the business of the Committee. At each meeting, the Chairman shall appoint as Secretary a person who may, but need not, be a member of the Committee. A certificate of the Secretary of the Committee or minutes of a meeting of the Committee executed by the Secretary setting forth the names of the members of the Committee present at the meeting or actions taken by the Committee at the meeting shall be sufficient evidence at all times as to the members of the Committee who were present, or such actions taken.
IV.
COMMITTEE AUTHORITY AND RESPONSIBILITIES
| ● | Developing the criteria and qualifications for membership on the Board. |
| ● | Recruiting, reviewing, nominating and recommending candidates for election to the Board or to fill vacancies on the Board. |
| ● | Reviewing candidates proposed by stockholders, and conducting appropriate inquiries into the background and qualifications of any such candidates. |
| ● | Establishing subcommittees for the purpose of evaluating special or unique matters. |
| ● | Monitoring and making recommendations regarding committee functions, contributions and composition. |
| ● | Evaluating, on an annual basis, the Board’s and management’s performance. |
| ● | Evaluating, on an annual basis, the Committee’s performance and report to the Board on such performance. |
| ● | Developing and making recommendations to the Board regarding corporate governance guidelines for the Company. |
| ● | Retaining and terminating any advisors, including search firms to identify director candidates, compensation consultants as to director compensation and legal counsel, including sole authority to approve all such advisors’ or search firms’ fees and other retention terms, as the case may be. |
V.
REPORTING
The Committee shall report to the Board periodically. The Committee shall prepare a statement each year concerning its compliance with this charter. The Committee shall periodically review and assess the adequacy of this charter and recommend any proposed changes to the Board for approval.
2
Board of Director Candidate Guidelines
The Nominating Committee will identify, evaluate and recommend candidates to become members of the Board with the goal of creating a balance of knowledge and experience. Nominations to the Board may also be submitted to the Nominating Committee by the Company’s stockholders in accordance with the Company’s policy, a copy of which is attached hereto. Candidates will be reviewed in the context of the then current composition of the Board, the operating requirements of the Company and the long-term interests of the Company’s stockholders. In conducting this assessment, the Committee will consider and evaluate each director-candidate based upon its assessment of the following criteria:
| ● | Whether the candidate is independent pursuant to the requirements of the NASDAQ Capital Market although such requirements may be waived by the Board. |
| ● | Whether the candidate is accomplished in his or her field and has a reputation, both personal and professional, that is consistent with the image and reputation of the Company. |
| ● | Whether the candidate has the ability to read and understand basic financial statements. The Nominating Committee also will determine if a candidate satisfies the criteria for being an “audit committee financial expert,” as defined by the Securities and Exchange Commission. |
| ● | Whether the candidate has relevant education, experience and expertise and would be able to provide insights and practical wisdom based upon that education, experience and expertise. |
| ● | Whether the candidate has knowledge of the Company and issues affecting the Company. |
| ● | Whether the candidate is committed to enhancing stockholder value. |
| ● | Whether the candidate fully understands, or has the capacity to fully understand, the legal responsibilities of a director and the governance processes of a public company. |
| ● | Whether the candidate is of high moral and ethical character and would be willing to apply sound, objective and independent business judgment, and to assume broad fiduciary responsibility. |
| ● | Whether the candidate has, and would be willing to commit, the required hours necessary to discharge the duties of Board membership. |
| ● | Whether the candidate has any prohibitive interlocking relationships or conflicts of interest. |
| ● | Whether the candidate is able to develop a good working relationship with other Board members and contribute to the Board’s working relationship with the senior management of the Company. |
| ● | Whether the candidate is able to suggest business opportunities to the Company. |
3
Phoenix Life Sciences International Limited - 8-K
Exhibit 99.3
Compensation Committee Charter for Phoenix Life Sciences International Ltd.
A.
