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another death spiral article
I can't believe you guys are defending astn. You know my posts are right on target here. astn is a bad investment. This financing is a bad deal for the shareholders. vwap is not profitable and hasnt' been in their entire seven year existence. They are running out of funds. They don't meet minimums to even qualify for their toxic convertible financing. they are doing this financing through a compnay which has been sued for stock manipulation and fraud in relation to these exact same deals. Do you guys remember what you're fighting for over here? http://www.siliconinvestor.com/stocktalk/msg.gsp?msgid=15845565&s=death%20spiral
BC: DEATH SPIRAL
This article is from the April 1, 2001, issue of Red Herring magazine.
L. David Sikes was desperate. The CEO of Ramtron International (Nasdaq: RMTR) watched helplessly as the publicly traded chip maker lost $1 million a month during the height of the Asian financial crisis of 1998. Ramtron needed $17 million to stay in business, but couldn't turn to the traditional capital markets -- not with its balance sheet and its dependence on the Asian market. With nowhere else to turn, Mr. Sikes contacted a consortium of 12 individual investors and came up with the $17 million at terms that would make a credit card company green with envy. "It was," Mr. Sikes concedes, "a roll of the dice."
What Mr. Sikes did was take a "toxic convert," a financing measure of last resort that is becoming increasingly popular in the wake of the Nasdaq crash on April 14, 2000 -- and is coming under increasing scrutiny. In exchange for the $17 million, Mr. Sikes was required to turn over about $19 million's worth of Ramtron common stock. The catch: the investors were entitled to the $19 million in stock, regardless of the price per share.
And it was likely that Ramtron stock would drop enough so that the investors would eventually take control of the company on the basis of their $17 million infusion. In fact, when a company takes a deal like this, the odds are overwhelming that its stock will drop. Within six months, Ramtron's share price dropped from $5 to $0.25. Of the 220 such toxic convert deals that took place in 2000, only five companies wound up in better shape -- most of them tanked.
It happened to eToys. It happened to MicroStrategy (Nasdaq: MSTR). It happened to Quokka Sports (Nasdaq: QKKA). And it happened to hundreds of other startups on the verge of extinction. Still, hundreds more clamor for a similar deal. And for every company in need there is an organization willing to lend a hand -- for a stiff price: Promethean Asset Management, the Citadel Investment Group, Marshall Capital Management, and Angelo, Gordon & Company. There's a reason they aren't household names. "They like to stay under the radar," says Steve Bruce, an attorney who represents the Citadel Investment Group, explaining why his clients and their competitors would be unwilling to discuss their business.
THE QUICK AND THE DEAD
Toxic converts are a form of private investment in public equity (PIPE) and are known in the industry as the grimmest of reapers. Companies accept the financing because it is fast -- typical deals close within a month -- and the sums are generally below the $30 million minimum for secondary offerings. A last-ditch infusion of capital tied to stock price is an entrepreneur's way of gambling on a long shot -- that the struggling company can quickly turn around. Far more frequently, however, it is merely an invitation to the short-sellers -- often the PIPE investors themselves -- and throws the company's stock into an irreversible death spiral.
Meanwhile, the investors get fat at the expense of long-term individual and institutional investors. Promethean Asset Management founder and president James O'Brien boasted in the pages of a conference agenda that his $140 million fund has returned 126 percent since 1996, when the financing mechanism was first unleashed. Six years ago, 36 death-spiral deals worth a combined $264 million were consummated, according to private equity tracker DirectPlacement.com. In 2000, death-spiral deals were taken by 220 companies and accounted for $2 billion of the $18 billion overall PIPE industry. This popularity comes despite the fact that the death-spiral investors, motivated by a seller's market, stack the odds higher and higher with increasingly onerous contract demands.
As the technique grows in popularity, so does the controversy surrounding the profiteering. And now some companies and long-term investors are fighting back. The State of Wisconsin Investment Board, which manages a $60 million portfolio, has threatened to sue any of its portfolio companies that get involved with PIPEs. Several other companies have sued or are suing their PIPE investors. The growing ranks of dissatisfied companies include Log On America (Nasdaq: LOAX), Ariad Pharmaceuticals (Nasdaq: ARIA), and Ramtron, where Mr. Sikes struggled to extricate his company from the deadly deal's tight grip. "That was the most miserable year of my life," he says.
Ramtron, based in Colorado Springs, Colorado, lives on today only because the deal went so horribly sour. The investors demanded more shares than the company had issued. Using that as leverage, Mr. Sikes engineered a five-for-one reverse stock split and paid the investors 50 cents on the dollar to settle several lawsuits. But Mr. Sikes, who retired last year, was one of the few lucky ones.
DEVIL'S FOOD
When Mr. Sikes signed his deal with the devil, he was able to explicitly ban his investors from short-selling the company's stock. It did little good. The company was hit hard by unidentified short-sellers who helped send the company's stock into a six-month nosedive. "Things can happen offshore that you can't prevent," he says.
Today's PIPE deals don't prohibit short-selling by the investors. In fact, companies sign contracts that explicitly allow the investors to sell stocks short. "The companies resist the clause in the first four or five drafts of the contract," says securities lawyer Robert Friese. "But by the sixth draft, it's in there."
When it comes time to recoup their investments, death-spiral dealmakers garner enough stock in the companies to cover large short positions and have enough left over to take control.
Another benefit of short-selling for toxic-convert investors: as the stock drops in price, not only do they get a larger share of the company, but the company's valuation makes it an attractive takeover candidate -- enabling the investors to make money on both ends.
Judson Schmid, chief financial officer of health care content provider ProxyMed (Nasdaq: PILL), points out that for dot-coms that went public too soon, there often is little choice -- take the tainted money or turn off the lights. "When you get desperate, you're willing to overlook things," he says.
Ramtron's 1998 agreement called for it to repay the death-spiral investors with common stock discounted 7 percent from the prevailing market rate. Now, companies are consenting to repay the investors with stock discounts ranging from 10 percent all the way up to 30 percent.
In December 1999, ProxyMed raised $15 million in a death-spiral deal with several investors. Among other concessions, ProxyMed agreed to voluntarily delist from the Nasdaq in the event that the investors were owed more than 20 percent of the company and its long-term shareholders refused to allocate additional stock. At the time ProxyMed signed the deal, its stock traded at $10 a share.
When the investors came calling for repayment last year, the company's stock had collapsed to below $3 a share. By May, the company owed the investors close to 40 percent of all its common stock. Rather than delist, ProxyMed's shareholders agreed to a radical dilution of the company's stock. They doubled the company's stock allocation from 50 million to 100 million, in essence devaluing their investments by half to pay off the death-spiral deal. The company also needed additional funding in 2000, taking a $24.3 million investment that further diluted the company's ownership.
ProxyMed now trades at around $1 a share.
PROMETHEAN UNBOUND
These deals are also referred to as "corporate loan-sharking," "payday advances," or "pawnshops for dot-coms." Mr. O'Brien, an industry pioneer, established Promethean in 1994 after serving as managing director of Fletcher Asset Management in New York. Last year, Promethean invested nearly $108 million in 11 companies. The stock of every one of those companies lost value after the investment. According to PlacementTracker.com, the stocks of companies that Promethean has invested in since 1995 have dropped an average of 36.5 percent just six months after closing the deals and 17.3 percent after a year.
Last year, Promethean chipped in $25 million of the $100 million in death-spiral convertibles invested in eToys and $20 million of the $125 million invested in MicroStrategy. EToys stock plummeted from around $5 at the time of the deal to almost zero this year and at press time was facing bankruptcy and Nasdaq delisting. MicroStrategy stock traded at $38 when its deal was announced in June, almost four times what it was trading by February. Promethean's partners in those two deals were Citadel in Chicago and Angelo, Gordon in New York.
Citadel is a $4.5 billion hedge fund that invested $141 million in seven companies last year, including $60 million in MicroStrategy and $30 million in eToys. Citadel's portfolio companies decline an average of 21 percent a year after closing its death-spiral deals, according to PlacementTracker.com.
Angelo, Gordon's portfolio companies fared somewhat better, dropping a mere 6 percent a year after closing its deals. But Angelo, Gordon doesn't do as many death-spiral deals as Citadel and Promethean. Last year, Angelo, Gordon closed seven death-spiral deals for a combined $125.7 million, of which $90 million was divided equally between investments in eToys and MicroStrategy.
Clearly, companies signing up for such financing are generally poor performers and doomed for failure anyway -- with or without additional cash. The death-spiral deals themselves don't necessarily kill an already dying company. But they definitely hasten death.
The investors are assured automatic profits because they demand repayment in common stock, sold to them below the prevailing market price. They face little downside in shorting the stock, especially since the companies are usually in financial trouble and their stocks were destined to tumble anyway.
TOXIC AVENGERS
As more death-spiral deals go bad, some long-term investors and even the companies themselves are fighting back.
In banning its portfolio companies from taking toxic converts, the Wisconsin Board of Investment warned: "The investors have gone through great lengths to appear thorough and genuine in their interest in the companies. However, they may actually be assessing the odds of failure. Adding a toxic security to the financial structure increases the odds."
If a company in the portfolio succumbs to temptation, "We will sell the company or seek some kind of [legal] action," says board analyst Mark Traster. The investment board also threatened to pull its business from a large investment bank that is trying to get into the death-spiral business. With the growth of this financing technique -- and the drying up of traditional investment banking services -- prestigious investment banks are entering the market. For example, Credit Suisse First Boston now controls Marshall Capital Management, which specializes in death-spiral convertibles.
Meanwhile, several companies have sued their death-spiral investors, alleging fraud and market manipulation. Ariad sued Promethean in 1999, a year after Promethean invested $5 million in the company. The suit accused Promethean of shorting 2.5 million shares -- 10 percent of the company -- soon after closing the deal. This massive short-selling helped send Ariad's stock from $3 a share to just $0.59 in a few weeks, say executives at Ariad.
