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SuperDirectories Inc (SDIR) – fast mover or ticking time bomb?

30 Sep SuperDirectories Inc (SDIR) – fast mover or ticking time bomb?

 

Super Directories Inc (SDIR)

SDIR has jumped up from $.018/share to $.17/share on just 59,474 shares traded over the last 3 days.

 

 

SDIR filed a Form 15 on May 4, 2012 to stop being an SEC reporting company - a big red flag no matter how you look at it.  At the time SDIR had nearly 3 billion shares outstanding.

On June 4, 2012, SDIR did a 1:2500 reverse split.   This brought the share count down from from 2,903,247,174 to approximately 1,161,450.  It was the second huge reverse split for SDIR in the past 2 years.  They had previously done a 1:1000 reverse split on January 11, 2011.

Following the reverse split which wiped out the previous shareholder base, SDIR almost immediately issued a bunch more shares.

On June 21, 2012, the Company’s Board of Directors authorized the issuance of 850,000,000 shares of its common stock to its President and majority shareholder as compensation for services to be rendered to the Company, in accordance with an employment agreement executed on that date.

Since Luke Lalonde is the sole officer/director of the shell he basically just made an employment agreement with himself.

At the reset share price of $.018/share those 850,000,000 shares were worth $15,300,000.

At the current share price of $.17/share those 850,000,000 shares are worth $144,500,000.

In June of 2012, the Company also entered into an agreement with an anonymous consultant for a one-year term, in exchange for a total of 40,000,000 shares of its common stock. 

By filing a Form 15, SDIR avoids having to disclose the actual consulting agreement so we are not told who now owns those 40,000,000 shares.

At the reset share price of $.018/share those 40,000,000 shares were worth $720,000 (for 1 year of consulting). 

At the current share price of $.17/share those 40,000,000 shares are worth $6,800,000 (for 1 year of consulting).

Those 40,000,000 shares are listed as free trading on the OTC website.

 

 

I would love to know what attorney did the opinion letter to remove the legend off of 40,000,000 newly issued shares.  Seems really dirty and pretty illegal to me.

 

Aaron S. Goldberg

The attorney that was doing the Attorney Letters for the OTC for SDIR is Aaron S. Goldberg.  Aaron S. Goldberg (ASG Law Offices) is also legal counsel for ANDI/TITL, BRYN, and EKNL.  EKNL is the current Xtreme Picks stock promotion.  Aaron hasn't done a legal opinion for SDIR since August of 2011.

I found it interesting that Aaron Goldberg uses a yahoo email address to contact him instead of using the ASG Law Offices website

I also find it interesting that Aaron Goldberg isn't mentioned any where on the ASG Law Offices website.  According to his LinkenIn page he no longer works at the ASG Law Office.  He is now a Screenwriter / Sound Healing & Meditation at Way of the Gong.

 

Fun read here about Aaron Goldberg's spiritual journey to the Way of the Gong.

 

 

Since Aaron Scott Goldberg is still a licensed attorney with the state of California it is possible that he could still be acting as an attorney for public shells while doing his gong thing (though the two careers seem to contradict one another).

So for any legal opinions written by Aaron Goldberg since February of 2012, either Aaron Goldberg is pretending to still be at ASG Law Offices or somebody is pretending to be Aaron Goldberg.

SDIR hasn't done any attorney letters since August of 2011, but I noticed that Andiamo Corp (ANDI) came out with an attorney letter allegedly authored by Aaron Goldberg.  If you compare old signatures from Aaron when he worked at ASG Law Offices to the signature on the recent ANDI attorney letter you really have to wonder if the new ANDI letter is a forgery.

OLD SIGNATURE:

http://www.otcmarkets.com/financialReportViewer?symbol=ANDI&id=34042

ANDI SIGNATURE:

http://www.otcmarkets.com/financialReportViewer?symbol=ANDI&id=84987

 

More about SDIR

SDIR has never realized a penny of revenues ever in its history and has an accumulated deficit of almost $9 million giving SDIR the look of nothing more than a share selling scheme especially with 2 recent huge reverse splits and super discounted shares being issued to insiders.

Here is the SuperDirectories Inc website It is an ugly mess of what is supposed to be an organized directory of information.  It is no wonder the company has yet to realize any revenues.  Luke Lalonde transferred ownership of the website to SDIR in 2000 and that has been the primary focus of the SDIR business operations since that time.

The other attorney listed on the OTC website for SDIR is Gottbetter & Partners LLP who has been legal counsel for at least a couple of big paid promotions (AAST and RACK).

Going back through past SDIR filings we find one name keep popping up over and over again as being a paid consultant for SDIR, Frank G Wright.

 

Frank G. Wright (past consulting payments)

Buried in past 10K filings is lots of information about consulting payments in shares made to Frank G. Wright which were subsequently sold for large amounts of cash.  Many of those shares were also gifted to friends and family members of Frank G. Wright.  The following is from the 10K from 12/28/09:

Mr. Frank G. Wright was a consultant and a minority shareholder of the Company, holding 3.61% of our issued and outstanding common stock.  He has sold his shares back to the Company.  Mr. Wright was engaged as a consultant pursuant to a November 2004 written agreement previously included as an exhibit to our Form-10-SB, General Form for Registration on Securities.  Compensation was $90,000 plus options to purchase 7,605,000 shares of common stock.  The services provided, for which Mr. Wright received compensation, were the introduction of and negotiation with a number of CPA’s and Securities lawyers engaged in the public company practice; liaison among us and those professionals engaged by us, supervision and coordination of the work of the professionals engaged in preparation and filing for the Company pursuant to SEC’s regulations, and examination of the SEC commentary with respect to the overall effort.
 