PURPOSE
The primary objectives of the Compensation Committee (the “Committee”) of the Board of Directors (the “Board”) of Phoenix Life Sciences International Ltd. are to assist the Board in fulfilling its oversight responsibility by:
● working with the CEO to provide a roadmap of Compensation Committee activities over a 24 month period that will meet regulatory requirements and will allow for a sequencing of initiatives consistent with the ability of the organization to resource the strategies;
● developing and overseeing the implementation of the Company’s compensation philosophy with respect to the Company’s directors, Chief Executive Officer (the “CEO”) and other executive officers, as defined by Rule 16a-1(f) of the Securities Act of 1933, as amended (“Executive Officers”);
● designing compensation programs that compensate the employees of the Company effectively and in a non-discriminatory manner consistent with such compensation philosophy, internal equity considerations, market practices and the requirements of the appropriate employment laws and regulatory bodies;
● considering, when making pay for performance decisions, compliance with applicable laws and regulations that have an impact on our business in order to maintain the highest standards of integrity and ethical conduct;
● reviewing and recommending to the Board the Company’s compensation discussion and analysis and committee report for inclusion in applicable SEC filings as required by the Securities and Exchange Commission.
B.
ORGANIZATION
1. Composition. The Committee shall consist of at least two members and the size of the Committee shall be determined by the Board. Committee members shall be appointed by the Board and shall serve until their successors have been duly appointed and qualified, subject to their earlier death, resignation or removal. Committee members may be removed by the Board, with or without cause, in the Board’s discretion and vacancies on the Committee shall be filled by action of the Board. The chairperson of the Committee shall be designated by a vote of the full Board or, if the Board so chooses, the Committee members shall appoint a chairperson by vote of a majority of the full Committee.
2. Independence and Qualifications. Each member of the Committee shall (a) meet the independence requirements established by the Board and applicable laws, regulations and listing requirements, (b) be a “non-employee director” within the meaning of Rule 16b-3 under the Securities Exchange Act of 1934, and (c) be an “outside director” within the meaning of Section 162(m) of the Internal Revenue Code. These independent and outside director requirements may be waived until such time that the Company fully develops these corporate governance measures.
3. Subcommittees. The Committee is empowered by the Board to form and delegate authority to subcommittees when appropriate.
C.
STRUCTURE AND MEETINGS
The chairperson of the Committee will preside at each meeting, set the frequency and length of each meeting, and prepare and/or approve an agenda in advance of each meeting. The chairperson of the Committee shall ensure that the agenda for each meeting is circulated to each Committee member in advance of the meeting. The Committee will meet a minimum of three times per year and more frequently as circumstances require. The Committee may invite to any of its meetings other directors, members of Company management, and such other persons as it deems appropriate in order to carry out its responsibilities. The Committee will maintain written minutes of its meetings. At each regularly scheduled meeting of the Board the chairperson of the Committee shall provide the Board with a report of the Committee’s activities and proceedings.
D.
RESPONSIBILITIES AND DUTIES
The principal responsibilities of the Committee are to:
1. At least annually, review the Company’s overall compensation philosophy and evaluate the results of its policies to ensure that the compensation payable to the Company’s Executive Officers provides overall competitive pay levels, creates proper incentives to enhance stockholder value, appropriately rewards performance, and is justified by the returns available to stockholders.
2. Review and approve, subject to submission to the stockholders of the Company, if required by law or any applicable regulatory body, the Company’s compensation programs for executive officers.
3. Coordinate the Board’s role in establishing performance criteria and goals for the Company’s executive officers, evaluate the performance of the Executive Officers, and certify whether and to what extent performance goals have been attained.
4. Establish and periodically review policies in the area of executive perquisites.
5. Review and approve the terms of any employment agreement or any other agreement providing for severance, post-termination or change of control benefits between the Company and any executive officer.
6. Ratify change of control benefits between the Company and any non-executive officer.
7. Review the performance of the CEO and determine the individual elements of total compensation for the CEO (at a meeting at which the CEO is not present), considering the performance of the CEO and the Company, the compensation practices of the Company’s peer group(s) and the Company’s compensation philosophy as established by the Committee.
8. Review and discuss with the CEO the performance of the Company’s Executive Officers and determine the individual elements of total compensation for each executive officer considering the recommendations of the CEO with respect to such compensation, the performance of such executive officers and the Company, the compensation practices of the Company’s peer group(s) and the Company’s compensation philosophy as established by the Committee.
9. Determine compensation for such other officers as the Committee deems appropriate considering the recommendations of the CEO and management with respect to such officers, such officers’ compensation, the performance of such officers and the Company and the Company’s compensation philosophy as established by the Committee.
