Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
BREAKING; Bolzan Brothers attempt to reduce their losses take $1,000,000 position in Global Digital Solutions (GDSI)
Merger completed.
202m OS
$145m revenue
EPS .717
Current share price .43. 60% discount vs earnings.
Industry PE is 15. This should be at
$10.75. Should get interesting.
If fully diluted, DILUTION DILUTION DILUTION!!!
Which would mean
the entire 400m AS is issued
the EPS would be $0.36 with a modest PE of 12. It’s pps would be $4.32
$1b Yuen (1yuen = .143314 usd) $145m usd/ 400m OS = $0.36 x 12 (PE) = $4.32
Figures are rounded.
If all 400m are issued by the merger date, an additional 1.6b would need to be Authorized and then issued to the new owners to fulfill the 80% ownership clause indicated in the PR. That’s an OS of 2b shares.
$145m/2b = .0725 EPS. With the same conservative PE of 12. The PPS still comes in at $0.87 a share.
This example is using an absolute worst case scenario based on what is currently know.
If we used what is reported 36m OS ( rounded up to 40m) and the reported 80% ownership post merger for a total OS of 200m then the figures are as follows
$145m rev / 200m shares = $0.725 EPS x 12 (PE) = $8.70 pps, post merger.
All figures based on currently available information.
GLTA.
Disagree with your interpretation of My post, as usual.
It is not an interpretation, it states the code as written. (See my stickie)
Posting excerpts of laws are not interpretations. They’re the laws as written.
See stickie titled “Foreign judgment directly enforceable.”
That is directly quoted from the Brazilian Civil code. It literally says “Foreign” in the title of the section not Domestic.
There is no Judgement yet. There is nothing for BSF to send to the Brazilian courts, BK or otherwise. Neither Brazilian Law nor Concise Undisputed facts in evidence support such an interpretation.
Incorrect. You are interpreting two different codes dealing with two totally different and unrelated issues.
The Brazilian civil code. Adopted by the Brazilian judiciary clearly states That foreign court rulings signed by a Judge are considered to be serviced and Recognized and move immediately to enforcement.
I have given no interpretation. I have quoted the Brazilian civil code adopted 2015 enacted 2016.
I would link it but I’m pretty sure no one here reads Brazilian Portuguese.
You’re trying to conflate issues that are not related to this litigation.
The Brazilian civil code. Adopted by the Brazilian judiciary clearly states
That foreign court rulings signed by a Judge are considered to be serviced and Recognized and move immediately to enforcement.
Not as long as you may think.
Brazilian law provides that CERTAIN TYPES of contracts and negotiable instruments take a speedier route in civil proceedings, GOING STRAIGHT TO THE ENFORCEMENT PHASE. THESE ARE CALLED enforceable certificates, and are divided into judicial (COURT and arbitration PROCEEDINGS)
Brazilian civil code adopted 2015
Enacted 2016.
The Judgement and Award handed down is an enforceable certificate as defined by Brazilian law. Enforceable certificates move immediately to Enforcement, there is no additional “service or Recognition” needed or required by law.
BSF made a “Concise statement of undisputed facts” that completely dismantled the AD claim filed by Rontan. AD claim/motions are the opinion of council and not facts nor law. The undisputed facts are those in evidence and agreed to be true by both parties. AD is not an option for Rontan.
GDSI is not obligated to file a claim in Brazilian BK court for the simple reason that until there is a judgement and award, there is nothing to base claim on. They would be in violation of the law to file a false claim without judgement.
Under Brazilian BK laws. Rontan is required to disclose the litigation
{Under Brazilian Law, interests in a Sociedade Limitada cannot be forcefully transferred.}
contractual sales are not “forced” actions. This does not apply.
Adjudicated disputed contractual sales are not “forced” actions either and again this does not apply.
You made a claim that there were no Parallel “court cases” and then you post the link to a Brazilian case running Parallel to the case in Florida. With the exact same Defendants. “Rontan and the Brothers Bolzan. “
On top of that. The article claims that after judicial review and forensic break the plan for Rontan to repay Creditors(taxes) $750m BRL, ($191m USD) could be approved soon after a February recess.
Rontan, the company that is broke and can’t even pay an award to GDSI if one was ordered. But can enter into a repayment plan to pay off $191m in back taxes.
The same Rontan that cant afford to pay its most excellent, all knowing, superior lawyer Mr. Carlos Osorio ~$200k or it’s previous most excellent council Jake Baccari and Kelly Pena the ~$80k it owes them.
“The decision of the creditors will still have to undergo judicial approval, which should occur soon after the end of the forensic recess in February.” (Excerpt from the link)
Looks like Rontan can easily meet the financial conditions needed to pay a settlement or judgement.
