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The point about their statements is exactly the main point-that they are misleading,,and what will get the company in trouble with the SEC engineering department at some point.And my main gripe that they do not make timely or material disclosure, and then make promotional disclosure the SEC will frown upon- and in the end does company no good anyway.
They may try to cover themselves with all sorts of disclaimers, but there is a clear pattern of unreasonable projections not being met, and then on top of that overly-promotional press releases throwing out values in the ground without sufficient analysis and disclosure,and untimely disclosure. Do they have a PEA ( preliminary economic assessment), pre-feasibility report ? Where is all the information required to be disclosed according to SEC Guide 7 ? If they have measured and indicated resources, then why do they not report mineralized material on their SEC filings with proper supporting information ?
The USA reporting system requires timely fair disclosure of material information and following SEC guidelines. This company touted the mill going into production in 2013, but as far as I can see took their sweet time indicating amount required to do so which clearly they cant raise.Obviously it is material to this company they need $3 million to re-activate the mill.
well i guess all we can do is try to piece together the story as best we can.i just get impression from filings that CEO actually believes that putting out press releases and otcmarket filing sis doing business.cant be easy being a sub penny stock these days
somehow you are responding to me when it was someone else who posted the excerpts from SEC comment letters.
i did specifically post guideline comments from Ontario securities Commission previously for example, which specifically identified as a "red flag" companies which reported metal values in the ground without extraction costs.and SEC guide 7 pretty easy to look up.
it is hard for me to read SEC Guide 7, then this company filings and come back with impression they are complying with the guidelines.it is equally hard to read NI43-101 requirements and come away with feeling that this company has overall complied with the spirit and letter of the criteria required.and it is deifnitely misleading in my opinion their use of NI43-101 references : lee rice is an american and member of SME, company is USA company, why not prepare techncial report according to american standards ?
ye sthey have covered themselves with a lot of qualifiers, but the SEC when they get to a comment letter on such things wont fool around with a company claiming values based on gross value of metal without extraction costs.
what do you mean by slander ? i posed a question as in my opinion they are not following the disclosures contained in SEC Guide 7, and not following the key criteria required of NI43-101 and recommended disclosure there as well. if anyone at fault here it is the company for not doing their homework and opening themselves up for this type of question.
I was referring to email from 1manband so I dont have links to the comment leteters he quoted. The wording as such is typical of SEC comment letter. SEC Guide 7 is easily available through any google search. It is so clear ( and only a few pages) I am not sure how the company or anyone can claim they are following in their disclosures.
Does he know ? I just raise question because why would anyone waste their time ( and some expenses) on continually announcing new massive deals six months or so when they have had no effect on stock price for a few years now.
The recent press release which you referred to in the body of the deal refers to figures of 500 million and of 125 million.If I recall the Canada gold deal/merger with chiense company also quoted at hundreds of millions of dollars.
What isnt clear ? 1manband gave specific quotes from SEC comment letters, SEC Guide 7 is only a few pages and easily available on the internet. The use of a reference to a NI43-101 report or a report "prepared according to NI4-101 criteria" creates serious disclosure issues when SEC gets around to reviewing their filings. Such reviews if I recall are mandated at least every 5 years, sooner if it comes to their attention. Seems pretty clear in my opinion reference to NI43-101 was out of line. What isnt clear ?
The above doesnt address other issues such as using value in the ground absent cost of extraction.
I guess it is now clear the company's problem with disclosure and the potential consequences.If CFO wishes to salvage whatever investment he has made in time in this venture, things need to change. Investors on this board certainly now have enough informaton about the disclosure problem, and the report does have the merit of clearly indicating pie in the sky projections about company producing at a profit in the short term,without massive share dilution will not be achieved.
To be fair even for experienced management at this juncture it would be a herculean task to turn company around, but with inexperienced management it doesnt appear likely much will change.
It is entirely possible that CEO believes the disclosures the company makes.To state he is a liar implies he knows that these deals are fake- I just raise possibility CEO actualy believes these deals.
Look at financials- all of a sudden a while back they started inserting footnote saying they were prepared according to GAAP. I think what happens is CEO tried to understand what GAAP is, saw a financial statement with this phrase,and decided that phrase itself makes it GAAP. This example would show he is not lying that financial statements are GAAP, which they arent, but he just doesnt know they arent GAAP.