10. Grant or approve the grant of awards, whether in cash or otherwise pursuant to the Company’s compensation programs, to the Company’s executive officers taking into consideration the recommendations of the CEO with respect to such awards.
11. Review and discuss with management the Compensation Discussion and Analysis, and approve the Compensation Committee Report.
12. Determine periodically the compensation for non-employee directors.
13. Oversee the completion of an annual compensation risk assessment, including an evaluation of incentive compensation policies and practices for all employees to ensure they do not pose risks that are reasonably likely to have a material adverse effect on the Company.
14. Administer claw back or recoupment policies as required by applicable law.
15. Review the Company’s hedging and/or pledging policies.
16. Review annually the results of the non-binding advisory vote by the Company’s stockholders on the compensation of the Company’s “named executive officers” as identified in the Company’s proxy statement, if applicable.
17. Monitor compliance by directors and executive officers with the Company’s stock ownership guidelines, if any.
18. Perform the responsibilities of the Committee as enumerated in any compensation plan.
19. Retain, oversee and terminate compensation consultants, outside counsel, or other advisors or experts that advise the Committee, as it deems appropriate, including approval of fees and other retention terms.
20. Undertake such other responsibilities as may be assigned to the Committee, from time to time, by the Board or as designated in compensation or benefit plan documents. The Committee may delegate to the CEO such of its duties and responsibilities as the Committee deems to be in the best interests of the Company, provided such delegation is not prohibited by law, regulation or listing standards.
E.
PERFORMANCE EVALUATION
The Committee shall, at least annually, conduct a self-evaluation of the performance of the Committee and its members, review and assess the adequacy of this Charter and recommend any proposed changes to the Board for approval.
F.
COMMITTEE RESOURCES
The Company must provide for appropriate funding, as determined by the Committee, for payment of retaining such third-party counsel, consultants, accountants and other advisors as the Committee deems necessary or advisable to assist in setting and evaluating director, CEO and executive compensation as well as for all other compensation matters. The Committee shall have sole authority to terminate such advisors.
Prior to engaging a compensation consultant, legal counsel or other advisor, the Committee shall consider all factors relevant to the advisor’s independence from management, including those factors specified in the applicable NASDAQ Stock Market listing standards.
G.
AMENDMENTS
This Charter may be amended from time to time by the Board, and any amendment must be disclosed as required by, and in accordance with, applicable laws, rules and regulations.
Phoenix Life Sciences International Limited - 8-K
Exhibit 99.4
PHOENIX LIFE SCIENCES INTERNATIONAL, LTD. (THE “COMPANY”)
Code of Ethics
Compliance With Law
All employees, officers and directors of the Company should respect and comply with all of the laws, rules and regulations of the U.S. and other countries, and the states, counties, cities and other jurisdictions, in which the Company conducts its business or the laws, rules and regulations which are applicable to the Company, including the Sarbanes-Oxley Act of 2002 and all applicable rules and regulations of the Securities & Exchange Commission. Such legal compliance should include, without limitation, compliance with the “insider trading” prohibitions of the federal securities laws applicable to the Company and its employees, officers and directors. Generally, employees, officers and directors who have access to or knowledge of confidential or non-public information from or about the Company are not permitted to buy, sell or otherwise trade in the Company’s securities, whether or not they are using or relying upon that information. This restriction extends to sharing or tipping others about such information; especially since the individuals receiving such information might utilize such information to trade in the Company’s securities.
Conflicts of Interest
All employees, officers and directors of the Company should be scrupulous in avoiding a conflict of interest with regard to the Company’s interests. A “conflict of interest” exists whenever an individual’s private interests interfere or conflict in any way (or even appear to interfere or conflict) with the interests of the Company. A conflict situation can arise when an employee, officer or director takes actions or has interests that may make it difficult to perform his or her Company work objectively and effectively. It is almost always a conflict of interest for a Company employee to work simultaneously for a competitor, customer or supplier. You are not allowed to work for a competitor as a consultant or Board member. The best policy is to avoid any direct or indirect business connection with our customers, suppliers or competitors, except on our behalf. Conflicts of interest may also arise when an employee, officer or director, or members of his or her family, receives improper personal benefits as a result of his or her position in the Company, whether received from the Company or a third party. Loans to, or guarantees of obligations of, employees, officers and directors and their respective family members may create conflicts of interest. Federal law prohibits loans to directors and executive officers made after July 30, 2002. Conflicts of interest may not always be clear-cut, so if you have a question, you should consult with the Company’s legal counsel. Any employee, officer or director who becomes aware of a conflict or potential conflict should bring it to the attention of the Company’s Chief Executive Officer.
