@iReact - well done tracking down the preliminary prospectus. Here are some interesting points I thought I'd share ...
- This is a preliminary prospectus and is subject to change.
- The preliminary prospectus is 191 pages and is dated December 13, 2019. Evidently, the company have been working their tails off to meet eligibility requirements and put together a prospectus to apply to list on the CSE. A prospectus with this level of detail would take an extensive period of time to produce so anyone who thinks the company have been slacking off are clearly mistaken. This just proves the team are driven and focused to get this company listed!
- FGF are required to file their prospectus with the British Columbia Securities Exchange as a prerequisite in order to comply with policies set by the CSE.
- Dollar amounts in the prospectus are expressed in Australian dollars unless otherwise indicated.
- As of November 30, 2019, the Company had approx. AUD $3,180,000 in working capital.
- How the company plans on using these available funds over the next 12 months is broken down below:
- Over the next 12 months, the company plan on injecting $2,000,000 into new investments.
- Breakdown of general and administrative expenses: Anoosh is set to pocket $240,000, while $60,000 will be paid to each Geoff, Athan, and Michael. Athan will make an additional $60,000 from FGA. $77,500 will be paid to Mark and Robert. Athan (on behalf of his consulting company) will make another $30,000. A whopping $240,000 has been allocated to travel expenses for a 12 month period. Now, I understand that 30% of FGF's business is operating in North America and they will be setting out to list on the CSE, but perhaps consider flying economy or conducting a few conference calls over Skype would bring this number down? It also be noted that prospectus states that "these amounts may vary".
It pisses me off to see this level of cash burn for a highly speculative stock that quite arguably hasn't provided any considerable liquidity to it's shareholders for a number of years. Yes, we all have families to feed, but consider the circumstances here. Perhaps directors should exercise some due diligence and take a pay-cut until some serious revenue is generated or shareholders see some returns - then maybe remuneration of this level would be justifiable?
I support the company and believe it will eventually succeed, but if I see a red flag, I have the balls to call it out.
- The events which led to FGF's suspension by the ASX are clearly detailed below:
- FGF claim to be a "founding member" and 50% owner of Cryptodata Vault LLC. who are (still) developing a hardware wallet to store digital currencies. Unless CDV have some kind of magnificent idea to disrupt the hardware wallet market , I don't hold much faith in this company. Ledger wallets for cold storage of digital assets that implement high security standards are already widely available. See companies like Ledger Nano and Trezor. I wish FGF would be more transparent as to where this project is at and provide some kind of indication as to when CDV will launch the hardware wallet or whether these plans have been abandoned.
It sounds like the patent application could be the reason for holding up the launch of the hardware wallet?? Who knows....
- The Company was appointed a corporate authorized representative (“CAR”) under SLM’s AFSL allowing the Company to engage in corporate advisory and equity capital markets, and advisory activities that fall under SLM’s AFSL.
- All of the Company’s directors and officers who operate under the license are required to participatein SLM’s compliance programs and monthly meetings. Anoosh Manzoori, the CEO is responsible for the Company’s compliance with the SML programs and attends the meetings.
- Finally we have a breakdown of the Globex deal and how the company plan on generating revenue through sales and fee transactions of the trading platform in Australia and New Zealand.
- FGF are a licensed re seller of the Globex Trading Platform.
- FGF paid Globex a one off fee of US $100,000 and provides the company with:
- Globex will receive execution fees for each buy and sell transaction FGF assist with facilitating.
- FGF will also pay Globex additional trading platform re seller licence fees.
- FGF are set to pocket a US $50,000 commission from Horizon Globex for each Trading Platform sub-licensed in Australia and/or New Zealand.
- FGF will receive a re seller commission of 0.25% for each fill/partial-fill buy execution and 0.25% for each fill/partial-fill sell execution on each customer Trading Platform delivered in the Licensed Territory. The Company has the right to set its own Buy and Sell Execution Fees.
- FGF sold all of it's shares in Kleos Space Limited (ASX: KSS) and Pearl Global (ASX: PG1).
- SQID has filed a preliminary non-offering prospectus in the province of British Columbia as a prerequisite to listing on the CSE. For its fiscal year ended June 30, 2019 it processed 794,000 transactions with a value of $163,000,000.
- FGF will be taking cryptocurrency investments very seriously and will be implementing and following a new approach involving cold storage and bank vault level security:
- First Growth Advisory's services are defined below. It sounds like things are about to begin ramping up as FGA are looking to "increase advisory services for the fiscal year ended June 30, 2020.
- Cloud Lumen - "As at 30 June 2019, for accounting and statutory reporting purposes, this investment was fully impaired". This one can be written off as a failed investment unfortunately. "Cloud Lumen is being sold via a trade sale."
- $223,984 with accumulating 1% interest per month has not been repaid to FGF by Australian Nutrition & Sports yet. However, Geoff Barnes (CEO of Peloton who are co promoting Australian Nutrition) has underwritten the loan and personally guaranteed repayment of it to FGF.
- FGF are open to investing in listed equities in Canada, US and on the London Stock Exchange.
- Helbiz are still expected to list on the NASDAQ this year.
- FGF will seek to invest in unlisted equities that are "building core infrastructure and software in blockchain technology".
- The Board of Directors is considering implementing a written code of ethical conduct for its directors, officers and future employees.