The companies settled last year. Ariad agreed to issue just under 1.1 million new common shares so Promethean could "cover [its] total outstanding short position," according to a document filed with the U.S. Securities and Exchange Commission. The company also agreed to pay Promethean $6.9 million.
Citing a nondisclosure agreement, lawyers for both sides declined to discuss the case. But Log On America, a small Rhode Island ISP, is using the Ariad settlement as a centerpiece for its own suit against Promethean, Citadel, and CSFB's Marshall Capital.
Log On America accuses the investors of stock fraud. The investors, Log On America alleges in its suit, funded the company simply "to launch an unlawful scheme to short-sell its stock in sufficient volume to drive down its price, knowing that they would be in a position to cover the short sales by converting their preferred stock at depressed market prices." The investors' alleged short-selling, according to the lawsuit, allowed them to reap millions of dollars in profits from short-selling while "simultaneously allowing them to reap tens of millions of dollars in profit and seize control of the company" as the ultimate result of the PIPE deal. Since Log On America entered into the deal in January 2000, its stock price has dropped from $17 to $2.50, and the company has lost about $120 million in market capitalization.
None of the investors returned telephone calls. But in court documents, they deny all of the accusations. In fact, every investor except Marshall Capital denies that they sold short a single share of Log On America stock. Besides, they say in court papers, even if they did sell short, they did nothing illegal.
Indeed, the contract explicitly allows the investors to sell short. Their bottom line: Log On America is trying to get out of "having to live up to its obligations under the agreement."
LIFE AFTER DEATH
What the lawsuit doesn't fully explain is why Log On America entered into the deal in the first place. That's saved for a separate suit against CSFB, which served as Log On America's financial adviser and helped negotiate the death-spiral deal. The suit alleges, and Log On America CEO David Paolo asserts in a separate interview, that CSFB led them astray with bad advice and that the advice was given because CSFB was concerned primarily with sending business to its subsidiary, Marshall Capital.
Mr. Paolo says his company had $20 million in cash on hand and a burn rate of $4 million a year when CSFB persuaded Log On America to take the deal. "We should never have done that deal," Mr. Paolo says now. "We didn't need the money." At press time, the investors were attempting to have the suit thrown out.
Meanwhile, most of the companies that took these deals weren't like Log On America. They were young companies teetering on the brink of extinction. Death-spiral investors were the only places these companies could raise more capital. Some decided against taking a death-spiral deal and chose to shut off their lights instead. An investor, who asked not to be identified, asked rhetorically, "Who was better off, Pets.com or eToys? EToys lasted longer and gave it a shot. Pets.com didn't, and shareholders in both companies are now in the same position. Which is worse?"
Julie Wainwright, CEO of the now-departed Pets.com, did, in fact, turn down offers from the toxic-convert crowd as the company sank into oblivion late last year. She apparently didn't want Pets.com tossed into a vortex that would end with toxic-convert investors walking away with the company's carcass. Instead, Ms. Wainwright filed for bankruptcy under Chapter 7, choosing to liquidate Pets.com and pay off the company's creditors and long-term investors as best she could. Ms. Wainwright apparently reasoned that the act of putting down Pets.com without taking a toxic convert was a more dignified death.
But there's another benefit to avoiding the financial grim reaper. By not selling out the interests of long-term investors to Johnny-come-latelies, executives like Ms. Wainwright stand a chance of burning fewer bridges -- increasing their odds of staying in the game.
Write to paul.elias@redherring.com.
1997-2000 Red Herring Communications. All Rights Reserved.
M
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Just say NO to stock fraud!
user name bird of prey
I have posted it before, many times, many articles, many references which went into how everything works. Please look at old posts as I asked you to earlier.
Jameson can purchase the shares at a 10% discount. They have incentive to short the shares immediately. That is what they do. That is what they did at mobile p.e.t. which had identical deal. That is what htey did at Nanopierce. That is what they did at other companies.
You seem eager to post your info about toxic convertible death spiral financing. Just go ahead and do it.
No one here has to read my posts. You can just ignore them.
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Just say NO to stock fraud!
Same finance deal
It's the same financing deal, just less money and RGC gets collateral and can pressure the shareholders into approving the new shares. They just didn't included 2001 report with new offering. That was the SEC problem with it. That was the holdup.
How can anyone say this is good news. If it were good news, they would have released it early.
Again, Fred not keeping his promises with employees, not giving the guy his promised severance package. Not too nice.
$6M march 31, $1M/mo min. burn rate, six months, no funds end of september, 2 1/2 months left. Will they be able to access the Jameson funds? I didn't notice a change in the terms relative to minimum requirements in order to get funds.
___________________________
Just say NO to stock fraud!
Report is out
some pieces of it. You guys know where to find it.
Jameson deal is still floorless convertible. They state they must meet certain minimums in order to get the funds still. They did not state that the minimums had been changed. Can astn even access these funds? Doesn't seem so as per this report.
ITEM 3. LEGAL PROCEEDINGS
The former President and Chief Operating Officer of eMC, filed an arbitration claim against Ashton claiming improper failure and refusal of Ashton, upon termination of his employment with eMC, to pay him severance and other amounts and benefits due under an agreement with him dated April 18, 2000. He seeks severance pay, other amounts and benefits, other damages and all costs and expenses incurred in connection with the claim.
On June 11, 2001, Ashton filed its response requesting the arbitration be dismissed against Ashton with prejudice or that Ashton be removed as a respondent to the matter. Ashton believes the claim has no merit and intends to defend it vigorously. We cannot predict the outcome of the arbitration, nor can we reasonably estimate a range of possible loss given the current status of the matter.
not too many shareholders here
As of March 31, 2001, there were approximately 329 holders of record of common stock, and approximately 90 holders of record of warrants
Was this for stock promotion? Right after CCE promotion notes.
We recorded non-cash compensation charges of $66,161 and $258,327 in the years ended March 31, 2000 and 1999, respectively, related to the issuance of stock options to non-employee consultants and professional advisors.
We incurred a net loss from continuing operations totaling $15.2 million, or $0.59 per share, for the year ended March 31, 2001, compared to $6.2 million, or $0.32 per share, last year. The increase is primarily a result of a $5.6 million gain recorded last year due to the change in accounting for our Gomez investment to the equity method, and a $2.6 million gain on the redemption of part of our Gomez series A preferred stock.
The loss from operations for the year ended March 31, 2001 decreased 3.5% to $14.7 million from $15.2 million last year. The loss from operations last year is comprised of $9.8 million from the intelligent matching systems business and $5.4 million from Gomez's results of operations; the loss from operations in the year ended March 31, 2001 was generated entirely by the intelligent matching systems business. Gomez's results of operations are included in our consolidated financial statements only through December 31, 1999, when we began accounting for our Gomez investment using the equity method. Excluding Gomez, our loss from operations increased approximately $5.1 million, or 50% from last year, due to increases in losses from trading activities, depreciation, and selling, general and administrative expenses, as further discussed below.
Revenues totaled $225,068 for the year ended March 31, 2001, and $3.9 million for the year ended March 31, 2000. The current year revenues were generated entirely by our intelligent matching systems business through the operation of eVWAP and securities commissions on trades executed through Croix. In the year ended March 31, 2000, we earned $32,135 from the operation of eVWAP, and Gomez generated the balance of the revenues. The increase in intelligent matching system revenues this year is a result of the increase in the number of shares traded through our system.
Following the sale of shares of our common stock by certain selling stockholders in May 2001 pursuant to an effective registration statement, we became aware that the financial statements included in the registration
statement did not satisfy the requirements of Regulation S-X. Because the registration statement incorporated by reference our Annual Report on Form 10- K for the year ended March 31, 2000, rather than for the year ended March 31, 2001, as it should have, the registration statement did not meet the applicable form requirements of a registration statement on Form S-2. Thus, claims may be made that the prospectus did not meet the requirements of, and that the sale of the shares was not properly registered pursuant to the Securities Act of 1933. If such claims are upheld, then the sale of the shares of common stock by these selling stockholders may have constituted a violation of the Securities Act of 1933. In this case, the purchasers of the common stock from the selling stockholders could have the right, for a period of one year from the dates of their respective purchases, to recover (i) the purchase price paid for their shares, plus interest, upon tender of their shares to us or (ii) their losses measured by the difference (plus interest) between their respective purchase prices and either the value of their shares at the time they sue us or, if they have sold their shares at a loss, the sale price of their shares. Alternatively, the purchasers of the common stock could have a right to seek redress from the selling stockholders, in which case we may have third party liability to the selling stockholders. We believe that these refunds or damages could total up to approximately $2.1 million, plus interest, in the event the purchasers of the shares suffer a total loss of their investment during this period and seek refunds or damages. If such liability were to occur, there is no guarantee that we would be reimbursed by our insurance carrier, and our business, results of operations and financial condition could suffer.
new jameson deal is...
not too hot, or different at all.
Following the sale of shares of our common stock by certain selling stockholders in May 2001 pursuant to an effective registration statement, we became aware that the financial statements included in the registration
statement did not satisfy the requirements of Regulation S-X. Because the registration statement incorporated by reference our Annual Report on Form 10- K for the year ended March 31, 2000, rather than for the year ended March 31, 2001, as it should have, the registration statement did not meet the applicable form requirements of a registration statement on Form S-2. Thus, claims may be made that the prospectus did not meet the requirements of, and that the sale of the shares was not properly registered pursuant to the Securities Act of 1933. If such claims are upheld, then the sale of the shares of common stock by these selling stockholders may have constituted a violation of the Securities Act of 1933. In this case, the purchasers of the common stock from the selling stockholders could have the right, for a period of one year from the dates of their respective purchases, to recover (i) the purchase price paid for their shares, plus interest, upon tender of their shares to us or (ii) their losses measured by the difference (plus interest) between their respective purchase prices and either the value of their shares at the time they sue us or, if they have sold their shares at a loss, the sale price of their shares. Alternatively, the purchasers of the common stock could have a right to seek redress from the selling stockholders, in which case we may have third party liability to the selling stockholders. We believe that these refunds or damages could total up to approximately $2.1 million, plus interest, in the event the purchasers of the shares suffer a total loss of their investment during this period and seek refunds or damages. If such liability were to occur, there is no guarantee that we would be reimbursed by our insurance carrier, and our business, results of operations and financial condition could suffer.
not too good. An sec violation.
eps - .79
6M in cash as of march 31.
