On January 17, 2017, an investment firm filed a civil complaint against the Company in the Third Judicial District Court of Salt Lake County, State of Utah, alleging breach of the terms and conditions of a convertible debt instrument. The Company contested the allegations. On September 29, 2017, the Third Judicial District Court of Salt Lake County, Utah, ordered an arbitration award to the plaintiff in the amount of $164,563.22. The Company is negotiating with the Plaintiff on settlement of the award.
On September 14, 2017, the Company entered into a “Settlement Agreement and Stipulation” (the “Agreement”) with an Investor providing for the issuance of unrestricted share of the common stock of the Corporation under Section 3(a)10 of the Securities Act of 1933, as amended, in settlement of $866,210.45 in debt owed by the Company to the Investor under several convertible promissory notes included in the September 30, 2017 financial statements of the Company.
On November 2, 2017, the United States District Court For The District of Maryland, Northern Division (the “Federal Court”), issued a federal court order (the “Court Order”) as the result of a “Fairness Hearing” conducted on November 1, 2017, Case No. BPG-17-2758, (i) which stated that the Agreement is “hereby approved as fair” to the Investor and to whom the shares will be issued over time, within the meaning of Section 3(a)10 of the Securities Act and that the sale of said shares to the Investor and their resale in the United States by the Investor, assuming satisfaction of all other applicable securities laws and regulation, will be exempt from registration under the Securities Act, and (ii) which ordered compliance with the Agreement by the Corporation and Investor, and (ii) reserved jurisdiction over the Corporation and Investor as well as the subject matter of the Agreement for purposes of contempt and enforcement of the Agreement as well as for such other purposes as allowed by law. As a result of the above, $866,210.45 in principal, accrued interest and fees owed the Investor is hereby to be converted to equity over time and the debt thereby extinguished.
I'm only going by TA and financial reports. I'm also assuming the dilution is from the settlement of the above lawsuits since it started right after the settlement date, but it could very well be some other noteholder. Most of the selling since Oct 20, has been due to the 850M cert, until 400M shares sold last report (200M + 200M - W/E 12/15/17 - see table below)
Week Ending: Number of shares sold Sale associated with Cert/Dilution -------------- ----------------------- ---------------------------------- 10/31/17 50M C 11/16/17 170M C 11/30/17 70M C 12/15/17 200M C 12/15/17 200M D
---------- 850M share cert....490M sold = 360M shares remaining 2 Lawsuits ~$1,032,000 - possibly around $500K converted (just a generous guess) -- We don't know if it's dilution from those lawsuits or another diluter. We also don't know the terms and if they convert per discount to prevailing price, therefore could be more or less) my guess is ~$500,000(+/-) remaining ------------
Class of Stock: Beneficial Owner: Amount/Nature: % of class ------------- --------------- -------------- --------- Series A Preferred SF Holdings, LLC 1,000,000 100
Series B* Preferred Dror Svorai 524,750 34.61
Series B Preferred Shalom Ohayon 396,500 26.15
Series B Preferred Yaniv Nahon 175,000 11.54
Following is number of preferred shares issued as a result of merger with Newgen Concepts (Simple Cork shareholders) that resulted in the above total of shares beneficially owned:
Series B Dror Svorai 262,250 ^ Yaniv Nahon 87,500 ^ Shalom Ohayon 396,500 ^ Arik Cohen** 140,000 ^ Avi Simhon** 140,000 ^ Asaf Cohen** 140,000
* Series B shares - Each = 1800 common ** Latter 3 shareholders hold less than 10%, therefore not included in the previous beneficial ownership table
We started the fiscal year with ~4Bil in outstanding -- today we have an additional Billion shares added despite the ex CEO Dror Svorai promising no dilution on Feb, 24 2017 in this letter here addressed to shareholders. Subsequent to that letter there was ~180M shares diluted which I didn't note -- only included totals from when preferred shares came off restriction in last week of October.
I'm not sure how much was diluted in the past 2 weeks (if any), although tbh, I spent very little time paying attention to VPOR lately (too many great plays right now), but whenever I took a glance at trading activity there certainly was all the indications with price action and dilution MM's on L2 that there was dilution on deck, and if that was the case -- it seems to be masked with what I can only assume is Simple Cork portion of preferred shares being returned to treasury and transferred to RC_GR, to offset any selling, however ~270M reduction would barely cover series B's issued as a result of merger with Simple Cork (see above table).I certainly hope that's not the final total!
IMO VPOR shareholders shouldn't have to foot that bill anymore, and majority of those shares should be returned to treasury, especially since we paid the bills and yet didn't see a single penny in sales, and now the IP is being transferred to another ticker, therefore SH's should see those shares returned so they can start to regain value lost due to dilution...It's the least they can do!
Note: please double check my math with deductions. I've been buried in numbers in past 2 wks researching many companies with multiple components open at all times that could be mistaken for another. You could say I over traded a lil last week ha ha :)
On a separate note, folks should be researching MMJ tickers now, and be ready to take advantage of the dips across the board from Friday before they start to regain momentum and rally, and don't waste too much time on one ticker -- it'll all be over before you know it!
