iTeknik Holding Corporation (ITKH)

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With a float of miniscule 164M and OS of 233M (unrestr. 174M) common shares (07/03/2019) https://www.otcmarkets.com/stock/ITKH/security and an annual revenue of $3.4M ITKH, should sail upwards after settlement was reached 07/10/2019 http://www.superiorcourt.maricopa.gov/docket/CivilCourtCases/caseInfo.asp?caseNumber=CV2017-003585
http://www.superiorcourt.maricopa.gov/docket/CivilCourtCases/caseInfo.asp?caseNumber=CV2017-003585

The market cap is grossly undervalued: A fair value market cap at 4 times the P/S ratio equals a pps of 0.058 which is 22 fold higher than the current pps

The company increased revenue from 2017 by 23% from $2,751,982 to $3,375,038. The company was actually break-even if not for the $900,000 disputed interest charge.
From the last PR: Overall iTeknik shows a net loss of $934,573 for the 12 months ending December 31, 2018. This loss includes $900,000 in disputed interest charges that iTeknik did not pay but has accrued on its books pending the outcome of its litigation with TCA Global Fund. Management believes that the Company will prevail in litigation and a major portion of the accrued interest will not be paid. In addition, the loss includes $88,155 of extraordinary legal expenses that the Company did pay. Without these extraordinary expenditures iTeknik would have made a net profit of 1.6%. What is encouraging about our profit situation is that in the last seven months of 2018 iTeknik averaged 4.3% net profit and posted a December net income of 6.2%, excluding disputed interest payments and extraordinary legal costs.

Management believes there are factors that will continue to support revenue growth and earnings improvement. First, Big Rhino is expected to continue to grow and increase its operating income. Secondly. Management expects its ligation with TCA to be resolved in 2019. This would allow the Company to implement its strategic plan and seek additional acquisitions. Acquisitions can provide iTeknik with the economies of scale that can help to increase earnings.

2019 Focus
First and foremost, Management will focus on its dispute with TCA Global Fund. Management expects either to prevail in court or reach an amicable resolution through settlement negotiations. Once this dispute is settled the company will be able to complete the audit started in 2017. After the audit is complete the Company will seek to become fully reporting as an OTC QB designated company. As an OTC QB company, Management is confident it will be able to secure the financing to acquire other advertising agencies.

Summary to the litigation (earlier post by Benosufan):

"I think it's great that a company is standing up for shareholders and not just allowing TCA to get away with fraud. If you know the whole story about how TCA screwed this company you would understand why the company is not releasing PRs and updates. They want the best outcome for shareholders. Basically TCA obtained assets from another company in default...sold those assets to ITKH without disclosing incurred debts that came along with the assets. ITKH considered TCA in default of their agreement and asked for the 300k in escrow back...TCA refused and considered ITKH in default and wanted to basically convert the debt. ITKH protected shareholders by filing a lawsuit against TCA.

Litigation details: On April 4, 2017, the Company filed suit in the Arizona Superior Court (case No. CV2017-003585) against the TCA Global Master Credit Fund, L.P. due to TCA’s uncured default for inducing the Company into the transaction by misrepresentation, and omissions related to the Asset Purchase Agreement Dated December 30, 2016 and related
documents.
Under advice of corporate and litigation counsel on April 4, 2017 the Company filed for relief in the Arizona Superior Court against the TCA Global Master Credit Fund, L.P. for among other things inducing us into the transaction by misrepresentation and omissions more specifically as defined as: failure to release escrow, sleading financial projections and undisclosed debts related to the assets among other things. Our litigators chose to bring the action in
Arizona because the assets are and have always been located in Arizona and the foreclosure that TCA had previously completed to take title to the assets, prior to selling them to us occurred in Arizona under Arizona statutes. We had previously offered TCA an opportunity to discuss the open items to come to an amicable solution that involved the payment by TCA of their expenses that we incurred, the immediate release of the funds still held in escrow for us, and an alteration in the repayment plan and or a reduction in the purchase price. Instead, TCA responded to our notice of
default to TCA and attempts to amicably negotiate and on March 29, 2017 by sending us a notice of default with a 10-day notice to cure by paying all fees TCA claims without offset of the monies the company has claimed is owed to us by TCA. Under advice of counsel we elected to file suit first to preserve or rights for the benefit of our shareholders.