BOLDFACE Group, Inc. (BLBK) Research Report

12 Aug BOLDFACE Group, Inc. (BLBK) Research Report

Boldface licensing + branding, a Nevada Corporation (“BLB”), was founded by Nicole Ostoya and Robin Coe-Hutshing beauty industry veterans with over 40 years combined experience.

BLB’s focus is on licensing top tier entertainment and designer brands for opportunities in the beauty market. BLB contracts to design, manufacture and sell branded color cosmetics, hair preparations, fragrances, home fragrances, skin care, beauty tools, and other beauty products in all channels.

BLB expects to launch its initial brand, “Khroma Beauty by Kourtney, Kim and Khloé” in December 2012 with a holiday collection at Ulta Beauty and other stores, followed by a full brand roll out in January 2013. The vision for the Khroma brand is luxury products at affordable prices in the mass retail channel. Other celebrity licenses are currently in negotiation. BLB has received written commitments to purchase Khroma products from Ulta Beauty, Sears, Kmart and Meijer, and is currently in active discussions with other retailers, including some of the largest pharmacy chains in the United States, regarding the Khroma products.

Boldface intends to capitalize on the extraordinary popularity of the Kardashian family and Mario Lopez.

http://www.boldfacegroup.com/#!home/mainPage

 

[color=red][b]The formation of the shell[/b][/color]

 

The shell was originally incorporated as Max Cash Media in July 2007 in the State of Nevada and remained Max Cash Media until June of 2012.

The stock was approved for trading under the symbol MXCS.OB

In July 2007 Noah Levinson was issued 5,000,000 founder shares at $0.001

As of Sepember of 2007 MXCS had $100 dollars in cash. Ironic for a company named Max Cash Media.

As of September 27, 2007 the company had zero revenues and expenses/loss of $16,593.

In September 2007 and October 1,370,000 common shares at $0.10 per share were sold in connection with a private placement for $137,000.

As a result Levinson owned 78.1% of the issued and outstanding.

An SB-2 filing was done for Max Cash Media, Inc to register 1,370,000 shares and bring the shell public on January 17, 2008.

Anslow and Jaclin served as counsel to bring the shell public and have connections with many pump and dump shells in the past.

One search of Greg Jaclin on Edgar will give you a long line of P & D tickers including JAMN, LBSR and probable future pumps such as BRND and more.

nodummy has Anslow & Jaclyn / Gregg Jaclin tagged on posts on PSS as well.

 

 

 

[color=red][b]The seed shareholders[/b][/color]

 

The original shares were held by 44 holders which were sold in a Reg D 506 offering completed in October 2007

In September 2007 and October we sold 1,370,000 common shares at $0.10 per share in connection with our private placement.

Tracy Baker 50,000
Alexander T. Balasco(1) 10,000
Byron Balasco(1) 50,000
Christopher Baumgartner 30,000
Brian A. Burdette (2) 5,000
Cynthia A. Burdette(2) 5,000
Jong Un Choe 50,000 50,000
Beverly W. Cline (3) 5,000
John Cline (3) 5,000
Lawrence Dodd 10,000
Russell Fuller 10,000
Harold Gignac (4) 30,000
Patricia Gignac (4) 20,000
Gerald E. Golt 20,000
James Hanlin 5,000
Kyung S. Hwang 50,000
David Ihn (5) 50,000
Myunghee Ihn (5) 50,000
Tai Ihn (5) 50,000
Eul S. Kang (6) 50,000
Jung R. Kang (6) 50,000
Myung Jae Kang (6) 50,000
Kyung Ae Kim 50,000
Donna K. Knight (7) 50,000
George M. Knight (7) 50,000
Joon K. Lee 50,000
Elizabeth H. Mays 20,000
John Messner 5,000
Won Sang Moon 50,000
Kevin Myers 10,000
Steven. Pyun (8) 50,000
Brian Pyun (9) 50,000
Dan R. Sanderson 5,000
Samir Shelat (10) 50,000
Sashi Shelat (10) 50,000
Noel Steven Simms 5,000
Angela Smelcer (11) 20,000
Hudson Smelcer (11) 20,000
Idea Nochole Trotter 10,000
Elizabeth Whitehead 10,000
William R. Wilkes 10,000
Frank S. Woody Jr. (12) 50,000
George G. Woody (12) 50,000
Riccardo L. Zimmerman 50,000