TK is in atg canada.
On December 20, 1999, we funded Ashton Canada with $333,400 in cash for equity in the class A common shares, and agreed to provide an additional $666,600 as and when required, by way of either equity or debt. As of March 30, 2001, we have funded our $1,000,000 commitment in full to Ashton Canada. We own 51% of the voting equity of Ashton Canada. In connection with the agreement to form Ashton Canada, we issued a series K warrant to purchase 500,000 shares of our common stock at an exercise price of $2.50 per share to TK Holdings, Inc. The warrants are exercisable for a period of two years beginning on June 4, 2000. On December 20, 2000, the series K warrant began vesting in quarterly installments of 125,000 shares, and will vest in full on September 30, 2001. During the year ended March 31, 2001, we recorded a dividend of $1,024,900 upon vesting of 250,000 of the series K warrants. The remaining series K warrants will be recorded as dividends when they vest during the fiscal year ending March 31, 2002
Related Party Transaction
In connection with the amended equity line agreement executed on July 13, 2001, Adirondack agreed to return the 50,000 restricted shares it received for its assistance in structuring the original agreement. Adirondack will not be paid any fees in connection with either the original or the amended equity line agreement
tk's in there deep
CALP II Limited Partnership Common Stock Issue
On February 5, 2001, we sold 1,333,333 shares of our common stock to CALP II Limited Partnership, for $1.50 per share, for an aggregate purchase price of $2,000,000 in a private placement. In May 2001, we registered the resale of the common stock sold under the Securities Act of 1933, on Form S-3. (See Commitments and Contingencies). The proceeds of the private placement were used to fund our investment in JAGfn, and for general corporate purposes at Ashton Canada.
On March 9, 2001, we issued 733,945 shares of our common stock with a value of $1,000,000 to TK Holdings in a private placement, in exchange for its 72,850 shares of UTTC series TK convertible preferred stock. The UTTC series TK preferred stock is presented as a minority interest on the consolidated balance sheet at its liquidation preference of $1,000,000 and $2,000,000 as of March 31, 2001 and 2000, respectively. As a result of the liquidation preference, the balance has not been reduced by any portion of UTTC's net losses.
___________________________
Just say NO to stock fraud!
Terms of financing are in SEC docs
Go look at the sec docs for the agreement. They are right there. I am not here to do your foot work and answer all your questions with links. If you want to post about astn, please read all the sec docs., press releases and all past posts to get up to speed. We've gone over this here, on SI, RB and Yahoo. It is not my job to get you up to speed. Just ignore my posts if you do not know enough to understand them.
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Just say NO to stock fraud!
nondiscriminatory enforcement of TOS
someone else's point of view. I agree with them. Others can post my name, address and nothing happens. I post someone's country and get suspended. Others can spam my board and personally attack me. All I was allowed to do was delete their posts. I put the same trash on someone else's board and I was suspended. Things have not changed.
To:gotinearlier who wrote (3241)
From: KG4 Monday, Jul 16, 2001 11:40 AM
Respond to of 3247
<<Ihub is for balanced communication in a professional manner >>
Now thats got to be the joke of the month!!
It was very apparant, IMO, from my very first day on IHUB that the site was a joke, was heavily biased and would not be a place for real investors to mutually share info. Right from the get go, it was obvious to me IHUB was similar to SI's Voltaires porch, in that you either were "in" with the right people, or you were not welcome. I had many posts deleted on IHUB, meanwhile others could post and say whatever they wished, without repurcussion. It was nothing but a biased popularity contest, IMO....heck, me and one or two other people even did a test....IHUB failed. We were told we were welcome to post on a particular thread as long as it was stock related. Well, we thought we were being biased against because of who we were, so we tested them....posted several posts, all 100% stock related only.....those posts were deleted. That was all the proof I needed to see how things were run over there....then of course, I stayed on the site, for entertainment purposes only, because thats about all I could find over there....nothing useful....but, I since realized that even the entertainment value it provided was not worth spending any time on, so I have not visited IHUB in awhile. I tried to talk to Matt about the biased way I thought IHUB was being run....and he didnt seem to care very much...certain people got treated like royalty....others were treated as peasants....just like on Voltaires porch here on SI, IMO.....The porch has a few very good people on it, but the few rotten and biased apples simply ruined the place, IMO.
___________________________
Just say NO to stock fraud!
"They were gonna get 25M
Now only 15M"
That's a bad thing. Less money, same devastating effect on the share price.
"There was no collateral before on RGC loan, now there may be if shareholders don't approve of more dilution."
This confirms that they think the astn longs think there is value in vwap. vwap is not profitable. It is still a money drain. I see no value at this time. This is a psychological ploy, in my mind. It's like holding a person hostage. Physical value of a human is $11 I think in terms of minerals and such. Emotional value is another thing.
>Also, Ashton would now have the cash to continue progressing with eVWAP.
this is good for BOD as they will continue to draw salaries and self deal. This is not good for the shareholders. More dilution, share price will go down. vwap burns money. Vwap continuing does not generate profits. It's a money drain. This is a bad thing.
___________________________
Just say NO to stock fraud!
They were gonna get 25M
http://www.ashtontechgroup.com/ainvinfo/01/021301.html
Now only 15M
The financing arrangement provides for the purchase by Jameson of up to $15 million worth of Ashton's common stock over a 24-month period.
http://biz.yahoo.com/bw/010716/2302.html
There was no collateral before on RGC loan, now there may be if shareholders don't approve of more dilution.
SEC also made them change the forms they file this underwriting/loan under.
All of these changes from the original deal are a good thing? I don't see it yet.
___________________________
Just say NO to stock fraud!
Got it Matt
Glad to see you updating the rules. I would prefer not to speak to the chairman, the person who has deleted my post. They most certainly do not want to undelete perfectly good tos abiding posts.
If someone refers to me in a negative manner as the red headed scam buster, can I call them the old lady poor investor? I see negative references to my being here which I find offensive. Please let us all know what is acceptable and what is not. Wouldn't it be nice if everyone could just stick to the issue and leave the posters here out of it? Too bad it's impossible.
___________________________
Just say NO to stock fraud!
We are speculating
and posting our opinions. That is what these boards are all about. My opinion is that the report will be bad showing very little COH. If they did not get a go ahead with the financing, they would have had major going concern language in the report. That is why they waited. They will wait til after close.
___________________________
Just say NO to stock fraud!
Toxic convertibles. Death spirals. It's getting hostile
July 8, 2001
Cigarettes can kill. So can PIPEs.
PIPEs is the acronym for private investments in public entities -- funding devices that struggling companies increasingly are turning to in a hostile emerging company environment.
When the PIPE is an issuance of convertible debentures or preferreds, it often leads to what is known as a death spiral -- a collapse of the stock allegedly caused by massive shorting.
What's particularly interesting is that the private entities buying the convertibles -- known as toxic convertibles -- tend to be located in offshore, secrecy-shrouded tax havens.
Some of the victim companies complain that the entities that bought the convertibles are responsible for the shorting, either themselves or through surreptitious surrogates.
Other victimized companies feel that short sellers (those betting a stock will go down) pounce on a company that has sold toxic convertibles. The shorts figure the shares will be converted quickly, leading to a larger supply of low-priced stock, and thus more opportunities to successfully short a stock that is normally thinly traded.
Since it is shaky companies that usually resort to toxic convertibles, the shorts feel they have cornered helpless prey.
According to Red Herring magazine, death spiral deals were taken by 220 companies last year, accounting for $2 billion of the $18 billion in PIPEs.
Overwhelmingly, the stocks of the companies issuing convertibles collapsed. However, it is invidious to pin all the blame on the toxic convertibles. After all, Nasdaq -- particularly the emerging companies -- imploded in 2000.
Earlier this year, Mobile PET in San Diego filed a suit claiming that enterprises buying its convertibles worked together to drive the stock down. In June, Mobile PET settled the suit and withdrew the allegations.
Now, San Diego's ailing GreyStone Digital Technology, which provides military software, complains that it is in the grip of a death spiral.
In May of last year, the company sold $5 million worth of convertible preferred stock to 13 investors -- mostly offshore in such havens as Liechtenstein, Switzerland, the Turks & Caicos Islands, Isle of Man and the Bahamas.
"It was a mistake," says founder and chief executive Richard A. Smith. "The stock went from $6 to 20 cents." The deal was set up through an agent, and the company didn't learn that the convertible buyers were offshore until right before closing.
GreyStone complained to the National Association of Securities Dealers about irregularities in short selling. Among other things, the amount of short selling did not seem to correlate with the numbers that were reported to domestic authorities, says Carolyn Harris, GreyStone's general counsel.
"We went through all the filing procedures; nobody told us about this stuff," Smith says. The NASD found that "people selling the stock were not delivering the stock in a timely way, or at all."
The NASD notified broker-dealers, but GreyStone "has not heard a word" from the self-regulating body, Smith says.
Harris says: "One of the things that bothers this company is: 'Where are the regulators when you need them?' The NASD knew there was underreporting of the short position."
The NASD refuses to confirm or deny any investigation into the matter.
The underreporting of short positions might have been a function of the shorters being offshore, Harris says, hastening to add that GreyStone has not accused the offshore buyers of its preferred with the shorting.
But, Harris says, "If I had known in May of 2000 what I know now, I would have lain down on the railroad tracks" to block the deal.
Buyers of toxic convertibles usually say they have no motivation to drive down a stock in which they have a stake.
But, Smith says: "There is obviously an incentive for whoever the preferred shareholders might be to see the stock go down, not up, so they can get more shares (upon conversion)."