Or after all of the past few years, BTDG puts out a press release about a $500 million deal. Now CEO probably knows wont effect stock price, and probably knows deal wont happen - but discloses what he is working on. It just doesnt seem CEO is making money from all this for quite some time. So what would be his motivation except he believes he can pull off some deal, any deal ?
Thanks for the excellent post on the whole NI43-101 issue. As you point out it is not the NI43-101 report is not illegal but the manner in which this company discloses or purports to disclose information, without following SEC Guide 7 guidleines, causes them to be in violation of regulations.
Simply put as you outline, they will be required at some point to review their disclosures in their filings and marketing material, and amend quite a few filings- all this will cost the company money and time.They will also in my opinion be required specifically to retract statements about values in the ground.
This is pretty basic stuff for any SEC reporting mining company, an experienced CFO would know this- or even a CFO who spent a day researching the issue.This has been my biggest gripe about this company is inexperienced management making a difficut situation even worse.
Actually for anyone who believed there was any chance of this company producing this year , or making a profit this year or next, or proceeding with "manageable dilution",I think the report would be an eye-opener.
It is a surprise how company persists in promoting the concept of a NI43-101 report or even NI43-101 compliant report. They just dont seem to grasp the issues involved.
interesting report, pretty slick. since i must assume as it was paid for company bears ultimately responsibility for data provided.
so if i understand this report we now have a revised forecast of when revenues will be generated, when profitability is projected, and if i understand report correctly company needs $11 million to achieve its business plans.
the report continues the fiction that there is a NI43-101 report ( which it states), and in another section that a NI43-101 compliant report. the report also gives values for metals in the ground without extraction costs. sec engineering office would have a field day with this report.
so fy 2015 new projection for profitability after raising $11 million.
if i understand correctly company paid $8,000 for this piece of marketing material, it is pretty slick.i have complained company hasnt updated their projections well at least they finally have.
same problems though exist with manner of disclosure.
so BTDG has no involvement with RealHipHop network ? maybe I missed something but a quick look at the SEC filing failed to show connection with BTDG. In fact, having made this filing, of what use woudl RealHipHop have with BTDG in the first place ?
Thanks for providing the link.
Is he a liar or mentally disturbed ?
His MBA is fake, and despite looking for the "University of San Gabriel" I dont find it- so it seems his bachelors and associates degrees also fake.
As far as his press releases, I get the impression reading BTDG press releases CEO actually believes stuff he puts out. If someone faxes him a billion dollar offer, he believes it and puts out his own press release. He cant be making money from all this, so would a scam artist keep at this for all these years ? The press releases and financial statements dont make any sense, what scam artist would keep at the same thing and not make any money ? I mean really who would believe BTDG doing a $500 million dollar deal ?
Could be an explanation.
Well this subject has been discused extensively in prior posts, but a few comments
- first question is according to their press releases, and now the 10q , was there a NI43-101 prepared according to the required criteria ? if not, then one could surmise there is a degree of misinformation as to whether such a report prepared
- second, i do not know if there is a specific law against mentioning such a report but i would assume (a) information in such a report that is released contrary to SEC Guide 7 guidelines would be against SEC rules(b) Since company not required to prepare the report, one can assume SEC would be very wary of why such an announcement made. (c) since the report is specifically for Canadian filing, it is curious how it is claimed such a report was prepared according to NI43-101 criteria in the first place.
My own opinion is that the Company's own press releases show a lack of understanding of NI43-101 criteria and that alone makes the whole disclosure very suspect, including the lack of information typically required by SEC Guide 7 of NI43-101 for that matter. I guess CFO thought this would be a good selling point. I would think when SEC engineering offices gets around to reviewing their filings they will specifically address this issue.
Is there any financing available to this company that will not result in severe dilution ? They already have over $400,000 on the books in convertible financing, and for some time that appears the only financing they can secure.
As far as abundance of assets all I know is (a) they have a mill, which while it has 2 liens arguable is worth more than what they paid for, to someone who could operate it and has mill feed,and there is no indication of ready mill feed for the project (b) some option agreements properties that have no established reserves but may have resource potential- but even that potential without any more information than we have is not presently ascertainable. (c) pressing liabilities including a legal judgement and quarterly burn rates apparently of $100,000 per quarter, without liquid assets to satisfy , or ability it seems to get any financing that doesnt invove huge discounts. Am I missing somthing in terms of what assets they have ? I can see someone saying potential , though hard to ascertain without more information, but I dont see hard assets.