1) Alexander and Byron Balasco are brothers.
(2) Brian and Cynthia Burndette are husband and wife.
(3) John and Beverly Cline are husband and wife.
(4) Harold and Patricia Gignac are husband and wife.
(5) David and Myunghee Ihn are husband and wife and Tai Ihn is their daughter.
(6) Eul and Myung Kang are husband and wife and Jung is their daughter.
(7) George and Donna Knight are husband and wife.
(8) Steven Pyun is the brother of Irv Pyun, the Company’s Secretary.
(9) Brian Pyun is the son of Steven Pyun and the nephew of Irv Pyun, the Company’s Secretary.
(10) Samir and Sashi Shelat are husband and wife.
(11) Hudson and Angela Smelcer are husband and wife.
(12) Frank and Georgye Woody are husband and wife.

There is more to be researched here with the insiders and will be done at a later date.

6,370,000 Issued and Outstanding and that share count would stand until the forward split and subsequent merger and change to BLBK.

 

[color=red][b]The business plan[/b][/color]

 

Initially the business was to acquire and market intellectual property in the entertainment industry and would be introduced as a website destination for writers looking to market their ip.

They intended for a screenplay "Bring Back the Clowns" to be their first acquisition.

They mention Selma Hayek and her production company as a possibility to market their project, but did not appear to be actually connected and just served as storyline fodder.

The business office address for MaxCash was 50 Brompton Road, Apt. 1X, Great Neck, NY, 11021.

[i]The executive officers as of January 16, 2008 were:[/i]

[b]Noah Levinson:[/b] Founder Chairman, CEO and Director.

He acted as VP and Op Manager for http://www.refinance.com/.

He has a history in the entertainment industry and was assistant to Danny Devito in LA and made many contacts during that time. Subsequently, he created is own PR firm Citiwide Media.

[b]Irv Pyun:[/b] Secretary - acted as Senior VP of TriSure Benefits was also involved in TV and movies.

 

[color=red]Trying to find a reverse merger partner for the shell and players along the way:[/color]

The company remained status quo until the 10Q filed on August 14,2009 which stated that on July 28, 2009 the company issued a convertible promissory note to [b]Paramount Strategy Corp[/b] for $50,000 to get some cash towards making a deal.

On January 28, 2011, the Company extended the due date of the $50,000 convertible promissory note to July 27, 2012.

Paramount Strategy Corp address comes up as a Cayman Island PO BOX.

PO BOX 802 West Bay Cayman Islands KYI-1303.

[b]Andrew Meade[/b] signed for [b]Paramount Strategy[/b] as Director.

Andrew comes up as connected to prior pumps such as LIEG, NVIV and ESRI which may come into play in the future and will research at a later date as it has recent volume.

 

Paramount comes up in filings as a beneficial owner in LCTZ in 2008 which has been on the wrong side of the pump and spiralled from $4.00 in 2010 and trading at .02 currently.

Interesting note about Paramount - they were involved in what appears to be a mystery real estate purchase in Harbor Beach Florida in 2005 for a house that sold for $14 million dollars.

Have to put that money somewhere 😉

“Who bought 1 Isla Bahia is somewhat of a mystery. Property records show South Ocean Drive LLC acquired the property on Monday from Dr. Jacob "Jack" and Arlene Nudel. South Ocean Drive's address is care of a post office box number for Paramount Strategy Corp. in Grand Cayman, according to Florida corporate records. South Ocean Drive's manager is listed as Precise Properties of Tortola in the British Virgin Islands. It also has a post office box number for an address. Neither Precise nor Paramount have phone numbers listed with directory assistance. A MYSTERY Others involved in the sale wouldn't shed any light on it either. Joshua Gerstin, the buyer's Boca Raton lawyer, and Marilynn Obrig, an Intercoastal Realty agent who handled the sale, said confidentiality agreements prevented them from commenting.”

