Despite its small size, this is definitely the single worst company I’ve ever shorted…this morning, this is what I sent to TIMalert subscribers:
Shorted 3000 GWSC at $2.76, Up 1000% & A Late SEC Filing…i’ve talked about this in my premarket watchlists, Thinkorswim seems to have plenty of shares available…this is a pump & dump as they have paid for all the press they’ve received, their contract is dubious and they just delayed filing their quarterly report in THIS SEC filing yesterday they didn’t have a PR announcing the delay, only positive PRs of course!)…the stock is up from 25 cents/share in a few days, still a low marketcap, still risky, but i kepy mt position small as i can and will build my short if it continues spiking…volume has already begun to fade and there was a classic morning panic all the way down to $2.20ish so there is some solid downside today…my goal is to cover under $2 as I think shorts have simply been squeezed and now reality will set in
Check out the ridiculous pump & dump chart (learn more about this pattern in my original PennyStocking DVD as it happens over and over and it’s the one pattern that made me a millionaire:
On top of this being a chart that looks to be rolling over, there are mannnnnny verrrrrry nasty segments I’ve lifted from the company’s last quarterly report SEC filing HERE (their most recent one was just delayed yesterday…which they didn’t have a PR for, it was just another SEC filing HERE…true incompetence/embarassment)
My favorite parts from the following: the company has less than $1,000 cash, no audited financials, they’re delinquent in paying suppliers, they can’t pay their workforce so they’ve laid people off, they can’t raise $ because lenders want personal guarantees from management (who don’t appear to be willing to give those), they’re in a legal battle with rumored stock promoter/manipulator Douglas Furth & Co. (one of the largest shareholders in the blatant pump & dump SPNG) and they have a $100,000 loan that they can’t pay back!
Yup, it’s pretty much the worst news all around, the only positives, which they are quick to mention in PRs galore (which they’ve paid for with big cash compensations) is that they’ve submitted plans for a big solar project…yup, that’s right, they didn’t win any contract, they just submitted plans…and given the company’s dire financial situation and sketchy sketchy background, I’d say the chances of them winning this contract is less than 10%…
Oh yes, that CEO interview on SmallCapVoice.com the other day was paid for with (read the disclaimer HERE):
GWSC: Small Cap Voice received $40,000 from the company and 150,000 restricted shares subject to Rule 144 of the Securities Act of 1933 from the Company on 7-15-08 for 90 days of service. Small Cap Voice received an additional 275,000 restricted shares subject to Rule 144 of the Securities Act of 1933 from the company on 11-15-08 for an additional 180 days of service.
Kinda funny that SmallCapVoice.com’s 275,000 restricted shares just became unrestircted in the last month, hmmmmmmmmmmmmmmmmmm aka the SEC is incompetent if they don’t halt this stock for blatant stock manipulation!!!!!!
And that positive SmallCapSentinal feature the other day that was ticker spammed to every major solar stock….that was paid for too with 30,000 shares:
Integrity Media Inc. (IMI) provides no assurance as to the subject company’s plans or ability to effect proposed actions and cannot project capabilities, intent, resources, or experience. The subject companies haven’t always approved the statements made in this report. This report is neither a solicitation to buy nor offer to sell securities and is for information purposes only and shouldn’t be used as basis for investment decisions. IMI isn’t an investment advisor, analyst or licensed broker dealer and this report isn’t investment advice. IMI is the beneficial owner of 30,000 restricted shares of GWSC provided by Emerging Markets Consulting LLC, an investor relations consultant to GWSC, for this report and other advertising services. Paid reports constitute a conflict of interest as to IMI’s ability to remain objective in communication regarding subject companies.
As if they’re actually gonna any contract with $780 in cash!!!!! The only thing this pump & dump is certain of is that the company is gonna use this spike in stock to raise precious capital in order to survive…my guess is in the $0.75 cents-$1 range, which would still be 3-4x what the stock was trading at before the pump happened.
My God, I love classic pump & dumps like this, they’re SO OBVIOUS with a little research (I explain my research process for 6 hours in my TIMfundamentals instructional DVD package)
Anyway, besides the stock manipulation, here’s the nasty SEC filings with the laughably horrific parts in bold:
The accompanying financial statements have been prepared by the Company without audit. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations, and cash flows at January 31, 2009, and for all periods presented herein, have been made.
