Strainwise, Inc. – ‘SC 14F1/A’ on 8/21/14 re: Strainwise, Inc.

On:  Thursday, 8/21/14, at 6:05pm ET   ·   As of:  8/22/14   ·   Accession #:  1004878-14-315   ·   File #:  5-88289

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Amendment to Statement re: Change in Majority of Directors   —   Rule 14f-1
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: SC 14F1/A   Schedule 14F-1 Amendment                               7     26K 

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 UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 14f-1/A

SCHEDULE 14f-1 INFORMATION
 Information Statement Pursuant to Section 14(f)
of the Securities and Exchange Act of 1934 and
Securities and Exchange Rule 14f-1

 4TH GRADE FILMS, INC.
--------------------------------------
(Name of Registrant as Specified in its Charter)

 Utah                   000-52825                 20-8980078
---------------------------- --------------------- -----------------------------
(State or other          (Commission File           (I.R.S. Employer  
 jurisdiction                Number)             Identification No.)
of Incorporation)                                                       

1350 Independence St., Suite 300  
Lakewood, CO 80125
--------------------------------------
(Address of principal executive offices)

 Company's telephone number, including area code: (303) 736-2442

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 4TH GRADE FILMS, INC.
1350 Independence St., Suite 300
Lakewood, CO 80125
(303) 736-2442

     On  August  19,  2014  we  acquired  approximately  90% of the  issued  and
outstanding  common stock of  Strainwise,  Inc.  ("Strainwise")  in exchange for
23,124,184  shares of our common  stock.  As of July 31,  2014 we had  2,345,000
shares of common stock issued and outstanding.                                  

In connection with the acquisition:                                   

  o    1,038,000 shares of our outstanding common stock will be cancelled;

o    our current officers and directors will resign; and              

o    new management will be appointed.                                

     As a result of the acquisition,  one former  shareholder of Strainwise will
own  approximately  90% of our common  stock.  We plan to acquire the  remaining
outstanding shares of Strainwise at a later date.                               

     Strainwise was organized in Colorado on June 8, 2012 as a limited liability
company and was converted into a Colorado corporation on January 16, 2014.      

     After the acquisition,  we plan to offer a variety of services to operators
of medical  and  retail  marijuana  shops.  These  services  will  include:  (i)
administrative;   (ii)  consulting;   (iii)  accounting;   (iv)  financial;  (v)
compliance;  (vi)  procuring  supplies;  (vii)  cultivation;  and (viii) growing
system and facility management.  In addition, we plan to purchase, lease and set
up buildings specifically designed for marijuana growers.                       

     Our common stock is our only  outstanding  class of equity  security.  Each
share of our common stock  entitles its holder to one vote at any meeting of our
shareholders.                                                                   

Principal Shareholders                                                          

     The following table lists, the  shareholdings  of: (i) each person who will
own beneficially 5% or more of our common stock; (ii) each officer and director;
and (iii) all officers and directors as a group,  after the acquisition.  Unless
otherwise indicated, each owner will have sole voting and investment powers over
their shares of common stock.                                                   

                                       Number of Shares       Percentage
Name                                  Beneficially Owned        of Class
  ----                                  ------------------     -------------

Shawn Phillips                                   -                 -    
Erin Phillips                           23,124,184               95%    
David Modica                                11,500               Nil    
All officers and directors                                              
 as a group (3 persons)             23,135,684               95%

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Management                                                                      

     Following the acquisition,  the following  persons will be our officers and
directors:                                                                      

Name                   Age      Position                          
----                   ---      --------                          

   Shawn Phillips           43      Chief Executive Officer and a Director

      Erin Phillips            37      President, Chief Financial and Accounting
                     Officer, and a Director

      David Modica             37      Manager of Quality Control and a Director

Shawn and Erin Phillips are husband and wife.                         