Corporate Opportunities
Employees, officers and directors are prohibited from (a) taking for themselves personal opportunities that properly belong to the Company or are discovered through the use of corporate property, information or position; (b) using corporate property, information or position for personal gain; and (c) competing with the Company. Employees, officers and directors owe a duty to the Company to advance its legitimate interests when the opportunity to do so arises.
Confidentiality
Employees, officers and directors of the Company must maintain the confidentiality of confidential information entrusted to them by the Company or its suppliers or customers, except when disclosure is authorized by senior management or required by laws, regulations or legal proceedings. Whenever feasible, employees, officers and directors should consult legal counsel if they believe they have a legal obligation to disclose confidential information. Confidential information includes all non-public information that might be of use to competitors of the Company, or harmful to the Company or its customers if disclosed.
Fair Dealing
Each employee, officer and director should endeavor to deal fairly with the Company’s customers, suppliers, competitors, officers and employees. None should take unfair advantage of anyone through manipulation, concealment, abuse of privileged information, misrepresentation of material facts or any other unfair dealing practice. We seek to outperform our competition fairly and honestly. We seek competitive advantages through superior performance, never through unethical or illegal business practices. Stealing proprietary information, possessing trade secret information that was obtained without the owner’s consent, or inducing such disclosures by past or present employees of other companies is prohibited.
Protection and Proper Use of Company Assets
All employees, officers and directors should protect the Company’s assets and ensure their efficient use. Theft, carelessness, and waste have a direct impact on the Company’s profitability. All Company assets should be used for legitimate business purposes.
Accurate Books and Records
All transactions by or on behalf of the Company shall be accurately reflected on its books and in its records.
Accounting Complaints
The Company’s policy is to comply with all financial reporting and accounting regulations applicable to the Company. If any employee, officer or director of the Company has concerns or complaints regarding questionable accounting or auditing matters of the Company, then he or she is encouraged to submit those concerns or complaints to the Board of Directors.
Reporting Any Illegal or Unethical Behavior
Employees are encouraged to talk to supervisors, managers, officers or other appropriate personnel about observed illegal or unethical behavior and, when in doubt, about the best course of action in a particular situation. Employees, officers and directors who are concerned that violations of this Code or that other illegal or unethical conduct by employees, officers or directors of the Company have occurred or may occur should either contact their supervisor or superiors. If they do not believe it appropriate or are not comfortable approaching their supervisors or superiors about their concerns or complaints, then they may contact the company’s legal counsel. Legal counsel for the Company is not an employee of the Company, and owes a fiduciary duty to the Company as its client, and not any one of its officers, directors or employees. If any employee, officer or director’s concerns or complaints require confidentiality, including keeping his or her identity anonymous, then this confidentiality will be protected, subject to applicable law, regulation or legal proceedings.
No Retaliation
The Company will not permit retaliation of any kind by or on behalf of the Company and its employees, officers and directors against good faith reports or complaints of violations of this Code or other illegal or unethical conduct.
Public Company Reporting
As a public company, the Company’s filings with the Securities and Exchange Commission must be accurate and timely. Depending on his or her position with the Company, an employee, officer or director may be called upon to provide necessary information to assure that the Company’s public reports are complete, fair and understandable. The Company expects employees, officers and directors to take this responsibility very seriously and to provide prompt accurate answers to inquiries related to the Company’s public disclosure requirements.
Document Retention
Records should always be retained or destroyed according to the Company’s record retention policies. In accordance with those policies, in the event of litigation or governmental investigation please consult the Company’s legal counsel.
Penalties for Failure to Adhere to Code of Ethics
Any employee who ignores or violates this Code and any supervisor or superior who penalized a subordinate for attempting in good faith to comply with this Code, including for reporting suspected violations of this Code, will be subject to disciplinary action by the Company, including immediate dismissal.
Amendment/Modification
This Code may be amended, modified or waived by the Company’s Board of Directors.