If there is an award of Specific Performance with incidental damages. GDSI will be the owner of a marketable enterprise with turnkey revenue substantial enough to pay off $191m in debt in a short period of time plus ~ $90m cash. $100m purchase price less $191m in undisclosed tax liabilities. Obviously the taxes must still be paid thus the offset in the purchase price.
Hopefully there is a considerable amount already paid down on the liabilities as this arrangement would have been finalized in the 1Q of 2019. As this article is from Dec 2018.
Not going to bother with the profits taken by the Bolzan’s for the past 5 years. What we know as fact to this point is quite substantial.
Wonder How many of the lawyers involved with the reorganization collect a paycheck from BSF also??Maybe none. Maybe some. The next 60 days should prove quite interesting. Maybe Rontan brings in new council in the 11th hour. Ohhh now that would be fun.
GLTA
Where did I say court case? I said “action”. Keeping another court informed is an action. Not a case.
About “Service” as it seems there is some contention on this matter. Probably since it occurred so long ago.
Maybe this will take care of that issue.
April 3, 2018: "Just a quick update. We are awaiting confirmation of service in the Rontan legal matter. It is a very precise process and I am very happy with the work being done by BSF and their partners in Brazil.
“Partners in Brazil”
Looks like BSF has been running this through the Brazilian courts in a parallel action with the US/Florida courts.
Imagine that, an International law firm that knows the laws of the country in which they seek remedy.
Could you link us to the “promotion” you speak of. Thanks.
This new Docket Entry clearly states that GDSI wishes to affirm the SPA, in other words , take ownership of Rontan provided the award of “Specific Performance” includes “Damages Incidental” to offset from the agreed purchase price the undisclosed tax liabilities.
Undisclosed tax liabilities are in the $100s of millions ( Brazilian R) according to depositions but no financial statements were ever submitted during discovery to corroborate. KPMG estimated the Tax liabilities at $112m USD for 2015.
DE 205. 02/07/2020
GDSI is entitled to Specific Performance under the Well-pleaded Allegations of the First Amended Complaint and the Undisputed Facts Already in the Record. .. 4 B. Plaintiff's Well-Pleaded Allegations and the Undisputed Facts Establish GDSI's Entitlement to Specific Performance and Damages Incident to Specific Performance under Florida Law (citations omitted for this post)
GDSI Has a Right to Affirm the SPA and Seek Both Specific Performance and Incidental Damages ............................................................................ 11 4. Damages Incident to a Decree of Specific Performance to Account for the Undisclosed Tax Obligations Are Appropriate
Pursuant to this Court's authorization at the Calendar Call on January 29, 2020, plaintiff Global Digital Solutions, Inc. ("GDSI") moves for a legal ruling establishing that, under Florida law, the Court may enter both a judgment against defendants Joao Alberto Bolzan ("J.A. Bolzan") and Jose Carlos Bolzan ("J.C. Bolzan) for specific performance with respect to their shares in Grupo Rontan Electro Metalurgica, S.A. ("Rontan") and a judgment against defendants J.A. Bolzan, J.C. Bolzan, and Rontan for incidental damages in the amount of the undisclosed, unpaid tax obligations of Rontan.
On January 23, 2020, GDSI filed a motion for entry of default judgment as to all Defendants. [D.E. 193.] Defendants have failed to respond to the motion. Their subsequent failure to appear at the status conference on January 24, 2020 and at the calendar call on January 29 are additional grounds for entry of a default judgment
The Court expressly recognized that, under Florida law, GDSI would be entitled to both specific performance and damages for the same breach if an award of specific performance would not place it in the condition it would have been in had Defendants not breached the SPA: 2 The Defendants' motion to dismiss for lack of personal jurisdiction was denied.
Had Defendants not falsely represented the status of Rontan's tax obligations, GDSI would not have agreed to pay the purchase price set out in the SPA. Instead, the purchase price would have reflected the tax obligations, a significant liability of Rontan that was purposefully misrepresented. Put another way, GDSI bargained to acquireâ?? and Defendants agreed to sellâ??Rontan without the burden of the undisclosed tax liabilities. A judgment for specific performance without an award of incidental damages will only result in GDSI acquiring a much-devalued Rontan as a result of the tax liabilities Defendants did not disclose.
Florida law is clear that, at the upcoming bench trial, GDSI is entitled to seek specific performance of the SPA. It intends to seek such relef, provided that it is allowed to recover damages in the amount of the undisclosed tax obligations as incident to a decree of specific performance.
