Replies to post #30479 on CSMG Technologies, Inc (fka CTGI)

[choctaw]

Totally agree....it is my main concern regarding CTGI's future. When the CEO first announced he was in bed with La Jolla, I knew then that things must not be going well. I kick myself for not immediately selling out and sitting on the sidelines until such time as it appeared La Jolla Cove was no longer a "threat". If the PPS ever gets to .32(my break even point),its SELL,SIT and WATCH. Once La Jolla is neutralized, I'll be back. Best of luck to all of us.

[sojourner]

Re: "I have no evidence of a pending lawsuit. It would, however, be naive to think that La Jolla will not pursue this claim vigorously. Like Cornell, La Jolla's..."

First, two; then one; now none. Sounds much better. lol

La Jolla Cove Investors declared CSMG in default of a financial obligation as of December 16, 2008. La Jolla's formal notification of default was dated January 28, 2009. La Jolla gave CSMG exactly $125,000 cash in total. "La Jolla claims that it is entitled to $402,629.28 under the terms of the Debenture based upon acceleration of 118% of the principal of the Debenture together with all accrued and unpaid interest to the date of payment. CSMG is not aware of any other material obligations that it has that may arise, increase, be accelerated or become a direct financial obligation as a result of the above triggering event or the increase or acceleration of the Debenture to La Jolla."

It's now December 13, 2009, a year following the claim of default as of December 16, 2008, La Jolla's "vigor" in pursuing the matter is nowhere to be found in the record anywhere. Their apparent insouciance is telling. Not quite a Cornell here. My guess is La Jolla and CSMG will settle the matter with shares just like CSMG did with Cornell. The dreaded Cornell converted its remaining loan to CTUM shares at $0.70/sh on Oct 17, 2007.

http://www.pinksheets.com/edgar/GetFilingHtml?FilingID=5950494
"The Company (CSMG) in 2005 was advanced $600,000 under a convertible debenture. In accordance with this agreement, the Company has been repaying this through issuances of stock under Rule 144. The Company on October 18, 2007 repaid the remaining $242,000 in principal along with interest in the amount of $132,687 with the issuance of 535,267 shares of common stock to YA Global Investments, L.P. There is no further indebtedness to YA Global Investments, L.P. These shares were issued pursuant to an exemption from registration under Section 4(2) of the Securities Act of 1933, as amended. The purchaser of these shares is aware that they are restricted. There were no warrants or options issued in the Cornell transaction."

http://cf.us.biz.yahoo.com/e/090205/ctgi.pk8-k.html
Form 8-K for CSMG TECHNOLOGIES, INC.

5-Feb-2009
Triggering Events That Accelerate or Increase a Direct Financial Obligation
Item 2.04 Triggering Events That Accelerate or Increase a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement.

The Registrant ("CSMG") received on February 2, 2009 a certified letter dated January 28, 2009 from La Jolla Cove Investors, Inc. ("La Jolla") declaring an event of default with respect to a 6% Convertible Debenture dated November 17, 2008 in the principal amount of $1,500,000 that matures on November 30, 2011 ("First Convertible Debenture") issued under a Securities Purchase Agreement dated November 17, 2008. Under the Securities Purchase Agreement, La Jolla paid $125,000 to CSMG and issued a Secured Promissory Note (the "First Secured Note") in the amount of $1,375,000 dated November 17, 2008 that is due and payable on demand by CSMG at any time after November 30, 2011. La Jolla stated that an event of default had occurred under the Convertible Debenture following the entry of judgment against the Company and in favor of Banco Panamericano, Inc. in the amount of $726,491.41 on December 16, 2008 and the failure of CSMG to timely pay interest under the Debenture. La Jolla claims that it is entitled to $402,629.28 under the terms of the Debenture based upon acceleration of 118% of the principal of the Debenture together with all accrued and unpaid interest to the date of payment. CSMG is not aware of any other material obligations that it has that may arise, increase, be accelerated or become a direct financial obligation as a result of the above triggering event or the increase or acceleration of the Debenture to La Jolla.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

99.1 Letter of Default from La Jolla Cove Investors dated January 28, 2009