Item 5.02(b), (c), and (d)-Departure of Directors or Certain Officers; Election
of Directors; Appointment of Certain Officers; Compensatory Arrangements of
Certain Officers.
(b)- Effective April 9. 2021, Richard Munn and William Green each voluntarily
resigned as a Director of QS Energy, Inc. (the "Company"), and all committees
thereof.
Effective April 15, 2021, Jason Lane and Thomas Bundros each voluntarily
resigned as a Director of the Company, and all committees thereof. Concurrently,
effective that date, Mr. Lane also voluntarily resigned as Chairman of the Board
of the Company.
Effective April 15, 2021, Michael McMullen voluntarily resigned as the Chief
Financial Officer ("CFO") of the Company. Notwithstanding, Mr. McMullen has
agreed to continue to serve the Company on a consulting basis for a limited time
to assist the Company in its transition to new management. Additionally,
effective April 15, 2021, Don Dickson resigned as the interim Chief Executive
Officer ("CEO") of the Company.
(c) and (d)- Effective April 15, 2021, the remaining Board members, namely, Don
Dickson and Eric Bunting, appointed Cecil Bond Kyte to serve as the Company's
Chief Executive Officer and Chief Financial Officer on such mutually acceptable
terms and conditions to be determined at a later date, based on and subject to
the Company's financial condition and viability. Currently, Mr. Kyte will not
receive any cash or stock consideration for his roles as CEO and CFO of the
Company until approved by the Board. Currently, there is no agreement or
arrangement regarding compensation for Mr. Kyte in his roles as CEO and CFO of
the Company. Additionally, effective April 15, 2021, the remaining Board members
appointed Mr. Kyte to serve on the Company's Board of Directors and to serve as
the Company's Chairman of the Board. The Board also approved a resolution
suspending all Board compensation effective January 1, 2021, payable under the
Company's May 6, 2014, Board compensation policy as amended January 1, 2015.
In December 2007, Mr. Kyte, age 50, was elected to serve as Chairman of the
Board of the Company, then known as Save The World Air, Inc. ("STWA"). In
January 2010, he was appointed to serve as CEO of STWA. In November 2013, Mr.
Kyte voluntarily resigned as a director, Chairman of the Board, and CEO of STWA.
Since then, Mr. Kyte has held positions with the following public companies:
MassRoots, Inc., where he served as a board member from late 2017, through July
2019. Massroots,Inc. was a technology platform for the cannabis industry during
the time Mr. Kyte served as a director of the company; Rightscorp, Inc., where,
since 2015, Mr. Kyte has served and continues to serve as the company's CEO, and
since 2016, has served and continues to serve as the company's CFO. Mr. Kyte is
also a member of the board of Rightscorp. Rightscorp's mission is to support
copyright holders' abilities to litigate and monetize their music and other
copyrights against piracy and peer to peer infringement on the internet. Mr.
Kyte has mainly been associated with "start overs" rather than "start ups,"
using his abilities to restructure and develop a company's management, financial
condition, compliance, and product commercialization. In addition to his current
roles as CEO, CFO, and board member of Rightscorp, Mr. Kyte is also currently
supporting the funding and business development for Bye Aerospace's suite of
products including the development and manufacturing of advanced
civilian/military aerospace technologies. Mr. Kyte has been a pilot for 31
years. He received a B.S. Degree in accounting from Long Beach State University.
2
Item 8.01- Other Events.
As reported in the Company's Form 12b-25 Notification of Late Filing, filed with
the SEC on March 31, 2021, the Company was unable file its Annual Report on Form
10-K for its annual fiscal period ended December 31, 2020 (the "2020 Annual
Report") by the filing date deadline of March 31, 2021. This filing provided the
Company an additional 15 days to April 15, 2021, to file its 2020 Annual Report.
Due to conditions described below, the Company has been unable to obtain an
independent audit of its financial statements and continues to be unable to
compile certain information required to permit the Company to file a timely and
accurate 2020 Annual Report. As of April 15, 2021, the Company is delinquent in
its SEC filing obligation regarding its 2020 Annual Report, and the Company can
provide no assurances as to a date when, or if, an audit can be conducted or the
2020 Annual Report may be filed with the SEC.
As reported in the Company's Form 10-Q filed with the SEC on November 10, 2020,
and in reports published online on the Company's website at
https://qsenergy.com/updates, the Company's efforts to demonstrate the efficacy
of its AOT technology under commercial operating conditions have been
unsuccessful. The Company continues to have confidence in its AOT technology and
in the commercial viability of its technology; however, it has been unable to
achieve its goal of commercialization of its AOT technology due, in substantial
part, to unsolved technical difficulties with the AOT and to a lack of working
capital necessary to sustain normal operations, including SEC compliance and an
audit, and to execute plans to diagnose and resolve technical difficulties with
its AOT technology. Currently, we do not have sufficient working capital to
operate, nor do we have sufficient cash on hand to pay past-due amounts owed to
our independent auditors, nor to pay our auditors for an audit covering calendar
year 2020. We have been informed by our independent auditors that unless we were
able to pay them amounts past-due in full, and pay amounts to cover their audit
services for the 2020, they would be unable to perform and complete the audit.
As a result, we are unable to have an audit performed on our financial
statements for the calendar year 2020 and unable to file our 2020 Annual Report
on April 15, 2021. The Company intends to complete the audit and file its 2020
Annual Report when sufficient funds are available; however, as noted above, the
Company can provide no assurances as to a date when, or if, the 2020 Annual
Report will be filed with the SEC. Also, the Company can provide no assurances
that sufficient funds will be available to have an audit completed and to file
its 2020 Annual Report, or that the Company will be able generally to raise
capital to remain in business, or that if capital is made available to the
Company that any such capital would be on acceptable terms and conditions.
3
Forward-Looking Statements
The Company cautions you that statements included in this Current Report on Form
8-K (including the exhibit hereto) that are not a description of historical
facts are forward-looking statements. In some cases, you can identify
forward-looking statements by terms such as "may," "will," "should," "expect,"
"plan," "anticipate," "could," "intend," "target," "project," "contemplates,"
"believes," "estimates," "predicts," "potential" or "continue" or the negatives
of these terms or other similar expressions. These statements are based on
current expectations, estimates and projections about our business based in part
on assumptions made by management. These statements are not guarantees of future
performance and involve risks, uncertainties and assumptions that are difficult
to predict. Therefore, actual outcomes and results may, and are likely to,
differ materially from what is expressed or forecasted in the forward-looking
statements due to numerous factors, including those set forth our periodic
reports filed with the SEC. You are cautioned not to place undue reliance on
these forward-looking statements, which speak only as of the date hereof, and
the Registrant undertakes no obligation to revise or update this report to
reflect events or circumstances after the date hereof. All forward-looking
statements are qualified in their entirety by this cautionary statement. This
caution is made under the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995.
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