Saturday, May 07, 2011 1:51:52 AM
BRZL - why BRZL is not a safe bet
BRZL has remained one of the most read forums on the IHUB over the past several days because the pumpers of that stock are selling it as a "merger" play. The biggest problem is that this "merger" play has been a "merger" candidate since May of 2010 when the acquisition agreement between BRZL and Renfro Energy LLC was first signed. At what point does the "merger" thing just get old? Obviously "merger/acquisition" plays don't have an expiration date (just ask Medinah Minerals - MDMN shareholders)
Ok that is the last time I'm going to use the word "merger" in this post because in reality BRZL didn't sign a merger agreement with Renfro Energy LLC. They signed an acquisition agreement.
Here is a copy of the BRZL/Renfro Energy LLC acquisition agreement:
http://www.sec.gov/Archives/edgar/data/1420924/000109635011000036/wx99one.htm
According to the agreement in order for the purchase agreement to take place BRZL would have to pay Renfro Energy, LLC $700,000.
Seller is willing to sell 100% of their interests in Renfro Energy, LLC to Buyer subject to the following terms and conditions:
1. The date all final contracts and agreements related to this transaction will be executed will occur on or before June 15, 2010 (such date is called the "Closing").
2. Buyer will purchase RE from Seller for $700,000 ("Purchase Price") payable at Closing.
3. At Closing, Buyer shall convey a 10% net profits interest ("NPI") in the Property to an individual or company designated by James R. Renfro.
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According to the filings BRZL hasn't made a penny in revenues ever and has never had more than $22 cash to its name.
They couldn't even afford to pay the $995 due to the NV SOS to keep their NV SOS filings current
http://nvsos.gov/sosentitysearch/FeeDetails.aspx?ctok=2cceKlrAtKQXpkra8Crq4Q%253d%253d
The NV SOS filing that still shows the officers from January of 2010
http://nvsos.gov/sosentitysearch/CorpDetails.aspx?lx8nvq=2cceKlrAtKQXpkra8Crq4Q%253d%253d&nt7=0
The deal obviously was extended in June of 2010 when the closing date was not met and as of the last 10Q it still lists the agreement as extended indefinitely, but seriously where is BZRL going to come up with the $700,000 to satisfy the agreement?
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I also don't see the incentive for James Renfro to close the deal without the $700,000. It won't happen. No money no deal. Even if BRZL did come up with the $700,000 to complete the acquisition, they would have no money to operate the wells. The way the agreement is written James Renfro receives 10% of the net profits of any active drilling so he would want to sell his company to somebody that would be able to operate the wells and continue to make him money.
On May 28, 2010, James Renfro received 24,000,000 (pre-forward split shares) which become 480,000,000 (post-forward split shares) just to be hired to help BRZL locate potential oil & gas companies for BRZL to purchase with its $22 cash.
On May 28, 2010, the Company entered into a services agreement (the “Agreement”) with Renfro Holdings, Inc. (“Renfro”) whereby Renfro will assist the Company in acquiring oil and gas companies by locating the appropriate candidates for acquisition, including Renfro Energy LLC (the “Services”). In consideration for providing the Services, the Company will issue to Renfro 24,000,000 shares of common stock, $0.001 par value per share.
The ONLY company that James Renfro actually assisted BRZL in finding was a company he owns, Renfro Energy, LLC.
In my opinion, I think if you read between the lines the agreement was really a 24,000,000 share payment to James Renfro so that BRZL could sign a letter of intent to purchase his company then use that letter of intent to help promote the BRZL stock price for the next 11 months and counting. A letter of intent with terms that BRZL had no means or way of ever being able to satisfy. A letter of intent that neither side actually ever really planned on completing.
I don't think that it is any coincidence either that all of this stuff happened within days of Samuel Weiss bursting on the scene and taking over all the officer positions of BRZL on May 5, 2010.
http://www.otcmarkets.com/edgar/GetFilingHtml?FilingID=7233453
In the mean time James Renfro was added as a Director for BRZL in August of 2010 probably giving him an annual salary to go with his 480,000,000 shares.
