Ferris resigned in December, so he is out, taking his stock and cash with him. He is now at Virtus Oil and Gas as its CEO.
The termination of the acquisition means there is no relationship between Channeland Entertainment Group and Lone Star Gold. Mr. Mark Townsend is President of Channeland Entertainment Group. Lone Star Gold does not currently have a President/CEO, see below.
The LSTG Board of Directors (Messrs Hepford and Townsend) is negotiating an employment agreement to let Townsend continue as the CEO of LSTG. The Board consists of Mr. Hepford, since Mr. Townsend has recused himself from negotiating on behalf of LSTG due to the obvious difficulties of negotiating with oneself.
The Board want Mr Townsend to give LSTG the right to use the Channeland name, but do not want the associated tangible assets (if indeed there are any). I suspect the difficulty in determining a valuation relates to the valuation of Channeland Entertainment Group, since it was the entity being acquired. The valuation of LSTG would be immaterial in this case, as no one is trying to buy it.
Channeland does not have a "20-year brand history." It was formed in June of 2013. The projects it cites on its "Current Projects" section of its "web site" were, with one exception, completed before, and in some cases years before Channeland was formed. So there are no "current projects." I sent Channeland a note today to ask them to name one or more real current, revenue producing projects.
Now here's the part shareholders need to watch out for: Channeland has an A/S of 100,000,000 shares, but has not registered any shares with the SEC. Lone Star Gold, of course has registered millions of shares of common stock. If LSTG gets the rights to the "Channeland Entity" (basically the name) it can change its name to Channeland Entertainment Group, walk away from the mining properties, and declare itself to be in the music business. Its insiders thereby get instant access to registered equity that they can use to raise capital. Instant public company without all the fuss and bother of an IPO. Not saying that will happen, just that it's one possibility. It this were to happen, whether it's bad or good depends on what the insiders do with whatever capital they are able to raise.
The PR does say the Board of LSTG is waiting for a report on monetizing the LSTG assets in Mexico, and they expect that report in April. Maybe they'll share some information when the report comes in, and it will be clearer what Townsend intends to do.
I also checked out Rhodes Holdings. Turns out that the principal, a Mr. Robert C. Rhodes, is shown on Linkedin as President of American Liberty Petroleum (ALP). On the Rhodes Holdings "web site" he is shown as CEO of Cornwall Resources Corporation in 2010, but ALP is not mentioned. He has signed the latest SEC filings by ALP as its President. American Liberty Petroleum is in dire financial straits right now, at least from the look of its last 10-Q.
Some long-time LSTG shareholders might remember Alvaro Vollmers. He was CEO of Keyser Resources, now LSTG, from November 2010 until Ferris arrived in March, 2011. He was also an officer and director of American Liberty Petroleum until his resignation in January 2014, when he was replaced by Mr Rhodes. So Mr. Vollmers has had significant(IMHO)business relationships with Mr. Ferris and Mr. Rhodes. Don't know what this means yet, but the fact that these people know one another seems like a good piece of information for shareholders to have. Nothing I know of connects Mr. Ferris to Mr. Rhodes directly. I've not discovered how Mr. Rhodes and Mr. Townsend got together. I've not discovered how Mr. Ferris and Mr. Townsend got together either.
The press release talks about a "social media project." There is not much in the background of the people in Channeland to inspire confidence that they can make money with that. They've worked in the music business. There are no people left in Lone Star Gold except the consultants in Mexico, and they're miners.
Not to be too critical, but the existence of these relationships and the current relationship of Mr. Rhodes to Channeland, and the venture into social media do not inspire me to get up off my wallet. Sorry about the length of the post. Hope this is useful.