For the Three Months Ended
January 31, 2009 2008
REVENUES $ 50,916 $ 150,878
COST OF GOODS SOLD 3,129 105,001
GROSS PROFIT 47,787 45,877
January 31, October 31,
2009 2008
ASSETS (unaudited)
CURRENT ASSETS
Cash $ 780 $ 7,101
Accounts receivable, net 5,830 5,945
Inventory 123,916 127,044
Total Current Assets 130,526 140,090
PROPERTY AND EQUIPMENT, net 28,700 32,702
TOTAL ASSETS $ 159,226 $ 172,792
Common stock issued for services at $0.58 per share 2,200,000
Our operating expenses had increased significantly during the last quarters of 2007 as we increased our office facilities, hired new employees and consultants, increased our ecommerce sales, and increased our competitive bidding activities; in 2008, due to a lack of operating capital and
our inability to acquire purchase order and accounts receivables financing, as well as equity financing, we had a series of layoffs, dramatically decreasing our workforce. We also could not complete occupying our new facility (Suite C12 in our existing complex) and began negotiations
with our landlord for assistance in subleasing that facility. Our lack of financing has also affected our ability to complete some orders in a timely fashion.
Because of our cash flow problems, during the quarter ended January 31, 2009 we were delinquent in paying many of our existing suppliers, and our credit rating declined. Our efforts to obtain accounts receivable, purchase order and inventory financing suffered a setback in September 2008 due to a significant decline in our stock price, caused by a group of control shareholders and brokers (which activity is the subject of a lawsuit by the company). Since stock warrants were part of the contractual compensation for our financing agent, this significant fluctuation in stock price affected our ability to raise equity capital. Moreover, the domestic, and then global, financial crisis which followed negatively affected our ability to obtain any type of purchase order, accounts receivable, inventory financing, or equity financing. We are continuing to negotiate for the necessary financing, but the credit crisis and broad economic downturn has caused both significant delays in our obtaining such financing, and much stricter requirements for obtaining such financing, with financial institutions and factors charging higher rates, demanding more comprehensive guarantees (including, in most cases, personal guarantees from our senior management), and requiring our customers’ end-users to qualify as credit worthy. This has negatively affected our business operations.
We are struggling to satisfy our basic cash requirements and we need to raise significant capital to continue as a going concern. We also have significant outstanding invoices from suppliers, some of which are overdue and which are negatively affecting our credit lines with our suppliers.
There can be no assurance that we will raise sufficient funds to continue our business operations.
Cash at the end of the period was $780, as compared with $85,929 at the end of the corresponding period in 2008. Our accounts receivable at January 31, 2009 were $5,830, with inventory of $123,916, as compared with accounts receivable of $102,607 and inventory of $99,881 at
January 31, 2008. We currently do not have any significant cash resources, and our need for capital is our most significant business concern and the single most significant factor limiting our growth. The significant decrease in our accounts receivable compared to the corresponding period
last year was caused by our inability to finance our sales contracts in a timely manner.
On May 27, 2008 the Company filed a lawsuit in the United States District Court, Central District of California, Case No. SACV08-00586 CJC (PLAx) alleging securities law violations and fraud against Douglas G. Furth individually and allegedly dba Millennium Consulting Group, Inc., a defunct Ohio corporation; Mark Fixler; JAG Enterprises, LLC; Michel Attias; Brendon Attias; Timothy Garlin; and various DOE defendants for disgorgement of short-swing profits in violation of the Securities Exchange Act of 1934, Section 16(b) and for recovery of damages for fraud and deceit. On August 7, 2008 we filed a First Amended Complaint adding, among others, defendants Comprehensive Financial Services, LLC, an Ohio limited liability company; The Signature Fund, a purported Ohio limited partnership; Signature Management, LLC, an Ohio limited liability company; Marc J. Bernstein; Legent Clearing LLC, a Nebraska company; UBS Financial Services, Inc., a California company; and
National Financial Services LLC aka Fidelity Investments National Financial Services, a Massachusetts company. Many of these defendants have answered and filed counterclaims, which we intend to vigorously contest.
One of our noteholders has agreed to forebear on the collection of a promissory entered into on September 1, 2007 with the company. As consideration for a six (6) month extension of the loan term, the parties agreed to the following: (i)The interest rate listed was changed from a
fixed rate of 12% per annum to 15% per annum, with payments due on the 15 th of each month; (ii) the conversion rights of the principal and unpaid interest remained, but the conversion rate was repriced at thirty cents ($0.30) per share; and (iii) the company also agreed, in consideration of its appreciation of her assistance and cooperation in extending this loan, to grant the noteholder stock equivalent to the amount of shares which would be purchased by a 10% interest “payment” on her loan. This amount, $10,000.00 (or 10% of the loan) yielded 50,000 shares of stock at a price of $0.20 per share. This was a one time nonrefundable and additional “interest” on her loan. The $100,000 loan, with accrued unpaid interest of approximately $9,000, was due March 1, 2009 and has not yet been repaid.
We are presently negotiating with certain bondholders to convert their bond debt into a combination of common and preferred stock, with designated privileges and preferences, including voting rights, which designations and terms are still being negotiated. The notes are secured by UCC-1 and a security agreement and our inability to renegotiate the notes could result in a foreclosure by the bondholders under their UCC-1 and security agreement.
Posted in Incompetence, Manipulation, Short Selling