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Then we get a new IHUB forum created on February 7, 2011 shortly after the creation of the new blog style website for the company on January 27, 2011 (announced in a PR on February 1st , 2011)
http://brazosinternational.info/
The domain was registered by the CEO of a shady penny stock company, Nazir Maherali which I had actually posted about on May 2, 2011.
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=62635418
He registered the domain on January 27, 2011 and on that very same day the website started being built with the COMPANY SUMMARY entry, SERVICES entry, STRATEGY AND IMPLEMENTATION SUMMARY entry, MANAGEMENT SUMMARY entry, and ECONOMIC ANALYSIS AND FINANCIAL STATEMENTS entry all being posted on the very same day (January 27, 2011). Leaving the possibility wide open that Nazir may be more than just the registrant of the domain.
All that was followed by this series of press releases:
Feb 10, 2011 Brazos International Exploration, Inc. Provides Update On Proposed Acquisition
Mar 9, 2011 Brazos International Exploration, Inc. Nearing Completion on Proposed Acquisition
Mar 10, 2011 Brazos International Exploration, Inc. Acquisition Almost Completed
Closing is scheduled to occur on or before March 31, 2011, and shortly thereafter
Mar 29, 2011 Brazos International Exploration, Inc. Acquisition Closing Extended
today announced the company has obtained a one month extension ....... sometime in April, 2011
Looks like that latest one month extension has expired.
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All that got me curious. Why the sudden new promotional campaign starting in January of 2011?
Going backwards and looking at events the original closing date came and went in June of 2010 and was hardly ever mentioned again.
Things got pretty quiet after that. The company kept up with filings, but they didn't do much to really promote the stock.
In September of 2010 the authorized share count was increased from 70,000,000 to 1,500,000,000. There were 44,400,000 outstanding shares at this time.
In November of 2010 the company executed a 20:1 forward split increasing the O/S count to 880,000,000 shares.
On December 31, 2010 (last reported count) there were still 880,000,000 outstanding shares.
The stock remained basically completely inactive during these months from September of 2010 through the end of January 2011.
Not a single share traded from 12/08/10 - 1/28/11 (except for some teeny tiny volume on 1/24/11, 1/25/11 and 1/26/11)
http://ih.advfn.com/p.php?pid=historical&symbol=BRZL
It's like somebody said hey let's make a new website and use all the old information about the signed purchase agreement from May of 2010 and pump this stock so we can start selling some shares because starting two trading days after the website was created the volume began picking up and not in a good way (lots of selling)
On January 31, 2011 - 270,000 were trading knocking the price down from $.09 to $.054
On February 1, 2011 (same day as the press release about the new website) - 4,064,900 shares traded and the stock closed even at $.054
Over the next several weeks the stock continued to decline (with WAY more red days than green days) until it reached its low of $.0042 on April 6, 2011.
This tells me the press release and sudden reemergence of the company on the map may have all been because somebody wanted to sell some shares. A new website and 5 significant press releases and the price went from $.10 to $.004.
The TA is gagged so there is no way to know the new outstanding share count. Only thing we can be sure of is that it is higher than the last reported 880,000,000 from December 31, 2010.
It could be that BZRL spent several months looking for financing from outside sources and was unable to find any. Then in late January they made the decision they could only raise the $700,000 by selling shares.
Then again it could be just an insider selling shares for their own personal gain. Could be the company selling shares to pay for services and expenses. We really don't know for sure.
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Clearing up miss information.
#1) John Renfro is not the CEO of BRZL. BRZL despite all its faults is a fully reporting company and no filing has been done with the SEC announcing the change of officer for the company.