Gottbetter and Partners are the escrow, placement, collateral agent for various deals along the way in the MXCS/BLBK timeline.

[b]Gotbetter & Partners[/b] show up as counsel in promo tickers such as MSEH , RACK and countless others and [b]Bretton James, Inc.[/b] ends up as one of the beneficial owners in the new ticker BLBK.

[b]Adam Gottbetter[/b], the President of [b]Bretton James, Inc.[/b], has the sole voting and investment power over the reported shares. Gottbetter’s name is linked to literally hundreds of deals.

 

[color=red]1st Attempt -The Prism Corportion[/color]

 

That’s where things started to get interesting. An 8k followed on August 9,2011 where the company announced they were working on a reverse triangular merger with a private Oklahoma oil, gas and energy company, [b]The Prism Corporation[/b]. The company announced that they may conduct an additional private placement for up to 2,500,000 shares.

On August 9 the company had a first closing of a private placement for $1,000,000 principal on their 8% Secured Convertible Promissory Note. The note was to mature 3 months from issuance.

As of August 9 [b]MXCS[/b] ceased to be recognized as a shell company.

Ultimately they received promissory notes for private placements totaling $2,000,000 each that were to be utilized to provide bridge loans to The Prism Corporation. The deal fell through as Prism ultimately defaulted on the loans.

On January 9, 2012, the Company commenced litigation in the Federal Court for the Southern District of New York (the “Court”) against the [b]Prism Corporation[/b] and its President [b]Joe Loftis.[/b]

The Complaint states causes of action against the Defendants for breach of contract, seizure of collateral and injunctive relief, and seeks to obtain a Judgment in the amount of $2,000,000 plus interest and all costs due under the four promissory notes at issue.

[b]Joe Loftis[/b] appears to be a real winner 😉

[b]Prism[/b] was acquired at least once before on October 3,2008 by AKVA as stated here in their 10-Q filed in May of 2009 and is clearly a fraud vehicle for Joe Loftis imo.

 

[color=red]2nd and Successful Attempt - Boldface[/color]

 

They didn’t waste any time as on May 16 and 17, 2012 they were right back into the private placement, bridge loan and merger action, but this time with the current attempt BLBK - Boldface Licensing and Branding as they are looking to capitalize on the popularity of the current Hollywood TV celebrities.

http://www.boldfacegroup.com/#!brands/c11pv

On May 16 and 17, 2012, they completed closings of a private placement offering of 10% secured convertible promissory notes in the aggregate principal amount of approximately $1,500,000. The 2012 Bridge Notes will mature six months from the date of issuance.

The net proceeds from the sale of the 2012 Bridge Notes, after deducting fees and expenses related to the offering, were used to make a secured bridge loan to Boldface Licensing + Branding ("Boldface").

[color=red]Name Change and Preparation for the Forward Split / Capital Change[/color]

On May 21, 2012, they filed their Amended and Restated Articles of Incorporation with the Nevada Secretary of State for the name change to BOLDFACE Group, to increase the Authorized share count to 310,000,000 common stock $0.001 par value per share, and 10,000,000 shares of preferred stock 0.001 par value per share consisting of 300,000,000 shares of common stock, $0.001 par value per share.

10,000,000 shares of blank check preferred stock, $0.001 par value per share and awaited issuance of the new ticker BLBK.

[color=red]Stock Split[/color]

On May 29th, 2012 the board of directors (still Levinson holding 5 million shares / 78+% of the outstanding and the others 1.37M shares) declared a 37.9562-for-1 forward stock split.

6.37M * 37.9562 = Shares Outstanding 241,780,994 post forward split a/o May 31, 2012

On June 4, 2012, FINRA approved the change of their OTC Bulletin Board trading symbol from “MXCS” to “BLBK” effective the open of business on June 5, 2012. At such time, FINRA also announced the name change to BOLDFACE Group, Inc.

