Replies to post #14836 on Sunset Island Group Inc (SIGO)

[jimr1717]

It looks to me as though anyone that bought from $2.00 to $1.00 will be left holding the bag.

[loanranger]

There's an obvious problem with this deal. The Certificate of Designation for the Series doesn't "fit"the issuance to the note holders.

re:
"It looks to me as though anyone who has that class of shares, shares in a percentage of the $200 per lb from each harvest, so if let's say five people hold those shares equally a couple years from now, they would receive around $40 per lb for their share. I could be wrong, but that's what it looks like."

There are two separate and distinct corporate actions involved.
1. The CofD describes the series this way:
"consists of 8,000,000 shares of Series B Convertible Preferred Stock"
"The Series B Preferred Stock shall receive a cash dividend of $200 per pound that the Company harvested from its cultivation operations. The dividend shall be paid quarterly."

They should have been more careful, because they then did this:
2. "The Company issued 305,700 shares for the $305,700 note payable."

So this CAN'T be true:
"the Company converted its note payable into its new Series B Preferred Stock. The Preferred Stock has no conversion right or no voting rights. The shareholders of the Series B Preferred will be entitled to $200 per pound that is sold by the Company."


As you can see, the CofD wasn't written to pay a quarterly dividend of $200 per harvested pound to the holders of 305,700 Preferred B shares. It says "The Series B Preferred Stock shall receive a cash dividend of $200 per pound". The way it reads assumes that the dividend is due to the SERIES, which is 8,000,000 shares, so as it stands the unquantified and unidentified holders of 305,700 shares of the series would be entitled to 305,700/8,000,000 x $200/lb of harvest quarterly or less then $8/lb per quarter.
Something tells me that that is not what was intended. But that's what they did.

It needs to be fixed.