"This volatile Nasdaq market casts an enormous shadow. If there is illegal shorting or manipulation, it's difficult to determine because of the size of that shadow."
Of course, GreyStone has very big operational problems: Recently it filed for an extension of the submission of its 10-K statement to the Securities and Exchange Commission, because it had been behind on payments to its auditor.
Last month, it was delisted from Nasdaq. Losses are escalating, and the auditor questions GreyStone's ability to survive.
This spring, the company said it was shelving its attempt to diversify into providing arcade games to casinos. One company agreed to buy $7 million of GreyStone's games, but then the potential customer's parent backed out.
"That was the left punch," Smith says. "The right punch was that as soon as that happened, the lender pulled its credit."
But GreyStone wants to use both its military and games technology in some kind of rescue combination. "We are in discussions about a spin-off or a split-off of the entertainment side," Smith says.
The company has ongoing discussions about being acquired or acquiring somebody else, but Smith can't discuss that.
Don Bauder's e-mail address is don.bauder@uniontrib.com. His phone number is (619) 293-1523.
http://www.signonsandiego.com/news/business/bauder/20010708-9999_1b8bauder.html
© Copyright 2001 Union-Tribune Publishing Co.
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Just say NO to stock fraud!
Mobile P.E.T. settles
They sued, were countersued, then settled. This deal was identical.
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delayed 20 mins - disclaimer
Thursday April 19, 9:40 am Eastern Time
Press Release
York Sues Mobile P.E.T. for Breach of Stock Purchase Agreement
Fund Seeks More Than $4.9 million in Redemption of Mobile P.E.T. Preferred Stock
LOS ANGELES--(BUSINESS WIRE)--April 19, 2001--York, LLC, today announced that on April 13, 2001, it filed a lawsuit in Federal District Court in Los Angeles against Mobile P.E.T. Systems, Inc. (OTC BB MBPT), a Delaware corporation engaged in the business of providing medical services.
Among the claims asserted against Mobile P.E.T. are breach of contract and various torts, based upon Mobile P.E.T.'s failure to deliver shares pursuant to an equity line agreement that required York to make additional purchases of Mobile P.E.T.'s Common Stock subsequent to a $4.5 million purchase of the corporation's convertible Preferred Stock in March and September of last year.
York's complaint alleges that, at Mobile P.E.T.'s request, York pre-paid $250,000 for 723,981 shares of Common Stock which the company now refuses to deliver. York is seeking the value of the common shares it is due and other compensatory damages, as well as attorneys' fees and costs.
York also announced that subsequent to filing the suit it served notices on Mobile P.E.T. requiring the redemption by Mobile P.E.T. of all of York's outstanding Preferred Stock, for an aggregate sum exceeding $4.9 million. The redemption arose from Mobile P.E.T.'s failure to deliver common stock as required upon York's conversion of a portion of the outstanding Preferred Stock.
A spokesman for York expressed the fund's outrage over Mobile P.E.T.'s allegations that wrongful conduct by York has caused the decline of the price of Mobile P.E.T.'s Common Stock. The spokesman reported that ``in the last several months, Mobile P.E.T., on its own initiative, has `put' (sold) over 1,590,000 shares of Common Stock to York in exchange for $1 million.'' He added that ``the foregoing does not include the latest `put' notice which obligated the company to deliver 723,981 shares in exchange for York's March 13, 2001 payment of $250,000.'' The spokesman also noted that Mobile P.E.T. knew those shares were being immediately re-sold by York, consistent with the terms of the agreement, and nonetheless continued to require York's purchase of additional shares.
--------------------------------------------------------------------------------
Contact:
York
John Hellerman, 202/973-1324
jhellerman@levick.com
Email this story - Most-emailed articles - Most-viewed articles
___________________________
Just say NO to stock fraud!
Nanopierce lawsuit
same funding. When these companies sue these strawmen in the caymans, the strawman countersues.
http://biz.yahoo.com/prnews/010510/lath049.html
Thursday May 10, 3:32 pm Eastern Time
Press Release
SOURCE: Harvest Court, LLC
NanoPierce Sued by Harvest Court, LLC for Breach of Contract
LOS ANGELES, May 10 /PRNewswire/ -- Harvest Court, LLC announced today that on May 7, 2001, it filed suit for breach of contract in New York County Supreme Court against NanoPierce Technologies, Inc. (OTC Bulletin Board: NPCT - news). Harvest Court's claims are based upon NanoPierce's failure to deliver shares of common stock owed pursuant to various contractual provisions. The Complaint alleges, among other things, that after Harvest Court's initial purchase of $7,500,000 worth of NanoPierce's common stock, NanoPierce was obligated by contract to provide additional shares of common stock on three subsequent ``re-set'' dates in the event that the stock's price had declined. Harvest Court further alleges that on April 30, 2001, the second re-set date, NanoPierce refused to issue shares of its common stock to Harvest Court, even though such issuance was required under the contracts between the parties. Harvest Court is seeking, among other relief, damages of more than $6.6 million in connection with NanoPierce's failure to deliver shares on the second re-set date, or, in the alternative, delivery of the 7,418,895 re-set shares. Harvest Court is also seeking relief in connection with NanoPierce's stated intention to withhold delivery of shares due on the third re-set date, as well as other miscellaneous damages and attorneys' fees.
In an attempt to deflect attention from its own defaults under its contracts with Harvest Court, NPCT recently issued a press release containing a variety of allegations, including an accusation that Harvest Court has shorted NanoPierce's stock. A Harvest Court spokesman stated that ``NanoPierce's accusations are absolutely false. Neither Harvest Court nor any other person or entity acting on Harvest Court's behalf has ever shorted a single share of NanoPierce's stock. In fact, on May 6, 2001, the date of NanoPierce's press release, Harvest Court continued to own approximately 2.1 million shares of NanoPierce's stock.''
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Just say NO to stock fraud!
10% discount on shares
That is the agreement. Please look up the sec documents yourself. I will not be doing your homework for you. Notice also that this entity has recently been sued for this exact type of funding with nanopierce and mobile p.e.t. besides quite a few others. Jameson a Cayman entity was sued for stock manipulation and fraud. They shorted the shares of the company instantly all the while promising orally not to. I have posted the links and lawsuits here before. Please read all the posts and astn sec docs for yourself.
___________________________
Just say NO to stock fraud!
I responded on yahoo
I will copy/paste my response here as you are by your example stating that it is acceptable.
Re: Mary, Re: interesting news
by: marycummins (35/F/Los Angeles, CA)
Long-Term Sentiment: Strong Sell 07/16/01 12:58 pm
Msg: 124892 of 124903
RGC is not validating vwap's worth. They are just saying that they'll take it as collateral as there is nothing else. I think it's more "extortion" on the long shareholders who think the product is actually worth something, especially after a few days of okay volume. That volume put some false hopes in the product for now.
How do you read this?
"Ashton had previously entered into an equity line arrangement with Jameson Drive LLC on February 9, 2001. On March 31, 2001, the Securities and Exchange Commission issued its views replacing Interpretation No. 4S in the March 1999 Supplement to its Manual of Publicly Available Telephone Interpretations.
Based upon these views and Ashton's discussions with SEC staff, Ashton and Jameson amended the securities purchase agreement."
It seems the SEC was involved also in the "discussions." The SEC has been trying to crack down on these types of finance deals because it really hurts the shareolders. Think I posted some SEC notes on the subject here before. Perhaps it was the SEC and the pr person just added Ashton and Jameson to make it seem like a mutual thing.
___________________________
Just say NO to stock fraud!
It is still toxic financing
I see no changes yet. No SEC filing either. This deal is even worse than before as RGC now can almost force the shareholders to approve of it and they now have backup collateral in case it doesn't go through as they like. There is nothing in there so far that says they cannot short the shares. RGC is only using vwap as collateral as they know there are some insane longs who think it's actually worth something. 7 years with no profits, it is not worth much. If it were, someone would have tried to buy it or merge astn with another company.
I do not give anyone permission to mention my name, address or phone number or domain names or anything that can lead to this information. To do so is an invasion of privacy which is a tos violation. I was also instructed by matt to contact the chairman if there is a post which I feel is a tos violation.
___________________________
Just say NO to stock fraud!
Here is SEC doc mentioned
http://www.sec.gov/interps/telephone/phonesupplement1.htm
4S. Sections 5, 4(2) and 2(a)(11); Rule 415; Form S-3
(a) A company entered into an agreement with a limited number of investors under which the investors committed to provide the company with private equity capital on a periodic basis. Under the agreement, the company will exercise its right to draw down on the "equity line" arrangement and issue securities after the filing and effectiveness of a registration statement covering the resale of the equity securities that the company will issue. The timing and amount of each draw-down on the equity line will be negotiated between the company and the investors during the duration of the commitment. The securities purchase price is based on a formula tied to market price at the date of each draw-down. The company has asked whether it may register the resale of the securities it will issue under the equity line on Form S-3.
Because the investors are not at market risk and have not made an irrevocable decision to purchase the securities prior to the filing of the resale registration statement, notwithstanding the signing of the equity line agreement before the filing of the registration statement, the transaction does not satisfy the conditions of the staff's PIPEs position. Because the "resale" is actually an indirect primary distribution of the securities by the company effected through the investors, the investors are viewed as statutory underwriters within the meaning of Section 2(a)(11). Thus, while the staff will not object to the registration for resale of securities issued under such equity line arrangements, the investors must be named as underwriters in the registration statement (not identified as possible underwriters), and the company may register the securities for resale on Form S-3 only if it is eligible to use the form for a primary offering. Otherwise, the company may register the resale of the securities only on the form that it may use for a primary offering (e.g., S-1 or S-2). In addition, because the parties' execution of the "equity line" arrangement is not considered sufficient to demonstrate that a completed private placement has occurred before the time of filing of the registration statement, the company may have to disclose in the registration statement the existence of contingent liabilities for a violation of Section 5 in connection with sales of the securities made under the equity line. Further, depending on the facts of a particular case, the offering may have more characteristics of a primary offering than a ,,,
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Just say NO to stock fraud!