 

[color=red]The Merger[/color]

 

On July 12, 2012 BOLDFACE Acquisition Corp. (“Acquisition Corp.”), a wholly owned Nevada subsidiary of BOLDFACE Group, Inc., a Nevada corporation (“BGI” or the “Company”), merged (the “Merger”) with and into BOLDFACE licensing + branding, a Nevada corporation (“BLB”). In connection with the Merger, each share of BLB common stock was cancelled and converted into the right to receive 200 shares of our Common Stock. BLB was the surviving corporation of the Merger. As a result of the Merger, BGI acquired the business of BLB, and will continue the existing business operations of BLB, as its wholly owned subsidiary.

Following the closing of the Merger, the board of directors now consists of two members.

Noah Levinson and Irv Pyun, the directors before the Merger, appointed Ronald S. Altbach, as Chairman of the Board, and Nicole Ostoya to fill two of the vacancies on the board of directors, and Messrs. Levinson and Pyun resigned their positions as directors.

Also on the Closing Date, Levinson and Pyun, the executive officers, resigned from all of their positions and Nicole Ostoya was appointed as our Chief Executive Officer and President and Ashumi Kothary was appointed as our Chief Financial Officer and Secretary.

Before the Merger, the board of directors and shareholders owning a majority of its outstanding common stock adopted the 2012 Equity Incentive Plan, which became effective on the Closing Date.

The 2012 Equity Incentive Plan provides for the issuance of up to 20,000,000 shares of our Common Stock as incentive awards to be granted to executive officers, key employees, consultants and directors of the Company.

BOLDFACE Group, Inc. Announces Reverse Merger and $2.05 Million Private Offering

In connection with the merger, the pre-merger stockholders of BOLDFACE will receive in exchange for the shares of BOLDFACE common stock owned by such stockholders, among other things, 25,000,000 shares of the Company's common stock.

The company completed an initial closing of 8,200,120 units in a private offering, at a price of $0.25 per unit resulting in aggregate proceeds of $2,050,030, which includes the conversion into units of $1,925,030 of principal.

Each unit consists of one share of the Company's common stock and one five year warrant to purchase one share of the Company's common stock at an exercise price of $1.00 per share.

The net proceeds of the offering, including the proceeds from the bridge financing have been or will be principally used for the implementation of sales and marketing programs, expansion of BOLDFACE's lines of branded products, payment of transaction expenses and for general working capital.

In connection with the merger, 3 of the Kardashian sisters have been issued warrants to purchase 10,000,000 shares of BLBK at .24 and prepaid royalties agreed upon.

Lock-up Agreements:

In connection with the Merger, for a term of 24 months from the Closing Date except in certain limited circumstances, our officers, directors, key employees and holders of 10% or more of our Common Stock after giving effect to the Transactions, who received shares of our Common Stock in connection with the Merger, agreed to “lock-up”, not sell or otherwise transfer or hypothecate directly or indirectly, or effect or agree to effect any short sale of, any of their shares of our Common Stock received in connection with the Merger. The form of Lock-Up Agreement is attached as Exhibit 10.8 to this Current Report and is incorporated herein by reference.

[color=red]Kardashian bounty:[/color]

The company has signed licensing agreement with the Kardashians and remains in effect through November 30, 2016. The Company has the option to extend the term of this agreement for an additional period of eighteen months.

During the term of the licensing agreement and as consideration for the grant of rights and license the Licensors’ image, the Company has agreed to pay the ladies depending on the product sold, a royalty on all wholesale sales of all products within the contract term equal to 8% to 10%.

In addition the Company has agreed to pay a guaranteed minimum royalty payment of $4,686,125 or $5,206,900 depending on launch date of various products.

[color=red]Mario Lopez[/color]

Mario has a history with a few tickers and isn't surprising to see him involved in the deal. Makes me wonder if he introduced the Kardashian's to the promotion stock game.