The SPA provided that the "Purchase Price" consisted of three components: (i) cash payments totaling R$100,000,000, payable "in equal monthly installments over a period of forty eight (48) months following the Closing Dateâ?¦" (SPA at §2.1.1 (emphasis added)); (ii) "R$100,000,000 of shares of [GDSI's] common stock," transferable at Closing (id. at §2.1.2.); and (3) future "earn-out" payments that were contingent upon Rontan's future financial 13 1 performance, with payments starting (if at all) more than two years after Closing (id. at § 2.1.3). Accordingly, ……the SPA did not require GDSI to make any cash payment to the Bolzans at closing.……… 8 This purchase price was predicated on the Defendants' express representation and warranty in the SPA that, as of the execution of the agreement, "Rontan has timely paid all the Taxes due, and complied with all Tax obligations in accordance with the applicable law."
GDSI would seek a reduction of the purchase price equal to the amount of all unpaid tax liabilities that the Defendants failed to disclose, as well as reasonable attorneys' fees and costs. In the event that the amount of the tax undisclosed tax obligations exceeds the purchase price, GDSI would seek a money judgment in the amount of the excess.
ARGUMENT A. GDSI is entitled to Specific Performance under the Well-pleaded Allegations of the First Amended Complaint and the Undisputed Facts Already in the Record. 4 1 In the context of Defendants' motion for summary judgment on specific performance, this has already determined that the SPA may be enforced through a judgment of specific performance. In reaching that ruling, the Court analyzed Florida case law and the record evidence in this case and concluded that specific performance "is an appropriate remedy for breach of contract under the facts of this case." [D.E. 181 at p. 13.] As the Court explained: Here, the undisputed facts are as follows. First, the Bolzan brothers 'are the sole shareholders of, and control ... Rontan.' (DE 94 ~ 2). Second, its shares are not publicly traded. (Kelley Decl. â?10). Third, 'Rontan is one of the largest manufacturers in the industry.' (DE 94) Just like the bottled glass business in Hogan v. Norfleet, 113 So. 2d 437, 439 (Fla. 2d DCA), Rontan is a going business, the value of which would be difficult to ascertain. As its shares are not publicly traded, they have no fixed or readily discernable value. [D.E. 181; Nov. 25, 2019 Order at 9.] Since the Court's entry of that Summary Judgment Order, nothing has changed in the record or in Florida jurisprudence to alter this conclusion.
This post consists of excerpts from DE 205 and does not include Citations.
You are conflating two different things. The Brazilian court Recognizes US courts. It has nothing to do with the lawyers.
Rontan et al already tried that. The judge rejected their argument.
My source is the BRAZILIAN CIVIL CODE. not the OPINION of some ambulance chaser in a foreign country.
Lawyers all have opinions of what the law says. That’s why there are so many of them. Judges decide what it actually says and set rules. such as the BRAZILIAN CIVIL CODE.
It’s not an interpretation it’s is the written Brazilian Civil Code. Adopted by the superior court 2015.
Brazilian Civil Code adopted 2015 addresses the issues your expert is lacking knowledge in. See the excerpt from the Brazilian Civil Code in my stickie.
Service; by responding to the original complaint via legal council, Rontan has acknowledged service of the claim. (See legal definition for service)
Recognition; the standard for recognition is set by Brazilian Civil code. It is not a phase or court proceeding. The Brazilian court recognizes order and awards handed down and signed by Foreign Federal/district Judges.
Awards that meet the Brazilian Civil codes requirements for Service and Recognition are enforceable under Brazilian law.
Lawful SERVICE was established see docket for Rontan et al response by council to numerous filings with the Florida district court.
Judgement/order will be signed by a US federal judge and a certified copy will be presented to the Brazilian court. The Brazilian court RECOGNIZES duly signed and adjudicated orders from Foreign courts or Arbitration’s with the signatures of at least two (2) witnesses.
Mr Isaacson is a recognized leader in international law. He is also appearing before the court in this matter for a specific cause and has been granted an appearance before the court.
It’s not a treaty it’s Brazilian civil code.
There is no “Recognition phase” recognition is already established by Brazilian law that duly adjudicated litigation from a foreign court is recognized. Brazilian Civil code adopted 2015.
They stated they were seeking “Specific Performance” as remedy.
Meaning they wish for the contract to be enforced with compensation for lost revenue since the breach. (Incidental damages)
It’s in their motion for Default Judgement.
DE 204
02/05/2020PAPERLESS ORDER granting [203] …Plaintiff's Motion to Appear Pro Hac Vice, Consent to Designation, and Request to Electronically Receive Notices of Electronic Filing for Attorney William A. Isaacson. William A. Isaacson may participate in this matter on behalf of Plaintiff. The Clerk of Court shall provide all electronic filings to William A. Isaacson at wisaacson@bsfllp.com. Signed by Judge Donald M. Middlebrooks on 2/5/2020.