It is bad news
Read the news items. RGC is basically extorting the shareholders with approve of this or the note is due sooner and we will attach your precious vwap as collateral. Also note that the new terms are only to be in compliance with SEC regulations/paperwork and to protect the lender. They do not protect teh shareholder. It's the same deal. the same toxic convertible death spiral fianncing deal as before, no major changes that I can see yet. This is not good news. There will still be dilution. I see nothing that keeps these com panies from shorting the shares. The share value will go down.
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Just say NO to stock fraud!
Article on director Valentine
He is uttc director. He set up the financing with his funds and company. He is handling canadian atg operations. He had astn invest in jagnotes, jagfn.
http://www.siliconinvestor.com/stocktalk/msg.gsp?msgid=15762686&s=mark%20valentine%20kernaghan
Bay St. brokerage at the centre of perfect legal storm
Thomson Kernaghan besieged by investors, firms it financed
Scott Adams and Derek DeCloet
Financial Post
Mount Sinai Hospital
Stephanie and Mark Valentine have donated hundreds of thousands of dollars to charities.
For a small brokerage, Thomson Kernaghan & Co. and its chairman, Mark Valentine, have attracted more than their share of controversy.
Mr. Valentine's once high-flying hedge funds have plunged in value during the market's recent downturn. As a result, a stream of fund unitholders is clamouring for redemptions the fund can't keep up with. Meanwhile, other investors have taken to the courts against Thomson Kernaghan over what it alleges is stock manipulation and "death-spiral financing" in its use of convertible debentures in its investments.
To top it all off, the police have started an investigation after allegations US$20,000 was taken without explanation from a client's account.
Though it looks like he is fighting fires on a number of fronts, the 31-year-old Bay Street executive writes it all off as business as usual in a down market.
"I don't view it as fires because I understand what is happening in the business environment," he says, sitting in his office on Bay Street. "I know what is happening. They're not fires." Thomson Kernaghan is not a major player on Bay Street, but it is well known for operating in speculative stocks.
Financial documents show Mr. Valentine owned 25% of the firm at one point. He started at Thomson Kernaghan in 1994 and rose to chairman in about five years. So who is he? He declines to talk about himself or to have his picture taken.
What is known is that he moves in Bay Street's fast lane, donating hundreds of thousands of dollars to charities such as Toronto's Mount Sinai Hospital, where the neonatal intensive care unit was named after him and his wife this spring. Also, his father Douglas was is a former Canadian ambassador to Saudi Arabia and Colombia.
What is also known is that his lawyers will be busy.
Chris Morgis, a former brokerage client of Thomson Kernaghan, has taken his complaints about the firm to the fraud unit of the Toronto police.
In a sworn affidavit, Mr. Morgis alleges that Thomson Kernaghan transferred US$20,000 (about $29,000 at the time) out of one of his accounts in January, 2000, without authorization or explanation.
According to documents, Mr. Morgis says he has made numerous attempts to have the money returned, without success.
Several months after the money went missing, Mr. Morgis alleges, he was told it went to an "investment club" he had signed up for in 1999. Mr. Morgis says he then asked for documents about the investment club that would show where the money went, but was denied.
Mr. Morgis's broker, Pat Teggart, has gone on medical leave from Thomson Kernaghan. Mr. Morgis has taken up his complaint with Lee Simpson, Thomson Kernaghan's president and chief executive. But Mr. Simpson "is refusing to provide an explanation for this transaction, and he is refusing to return the US$20,000 to my wife and I. I believe this this money was stolen," says Mr. Morgis in a written statement to police.
Mr. Simpson refused to discuss the matter with the Post, citing a lawsuit filed by Mr. Morgis against Thomson Kernaghan and Mr. Teggart.
That suit is itself unusual, both for the amount of money involved -- Mr. Morgis and his wife, Joanne, are claiming damages of $5.75-million -- and the allegations they have made.
The Morgises had approximately $2.75-million in accounts with Thomson Kernaghan in March, 2000, the month the Nasdaq composite index peaked. The Morgises' equity plummeted to about $800,000 by April -- a 70% drop in less than two months.
Thomson Kernaghan admits in court filings that the Morgises lost that amount. Exactly how that happened is at the core of the dispute.
Mr. Morgis, who controlled all the accounts, concedes that he was an aggressive investor who traded frequently and used margin. But he alleges that faulty compliance at Thomson Kernaghan contributed to his meltdown in the spring of 2000.
Mr. Morgis claims Mr. Teggert advised him to load up on tech stocks, to the exclusion of almost anything else. At one point, 70% of his portfolio was in speculative shares of Research in Motion Ltd., Mr. Morgis alleges.
Mr. Morgis also says Thomson Kernaghan wasn't even able to tell him what his margin position was at times. That allowed him, "encouraged by Mr. Teggart," to continue trading millions of dollars in shares a day, even though his margin debt exceeded the regulatory limit, Mr. Morgis alleges.
For its part, Thomson Kernaghan denies it has done anything wrong, and says the losses are Chris Morgis's fault. "To the extent he suffered trading losses while a client at TK, he is the author of his own misfortune," says its statement of defence.
The only thing Mr. Simpson will say on the case is that he wants to fight it. "We are intending on vigorously defending every allegation that's made in that statement of claim," he says.
- - -
Mr. Valentine's private hedge funds for wealthy individuals were once hot commodities on Bay Street and in wealthy circles. The returns were astonishing, but the funds have run into a wall with the downturn of the technology and small-cap market.
Unitholders, for example, are clamouring for redemptions from a fund called the Canadian Advantage Limited Partnership, or CALP. But they can't get out. The fund's assets have been falling, while redemptions can only dribble out because the investments have plunged in value or are illiquid, according to documents obtained by the Financial Post.
It didn't start out that way.
In January, 1997, CALP had US$1.4-million in assets. In two years, the fund's assets soared to US$21.2-million and the units had returned a remarkable 137.3%.
By September last year, the assets had shot up to US$96.8-million and the units had returned 575.6% since inception.
But the party ended. By January this year, assets had plunged to US$62.5-million, still up 430% since inception, but with further declines expected for February and March, according to documents. Mr. Valentine's other funds have been losing assets too.
The call for redemptions also looks troubling. In communications to unitholders last month, the fund said a redemption pool for CALP and another fund (the two had been consolidated into CALP II) had reached US$40-million, meaning that unitholders wanted to redeem a little less half of the US$90-million in CALP II assets.
Furthermore, the fund was only able to provide a distribution of 0.8% under the monthly redemption program recently. "While we have managed to satisfy some US$11.6-million of redemptions since October, unless we see a marked improvement in market liquidity, we expect cash distributions will be lumpy and limited for the foreseeable future," unitholders were told.
Though the picture looks troubling, Mr. Valentine defends his funds. Many unitholders have over-submitted for redemptions, meaning they don't want all their money out now, but have submitted for more until they see liquidity improve, he said.
"We're continuing to focus this as an ongoing business. There is great upside for the investors. We've had a great track record in the past," said Mr. Valentine, who is president of VMH Management Ltd., which manages CALP. He says he is working on mergers, acquisitions and other strategies to improve liquidity.
In the second to last note to CALP's financial statements for last year, it says there are a number of legal proceedings pending by and against the partnership, dealing with trying to convert the fund's convertible securities. The partnership's management doesn't believe the proceedings will ever be material. That leads to the next hot spot.
- - -
Internet Law Library Inc. of Houston launched a lawsuit against Thomson Kernaghan this year, also naming Southridge Capital Management LLC, Steve Hicks, Dan Pickett, Christy Constabile and Cootes Drive LLC.
According to the statement of claim, Internet Law Library was looking for financing in March, 2000, and talked to Mr. Hicks (a former senior executive with Mr. Valentine at VMH Management) and of Southridge. The result was that Internet Law says it was promised financing by way of US$3-million in convertible preferred shares and US$25-million in equity by a firm called Cootes Drive, which allegedly turned out to be a "straw man" for Southridge and Thomson Kernaghan, the suit says.
Internet Law says Southridge guaranteed it wouldn't sell any Internet Law stock short. That's key because Internet Law alleges that what happened was a "death spiral."
Internet Law alleges that Southridge and Thomson Kernaghan were short on its stock from March, 2000, though they told Internet Law they were not.
Later, Southridge and Thomson Kernaghan manipulated the stock lower by entering low bid prices at the daily close of the market and through other methods, the suit says. The stock fell from US$7 in March to US12¢ in January this year, losing US$200-million in value.
As for the US$25-million equity financing, Cootes delayed it until a provision was triggered that said it wouldn't be provided if the stock fell below US$1.50.
Cootes Drive has fired back a lawsuit against Internet Law, alleging that Internet Law refused to convert 100,000 preferred shares in January, breaching a contract. Mr. Valentine is adamant that his funds and Thomson Kernaghan never took a short position with Internet Law and never take a short position with convertible debentures, ever. "Absolutely not," he says.
Internet Law's suit alleges that the parties it is suing have engaged in similar financing with other companies and the combined losses total more than US$500-million. Thomson Kernaghan was sued at least five times a few years ago over similar circumstances and at least three times more recently.
"All those [five old] cases were successfully defended and won," Mr. Valentine said. "Thomson Kernaghan has done nothing wrong in any of those cases in the past and in the present."
___________________________
Just say NO to stock fraud!
Notice this part, signs of possible scam
• No profits or — worse yet — little or no revenues.
That's astn
• "The underwriters of the initial public offering have a tainted reputation." (Asensio)
That's for sure
• Switching auditors.
Switched auditors right after ipo, fred's idea. It wasn't on good terms either. See SEC docs.
• Delayed filing of financial reports.
You got that right.
• A product "in a sexy, hot field with hard-to-quantify, hard-to-understand performance specifications" (Asensio). In particular, be wary of companies promoting new medical breakthroughs. One such example is Sunrise Technologies International, which I panned in my January column,"Stocks to Avoid."(As I predicted, the stock is well on its way to zero.) Asensio cites other examples, including Chromatics Color Sciences, Zonagen, and Hemispherx Biopharma.