BLB has signed a licensing agreement with Pez-Mar, Via Mar Productions Inc., a corporation wholly owned by Mario Lopez (the “Licensor”), whereby BLB (i) acquired the exclusive right and license to use the certain trademarks owned by the Licensor in connection with the development, manufacture, production, distribution, advertisement, promotion and sale of a line of male fragrances, toiletries and other agreed upon products within the United States and its territories and possessions, Canada, Mexico and “duty-free” zones and shops; and (ii) obtained certain ancillary services of Mr. Lopez, including for the purpose of promotion and marketing support of the licensed products. The term of the Lopez License Agreement is three “contract” years, commencing on July 11, 2012 and continuing through February 2016. Pursuant to the Lopez License Agreement, BLB agreed to make certain royalty payments to the Licensor, which are based on a percentage of net sales of the licensed products. The Licensor is also entitled to receive certain guaranteed minimum royalties during each contract year.

Prism Update:

Also, an indemnification agreement with a substantial holder of the Prism notes was reached and is explained here:

 

[color=red][b]Now as the company has changed hands here are the beneficial ownership percentages:[/b][/color]

 

BOLDFACE Leadership:

Nicole Ostoya Chief Executive Officer, President and Director

Ashumi Kothary Chief Financial Officer and Secretary

Ronald S. Altbach Chairman of the Board of Directors

Robin Coe Hutshing Co Founder /Creative Director at BOLDFACE Licensing+Branding -

 

Going forward:

For New Product Development and Research and Development they have named Ostoya and Robin Coe-Hutshing’s company [b]GoldGrenade, LLC.[/b]

Boldface has retained Gold Grenade, LLC, a beauty and fragrance product development firm (“Gold Grenade”), an affiliate of our Chief Executive Officer and President, to conduct research and development, testing, translation (of packaging copy) and compliance (collectively, “R&D”), on behalf of BLB. Gold Grenade will identify consumer needs and shifts in consumer preferences in order to develop new products, introduce line extensions and redesign or reformulate existing products to satisfy such needs or preferences.

Employees

As of June 15, 2012, Boldface employed eight people. BLB expects to grow to approximately fifteen employees within the next 18-24 months.

Company Facilities

Boldface entered into a one-year lease of approximately 800 square feet of office space located at 1309 Pico Blvd., Suite #A, Santa Monica, California 90405.

Boldface’s executive office will be located at the Premises. The monthly rent of the Premises is $1,785, and BLB has no renewal or extension options.

[b]Recent PR’s:[/b]

Aug 3, 2012 BOLDFACE Group, Inc. CEO and Founder Nicole Ostoya to Appear on KTVK-TV, Phoenix, Arizona and KCRA-TV, Sacramento, California

Jul 19, 2012 BOLDFACE Group, Inc. Announces Fragrance License With Mario Lopez

Jul 17, 2012 BOLDFACE Group, Inc. CEO and Founder Nicole Ostoya Appears on ABC Detroit Affiliate -- WXYZ-TV Channel 7 - media link

Jul 12, 2012 BOLDFACE Group, Inc. Announces Reverse Merger and $2.05 Million Private Offering

 

Daily Chart with recent volume:

 

[color=red]Conclusion:[/color]

 

BLBK shows the 5 major signs of a shell being setup for insider enrichment / promotional campaign.

#1) no real business operations when taken public
#2) seed shareholders given shares for next to nothing
#3) change in control
#4) name and symbol change
#5) forward split while all the shares were insider owned

They have begun a recent media campaign and have the hottest Hollywood Celebs on board.
They have guaranteed the Kardashians a payment between $4 and $5M+ and the Kardashians have warrants to purchase 10,000,000 shares at .24

I, for one, will have BLBK on watch for future promotional activity.

-------------------------------------

*edit  - as we were finishing up this research report we received emails from Global Marketing Media that were paid for by Capital Financial Media, LLC.

The pump is underway:

http://promotionstocksecrets.com/boldface-group-inc-blbk-promotion-starting-research-report-will-be-out-very-shortly/

SmallCapFortunes BLBK landing page:

http://www2.smallcapfortunes.com/blbk/