Mr. Wright received a total of 7,452,900 shares on exercise of his option on April 11, 2005 and March 25, 2006.  The value for these shares was set at $0.50 per share ($3,726,450) as agreed to by the Company and Mr. Wright.  The exercise price was $0.01 per share.  Mr. Wright paid for these shares with 152,100 shares from his total grant of 7,605,000 in a cashless transaction.  In February 2006 Mr. Wright made a gift of 1,485,000 shares to 22 members of his family and 2 acquaintances.  He received no consideration for these shares and there were no fees or commissions paid.  No broker/dealers were involved, and the transferees were advised there was no market for the shares.
 
Commencing on August 1, 2006, we entered into an oral agreement with Mr. Wright to continue his consulting services.  His services included interviewing and recommending a person to be Chief Financial Officer, assisting in finalizing our Form 10-SB and future periodic filings.  He also served as liaison among Mr. Lalonde, counsel and auditors and reviewed the work of the professionals and the Company with respect to our obligations as a reporting company.  He was compensated $8,000 per month on a month to month basis.  He did not assist in raising capital or engage in any effort to promote or retain a public market for our securities.  He was not authorized to engage in any other activities on our behalf.  He was retained as a consultant only and was not a director, officer, or employee.  We did not enter into a written agreement, and there were no additional terms in the oral agreement.  Mr. Wright’s oral agreement was not extended and his services terminated as of December 31, 2007.
 
Mr. Wright, together with members of his family who received shares of stock in the Company as gifts from Mr. Wright, offered to sell back a total of 7,347,669 shares, or an aggregate of 4.6% of the outstanding shares of the Company.  On May 1, 2008, the Company acquired for cash consideration in a negotiated transaction all such shares for $0.025 per share, or an aggregate consideration of $183,691.72, of which Mr. Wright and his wife received $155,067.  The stock is not listed on any securities exchange or other trading market.  The book value per share at March 31, 2008 was $0.006 per share.

 

Those shares were sold back to the company because no registration statement was ever filed for the shares, therefore selling them into the market would have been an SEC violation.

We may be or become liable for a violation of section 5 relative to the registration of shares issued to a consultant, Mr. Frank G. Wright, pursuant to an option agreement if it is ever determined that we did not properly use Form S-8.  Mr. Wright received his option grant as a part of his compensation for services rendered.  One of the items provided for in the agreement was that Mr. Wright would assist in getting our stock quoted on the OTC Bulletin Board.  If Mr. Wright were to perform this service, the Company could not use Form S-8 to register the option shares issued to Mr. Wright.    Mr. Wright's agreement also provided he would not be required to perform any activity that would render Form S-8 unavailable. The test relied upon by the Company was whether or not SD authorized or requested that Mr. Wright perform an activity and whether Mr. Wright performed such activity at our request which would render our issue of securities in reliance on S-8 a violation of Section 5.  If a claim is made and it is ultimately determined that Form S-8 was not available to the issuer, we may face the same types of actions and claims against us discussed in paragraph 2 above. We cannot estimate the amount or nature of our liability, if any.  Mr. Wright has sold all of his shares back to the Company.

 

The most recent 10K also lists several preferred B shares recently issued for consulting services:

The Company entered into financial advisory and consulting agreements with various consultants mostly for one-year terms with effective dates starting in November 2010, in exchange for a total of 255,000 of its Series B preferred shares. The Series B preferred shares were issued in January 2011 and accordingly, the fair value of $ 4,716 was recognized in the accompanying consolidated statements of operations during the year ended September 30, 2011 under general and administrative expenses.

 

Since the Series B preferred shares convert into 2,500,000 common shares each those 255,000 Series B preferred shares issued for consulting services can convert into 637,500,000,000 common shares .

Since the 1:2500 reverse split did not effect the preferred shares, it seems obvious that the reverse split was to increase the value of the shares owned by the consultants and CEO with no regard for the retail shareholders.

The last financial report showed 12,253,840 preferred B shares outstanding as of June 30, 2012.  Fully converted that is 30,634,600,000,000 common shares.

I predict several more reverse splits in the future for SDIR at least until the SEC puts a stop to this share selling scheme.

 

Conclusion

SDIR appears to be a very ugly insider enrichment scam.  Insiders are being enriched with cushy consulting agreements, free trading stock, and preferred stock that converts into over 30 trillion common shares.

The long term future for SDIR is easy to predict.... lots of dilution and more huge reverse splits.  The messy looking website will probably never realize any significant revenues, but after 12 years of no revenues I'm not sure how anybody could expect anything else.

40,000,000 of the 40,171,600 free trading stock is control by an anonymous consultant so they control how high the SDIR share price will go before they start selling shares faster than buyers can be found. If they decide not to sell, the stock price has the potential to continue to rise very quickly.

It is possible we could see an awareness campaign of some sort kick off for SDIR especially since those 40,000,000 free trading shares are currently worth over $6.8 million, but SDIR is a very risky stock.  The history of the shell and the set up of the share structure make SDIR a huge gamble.  It will be fun to watch what happens with SDIR in the coming days.

 

 

 

 

 


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