That makes the information available on the suspicious BRZL website materially false and misleading. The BRZL website has contained that information since at least March 27, 2011 and possibly since it was first created.
http://brazosinternational.info/executive-summary/management-team/
#2) The Texas entity created for Brazos International Exploration Inc doesn't do anything to verify the acquisition being any closer to closing.
https://ourcpa.cpa.state.tx.us/coa/servlet/cpa.app.coa.CoaGetTp?Pg=tpid&Search_Nm=brazos%20international%20&Button=search&Search_ID=32042667082
The entity was created in September of 2010 with James Renfro as the resident agent. If you read the information available on the Texas SOS site carefully you'll see that no officers were added for the company. The company is domiciled in Nevada (meaning it is the same entity as the Nevada based Brazos International Exploration, Inc). Most likely the entity was registered in Texas because that is the requirement for any company doing business in that state and John Renfro was used as the resident agent because a resident of Texas is required to register the business and he was already affiliated with BRZL. Obviously since several months have passed since September of 2010 (7 months ago) the registering of Brazos International Exploration, Inc in Texas had no bearing on the closing of the agreement.
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Conclusion:
The lack of transparency is not good. We have a gagged TA. A Nevada business entity that is in default. From posts I've read James Renfro doesn't respond to investor inquiries. Nobody really knows the true progress of the acquisition agreement. All we know is it has been delayed for over 10 months now and the last deadline was once again missed. Nobody knows for sure if shares are being sold to raise capital or not. If they are selling shares to raise capital nobody knows how many shares need to be sold, how long it will take and just how low the stock price will be when they are done. We just know that a stock that was trading at $.10/share when the new website and latest round of press releases started is now trading at $.01/share and it is only that high because of a huge boost it received by the IHUB forum. At $.01/share 70,000,000 shares would have to be sold to make $700,000.
I'm a skeptic by nature. The penny world forces you to be skeptical. And most of the signs surrounding this stock are telling me that betting on this acquisition closing is not a safe bet.
BRZL has remained one of the most read forums on the IHUB over the past several days because the pumpers of that stock are selling it as a "merger" play. The biggest problem is that this "merger" play has been a "merger" candidate since May of 2010 when the acquisition agreement between BRZL and Renfro Energy LLC was first signed. At what point does the "merger" thing just get old? Obviously "merger/acquisition" plays don't have an expiration date (just ask Medinah Minerals - MDMN shareholders)
Ok that is the last time I'm going to use the word "merger" in this post because in reality BRZL didn't sign a merger agreement with Renfro Energy LLC. They signed an acquisition agreement.
Here is a copy of the BRZL/Renfro Energy LLC acquisition agreement:
http://www.sec.gov/Archives/edgar/data/1420924/000109635011000036/wx99one.htm
According to the agreement in order for the purchase agreement to take place BRZL would have to pay Renfro Energy, LLC $700,000.
Seller is willing to sell 100% of their interests in Renfro Energy, LLC to Buyer subject to the following terms and conditions:
1. The date all final contracts and agreements related to this transaction will be executed will occur on or before June 15, 2010 (such date is called the "Closing").
2. Buyer will purchase RE from Seller for $700,000 ("Purchase Price") payable at Closing.
3. At Closing, Buyer shall convey a 10% net profits interest ("NPI") in the Property to an individual or company designated by James R. Renfro.
--------------------------------------------------------------------
According to the filings BRZL hasn't made a penny in revenues ever and has never had more than $22 cash to its name.
They couldn't even afford to pay the $995 due to the NV SOS to keep their NV SOS filings current
http://nvsos.gov/sosentitysearch/FeeDetails.aspx?ctok=2cceKlrAtKQXpkra8Crq4Q%253d%253d
The NV SOS filing that still shows the officers from January of 2010
http://nvsos.gov/sosentitysearch/CorpDetails.aspx?lx8nvq=2cceKlrAtKQXpkra8Crq4Q%253d%253d&nt7=0
The deal obviously was extended in June of 2010 when the closing date was not met and as of the last 10Q it still lists the agreement as extended indefinitely, but seriously where is BZRL going to come up with the $700,000 to satisfy the agreement?