     The  following  is a brief  summary of the  background  of each officer and
director  including their principal  occupation during the five preceding years.
All  directors  will serve until their  successors  are elected and qualified or
until they are removed.                                                         

     Shawn  Phillips is one of the early  pioneers in the marijuana  industry in
Colorado and is one of the  founders of  Strainwise.  Currently,  Shawn owns and
holds  all of the  licenses  issued  by the  State  of  Colorado  for the  eight
marijuana  stores (the  "Captive  Stores").  In concert  with his  spouse,  Erin
Phillips,  he has been instrumental in the management of the operations of these
stores since the date they were either  purchased as an existing retail store or
initially  opened for medical  marijuana  sales  beginning in 2010. In addition,
Shawn  oversees  the growing  facilities  which  supply the  various  strains of
product to the Captive Stores and other retail operations in Colorado.  Prior to
2010 Mr.  Phillips  was the  owner/operator  of RLO Realty,  a  residential  and
commercial real estate firm (2008-2010), an account executive with Stewart Title
Company  (2007-2008) and the  owner/operator  of Legacy  Funding,  a residential
mortgage  company  (2001-2007).  Mr.  Phillips  holds a B.S in  Accounting  from
Colorado State  University,  and using his accounting  education and experience,
his  established  reliable  point-of-sale  accounting  procedures  and financial
controls for these stores and the multiple production  facilities.  Mr. Phillips
filed a personal  bankruptcy petition in September 2009 and received a discharge
in January 2010.                                                                

     Erin Phillips has over 17 years of operational  and management  experience.
Erin is one of the early  pioneers in the marijuana  industry in Colorado and is
one of the founders of Strainwise.  In concert with her spouse,  Shawn Phillips,
she has been  instrumental  in the  management  of the  operations  of the eight
Captive Stores since the date they were either  purchased as an existing  retail
store, or initially  opened for medical  marijuana sales beginning in 2010. Erin
is  responsible  for managing the marketing,  advertising  and promotions at the
Captive  Stores,  and is responsible  for  establishing  and expanding the brand
recognition of the  Strainwise  name and logo  throughout  the Company's  target
markets. Prior to establishing  Strainwise,  Erin spent 13 years in the mortgage
industry  as a business  owner,  audit and  funding  supervisor,  title  company
closer,  mortgage loan  processer,  and loan  originator.  Ms.  Phillips filed a
personal  bankruptcy  petition in May 2009 and  received a  discharge  in August
2009.                                                                           

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     David  Modica has been the Quality  Control  Manager for  Strainwise  since
2013. In this capacity,  he works with the managers of the  cultivation and grow
facilities  owned by Shawn  Phillips to maintain the quality of the  proprietary
strains and marijuana products grown in these facilities. Upon initially joining
Strainwise,  he was tasked with converting the point-of-sale systems used by the
Captive  Stores to a more advanced  system which can better track all categories
of inventory.  Prior to joining  Strainwise,  he was the owner and operator of a
residential  rental  company (2005 to 2013),  a web developer for Design Factory
International  (2003  to  2005),  and a  web  developer/designer  for  Eastridge
Technology  (2001 to 2003).  Mr. Modica obtained his B.A. from the University of
North  Carolina at Chapel  Hill in 2000,  with a degree in  Journalism  and Mass
Communications.                                                                 

     Shawn  Phillips,  Erin  Phillips,  and David Modica will not be independent
directors as that term is defined in Section 803 of the NYSE MKT Company Guide. 

     Our  Board of  Directors  does  not  have  standing  audit,  nominating  or
compensation  committees,  committees performing similar functions,  or charters
for such  committees.  Instead,  the  functions  that might be delegated to such
committees  are carried out by our Board of Directors,  to the extent  required.
Our  Board  of  Directors  believes  that  the  cost  of  associated  with  such
committees, has not been justified under our current circumstances.             

     Given our lack of operations to date, our Board of Directors  believes that
its current  members have  sufficient  knowledge  and  experience to fulfill the
duties and obligations of an audit committee.  None of the current Board members
is an "audit  committee  financial  expert"  within the meaning of the rules and
regulations  of the SEC.  The Board has  determined  that each of its members is
able to read and understand fundamental financial statements and has substantial
business experience that results in that member's financial sophistication.     

     Our  Board  of  Directors   does  not  currently  have  a  policy  for  the
qualification,  identification, evaluation, or consideration of board candidates
and does not think  that such a policy is  necessary  at this  time,  because it
believes that, given the limited scope of our operations,  a specific nominating
policy would be premature and of little assistance until our operations are at a
more advanced level. Currently the entire Board decides on nominees.            