What is interesting is that if management believes that the conditions to the permit will be addressed by the end of fiscal 2013 why then (a) they not update projection on website (b) since they have stated takes $3 million to re-activate mill, and we are now mid July, would that also not mean a reasonable person would not update their overall-projection ?
This is precisely a problem with management beyond whether they do reverse splits or not, in my opinion- an IR strategy that seems dedicated to not building credibility. It is a tough market right now for junior mining equities, tougher for those with little or no credibility.
what is great about pan american is they set a strategy and follow it, and their implementation is long term. looking at how company started, and path hasnt swerved from the strategy they set. so i tend to not worry about short term fluctuations in the business, though of course one can time when to buy or sell. great companies operate this way, and in this sector pan american and hecla are the best bets on silver equities for the long term.
At this point just curious how this thing will play out,and also it is very educational seeing how people who went into this stock view things. Ultimately any stock is about how the market considers the stock, and this board has been very interesting.
Something is up though- looking at the timing of this second reverse, and the new convertible debt secured according to 10q, will be inetresting how this plays out this year.
Wonder what convertible debt holders thinking. o they think CGFI can repeat th eprocess of the last few years.
Lots of money made by these fellows- looking at cash flow statement (a) cash received from convertible debt (b) cash value of shares converted.
Pan American ( like Hecla) a blue chip amongst the limited universe of producing primary silevr companies. Management solid and have followed a long term plan that has resulted in their success. To me a pretty simple investment as long as one has patience.
Interesting 10q. First thing that jumps out, if I understand correctly, they actually received another $200,000 in convertible financing for the quarter ending May 31, with the total outstanding of over $400,000. So I guess we are back to another road to ever increasing outstanding shares.I wonder how much a connection there is between those buying the convertible debt and the company- it would have seemed after the reverse convertible guys would have backed off for a while until volume increased.
The second item is under legal proceedings. Do I understand correctly that there is now a judgement againt company over $300,000, or a rather a judgement that could be enforced ? I must be missing something here- if someone has that size judgement why havent they garnished bank account yet, or filed anotehr lien against mill ? Also, I would have thought this was a material event that should have been reported on an 8k. Welcome comments form someone who knows more than I about legal prcoess !
Third, incredibly they state in a 10q that the technical reports they prepared were accordng to NI43-101 criteria.I guess company's position therefore that whether they meet the crietria or not ( I have argued they dont), they believe so.
Anyway bottom line they have under $10,000 cash, hardly enough to re-open the mill. Appears though convertible guys will put in money to keep company afloat for a while longer.
Magic will not raise the stock price sufficiently for investors suffering 2 reverse splits to make a capital gain, nor will it help current buyers make a profit in 2014.
Just a few months ago there were posts that they actually would meet their projection of mill operating in 2014, that some type of conventional financing may exist, that even without information on CAPEX there was "value" underground.
The company's management needs to realise that any serious money will not fall for their type of press releases, and that credibility needs to be built in the market. Not meeting projections, lack of concern about SEC review of their press releases, and CFO controlling voting shares, all would be of concern to long term equity investor.
Junior mining market may turn in 2014,and company has an option on some prospects and control of a mill. I am open-minded, has anything in the last year shown (a) management can set goals and meet them (b) can? management disclose key information on properties and projections (c) can management build credibility in the market.
CFO must know by now, in my opinion ,mill will not be operatonal in September, yet unsuspecting buyer looking at their website might get that impression. This is way to build stockholder support ?
I am unclear where people think financing will come from. The company is in the same position as it was except now even less volume for a convertible note holder to sell into. The whole industry having probems raising capital let alone debt financing, this is why the convertible note buyers are often the only game in town.
I do not understand comment that " there is no denying" what is underground. We simply do not have sufficient information to make a judgement.(a) Company has shown in press releases it is selective in what it releases, and in such an overly-promotional manner that raises doubts. (b) There is no proper report as far as we know- we have a company press release summarizing what they feel old data shows.(c) Company's track record is of not meeting projections.
Even if at some point in the future someone gives them a few million even to get to point where they could quote measured and indicated resources ( let alone reserves) , company still faces challenge of raising capital, and building credibility in the market. Nothing I have seen indicates CFO will not go down same path again.
Thanks forheinformation. Doesnt look likely the final permit without conditions will be received this summer. Also I note references for example to site grading on 2013-2014 timeframe.