The big dogs always come in for the verdict.
Partners get the credit, not the associates.
DE 203
02/04/2020Plaintiff's MOTION to Appear Pro Hac Vice, Consent to Designation, and Request to Electronically Receive Notices of Electronic Filing for William A. Isaacson. Filing Fee $ 75.00 Receipt # AFLSDC-12396242 by Global Digital Solutions, Inc. Responses due by 2/18/2020
Hmmm seems that Isaacson is very much involved in the GDSI v Rontan et al. Litigation.
So strange,
The Bolzan’s and Rontan et al had exactly that opportunity in the southern district of Florida, in front of Judge Middlebrooks and Judge Brannon and failed to convince either of them that any of the claims you have made here are true.
DE202
01/29/2020NOTICE OF TRIAL: Bench Trial set for 3/4/2020 at 09:00 AM in West Palm Beach Division before Judge Donald M. Middlebrooks. (gm1)
01/30/2020Deadline(s)/Hearing(s) terminated. The Jury Trial set for February 3, 2020 is cancelled. This case is set for a Bench Trial on March 4, 2020 at 9:00 am.
DE 201 in part;
20101/29/2020PAPERLESS Minute Entry for proceedings held before Judge Donald M. Middlebrooks: Calendar Call held on 1/29/2020. Attorney Appearance(s): Carlos Mario Sires, Esq. and James Grippando, Esq. Defendants did not appear. Bench Trial set for March 4, 2020 at 9:00 am. Total time in court: 10 minutes.
Specific Performance means they are asking for the contract to be enforced.
This means the transfer of Rontan to GDSI under the terms of the contract $50m cash, $50m stock less whatever “incidental” damages would be awarded for the 5 years hence. (Short version from DE 193 and it’s subsequent memorandums)
Rontan had revenue of $128m for 2014-15 so damages for at least one of the 5 years can be calculated from those figures. We would need the information, Rontan has refused to provide under discovery, for the years 2016- present.
I have not seen in any filings where BSF has stated any figures for this purpose as they would need the financials for the remaining years in question.
We can however speculate where that figure might be by using the information that is available.
If we used a conservative figure and estimate that there were 20% net profit from operations we could extrapolate that each year would be about $25m (based on the $128m for 2014-15) x5 which would fully offset all the monetary obligations of GDSI in the execution of its obligations under the SPA, plus an additional $25m-$50m that would be owed GDSI.
Hope this helps a little.
GL
Specific Performance + incidental Damages and Costs.
As Defendants have failed to file a notice of appearance, it seems that they may not appear at calendar call. In that case, Plaintiff has indicated its intent to waive its demand for a jury trial. Accordingly, I find good cause to grant an extension of the deadline to file proposed jury instructions or findings of fact and conclusions of law until after calendar call on
January 29, 2020,
when it is clear whether this case will proceed to a jury trial.
The request for time is a formality in lieu of the pending ruling on the Default Judgement.
The court could just rule in favor of the MDJ and dismiss the Extension request as being moot.
We will know in the next few days
GDSI (DE 199) request extension for pretrial meeting to set Jury instruction till after the court rules on the Motion for Default Judgement. (DE193).
PhenixBlue. The information you posted is incomplete. The information I posted is supplemental and completes the information you have provided.
The law says that a Foreign action must be “recognized” by the superior court ( your links) the Rules for Civil procedure ( my excerpts) gives the standards by which the superior court “recognizes” a foreign action. Specifically a “court action” from a foreign country is recognized.
The Rules enacted May 2016 from which that excerpt is taken specifically state “COURT PROCEEDINGS”.
A default judgement for GDSI is a “court proceeding.”
The litigation, GDSI v Rontan is a “court proceeding.”
The award will be a court proceeding if the court orders one in lieu of a settlement. Foreign court proceedings are immediately “RECOGNIZED” and “ENFORCEABLE” under current Brazilian law/rules of civil procedure.
Most unique scams ever. A person could more than doubled their investment on 3 scams involving the same person at the same time.
Ohhh the humanity!!
Foreign judgment directly enforceable.
Brazilian law provides that CERTAIN TYPES of contracts and negotiable instruments take a speedier route in civil proceedings, GOING STRAIGHT TO THE ENFORCEMENT PHASE. THESE ARE CALLED enforceable certificates, and are divided into judicial (COURT and arbitration PROCEEDINGS)
this litigation is a court proceeding. IT IS IMMEDIATELY RECOGNIZED AND IMMEDIATELY ENFORCEABLE under Brazilian law.