BlackStar Enterprise Group Inc (BEGI)

[Bubae]

"... the Company could be exposed to further risks of lawsuits for similar issues." Pay attention to that comment in the Q3 filing related to the current lawsuit. Per the Q3 filing and the 8K filed for the note in November 2020 it would appear that Quick Capital is entitled to convert that defaulted debt at a 50% discount to the lowest trading price during the delinquency period. It looks to me like Quick Capital benefited during this period of delinquency when the company was converting other debt eventually driving the price to as low as $0.0001 in October 2023. The note reads "lowest Trading Price" not lowest closing trading price. Quick Capital is claiming an outstanding amount due on the note is $133,317. If you read over the default terms of the note you can see how they calculated that figure.

Until now there really wasn't much to go after but retail and the promoters have now run this stock up so it should be a feeding frenzy for note holders who will be preying on the hapless. 700 million shares at stake in the GS Capital Partners lawsuit. If you calculate the defaulted claim amount at $0.00005 a share for Quick Capital you are looking at 2.6 billion shares. If you go by 50% of the lowest "closing price" even for this stock in October of $0.0002 which is $0.0001 you have 1.3 billion shares. Looks like another one for a judge to decide. Meanwhile they are selling the balance of the 698 million shares issued at $0.00017. At least as long as the volume holds up. This is fun to watch!


For the quarterly period ended September 30, 2023
https://www.otcmarkets.com/filing/html?id=17069009&guid=25J-k6VdULSidth

ITEM 1A. RISK FACTORS
The risk factor included in the periodic report for the prior quarter ended June 30, 2023, is incorporated herein by reference.
The following additional risk factor shall be added:
A LAWSUIT WAS FILED AGAINST THE COMPANY ON NOVEMBER 6, 2023.

On November 6, 2023, GS Capital Partners LLC filed a lawsuit against the Company in Nevada regarding the unavailability of conversion shares relating to the Promissory Note entered into on October 11, 2021 and the remaining principal balance of $33,682. The plaintiff is seeking specific performance for the reserve of 700,000,000 shares, or damages in excess of $15,000, plus interest, costs, and legal fees. The lawsuit increases the company’s financial and administrative burdens and is a risk to the Company’s capital. Although the Company is attempting to settle the dispute by paying the note in full, there is no guarantee that this will settle the matter in its entirety. The Company may need to increase the authorized shares of common stock in order to accommodate any judgments or settlements, and the Company could be exposed to further risks of lawsuits for similar issues.


NOTE 7 – CONVERTIBLE NOTES

In April 2022, Quick Capital LLC issued a notice of default on its $33,275 convertible note to the Company dated November 16, 2020 and stated that the outstanding amount due on the note is $133,317, the default interest per annum is 24%, and that the conversion price is the lowest trading price during the delinquency period with a 50% discount. The Company has recorded accrued default interest on the note at the rate of 24% per annum from May 24, 2021 (date of default) to September 30, 2023 based on the original loan value of $33,275. At September 30, 2023, the accompanying financial statements reflects an outstanding loan balance due to Quick Capital LLC of $33,275 and accrued interest of $9,569. The Company and Quick Capital LLC have been in discussions to reach a reasonable and fair settlement of the balance due on the financing agreement.

FORM 8-K
Date of report (Date of earliest event reported): November 20, 2020
https://www.otcmarkets.com/filing/html?id=14531150&guid=CoJ-kqs1ahwqJth

ARTICLE III. EVENTS OF DEFAULT
...the Holder shall be entitled to use the lowest Trading Price during the delinquency period as a base price for the conversion with the Variable Conversion Price shall at the option of the Holder be redefined to mean fifty percent (50%) multiplied by the Market Price, subject to adjustment as provided in this Note. For example, if the lowest Trading Price during the delinquency period is $0.50 per share and the conversion discount is 50%, then the Holder may elect to convert future conversions at $0.25 per share. If this Note is not paid at Maturity Date, then the outstanding principal due under this Note shall increase by Ten Thousand and No/100 United States Dollars ($10,000).