This dispute is going to end up in court and you'll see the scam was perpetrated against BCAP who is a significant shareholder in RIGH.
Aron Stanz signed an Amendment to one of the Notes (maybe more, but we've now seen his signature on at least one note). That is definitive proof he, as President & CEO of RIGH, reached a consensual agreement with Matt Dwyer as CEO & President of BCAP. Mr Stanz then proceeded to allow the loan to go into default.
According to BCAP's filing Mr. Stanz claims RIGH had no money to repay BCAP and couldn't / wouldn't increase its A/S to repay the 800k Preferred. However when RIGH resurfaced as a WY Corp (no longer a NV Corp), they managed to increase their A/S from 4B (or whatever the old number was in the prior filings) to 30B and lists assets of ~$2.5M (current RIGH filing). That proves RIGH could at any time increase its A/S to settle the debt obligation and had the capacity to settle the loan.
As a matter of fact: RIGH doesn't even dispute non-payment even in the recent filing. They've set aside $214k ($200k principal + some interest) as a contingency. Clear acknowledgement that they haven't paid. Moreover RIGH claims its dispute is material breach of contract, when the contract Mr. Stanz signed clearly calls for an extension (and nothing more) which was agreed to and done by BCAP.
Here's the legal case for both sides and why BCAP wins:
- BCAP can prove in multiple documents over time the terms of the contract were agreed to AND that RIGH then defaulted (material breach of contract)
- RIGH knowing it has no case whatsoever will try to find novel legal means to delay and use emotive arguments
This is a very standard bankruptcy case, and there's not even grounds for RIGH to try to set legal precedent.
Hopefully Mr. Stanz hasn't done anything to make a bad situation terrible (threatening letters which are essentially attempted blackmail for example, and again typical of defaulted debtors).
The paradox of iHub: buy high, sell low
