Viking Energy Group Inc (VKIN)

[Potse]

VKIN...floorless convertible financing.....

VKIN continues to have some intriguing/significant potential upside, which is why I still hold my full position here (see posts below). However, there is a real possibility that much of that potential may never get realized as long as the current management/directors remain in place.

The inability/unwillingness of Simeo/management to provide information and clarification on a number of matters here has been extremely disappointing to me, to put it mildly.

Regarding the involvement of this latest awareness/promotion firm: IMO, if there is going to be a significant pick up in business activity at VKIN, the $20K worth of stock given to this firm would have been better spent toward hiring a well-established, dedicated investor relations firm that is capable of creating well-worded, detailed, coherent, accurate press releases and related IR material. But any IR firm worth its salt is going to request the same type of information/clarifications that I have been seeking, and as noted above management doesn't seem interested in doing that. So I guess this is a moot point.

I am not pleased at all with the last quarterly filing (2013 Q2). It was disclosed that VKIN entered into a $58K floorless convertible financing deal (with Asher Enterprise) on May 21.....

On May 21, 2013, the Company issued a $58,000 8% convertible note with a term expiring on February 28, 2014 (the “Maturity Date”). The principal amount of the note and interest is payable on the maturity date. The note is convertible into common stock beginning 180 days after the issuance date, at the holder’s option, at a 58% discount to the average of the three lowest closing bid prices of the common stock during the 10 trading day period prior to conversion. In the event the Company prepays the note in full, the Company is required to pay off all principal, interest and any other amounts owing multiplied by (i) 130% if prepaid during the period commencing on the closing date through 60 days thereafter, (ii) 135% if prepaid 61 days following the closing through 90 days following the closing, (iii) 140% if prepaid 91 days following the closing through 120 days following the closing, (iv) 150% if prepaid 121 days following the closing through 180 days following the closing, and (v) 175% if prepaid 181 days following the closing through the maturity date. The terms of the convertible note provide for certain redemption features which include features indexed to equity risks. In the event of default, the amount of principal and interest not paid when due bear interest at the rate of 22% per annum and the note becomes immediately due and payable.

That should have been disclosed in the previous quarterly report (2013 Q1) in the "subsequent event" section of the filing. Also, VKIN failed to acknowledge in the last filing that 100K shares were given to New Money Management for awareness/promo services.

It appears that New Money Management (Andy Theronier) was hired roughly around the same time that this floorless convertible deal was completed. I don't know whether there is any connection between these two deals, but certainly the timing is at best disconcerting/disturbing/strange.

At this point, I have no idea what is going through CEO Tom Simeo's mind or what the ultimate end game will be here. Unless VKIN decides to prepay the convertible note before November 21 (the date Asher can start converting), then this probably is the "beginning of the end" for the stock.

It will interesting to see if there is any attempt made to push the stock higher in the next month or so.