Phoenix Life Sciences International Limited - 8-K
Exhibit 99.5
NATIONAL STORM RECOVERY, INC. (THE “COMPANY”)
INSIDER TRADING POLICY
I.
introduction
"Insider trading" refers generally to buying or selling a security, in breach of a fiduciary duty or other relationship of trust and confidence, while in possession of material, nonpublic information about the security. Insider trading violations may also include "tipping" such information, securities trading by the person "tipped," and securities trading by those who misappropriate such information.
The scope of insider trading violations can be wide reaching. The Securities and Exchange Commission (the "SEC") has brought insider trading cases against corporate officers, directors, and employees who traded the corporation’s securities after learning of significant, confidential corporate developments; friends, business associates, family members, and other "tippees" of such officers, directors, and employees who traded the securities after receiving such information; employees of law, banking, brokerage, and printing firms who were given such information in order to provide services to the corporation whose securities they traded; government employees who learned of such information because of their employment by the government; and other persons who misappropriated, and took advantage of, confidential information from their employers.
Consequently, an "insider" can include officers, directors, major stockholders and employees of an entity whose securities are publicly traded. In general, an insider must not trade for personal gain in the securities of that entity if that person possesses material, nonpublic information about the entity. In addition, an insider who is aware of material, nonpublic information must not disclose such information to family, friends, business or social acquaintances, employees or independent contractors of the entity (unless such employees or independent contractors have a position within the entity giving them a clear right and need to know), and other third parties. An insider is responsible for assuring that his or her family members comply with insider trading laws. An insider may make trades in the market or discuss material information only after the material information has been made public.
II.
penalties; sanctions
General. Violation of the prohibition on insider trading can result in a prison sentence and civil and criminal fines for the individuals who commit the violation, and civil and criminal fines for the entities that commit the violation. The Company can be subject to a civil monetary penalty even if the directors, officers or employees who committed the violation concealed their activities from the Company.
Criminal Penalties. The maximum prison sentence for an insider trading violation is now 20 years. The maximum criminal fine for individuals is now $5,000,000, and the maximum fine for non-natural persons (such as an entity whose securities are publicly traded) is now $25,000,000.
Civil Sanctions. Persons who violate insider trading laws may become subject to an injunction and may be forced to disgorge any profits gained or losses avoided. The civil penalty for a violator may be an amount up to three times the profit gained or loss avoided as a result of the insider trading violation.
The Company (as well as other natural or non-natural persons who are deemed to be controlling persons of the violator) faces a civil penalty not to exceed the greater of $1,000,000 or three times the profit gained or loss avoided as a result of the violation if the Company knew or recklessly disregarded the fact that the controlled person was likely to engage in the acts constituting the insider trading violation and failed to take appropriate steps to prevent the acts before they occurred.
In addition, persons who traded contemporaneously with, and on the other side of, the insider trading violator may sue the violator and the controlling persons of the violator to recover the profit gained or loss avoided by the violator.
Bounties. The SEC offers bounties to persons who provide information leading to the imposition of the civil penalty.
III.
policy statement
Illegal insider trading is against the policy of the Company. Such trading can cause significant harm to the reputation for integrity and ethical conduct of the Company. Individuals who fail to comply with the requirements of this Insider Trading Policy are subject to disciplinary action, at the sole discretion of the Company, including dismissal for cause.
IV.
what is material, nonpublic information?
Nonpublic, or inside, information about the Company that is not known to the investing public may include, among other things, strategic plans; significant capital investment plans; negotiations concerning acquisitions or dispositions; major new contracts (or the loss of a major contract); other favorable or unfavorable business or financial developments, projections or prospects; a change in control or a significant change in management; impending securities splits, securities dividends or changes in dividends to be paid; a call of securities for redemption; and, most frequently, financial results.
All information about the Company is considered nonpublic information until it is disseminated in a manner calculated to reach the securities marketplace through recognized channels of distribution and public investors have had a reasonable period of time to react to the information. Generally, information which has not been available to the investing public for at least two (2) full business days is considered to be nonpublic. Recognized channels of distribution include annual reports, prospectuses, press releases, marketing materials, and publication of information in prominent financial publications, such as The Wall Street Journal.
Nonpublic information is material if it might reasonably be expected to affect the market value of the securities and/or influence investor decisions to buy, sell or hold securities. If a person feels the information is material, it probably is. Moreover, it should be remembered that plaintiffs who challenge and judges who rule on particular transactions have the benefit of hindsight.