--------------------------------------------------------------------
I also don't see the incentive for James Renfro to close the deal without the $700,000. It won't happen. No money no deal. Even if BRZL did come up with the $700,000 to complete the acquisition, they would have no money to operate the wells. The way the agreement is written James Renfro receives 10% of the net profits of any active drilling so he would want to sell his company to somebody that would be able to operate the wells and continue to make him money.
On May 28, 2010, James Renfro received 24,000,000 (pre-forward split shares) which become 480,000,000 (post-forward split shares) just to be hired to help BRZL locate potential oil & gas companies for BRZL to purchase with its $22 cash.
On May 28, 2010, the Company entered into a services agreement (the “Agreement”) with Renfro Holdings, Inc. (“Renfro”) whereby Renfro will assist the Company in acquiring oil and gas companies by locating the appropriate candidates for acquisition, including Renfro Energy LLC (the “Services”). In consideration for providing the Services, the Company will issue to Renfro 24,000,000 shares of common stock, $0.001 par value per share.
The ONLY company that James Renfro actually assisted BRZL in finding was a company he owns, Renfro Energy, LLC.
In my opinion, I think if you read between the lines the agreement was really a 24,000,000 share payment to James Renfro so that BRZL could sign a letter of intent to purchase his company then use that letter of intent to help promote the BRZL stock price for the next 11 months and counting. A letter of intent with terms that BRZL had no means or way of ever being able to satisfy. A letter of intent that neither side actually ever really planned on completing.
I don't think that it is any coincidence either that all of this stuff happened within days of Samuel Weiss bursting on the scene and taking over all the officer positions of BRZL on May 5, 2010.
http://www.otcmarkets.com/edgar/GetFilingHtml?FilingID=7233453
In the mean time James Renfro was added as a Director for BRZL in August of 2010 probably giving him an annual salary to go with his 480,000,000 shares.
--------------------------------------------------------------------
Then we get a new IHUB forum created on February 7, 2011 shortly after the creation of the new blog style website for the company on January 27, 2011 (announced in a PR on February 1st , 2011)
http://brazosinternational.info/
The domain was registered by the CEO of a shady penny stock company, Nazir Maherali which I had actually posted about on May 2, 2011.
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=62635418
He registered the domain on January 27, 2011 and on that very same day the website started being built with the COMPANY SUMMARY entry, SERVICES entry, STRATEGY AND IMPLEMENTATION SUMMARY entry, MANAGEMENT SUMMARY entry, and ECONOMIC ANALYSIS AND FINANCIAL STATEMENTS entry all being posted on the very same day (January 27, 2011). Leaving the possibility wide open that Nazir may be more than just the registrant of the domain.
All that was followed by this series of press releases:
Feb 10, 2011 Brazos International Exploration, Inc. Provides Update On Proposed Acquisition
Mar 9, 2011 Brazos International Exploration, Inc. Nearing Completion on Proposed Acquisition
Mar 10, 2011 Brazos International Exploration, Inc. Acquisition Almost Completed
Closing is scheduled to occur on or before March 31, 2011, and shortly thereafter
Mar 29, 2011 Brazos International Exploration, Inc. Acquisition Closing Extended
today announced the company has obtained a one month extension ....... sometime in April, 2011
Looks like that latest one month extension has expired.
--------------------------------------------------------------------
All that got me curious. Why the sudden new promotional campaign starting in January of 2011?
Going backwards and looking at events the original closing date came and went in June of 2010 and was hardly ever mentioned again.
Things got pretty quiet after that. The company kept up with filings, but they didn't do much to really promote the stock.
In September of 2010 the authorized share count was increased from 70,000,000 to 1,500,000,000. There were 44,400,000 outstanding shares at this time.