A little hard to quantify. astn is supposed to make one to three cents/share trade but now the number is all over the place.
• A company claiming to have discovered new sources of (or methods of extracting) natural resources, such as oil or gold. Remember Solv-Ex, Bre-X, or Crystallex International? (As I look at this list, I'm coming up with a new warning flag: natural resource companies with names that end in "x.")
No
• Cute, dumb ticker symbols. Asensio cites the case of Systems of Excellence (Ticker: SEXI), which "went bankrupt in 1996, only after, according to the SEC, it had become the most important case of Internet stock-touting fraud ever."
No
• A blizzard of press releases. I find there tends to be an inverse correlation between the quality of a company (and its management) and the number of press releases it generates.
they used to
• A high short interest. (Anything above 5-10% of shares outstanding is cause for concern.) This is easy information to gather. I use Yahoo! Finance's "Profile" feature. (Data for Sunrise is available online as one example. In the bottom-right corner of Yahoo! profile page, under the heading Short Interest, you can see that 15.1% of Sunrise's shares are sold short.)
Only 3% now I think.
• A company suing — or even responding to — short sellers. Asensio says it best: "How many times have we seen officials of outright blatant scams blame their troubles on short sellers? No legitimate company with a real business would bother wasting valuable corporate resources, including valuable management time, suing a short seller.... When investors see public companies expend vast resources to silence their critics, they might want to tread carefully."
Yes, sireeee! ceo said he was suing a poster.
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Just say NO to stock fraud!
I posted link to ENTIRE sec filing
There was nothing missing. I didn't even post my opinion with that SEC doc. I will post my opinion of the doc now.
I believe it is bad news when companies file late. Here is a book which states it's a red flag.
Book about spotting fraud
http://www.msnbc.com/p/cnbc/576957.asp?bt=cnbc
The short-seller's mindset
Even after the bursting of the technology bubble, stock promotions and scams are still all too common
By Whitney Tilson ANALYSIS
Motley Fool
May 22 — I just finished reading "Sold Short", a new book by famed short-seller Manuel Asensio. In it, he describes numerous long-running battles with companies that were, in almost all cases, engaged in nefarious, outrageous, fraudulent activities.
I'M NOT AT all surprised that many companies engage in such behavior. The stock market has long been fertile ground for promoters and scoundrels. Nor am I particularly surprised that so-called analysts, even those at major brokerages, unwittingly — and, in many cases, knowingly — aided and abetted stock promotions.
What was surprising to me, however, was the extent of the denial on the part of investors. As Asensio describes in case after case, investors — ranging from individuals to money managers at the largest, most prestigious institutions — refused to acknowledge the truth despite overwhelming evidence that they had been victims of a scam and clung irrationally to their holdings.
It's hard to admit a mistake and even harder to sell at a loss (as I discussed in my columns,"To Sell or Not to Sell"and"Never Too Late To Sell"), but it would seem that these natural inclinations could be overcome with hard evidence. Maybe not.
Sunrise TechnologiesChromatics Color SciencesZonagenHemispherx Biopharma
• Message Board
• Company Profile
• Earnings Estimates
• Analyst Reports
How can you avoid getting into such a predicament? The easiest way, of course, is not to own the stock of a questionable company to begin with, so allow me to share some tips — drawn from Asensio's book as well as my own observations — on how to identity them.
None of these characteristics are, by themselves, conclusive, but when you see them — especially more than one of them — be careful!
• No profits or — worse yet — little or no revenues.
• "The underwriters of the initial public offering have a tainted reputation." (Asensio)
• Switching auditors.
• Delayed filing of financial reports.
• A product "in a sexy, hot field with hard-to-quantify, hard-to-understand performance specifications" (Asensio). In particular, be wary of companies promoting new medical breakthroughs. One such example is Sunrise Technologies International, which I panned in my January column,"Stocks to Avoid."(As I predicted, the stock is well on its way to zero.) Asensio cites other examples, including Chromatics Color Sciences, Zonagen, and Hemispherx Biopharma.
• A company claiming to have discovered new sources of (or methods of extracting) natural resources, such as oil or gold. Remember Solv-Ex, Bre-X, or Crystallex International? (As I look at this list, I'm coming up with a new warning flag: natural resource companies with names that end in "x.")
• Cute, dumb ticker symbols. Asensio cites the case of Systems of Excellence (Ticker: SEXI), which "went bankrupt in 1996, only after, according to the SEC, it had become the most important case of Internet stock-touting fraud ever."
• A blizzard of press releases. I find there tends to be an inverse correlation between the quality of a company (and its management) and the number of press releases it generates.
• A high short interest. (Anything above 5-10% of shares outstanding is cause for concern.) This is easy information to gather. I use Yahoo! Finance's "Profile" feature. (Data for Sunrise is available online as one example. In the bottom-right corner of Yahoo! profile page, under the heading Short Interest, you can see that 15.1% of Sunrise's shares are sold short.)
• A company suing — or even responding to — short sellers. Asensio says it best: "How many times have we seen officials of outright blatant scams blame their troubles on short sellers? No legitimate company with a real business would bother wasting valuable corporate resources, including valuable management time, suing a short seller.... When investors see public companies expend vast resources to silence their critics, they might want to tread carefully."
• • LISTEN TO SHORT SELLERS
I don't short stocks because — as I discussed in"Good Time to Short Stocks?"— it is an extremely difficult and dangerous activity. Unlike investing on the long side, where a lack of talent and a poor track record don't seem to be much of a barrier to managing large sums of money, incompetent short sellers quickly go out of business.
Those who remain and thrive really do their homework. So when you see a stock panned publicly by Asensio or David Tice or a credible investigative journalist with sources among short sellers like TheStreet.com's Herb Greenberg, don't go anywhere near it! Sure, the shorts could be wrong, but why take the chance? Of the thousands of stocks in the investment universe, surely there are better ones than those broadly targeted by short sellers.
Very rarely have I owned a stock targeted by shorts, but when it's happened, I'm grateful, not resentful. It doesn't advance my thinking very much to read an analyst's puff piece about a stock I already like and own. What I really benefit from is a smart person — be it a short seller, journalist, or fellow investor — making a bearish case for the stock. Listening to short sellers paid off for me last year when I dumped many of my technology holdings before they collapsed.
Unfortunately, however, embracing criticism is not the typical reaction by those who have been lured into a stock promotion. Instead, "shoot the messenger" is the order of the day. You would not believe the hateful emails I receive every time I criticize a stock. For daring to question the future viability of Sunrise, for example, one reader accused me of "cooperating with the short interest" and expressed hope that I suffer "total vision damage and have to always look at the world through blury [sic] vision. All in the name of profit for yourselves. I wish nothing but the worst for you and your kind." Take a look at Sunrise's latest 10-Q and tell me if you can come to any other conclusion than this company will soon be bankrupt.
CONCLUSION
Love him or hate him — and he is widely reviled by the stockholders of many companies he targets — Asensio's book is well worth reading. I'll let him give the last piece of advice:
"There are two things that every investor can do to foil stock fraud: Don't be cynical, be skeptical. And be informed. Due diligence does not mean perfunctory, one-source research. It does not mean taking as gospel the pronouncements of a broker or some financial pundit. And it most definitely does not mean taking the advice of some stranger phoning at dinnertime from a boiler room in New Jersey."
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Just say NO to stock fraud!
A very good post
worth reposting over here. Link included. Reposting links from other boards is allowed as the chairman here has done it on numerous occassions.
http://messages.yahoo.com/bbs?.mm=FN&action=m&board=4687979&tid=astn&sid=4687979&...
continued listing requirements
by: marycummins (35/F/Los Angeles, CA)
Long-Term Sentiment: Strong Sell 07/15/01 07:09 pm
Msg: 124808 of 124808
http://www.nasdaq.com/about/nnm1.stm
minimum bid $1. Net assets of $4M.
.
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Just say NO to stock fraud!
Related parties transactions
See all the self dealing to the board members? This was from last quarterly report. There is also mention in there about their deal with the stock promoter continental capital getting over 800K for his 1999 promotion of the stock from $1 or $2 to $18.
4. RELATED PARTY TRANSACTIONS
The Dover Group, Inc.
Ashton has utilized The Dover Group, Inc. ("Dover") for consulting services related to Ashton's financings and product development efforts. Fredric W. Rittereiser, Ashton's Chairman and Chief Executive Officer, is the sole stockholder, director and officer of Dover. Ashton paid consulting fees to Dover amounting to $80,000 and $135,000 in the nine-month periods ended December 31, 2000 and 1999, respectively. Effective September 1, 2000, Ashton and UTTC entered into an employment agreements with Mr. Rittereiser, and the consulting arrangement with Dover was terminated.
On January 14, 1998, Ashton and UTTC entered into an agreement with Dover and Mr. Rittereiser, whereby Dover and Mr. Rittereiser agreed to reimburse Ashton and UTTC for $413,980 in legal costs associated with a lawsuit brought by David N. Rosensaft against Ashton and UTTC (the "Rosensaft Lawsuit"), to the extent such costs were not covered by Ashton 's directors' and officers' liability insurance carrier. Dover and Mr. Rittereiser pledged 250,001 shares of UTTC stock as collateral in support of their agreement to pay the legal costs ("Agreement to Pay Legal Costs"). On March 4, 1998, the U.S. District Court for the Southern District of New York entered an order awarding damages against Dover and Mr. Rittereiser in the Rosensaft Lawsuit in the amount of $1.2 million.
