We see a scam in our crystal ball.
The first question we are loathe to ask is, why does it take 10 weeks to complete due diligence on a relatively small deal? DD on billion dollar acquisitions don't take this long. Don't be surprised if it gets extended just so the PUMP & dump can continue.
Our next question is, why haven't we heard of this asset before? Not anywhere on the company website and nowhere to be found within 10-Q filings. In fact, the May 18, 2011 10-Q lists total assets of $227,478 almost of all of which is prepaid expenses. The only liquid asset listed on the company's book is $603 in cash. In short, on March 31, 2011 this company had nothing, but suddenly it has a $15 million asset to sell! Yeah, sure. Now granted, the company did announce a project to convert waste into electricity in Bucharest six weeks earlier but how did this suddenly turn into a $15 million dollar sellable asset in just six weeks? And why sell it instead of enhancing your reputation in the industry? Hmmmm. Of course with these shenanigans conveniently taking place in Bucharest, it is hard to confirm anything.
Why announce a dividend before the money is in the bank? Well to pump the stock of course, which is supported by a coinciding touter's promotion. Even though the company has only 600 bucks in the bank, and the 10-Q states that it will need additional funding to remain a going concern, and even though the company owes money, and is being sued for unpaid wages, ADAC is going to distribute the entire proceeds of its phantom asset to the shareholders. Yeah, sure. To whit:
"Our auditors have issued an opinion on our financial statements which includes a statement describing our going concern status. This means that there is substantial doubt that we can continue as an on-going business for the next twelve months unless we obtain additional capital to pay our bills and meet our other financial obligations. This is because we have not generated any revenues and no revenues are anticipated until we begin marketing the product. Accordingly, we must raise capital from sources other than the actual sale of the product. We must raise capital to implement our project and stay in business."Here's another beauty. The company's CEO, Aviram Malik, last week announced that he is going to convert his entire debt to 1.5 cent common stock. Yeah, sure. Now which con are you running here Aviram? Are you converting the stock so that you can have a 6 cent dividend instead of 1.5 cents? Or are you giving the perception of conversion of a barely existent, if at all, debt? Notice that the press release announcing the conversion doesn't identify how much is owed to the CEO. It's been left open ended. The May 10-Q, however lists an obligation to officers and directors of just over $46,000. Assuming the entire debt is owed to him, that would give Aviram another 4,000,000 shares to add to the 7.5 million shares he originally purchased for $150. No we didn't leave out any zeros. 150 bucks!
ADAC is the cousin of another public entity, Global Energy, Inc. (GEYI), which has already failed in the same business that ADAC purports to be in. Both are being run by the same cast of schemers from far away Israel, far away from the regulators. If you want to send your money far away, we suggest that you go with it. Israel is a great place for a vacation.
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