This deal, run by convicted securities violator, Larry Moore, is so full of camouflaged pratfalls, that we did a lot of digging the last time. Those pratfalls alone should be enough to keep you away. If you haven't read our previous advisory on GRAS, then please do so right now. You can retrieve it by clicking here.
Since the last iteration of this ongoing Pump & Dump scheme, many have taken a 60% haircut. We think that many of those participating in the current round of promotions stand a chance to take even bigger losses.
One of the regulatory problems we pointed out last time that has yet to be corrected, is that GRAS's corporate status is in default. STILL! And the wrong officers are listed with the Nevada Secretary of State! This is Incorporating 101 here folks and GRAS employs attorney Charles Barkley. The SEC can halt trading in this stock at any minute because of this default status. Why would you buy stock in a company where the left and right hands do not know what they are doing?
But the latest con job the crook at GRAS is trying to foist upon you, is a phony $10 million share purchase by Ascendiant Capital Partners, Pump & Dump financing specialists. These are the same guys who "financed" massive Pump & Dump subject Jammin Java Corp (JAMN), a scheme in which some lost 90% of their investment over 10 weeks.
Equally scummy, are the touts who are promoting this fraud, triplets Stock Castle, Obscure Stocks and Wall Street Penny Stock Advisors, who are trying to make you believe that the financing is fait accompli. But read GRAS's press release.
"Under the terms of the agreement Ascendiant will purchase up to $10 million of the company's common stock over the next 24 months."This is far from having the money in the bank! Criminy, it's an agreement of up to $10 million. This could mean that GRAS will get only $1000! Want more? The deal hasn't even been filed with the SEC yet! No 8K! No contract! Nobody, outside of GRAS and Ascendiant knows exactly what the terms of the deal are! Why not? Because the insiders (which now includes Ascendiant) want a chance to dump stock before they file the bad news.
Bad news, we say? Yup. Think about it. The stock closed at 21 cents prior to this announcement. Do you think that Ascendiant is going to pay 21 cents? Not a chance! We don't think they are going to pay even 10 cents. But let's say they do. $10 million at .10 is another 100 million shares to be issued! And we'd bet that if there is a set price for the stock, warrants are also included in the deal and that will increase the number of shares outstanding even more. And this is with a company that already has virtually a billion shares outstanding, once preferred shares are converted.! Even if GRAS got all $10 million dollars today, does that make this company, with almost zero (if not zero) in sales, worth $300 million?
The worst part is that we think that we could be looking at death spiral financing here, as is often the case when money is trickled into a company. An example of trickling would be, "up to $10 million over 24 months". Under a death spiral financing scheme, stock is purchased by the financier at a steep discount to the market price. Once the financier sells a tranche of stock, he uses some of the money to buy more stock. The problem is that the stock he's dumped will cause the price to drop dramatically, meaning the next tranche will be purchased even cheaper. Then that sale of that stock drops the share price even more and so on. Death spiral financing has caused the demise of many hopes and dreams.
The last time we heard about GRAS from these very same touts was on July 19. At that time, they insisted that their audience:
"Get in early on the buying today as we expect a big jump today as the price has become much more attractive for investors."The stock dropped 15% that day and not no explanation was forthcoming from the touts. In fact, since those "attractive prices", the stock dropped as much as 60% and sits 40% below that day's high. And as soon as the touting went into hiatus, the volume dropped. This ladies and gentlemen is a text book Pump & Dump.
In return for spreading all this hooey, the touts received $100K and 3.5 million shares of GRAS. Do you really think that their efforts are worth $ 800K just for participating in this scheme? We promise you that the touts are not expecting $800K because they are not holding onto that stock for long. That's coming right out onto the street as soon as it is free trading. And at least some of it, if not all of it is free trading right now. Are you sucker enough to buy it?
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