Does anyone have a reasonable current estimate of when a perit would be granted or costs required for granting of permit ?
Seems that CGFI facing a very challenging time now as withot sufficient volume how can they interest convertible debt buyers ? The next 10q will be quite interesting as to financial status of company.
The idea that shareholders are unreasonable in my opinion is unfair- the company had every opportunity over quite a length of time to build credibility. These are difficult times for micro-cap companies, but worse for companies that dont meet their own projections and issue overly-promotional press releases that are misleading.
Yes MBA fake and probably the claimed Bachelor is also fake.
It seems on the financials what they did was to take 2007/2008 financials and just carry forward without paying any attention to assets that should be written off, nor any sensible way of recording offset to all the shares issued, nor made the necessary accruals for expenses. The capital accounts seem to be a "catch-all" with all sorts of accounts that are not proper capital accounts. So it seems someone who knows quickbooks but not accounting makes the entries. The result is misleading and incorrect financials.
The capital account is odd. If one tries to tie-in shares issued, in which time period, and what was offsetting entry, doesnt appear to make any sense.
This is just one reason why idea of someone making muti-million dollar investments with objective of going to higher exchange doesnt make sense. The financials are now so far gone for the last few years, it would be cost-prohibitive to produce audited financial statements.
Also shows severe weakness in the otcmarkets continuous disclosure requirements. If one reads this on their website it is quite clear BTDG doesnt meet requirements but apparently otcmarkets doesnt review filings made.
Yes financials prepared by someone with no knowledge of any level of proper accounting. Evidently they just punched in some numebrs on quickbook without knowledge of UDS GAAP principles or even common sense.
Look at the footnotes, evidently at some point they decided to copy footnotes form other companies to make them look better. So all of a sudden they inserted footnote saying statements were prepared according to GAAP- even though they dont know what GAAP means.
But since company has no funds even for a basic bookeeper with common sense, and the CEO has evidently no college training at all in business, it is not surprising financials don't make much sense.
But really negative assets ? What about expenses- even if CEO is covering, why dont regular expenses to maintain a company show up ?If they have bought businesses as they claim, where is footnote and accounting to reflect that ?
What is more of a concern is if CEO doesnt grasp fundamental accounting principles, how can he negotiate $500 million deals ?
The MBA we know is fake, and it looks as though the associate and bachelor degrees claimed are also probably fake. Financial statments are not GAAP as they claim to be. The CEO should step back and consider whether this is way to build credibility.
first step to stop claiming degrees that are fake,and second account of the "negative assets" one way of another.Then do a reverse, then focus on one thing the CEO may have expertise in or appoint new administrative people.Not rocket science investors dont like company CEO claiming a degree that was purchased form diploma mill !
The CEO does have experience within the industry- though experience at raising money, marketing company and running an operating mine , I do not know if he has extensive experience in these areas.
As to whether the compay could produce within a reasonable timeframe I would contend that we simply dont have enough information. We dont know whether the nearby mines have sufficient ore/reserves, nor capital cost to extract.I am not sure how one could make such a projection based on limited information we have been presented.
What specifically are the reasons generated by "fraud" in your opinion ?
BTDG claims GAAP statements but the financial statements are not prepared according to GAAP. The negative assets is a dead give-away,as well as the income staetment. Doesnt seem as though otcmarkets.com reviews closely though.
What type of financing would you be referring to ?
Equity financing unlikely , conventional debt financing probably impossible, so that leaves convertible debt financing- but hardly enough volume to even justify that.
Let's look at this- they were apparently having a burn rate of about $400,000 per quarter. They have stated they need $3 million to re-activate the mill. They have now down 2 reverse splits in one year. And if I understand their filings, they have a judgement against them winding its way through the courts.
Wonder when they will update projections.
My issue is not inparticular that they have no revenue as I agree many Pink Sheet start up companies have no revenue. However after last few years-
1. Every "business" they buy or attempt to start has not only no revenue, no profits and no cash flow, but evidently not even enough activity to generate real expenses. For example they issued shares for a "mortgage lead" generation business, but there is no evidence that business exists or is even being developed.
2. As far as I can see only "business" is developing rather far-fetched press releases that never result in a concept being implemented. If this was just one time or even twice one could perhaps understand, but this seems to be consistent for last few years.