Ashton and its subsidiary, UTTC, had previously been dismissed as parties to the Rosensaft Lawsuit. On April 7, 1998, Ashton's Board of Directors, after due deliberation, concluded that Ashton and UTTC derived mutual benefit from the Rosensaft settlement entered into by Dover and Mr. Rittereiser. The Board resolved to fund one-third of the $1.2 million settlement amount. Separately, UTTC agreed to fund one-third of the Rosensaft settlement. On April 8, 1998, pursuant to a Repayment Agreement, Ashton loaned $380,000 to Dover and Mr. Rittereiser at an annual interest rate of 9% for thirty months to satisfy their portion of the Rosensaft settlement. In exchange for the loan to satisfy the Rosensaft settlement, Dover initially pledged 300,000 shares of Ashton common stock under its control to Ashton. On March 20, 2000, Ashton , Dover and Mr. Rittereiser amended the agreement and reduced the number of shares of Ashton common stock subject to the pledge from 300,000 shares to 63,500 shares.
Ashton has determined that it will not receive any payments from its insurance carrier in connection with the claim it filed related to the Rosensaft Lawsuit. As a result, on April 3, 2000, Ashton's Board of Directors resolved to accept from Dover and Mr. Rittereiser shares of Gomez common stock owned by Dover equivalent in value to the amounts due Ashton and UTTC under the Repayment Agreement and the Agreement to Pay Legal Costs, or approximately $884,564, as full and complete satisfaction of the debts. The Board agreed the number of shares of Gomez stock to be transferred to Ashton and UTTC would be valued at the initial public offering price of the shares or such other price as determined by Ashton's Board of Directors. On October 8, 2000, Ashton extended the maturity date on the $380,000 note to Dover for a period of ninety days, during which time Ashton's Board of Directors would determine the valuation of the Gomez common stock and the resulting number of shares to be transferred to Ashton. The Board agreed to accept, as of November 23, 2000, 216,805 shares of Gomez common stock in satisfaction of the amounts due Ashton. The price of the common stock was determined by the Board based upon the price of the Gomez Series D Preferred Stock issued in October 2000, discounted by 20% to reflect the liquidation preference and dividends applicable to the Gomez Series D Preferred.
As a result of the acceptance of the Gomez common stock in November, Ashton recorded other income of $413,980 for the reimbursement of legal costs. However, due to Ashton's equity method of accounting for Gomez, Ashton recorded a loss in affiliates of $884,564 offset by the $413,980 of other income and the $470,584 received as satisfaction of the note receivable and accrued interest.
In April 2000, Mr. Rittereiser entered into an agreement with Morgan Stanley Dean Witter, whereby he pledged certain shares of his Ashton common stock in exchange for a loan in the amount of $500,000 (the "Rittereiser Loan"). Morgan Stanley requested Ashton provide additional credit enhancements to secure the Rittereiser Loan, in the form of a guarantee of the loan by Ashton. Ashton agreed to guarantee the Rittereiser Loan up to $500,000, on the condition that Mr. Rittereiser secure Ashton's guarantee with sufficient personal collateral pledged to Ashton and on the condition that the guarantee shall only extend until such time that Mr. Rittereiser repays the Rittereiser Loan or locates other collateral to substitute for Ashton's guarantee. Mr. Rittereiser agreed to secure Ashton's guarantee of the Rittereiser Loan with a first lien on certain real estate that he owns, which is valued in excess of $500,000, and has agreed to repay the Rittereiser Loan and/or locate substitute collateral for Ashton's guarantee within a reasonable period of time.
Adirondack Capital, LLC
In 1997, Ashton retained Adirondack Capital, LLC to provide investment banking and financial advisory services. K. Ivan F. Gothner, a member of Ashton's Board of Directors, is the Managing Director of Adirondack. Ashton paid consulting fees to Adirondack amounting to $90,000 in each of the nine-month periods ended December 31, 2000 and 1999. In addition, Ashton paid Adirondack a fee of $75,000 in September 2000 to terminate a fee agreement for advisory services provided by Adirondack to eMC. Additionally, during the nine months ended December 31, 1999, Ashton paid Adirondack $287,500 pursuant to the Private Equity Line of Credit Agreement, and Gomez paid Adirondack $50,000 for its assistance in structuring the private placement of the Gomez Series B Preferred Stock.
Wyndham Capital Corporation
In 1997, Ashton retained Wyndham Capital Corporation to provide investment banking and financial advisory services. Thomas G. Brown, a member of Ashton's Board of Directors, is the President and Managing Director of Wyndham. Ashton paid $25,000 in consulting fees to Wyndham during the nine months ended December 31, 1999. Effective September 1, 1999, Wyndham's consulting fees were terminated and Mr. Brown began receiving a monthly board retainer upon his election to the Board.
Kronish, Lieb, Weiner & Hellman LLP
Kronish, Lieb, Weiner & Hellman LLP, the law firm of which Herbert Kronish, a director of Ashton, is a Senior Partner, acted as counsel to Ashton and its subsidiaries in various matters since 1998. Ashton paid aggregate fees of $55,385 and $79,732 during the nine-month periods ended December 31, 2000 and 1999, respectively, to Kronish, Lieb, Weiner & Hellman LLP for legal services.
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Just say NO to stock fraud!
Calp II, Southshore, TK Holdings, Kernaghan...
Look at all the TK funds involved in this deal. What will happen now that Valentine and his partner are splitting? They controlled these funds together.
(1) This registration statement covers the following: (a) the resale by CALP II Limited Partnership of up to 1,333,333 shares of our common stock, which we sold to CALP II pursuant to a private placement in February 2001; (b) the resale by TK Holdings, Inc. of up to 933,945 shares of our common stock, 733,945 which we issued to TK Holdings in a share exchange and 200,000 of which are issuable upon the exercise by TK Holdings of its beneficial interest in the Series K Warrant; (c) the resale by Southshore Capital Fund Limited of up to 150,000 shares of our common stock issuable upon the exercise by Southshore of its beneficial interest in the Series K Warrant; (d) the resale by Advantage (Bermuda) Fund Ltd. Of up to 40,500 shares of our common stock issuable upon the exercise by Advantage of its beneficial interest in the Series K Warrant; and
(e) the resale by CALP Limited Partnership of up to 109,500 shares of our common stock issuable upon the exercise by CALP of its beneficial interest in the Series K Warrant.
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Just say NO to stock fraud!
Self dealing to director Gothner
He was already given the shares. This was for the potential toxic convertible death spiral financing.
This prospectus covers 7,450,000 shares of our common stock that Jameson Drive, LLC, a selling stockholder, may offer and sell from time to time. We will issue the common stock under the terms of a securities purchase agreement dated February 9, 2001, and the exercise by Jameson of a stock purchase warrant issued in connection with the securities purchase agreement. We also executed a registration rights agreement on February 9, 2001, wherein we agreed that we would file a registration statement covering the resale of the shares of common stock that we may sell to Jameson. According to the terms of the securities purchase agreement, we may sell our common stock to Jameson only after we have successfully filed the registration statement of which this prospectus is a part.
This prospectus also covers 50,000 restricted shares of our common stock that we issued to Adirondack Capital LLC, a selling stockholder, for its assistance in structuring the securities purchase agreement with Jameson. K. Ivan F. Gothner, a director of Ashton, is a managing member of Adirondack. The shares issued to Adirondack become freely transferable and nonforfeitable on February 9, 2002, provided Adirondack's relationship with us has not been terminated.
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Just say NO to stock fraud!
New SEC filing
FORM 12b-25
NOTIFICATION OF LATE FILING
(Check One): (X) Form 10-K ( ) Form 20-F ( ) Form 11-K ( ) Form 10-Q
( ) Form N-SAR
For Period Ended: March 31, 2001
[_] Transition Report on Form 10-K
[_] Transition Report on Form 20-F
[_] Transition Report on Form 11-K
[_] Transition Report on Form 10-Q
[_] Transition Report on Form N-SAR
For the Transition Period Ended:______________
Read Instructions (on back page) Before Preparing Form. Please Print or Type.
Nothing in this form shall be construed to imply that the Commission has
verified any information contained herein.
If the notification relates to a portion of the filing checked above, identify
the Item(s) to which the notification relates:____________
PART I - REGISTRANT INFORMATION
The Ashton Technology Group, Inc.
Full Name of Registrant
Former Name if Applicable
1835 Market Street, Suite 420
Address of Principal Executive Office (Street and Number)
Philadelphia, PA 19103
City, State and Zip Code
PART II - RULES 12B-25(b) AND (c)
If the subject report could not be filed without unreasonable effort or expense and the registrant seeks relief pursuant to Rule 12b-25(b), the following should be completed. (Check box if appropriate)
(x) (a) The reasons described in reasonable detail in Part III of this form could not be eliminated without unreasonable effort or expense.
(x) (b) The subject annual report, semi-annual report, transition report on Form 10-K, Form 20-F, 11-K or Form N-SAR, or portion thereof, will be filed on or before the fifteenth calendar day following the
--------------------------------------------------------------------------------
prescribed due date; or the subject quarterly report of the transition report on Form 10-Q, or portion thereof will be filed on or before the fifth calendar day following the prescribed due date; and
( ) (c) The accountant's statement or other exhibit required by Rule 12b-
25(c) has been attached if applicable.
PART III - NARRATIVE
State below in reasonable detail the reasons why Forms 10-K, 20-F, 11-K, 10-Q, N-SAR, or the transition report portion thereof, could not be filed within the prescribed time period.
The Registrant is renegotiating the terms of a financing arrangement which would provide necessary capital to its business operations. On June 19, 2001, the Registrant requested the withdrawal of a registration statement covering the resale of 7,450,000 shares of its common stock to be sold pursuant to an equity line financing arrangement entered into in February 2001. The withdrawal was requested to modify the structure of the equity line transaction in a manner that could not be achieved within the context of the registration statement as filed. The results of this renegotiation will require the Registrant to significantly change the classification of items in its financial statements and the notes related thereto, and the discussion of its liquidity and capital resources. These changes could not be made in time for the Registrant to file its Form 10-K on the prescribed due date without unreasonable effort or expense.
