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  • Do Fools Or Hucksters Run SKTO And California?

    A few months ago, California NORML Director, Dale Gieringer, was quoted as saying in an email;

    It's hard to tell whether SK3 is run by fools or by hucksters; in either case, it would be foolish to put any faith in them.

    Gieringer also said of SK3 Group;

    The cultivation facilities they are proposing are blatantly illegal under federal law, which will make it impossible for them to win FDA approval. While they have claimed that what they are doing is legal because they are producing CBD, not THC, the fact is that CBD is 100% illegal under federal law.

    I wonder what Dale would say about SKTO's recent press release in which the company says their licensed products are seeing wide distribution across California since the products mentioned are suppose to be "not-for-profit"? Does SK3 plan to sell these products at cost in order to remain compliant with Prop 215, SB420, and AG Guidelines? YAK Edibles were introduced in 2010 and claimed on the packaging they were produced in small batches under a non-profit structure.

    How did SK3 obtain the rights to these products? Did someone sell them snake oil? In last weeks press release that misspelled the Presidents last name, we see this puzzling statement;

    A. Mayer, President SK3 Group, said, "Mass distribution in the States that are now selling medical cannabis is the key to the growth of the company and ultimately the revenue and we feel we are making great strides toward that end."

    The company plans to release a taped conference call next week. Perhaps they will explain to shareholders why they would be involved with not-for-profit products in California and how this will benefit shareholders.

    Since entering the non-profit medical marijuana space in California, SK3's subsidiary, Medical Greens, claims they contracted and are owed over $18 million for about 4 months worth of services. If this doesn't turn out well for shareholders, and it appears it may not based on the rise and fall in stock price, will Gavin Newsom's endorsement of SK3 be the end of his political career? Newsom has not responded to requests to explain his endorsement.

    Shareholders were quick to praise Newsom's endorsement, but quicker to attack Dale Gieringer's critical remarks about management. Gieringer is a private citizen and has a right to his opinion. Newsom is a public figure that is suppose to be a public servant. Gieringer explained his position while citing federal law. It's time Newsom did the same. Endorsing a company with plans to violate state and federal law could be a political disaster if SK3 follows through with previously announced plans and recent updates.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Sep 01 7:54 PM | Link | Comment!
  • SKTO And Medical Greens ~ Déjà Vu?

    In the month of March, SK3 Group, Inc. (OTC:SKTO) has provided some enormous returns to traders who got in early. Cashing in on the medical marijuana boom, the company announced the acquisition of Medical Greens, who is said to be a provider of licensing, management, and logistic services for Medical Marijuana collectives throughout California. Their website, which was launched just last month doesn't explain the services the company offers, but amazingly they secured over $30 million in contracts right after being acquired by SK3, which was announced on March 11th.

    On March 13th, the company announced a new chairman, Kevin Allyn, formerly of King World Productions. Then on March 26th, high profile attorney, Jeff Benz, who was once Chief Ethics Officer for the United States Olympic Committee was announced as General Counsel and Executive Vice President of Business, Legal, and Government Affairs. Impressive for a non-reporting pink sheets stock, to say the least.

    Will this run continue for SKTO? Can these high profile names help sustain these tremendous gains? After all, SKTO hasn't provided any financial information in 2 years. Are big names all that are needed or will transparency from the company be required for the run up to continue?

    Medbox, Inc. (OTCQB:MDBX), another medical marijuana player who saw it's stock soar from $4 to over $200 in just 3 days a few months ago told investors in January that they would become SEC filers in the first quarter of this year. To date MDBX has not kept it's word, which is typical of many pink sheets companies.

    Pink sheets stocks are often hyped so insiders can dump shares to novice investors who lack the knowledge to understand how these schemes work. When the dust settles these non-filers ride off into the sunset with the novice investors money never to be heard from again. That is until they have a new business idea. Which is what SKTO now has, a new focus for the company, medical marijuana.

    When SKTO last filed financial information with the OTC, they said they had acquired several healthcare related companies valued around $11 million. They bought these companies with deeply discounted shares. This was all part of a new business plan that had been previously announced.

    At the same time they released the 2010 annual report, SKTO was also telling investors they were going to become SEC filers. 2011 was going to be an exciting year according to SKTO. That was the last time SKTO provided any financial information to the investing public. For nearly 2 years SKTO has provided no information about those 2011 acquisitions, and like many pink sheets pumps and dumps, they have a new business focus, again.

    Perhaps the newly assembled SKTO Dream Team, as they are being called, will do the ethical thing for it's stock holders and be transparent. It would be refreshing to see. For now OTC Markets has it right. Buyer Beware. At least until the company becomes transparent.

    SKTO has a questionable history, as do many pink sheets stocks. Will that history repeat itself? One has to wonder with the tremendous volume we saw in March.

    Just a reminder, Monday is April Fool's Day and SKTO is a non-reporting pink sheets stock. The company has announced a new direction and acquisitions before.

    Déjà vu?

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Apr 01 8:07 AM | Link | Comment!
  • TEXX Is Driving It's Shareholder's To Drink

    You don't get accolades from Mike Morales at Tequila Aficianado unless you have a brand worth talking about. You shouldn't access public markets unless you plan to expand that brand people have been talking about. TEXX, what gives?

    Tequila Distinguido was launched in 2005, and in 2008 Emperial Americas acquired the rights to the brand. This past March, Emperial Americas announced a reverse merger into AAA Public Adjusting Group, and after a spike in price on some unfounded rumors, it's been all downhill ever since.

    Many OTC stocks offer investors ideas or concepts. Emperial Americas offered investors ownership in an existing company complete with an importer's license in hand, trademark and labels, and some high level marketing agreements in place. One would think a private placement would be achievable. After all, that's why private companies go public, right?

    After reaching a high of .82 earlier this year on light volume, TEXX is trading, if you call it that, around .02. The drastic price drop appears to be the result of a convertible note held by one of it's company directors. Victory Partner's, owned by COO Bruce Klein, provided funding for the reverse merger. In the 2nd quarter some serious debt conversion occurred, volume spiked, and that increase in volume continued into the 3rd quarter. Then it stopped, as did company communications.

    The company had released news about expanding it's distribution network as well increasing sales of the tequila through it's marketing efforts. Of course that appears to have given Victory Partners the leverage they needed to turn a $200K note into a 200% gain, by my estimates.

    It's a shame when a small company with such big potential either mishandles the public trust, or was mishandled by one of it's own. I assume the latter took place. The CEO appears to have far more invested with blood, sweat, and now tears, than it's convertible note holder.

    I need a drink, don't you?

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Dec 02 8:23 PM | Link | Comment!
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