     Our Board of  Directors  does not have any  defined  policy  or  procedural
requirements  for  shareholders  to submit  recommendations  or nominations  for
directors.  We do not have any restrictions on shareholder nominations under its
articles of incorporation or bylaws.  The only restrictions are those applicable
generally under Nevada law and the federal proxy rules.  The Board will consider
suggestions  from  individual  shareholders,  subject  to an  evaluation  of the
person's merits.  Shareholders may communicate nominee  suggestions  directly to
the Board,  accompanied by  biographical  details and a statement of support for
the nominees.  The suggested nominee must also provide a statement of consent to
being considered for nomination. There are no formal criteria for nominees.     

     Our Board of Directors  does not have a "leadership  structure"  since each
board member is free to introduce any resolution at any meeting of our directors
and is entitled to one vote at any meeting.                                     

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     Holders of our common stock may send written  communications  to our entire
board  of  directors,  or to  one or  more  board  members,  by  addressing  the
communication  to  "the  Board  of  Directors"  or to  one  or  more  directors,
specifying the director or directors by name, and sending the  communication  to
our offices in  Lakewood,  Colorado.  Communications  addressed  to the Board of
Directors  as whole  will be  delivered  to each  board  member.  Communications
addressed  to a  specific  director  (or  directors)  will be  delivered  to the
director (or directors) specified.                                              

     Security  holder  communications  not sent to the board of  directors  as a
whole or to specified board members will be relayed to board members.           

Executive Compensation                                                          

     During the period  from  inception  (June 8, 2012)  through  April 30, 2014
Strainwise paid the following compensation to its officers:                     

Name                   Amount               
----                   ------               

Shawn Phillip          s    --                
Erin Phillips          $22,500                
David Modica           $ 9,000                

     We did not have employment agreements with our officers. We do not have any
type  of  equity  incentive   plans,   retirement  plans  or  similar  plans  or
arrangements for our current officers. We have not entered into any contracts or
arrangements  with our officers or directors  that would provide them with forms
of  compensation  resulting  from their  resignation,  retirement,  or any other
termination of their employment with us or from a  change-in-control  of us or a
change of their responsibilities following a change-in-control.                 

     The following shows the amounts we expect to pay to our new officers during
the twelve  months  ending  June 30,  2015 and the amount of time these  persons
expect to devote to our business.                                               

                                               % of time
                        Projected               to be devoted to
Name                   Compensation             Company's business
----                   ------------             ------------------

Shawn Phillips           $160,000                        85%        
Erin Phillips            $180,000                        90%        
David Modica             $ 72,000                        95%        

     None of our directors  received any  compensation for service as a director
during our fiscal year ended June 30, 2014.                                     

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Operating Leases                                                                

     On  March  7,  2014,   Strainwise   leased  a  grow   facility   containing
approximately  26,700  square  feet  ("Custer  Lease")  for a term of five years
commencing  on April 1, 2014.  Lease  payments  are  scheduled to be $29,200 per
month for the first 12 months of the lease, and then are scheduled to be $27,500
per month for the subsequent 12 months,  $28,325 per month for the subsequent 12
months, $29,170 per month for the subsequent 12 months and $30,035 per month for
the  final  12  months  of the  lease.  Under  the  terms of the  Custer  Lease,
Strainwise  paid a security  deposit of $29,200.  The lessor will provide all of
the tenant improvements that will enable the continuous cultivation of marijuana
plants under 459 grow lights.                                                   