PART IV - OTHER INFORMATION
(1) Name and telephone number of person to contact in regard to this notification
Arthur J. Bacci (215) 789-3300
--------------------------------------------------------------------------------
(Name) (Area Code) (Telephone Number)
(2) Have all other periodic reports required under Section 13 or 15(d) of the Securities Exchange Act of 1934 or Section 30 of the Investment Company Act of 1940 during the preceding 12 months or for such shorter period that the registrant was required to file such report(s) been filed? If the answer is no, identify report(s). (X) Yes ( ) No
(3) Is it anticipated that any significant change in results of operations from the corresponding period for the last fiscal year will be reflected by the earnings statements to be included in the subject report or portion thereof? ( ) Yes (X) No
If so, attach an explanation of the anticipated change, both narratively and quantitatively, and, if appropriate, state the reasons why a reasonable estimate of the results cannot be made.
--------------------------------------------------------------------------------
The Ashton Technology Group, Inc.
Name of Registrant as Specified in Charter
has caused this notification to be signed on its behalf by the undersigned hereunto duly authorized.
Date July 2, 2001 By /s/ Arthur J. Bacci
----------------- -------------------------
Name: Arthur J. Bacci
Title: President and Chief Operating Officer
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Just say NO to stock fraud!
Funding situation
I'd posted that kernaghan was having an internal situation and were splitting up. This is from Chell on Friday. CALP and Advantage are controlled by the same entities. they are just dealing with themselves. CALP is invested in astn remember. Chell is bud of Valentine.
(10) Canadian Advanced Limited Partnership II is controlled by its general
partner, VHM Management, Ltd. an Ontario Corporation. As of April, 2001, VHM's
directors are Mark Valentine and Ian MacKinnon. Ian MacKinnon has resigned and
is in the process of being replaced. Neither of the companies nor any of their
principals/directors is in any way related to us. Canadian Advantage Limited
Partnership II is the assignee of a US$3,000,000 convertible debenture issued by
us to the VC Advantage Limited Partnership
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Just say NO to stock fraud!
I can post numbers
but not my opinion? These boards are all about opinions. You just posted your opinion. I will post my opinion.
I believe astn is a poor investment. They have never shown a profit in seven years. They are running out of funds. They have no new funding lined up. The CEO has a checkered past as do two other directors, Valentine and Gothner.
Do not remove my ontopic post which is not a tos violation.
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Just say NO to stock fraud!
I predict price lower on Monday
My predictions will probably change every day also. I believe that when the bad report comes out and we see the true COH, "consulting" fees...the price will go lower. It may even set an alltime low.
Thoughts anyone on whether or not they will have the financing wrapped up by Monday? Will they have a deal in hand? Will they have going concern language in the annual report? I believe they should. I also think that because they waited this long, they may not have financing.
Would you like to know who suggested to Matt that sara be made the chairman here? Your's truly. May the experience be enjoyable.
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Just say NO to stock fraud!
More days under a buck
It's now over a month that they are under a buck. Whenever there is something negative fred always says he doesn't care, it doesn't matter... It's called negative pr spin. It's his job to spin and lie. That's what he does.
This figure will change every day like the vwap volume so I shall post it every day.
07/13/01 0.860 0.900 0.840 0.900 48,900
07/12/01 0.850 0.890 0.850 0.860 40,700
07/11/01 0.860 0.900 0.850 0.850 76,100
07/10/01 0.930 0.940 0.870 0.900 155,400
07/09/01 0.870 0.960 0.860 0.940 108,100
07/06/01 0.910 0.910 0.880 0.880 40,600
07/05/01 0.900 0.930 0.880 0.910 62,900
07/03/01 0.910 0.970 0.870 0.940 28,900
07/02/01 0.910 0.920 0.860 0.910 53,400
06/29/01 0.960 0.990 0.900 0.980 68,100
06/28/01 0.810 0.980 0.810 0.960 156,000
06/27/01 0.860 0.860 0.800 0.840 147,300
06/26/01 0.930 0.950 0.850 0.880 120,500
06/25/01 0.930 0.940 0.890 0.930 92,800
06/22/01 0.950 0.960 0.910 0.930 34,600
06/21/01 0.950 0.980 0.920 0.950 104,400
06/20/01 0.960 0.960 0.910 0.960 45,600
06/19/01 0.980 1.000 0.940 0.950 61,600
06/18/01 1.000 1.000 0.930 0.990 46,000
06/15/01 1.000 1.000 0.950 0.970 21,800
06/14/01 1.000 1.020 0.960 1.000 27,800
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Just say NO to stock fraud!
You have made your points before bop
If you continue to repost them, it will be considered thread disruption and spam and should be deleted by the chairman, director and or matt. There must be nondiscriminatory enforcement of the TOS. If people here can post over and over why astn is such a good stock, then I can post why it is not. If all of us can only make one post about astn on this board, it should be in the ibox. If sara can post vwap every day, I will be posting the share price every day. I am only on this board to test Matt and his promised fair enforcement of the TOS.
Here is a new point. Fred has no formal education at all. He has two years of police science, that is it. I don't think this helps him in the ceo department. He also cannot manage his own money. He lost his boat through forclosure. If he can't manage his own money, how can he manage the funds of a large company. I don't believe he is doing a good job in that department. I also don't believe he keeps his word. He was sued by a uttc person and lost. He didn't keep his word to the guy. He was also sued by his exboss and lost. His exboss is the sherwood group who took over first jersey. Yes, First Jersey of Brennan infamy. Fred worked with him over there. Fred was the ceo of the sherwood group also for a short time and was fired then sued. What did he do? Something which prevented him from coming into astn directly. He had to come in through Dover.
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Just say NO to stock fraud!
bird of prey
1. They have been in business since 1994 and have not been profitable in seven years. They projected profits in 1999 along with a share price of $30. The company projected the profits. The company stock promoter projected the share price.
2. They have tried to find normal funding and failed. They did a toxic convertible last year which took the price from $18 to $2. They still did nto turn over all the shares from the last convertible deal and are trying to get another one. Dilution and the share price will drop lower. Not a good investment.
3. They are trying to go ahead with the toxic deal but they all cannot agree on the terms to keep the old toxic convertible people happy.
4. Yes, they could do a reverse split. Having to do a reverse split is not good for shareholder confidence or value. It is not a good thing.
5. They promised critical mass of vwap in 1999. It's 2001 and still no critical mass. They promised profits in 1999. No profits. They don't keep their promises. The ceo said on his FWF webcast that he was suing certain posters. He only sued one of them. The ceo made numerous promises and projections which never materialized. Go listen to all his FWF.
6. The current director Ivan Gothner was the managing director of the mob company during the time of the illegal boiler room and stock fraud. He is also a director in the divisions of the company. He arranged the toxic deal for a fee. I realize the deals aren't illegal, they are just bad for the companies. SEC and FBI investigation is still ongoing. See their press releases.
7. ASTN hired Westergaard to get the share value up after the mob boiler room pulled out. Westergaard did not have his disclaimer during the time of ASTN coverage on astn stock promotion. Westergaard is currently being sued for astn coverage. The main bit of evidence is his posts where he tells people to mortgage their homes to buy this stock and to do it on margin. Fred saw what westergaard was doing and obviously approved of it. Fred was a licensed trader. Not anymore. He knows the SEC regulations about disclosure.
8. See response seven. CEO of CCE is in jail for fraud. See sec.gov documents.
ASTN IS A VERY BAD INVESTMENT. The report out monday will be bad. The share price will go lower.
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Just say NO to stock fraud!
ASTN is not a good investment
No profits, very little money, product not fully operational, bad financing, mishky pishky business dealings and associates...
1. They are currently not profitable.
2. They are currently running out of funds.
3. They are getting ready to do some toxic convertible financing which will probably lower the share price besides cause even more dilution. The entities doing the financing Kernaghan/Mark Valentine/TK Holdings/Calp II/Southridge have been sued for stock manipulation and fraud in relation to other almost identical financing. Jameson Drive entity is a Cayman Island strawman probably controlled by the above entities. Kernaghan has six current securities investigations in Canada. He's been partners with people who have been sued for securities fraud in the past. He is currently a director in ASTN uttc.
4. They could possibly be delisted if they slip under $1 for too long. They've been under a buck for a month now.
5. They have not been able to keep their promises or projections most of the time. They are years behind with their vwap product and becoming profitable. The product is still not fully operational and for "some reason" the market is not accepting it's usage fully.
6. The mob was involved in their ipo. They boiler roomed and pump and dumped the price keeping it artificially high from the time of their ipo to 1998 from about $7 to $15 or so as per charts. All other information as per SEC and FBI litigation releases. After their IPO company First United was going out of business and dropped their stock support, Fred hired the managing director who is currently a director in the company. He also set up the upcoming funding for a fee.
7. 1998 they hired John Westergaard to promote their stock. He was later sued by the SEC for that promotion and others for lack of a disclaimer. He told investors they should mortgage their house to buy this stock. They should do it on margin also he said.
8. 1999 they hired CCE to promote their stock. They were able to get it from $2 to $18 or so. When they stopped their promotions, the stock fell back down to $2. They were paid over $800K in 1999 for their promotion. They were also sued by the SEC for fraud, lack of disclaimer and insider trading.
Face it folks. ASTN does not have a lot of good things going for them. For anyone to say that right now astn is a good investment must either be in deep, a total fool or a paid promoter. There is a very good chance that ASTN could go out of business when the money runs out. They needed to be profitable yesterday in order to survive.
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Just say NO to stock fraud!
laforza<~~~crappy car
crappy car~~~>laforza
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Just say NO to stock fraud!
junk mail
for you
tee hee tee hee
.
oh yeah, jmhollen has a few user names here. I thought it was a tos violation but I guess not as matt doesn't care.
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Just say NO to stock fraud!
litter
.
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Just say NO to stock fraud!
trash
.
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Just say NO to stock fraud!
and this too
isn't deleting junk fun guys?
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Just say NO to stock fraud!
please remove this
.
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Just say NO to stock fraud!
more litter
my grandkitties, they're so sweet, jmhollen is a scorned stock promoter who lost big in tmot. tee hee tee hee
.
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Just say NO to stock fraud!