In November of 2010 the company executed a 20:1 forward split increasing the O/S count to 880,000,000 shares.
On December 31, 2010 (last reported count) there were still 880,000,000 outstanding shares.
The stock remained basically completely inactive during these months from September of 2010 through the end of January 2011.
Not a single share traded from 12/08/10 - 1/28/11 (except for some teeny tiny volume on 1/24/11, 1/25/11 and 1/26/11)
http://ih.advfn.com/p.php?pid=historical&symbol=BRZL
It's like somebody said hey let's make a new website and use all the old information about the signed purchase agreement from May of 2010 and pump this stock so we can start selling some shares because starting two trading days after the website was created the volume began picking up and not in a good way (lots of selling)
On January 31, 2011 - 270,000 were trading knocking the price down from $.09 to $.054
On February 1, 2011 (same day as the press release about the new website) - 4,064,900 shares traded and the stock closed even at $.054
Over the next several weeks the stock continued to decline (with WAY more red days than green days) until it reached its low of $.0042 on April 6, 2011.
This tells me the press release and sudden reemergence of the company on the map may have all been because somebody wanted to sell some shares. A new website and 5 significant press releases and the price went from $.10 to $.004.
The TA is gagged so there is no way to know the new outstanding share count. Only thing we can be sure of is that it is higher than the last reported 880,000,000 from December 31, 2010.
It could be that BZRL spent several months looking for financing from outside sources and was unable to find any. Then in late January they made the decision they could only raise the $700,000 by selling shares.
Then again it could be just an insider selling shares for their own personal gain. Could be the company selling shares to pay for services and expenses. We really don't know for sure.
--------------------------------------------------------------------
Clearing up miss information.
#1) John Renfro is not the CEO of BRZL. BRZL despite all its faults is a fully reporting company and no filing has been done with the SEC announcing the change of officer for the company.
That makes the information available on the suspicious BRZL website materially false and misleading. The BRZL website has contained that information since at least March 27, 2011 and possibly since it was first created.
http://brazosinternational.info/executive-summary/management-team/
#2) The Texas entity created for Brazos International Exploration Inc doesn't do anything to verify the acquisition being any closer to closing.
https://ourcpa.cpa.state.tx.us/coa/servlet/cpa.app.coa.CoaGetTp?Pg=tpid&Search_Nm=brazos%20international%20&Button=search&Search_ID=32042667082
The entity was created in September of 2010 with James Renfro as the resident agent. If you read the information available on the Texas SOS site carefully you'll see that no officers were added for the company. The company is domiciled in Nevada (meaning it is the same entity as the Nevada based Brazos International Exploration, Inc). Most likely the entity was registered in Texas because that is the requirement for any company doing business in that state and John Renfro was used as the resident agent because a resident of Texas is required to register the business and he was already affiliated with BRZL. Obviously since several months have passed since September of 2010 (7 months ago) the registering of Brazos International Exploration, Inc in Texas had no bearing on the closing of the agreement.
--------------------------------------------------------------------
Conclusion:
The lack of transparency is not good. We have a gagged TA. A Nevada business entity that is in default. From posts I've read James Renfro doesn't respond to investor inquiries. Nobody really knows the true progress of the acquisition agreement. All we know is it has been delayed for over 10 months now and the last deadline was once again missed. Nobody knows for sure if shares are being sold to raise capital or not. If they are selling shares to raise capital nobody knows how many shares need to be sold, how long it will take and just how low the stock price will be when they are done. We just know that a stock that was trading at $.10/share when the new website and latest round of press releases started is now trading at $.01/share and it is only that high because of a huge boost it received by the IHUB forum. At $.01/share 70,000,000 shares would have to be sold to make $700,000.
I'm a skeptic by nature. The penny world forces you to be skeptical. And most of the signs surrounding this stock are telling me that betting on this acquisition closing is not a safe bet.
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