     On  April  1,  2014,   Strainwise   leased  a  grow   facility   containing
approximately  65,000  square feet ("51st Ave.  Lease") for a term of five years
and nine  months.  The terms of the 51st Ave.  Lease  stipulate  the  payment of
$15,000  per month,  prorated if  necessary,  until such time that the lessor is
able to deliver a  Certificate  of  Occupancy,  which is  scheduled  to occur on
August 1, 2014.  Thereafter,  lease  payments  are  scheduled to be $176,456 per
month for the first six months of the lease, and then will be $221,833 per month
for the  subsequent  24  months,  $231,917  per  month  for the next 12  months,
$242,000  per month for the next 12 months and  $247,041 per month for the final
12 months of the lease.  Under the terms of the 51st Ave.  Lease,  Strainwise is
obligated  to pay a security  deposit of  $150,000,  one-third of which was paid
upon the execution of the 51st Ave. Lease,  the second third of which is due and
payable  after the first  harvest or by October 1, 2014,  and the final third of
which is due and payable  after the second  harvest or by December 1, 2014.  The
lessor  will  provide  all of the  tenant  improvements  that  will  enable  the
continuous cultivation of marijuana plants under 1,680 grow lights.             

     On  April  22,  2014,   Strainwise   leased  a  grow  facility   containing
approximately  38,000 square feet ("Nome Lease") for a term of seven years.  The
lease  payments are scheduled to be $44,570 per month for the first 12 months of
the lease,  and then are scheduled to be $46,151 per month for the subsequent 12
months,  $47,743 per month for the  subsequent 12 months,  $49,334 per month for
the  subsequent  12  months,  $50,925  per month for the  subsequent  12 months,
$52,517  per month for the  subsequent  12 months and  $54,108  for the final 12
months  of the  lease.  Under  the terms of the Nome  lease,  Strainwise  paid a
security  deposit  of  $133,679.  The  lessor  will  provide  all of the  tenant
improvements  that will enable the continuous  cultivation  of marijuana  plants
under 800 grow lights.                                                          

     On June 10,  2014,  we  leased  a grow  facility  containing  approximately
113,000 square feet ("32nd Ave. Lease") for a term of five years and nine months
which will not become effective until the proper licenses are awarded, which are
expected  to be  awarded  September  1, 2014.  The terms of the 32nd Ave.  Lease
stipulate the payment of $25,000 per month,  prorated if  necessary,  until such
time that the lessor is able to deliver a Certificate of Occupancy, which is due
to occur on September 1, 2014.  Thereafter,  lease  payments are scheduled to be
$282,500 per month for the first 16 months of the lease,  and then are scheduled
to be $301,333 per month for the  subsequent  12 months,  $320,167 per month for
the  subsequent  12 months and $329,583 per month for the final 12 months of the
lease. Under the terms of the 32nd Ave. Lease,  Strainwise is obligated to pay a
security  deposit of $250,000,  $150,000 of which was paid upon the execution of
the lease,  and $100,000 of which will be due upon obtaining the  Certificate of
Occupancy.  The lessor  will  provide all of the tenant  improvements  that will
enable the continuous cultivation of marijuana plants under 1,936 grow lights.  

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     Strainwise has the option to renew the leases described above at the end of
their terms at mutually agreed upon rates.  There are no options to purchase the
properties underlying these leases.                                             

     Strainwise has subleased the grow  facilities  described above to a growing
facility owned by Shawn Phillips for its grow operations.                       

Master Service Agreements                                                       

     Strainwise  provides  branding  and  fulfillment  services to eight  retail
marijuana stores and one cultivation and growing facility owned by Mr. Phillips.

     Pursuant to the terms of these  agreements,  the marijuana  stores and grow
facility collectively pay Strainwise $81,500 each month for branding, marketing,
administration,  accounting and  compliance  services.  Strainwise  also supplys
nutrients to the one grow facility at a 90% mark-up to Strainwise's cost for the
nutrients.                                                                      

     Strainwise's agreements with the marijuana outlets and grow facility expire
on December 31, 2023.                                                           

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Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘SC 14F1/A’ Filing		Date		First		Last			Other Filings
		12/31/23		7
		6/30/15		5
		12/1/14		6
		10/1/14		6
		9/1/14		6
Filed as of:		8/22/14
Filed on:		8/21/14							8-K
		8/19/14		2					3,  4,  8-K
		8/1/14		6
		7/31/14		2
		6/30/14		5					10-K,  NT 10-K
		6/10/14		6
		4/30/14		5
		4/22/14		6
		4/1/14		6
		3/7/14		6
		1/16/14		2
		6/8/12		2		5
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