Labor Smart Inc (LTNC)

[DD2Gain]

I have a minute to kill and I don't mind providing a smack-down. DD2Gain class is in session.

On May 22, 2015, the reporting person, Command Center, Inc., acquired an unsecured 10% OID CONVERTIBLE NOTE DUE JANUARY 1, 2015, originally issued by Labor Smart, Inc. as the maker, on March 27, 2014 to Gemini Master Fund, Ltd. (the “Note”).

Notice that is a 'convertible note due January 1, 2015".

http://www.otcmarkets.com/edgar/GetFilingHtml?FilingID=10751815

On March 27, 2014, the Company entered into a 10% Original Issue Discount Convertible Promissory Note (“Note”) with Gemini Master Fund, Ltd. (“Holder”) in the original principal amount of $220,000 bearing a 10% annual interest rate and maturing January 1, 2015. At March 27, 2015, the Note has passed its maturity date and the Company has not received a notice of default. At the option of the Holder:

i) The Note together with any unpaid accrued interest is convertible into shares of common stock of the Company at a variable conversion price calculated at 65% of the market price which means the average of the lowest volume weighted average price during the twenty trading day period ending prior to the conversion date, or

ii) All principal, costs, charges and interest amounts outstanding may be exchanged for shares of the Company’s common stock at the Conversion Price of $0.25 per share. The Conversion Price is subject to an anti-dilution adjustment.

The Company may repay the Note at 130% of the original principal amount plus interest. During the year ended December 26, 2014, the Holder converted 2,386,034 shares of common stock of the Company with a fair value of $143,162 to settle $30,000 of principal and interest. During the three months ended March 27, 2015, the Holder converted 24,923,077 shares of common stock of the Company with a fair value of $29,908 to settle $16,200 of principal and interest. At March 27, 2015, the Note is recorded at a fully accreted value of $292,584 less unamortized debt discount of $0.

Once again: "AT THE OPTION OF THE HOLDER"

http://www.otcmarkets.com/edgar/GetFilingHtml?FilingID=10709761


Also from the 1Q

Contingent liability, current portion 122,129
Convertible notes payable 3,744,754
Warrants and bifurcated conversion features 475,371



And if you think paying back 2x principal is outrageous just look at the 10K

During the year ended December 26, 2014, the holders of Convertible Promissory Notes (see Note 8) converted 158,382,363 shares of common stock of the Company with a fair value of $3,448,803 to settle $1,575,531 of principal and interest.

http://www.otcmarkets.com/edgar/GetFilingHtml?FilingID=10621811


Schadel owes AT LEAST 55 billion shares in debt and blown through $6 million for a company that shouldn't have cost more than $1.5 million BY HIS OWN ESTIMATE (do you need that to?). He doesn't have the cash and he doesn't have the wits. Command Center is well positioned to get LTNC for pennies on the dollar through the bankruptcy proceeding they initiated.