If a person is in doubt as to whether information is public or material, that person should wait until the information becomes public, or should refer questions to the Company’s legal counsel.
V.
handling of information
The Company’s records must always be treated as confidential. Items such as interim and annual financial statements, managed assets information and similar information are proprietary (that is, information pertaining to and used exclusively by the Company), and proprietary information must not be disclosed or used for any purpose other than for Company business. All Company policies and procedures designed to preserve and protect confidential information must be strictly followed at all times.
No director, officer or employee of the Company shall at any time make any recommendation or express any opinion as to trading in the Company’s securities.
Information learned about other entities in a special relationship with the Company, such as acquisition negotiations, is confidential and must not be given to outside persons without proper authorization.
All confidential information in the possession of a director, officer or employee is to be returned to the Company at the termination his or her relationship with the Company.
VI.
trading in the company and other securities
General Rule. Directors, officers and employees of the Company shall not effect any transaction in the Company’s securities if they possess material, nonpublic information about the Company. This restriction generally does not apply to the exercise of stock options under the Company's stock option or deferred compensation plans, but would apply to the sale of any shares acquired under such plans. The provisions set forth in this Paragraph VI and all other provisions of this Insider Trading Policy shall equally apply to the directors, officers and employees of any subsidiary of the Company, except as noted in the "Trading Window Periods" paragraph below.
Trading Window Periods. Investment by the Company’s directors, officers or employees in Company securities is encouraged, so long as such persons do not purchase or sell such securities in violation of this Insider Trading Policy. In furtherance of the goals underlying the Company’s Insider Trading Policy, the Company’s directors, officers (those required to make filings under Section 16 of the Securities Exchange Act of 1934) and all employees at the Vice President level and above, as well as all employees in the accounting group are prohibited from buying or selling Company securities at all times, except during the period extending from the third (3rd) through the thirteenth (13th) business day following the release of the Company's earnings for the immediately preceding fiscal period to the public (the "Trading Window Period"). The prohibition on trading in Company securities by such persons at all times other than the Trading Window Period is designed to prevent any inadvertent trading by such persons in the Company's securities during times when there may be material financial information about the Company that has not been publicly disclosed.
Black-out Communications. In addition to the foregoing restrictions, the Company reserves the right to issue "black-out notices" to specified persons when material, nonpublic information exists. Any person who receives such a notice shall treat the notice as confidential and shall not disclose its existence to anyone else.
Trading in Securities of Other Entities. In addition, no director, officer or employee of the Company shall effect any transaction in the securities of another entity, the value of which is likely to be affected by actions of the Company that have not yet been publicly disclosed. Please note that this provision is in addition to the restrictions on trading in securities of other entities set forth any Code of Ethics of the Company.
Applicability to Family Members. The foregoing restrictions on trading are also applicable to family members’ accounts, accounts subject to the control of personnel subject to this Insider Trading Policy or any family member, and accounts in which personnel subject to this Insider Trading Policy or any family member has any beneficial interest, except that the restrictions on trading do not apply to accounts where investment decisions are made by an independent investment manager in a fully discretionary account. Personnel subject to this Insider Trading Policy are responsible for assuring that their family members comply with the foregoing restrictions on trading. For purposes of this Policy, "Family Members" include one’s spouse and all members of the family who reside in one's home.
Rule 10b5-1 Trading. Notwithstanding the restrictions stated in this Paragraph VI, such restrictions shall not apply to purchases or sales of securities of the Company made by the persons covered hereby who have entered into a written trading plan that complies with Rule 10b5-1 of the Exchange Act and has been approved by the Compliance Officer.
VII.
investigations; supervision
If any person subject to this Insider Trading Policy has reason to believe that material, nonpublic information of the Company has been disclosed to an outside party without authorization, that person should report this to the Compliance Officer immediately.
If any person subject to this Insider Trading Policy has reason to believe that an insider of the Company or someone outside of the Company has acted, or intends to act, on inside information, that person should report this to the Compliance Officer immediately.
If it is determined that an individual maliciously and knowingly reports false information to the Company with intent to do harm to another person or the Company, appropriate disciplinary action will be taken according to the severity of the charges, up to and including dismissal. All such disciplinary action will be taken at the sole discretion of the Company.