3.I then try to be objective and determine whether management has the ability or experience to develop a business.I see nothing academically or track record to indicate management has that ability, or ability ( important for public company) to produce US GAAP financial statements .
I am open minded and certainly have expressed my interest in any objective indication that there could be potential in this company as currently structured and managed.
Fully agree posts should be about company, and a dialogue perhaps may have given impression I meant to remark about posters which was not my intention.
Guess I am just curious about this company which seems to add new businesses every year, with no capital, no sales ,no profits and no cash flow- in shotr never has results but also a new business it is acquiring or going into.
If CEO needs a fake MBA to get a job to feed hisfamily that of coruse is his personal decision what is the moral coruse BUt in a company traded on the OTC this is clearly misleading, and also misleading to unsuspecting investors that Kazorchian says CEO is qualified based on having an MBA.
I dont question Kazorchian personal motives,just the logic of promoting a company without being able to support the reasons for this. The specific time he provides support, the "MBA", he then will not address fact it is fake.It also appears the other diplomas may be also fake as no one has idnetifeid the colleges they supposedly come from.
Good point about private small company insurance, I always did wonder how they set $1 million as the basic level.
From Wikipaedia :
Directors and officers liability Insurance (often called D&O) is liability insurance payable to the directors and officers of a company, or to the organization(s) itself, as indemnification (reimbursement) for losses or advancement of defense costs in the event an insured suffers such a loss as a result of a legal action brought for alleged wrongful acts in their capacity as directors and officers. Such coverage can extend to defense costs arising out of criminal and regulatory investigations/trials as well; in fact, often civil and criminal actions are brought against directors/officers simultaneously
The types of claims is dependent upon the nature of the company. Directors and officers of a corporation may be liable if they damage the corporation in breach of their legal duty... or fail to disclose conflicts of interest. ...............Even innocent errors in judgment by executives may precipitate claims.
In any case I doubt they have such a policy or could get one.
Evidently Kazorchian besides believing fake MBA being a qualification in his opinion, also believes these press releases. I am still waiting for him to support his contsnat promoting this stock. The funny thing is that BTDG keeps issuing these press releases with no effect. Not sure why.
Thanks for taking the time in your response
Yes good point no D & O insurance wil protect against illegal acts, or acts that are detemriend to have violated rules against self-dealing etc. If restrictions were removed from stock or stock issued to related parties and not disclosed there could be some serious issues.And personal assets in may cases will not be protected in all cases.
I know of no requirement for D & O insurance on OTC or on the exchanges, though it is quite common someone with assets will lrefuse a director position unless such insurance in place.
However D & O for a public company isnt based solely on assets or income of company. For example if a mining company which has no assets on balance sheet per US accounting rules,a company could still apply for D & O insurance. And yes quite typically one of main reasons for such policies is to cover legal expenses. These policies as they apply to public companies are different than those which apply to private organizations. These are not the typical start-up policies on sees for private businesses.Very specialised stuff,and from what I understand very few insurance companeis offer these sort of policies for public companies.
One would expect CFO of a junior company to have or develop some familiarity with disclosure practice for junior mining companies, to not issue miselading press releass for a start.
We can debate any mitigating circumstances but (a) CFO hasnt delivered sufficient financing to meet stated objectives (b) CFO apparently the driving force in the company so who else is responsible ? (c) yes market has been poor for junior exploration companies , but after two reverses this company hasnt performed well.(d) credibility of CFO and company is shot- who else is responsible ?
You make a good point some things outside of CFO control, but his press releases certainly set up company with problems with SEC engineering office, CFO is clearly responsible. Credentials do not appear to include experience with junior sector, nor in this industry.As far as compensation guess it depends whether one believes he has only been compensated by cash as disclosed, or whether through the various share issuances his return has been higher.Maybe if CFO had more experience the continued stating of objectives that are not met would have been toned down so company would maintain some level of credibility
Well an interesting discussion to be sure.
First, I quite agree if there is no money to be had ( a point I think I also made),a lawsuit may not bring any results for shareholders.
Second,as far as "intent" etc that may be a defense- but again,many such suits are not meant to win but force a settlement; also regardless of what Nevada law states, this is a SEC reporting company so there are federal regulations and laws that come into play as well. As far as lifting restrictions, or doing so and benefitting in a manner that should have been reported,I just mention this as an example of a potential problem.
Third, I am unsure looking at his press releases and his SEC filings how one could say this fellow is experienced in the junior mining sector.