[43] When Mr. Cragun retired in 1999, Rory Boyce-Varley, an internet marketing specialist, became Mr. Harris' business partner in Veritas. The financial prospects for 2000 looked promising when Trademex placed a million shares in escrow, and Internet Studios promised two million shares. However, in 2000 things went from bad to worse. Internet marketing started its downward spiral, Trademex was de-listed, and unbeknownst to Mr. Harris, Mr. Boyce-Varley swapped Internet Studios restricted shares for freetrading shares and sold them. Mr. Harris returned from California to find that his partner had cleaned out his office and apartment, and left the country.
and then lol
Stocklemon Reports on Inernetstudios. (OTCBB: ISTO)
Posted in Citron Reports by Stocklemon on the February 14th, 2003
stock ticker: ISTO
The Company That Never Was…
Shares Outstanding- 10.029 million
Cash in Bank- $6,487
Nine Month Revenues- 0
10kwizard.com
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Internetstudio’s stock (OTCBB: ISTO) has risen this year from a low of .20 to its current price of $1.50. Yet Stocklemon believes that this is nothing more than a stock promotion and the company should not even be trading. We expect eventual bankruptcy for this company considering the amount of debt, judgments against them, and lack of any form of revenue.
Cheap Stock for Debt.Everyone Owns the Stock at a Nickel
During February and March 2002 the Company issued a total of 3,487,873 shares of common stock on conversion of the outstanding convertible loans of $199,159. $.0571 per share.
During January 2002 the Directors approved a resolution to issue a maximum of 5,720,000 shares of common stock to certain directors, officers and employees in settlement of outstanding obligations that totaled $393,684. $.0571 per share.
10kwizard.com
CEO and Offshore Accounts.
The CEO of Internet Studios, Richard Mclean, is employed with the company through a consulting contract between the company and his corporation Spray Point Consulting. Spray Point is a corporation in the tax haven in the Isle on Man. Therefore, the millions of shares given to Mclean are in an offshore account.
For those of you who are frequent readers of Stocklemon, you know how skeptical we are of any offshore accounts. Even though there is nothing illegal about it, we have found this to be the one true tell tale sign of a lemon. Normally, we find offshore accounts with investors. The fact that the CEO gets paid in stock that is offshore is both unheard off from the perspective of this reporter.
No Business
InternetStudios.com describes themselves as an online database that allows rights holders and buyers of filmed entertainment to trade in a timeless marketplace. As a matter of fact, on May 28 2002, they made an announcement about their new website.
quote.bloomberg.com
As of the writing of this article, no sites that the company owns are even operational..except of course the investor relations site..try for yourself.
www.onlinefilmsales.com
www.oftvs.com
www.reportertv.com
www.studiobuzz.com
Legal Problems..Judgments Galore
The following comes directly from the company filings:
August Entertainment, Inc. brought an action against our company on September 7, 2000, in Los Angeles County Superior Court for breach of contract arising from an alleged contract for distribution of films. This matter was settled in December 2001. Pursuant to the terms of the settlement, we agreed to pay August Entertainment $70,000, of which $46,000 has been paid as of November 14, 2002.
Two former employees of OnlineFilmSales.com, LLC filed claims with the Labor Commissioner in the State of California. The first made a claim against InternetStudios with the Labor Commissioner’s office on April 25, 2001 even though she was never directly employed by InternetStudios. The former employee alleged non-payment of wages plus interest and penalties. On July 10, 2001, she received an “Order, Decision or Award” (sic) from the Labor Commissioner against InternetStudios in the amount of $11,328.09. As of November 14, 2002, no payments have been made to this employee. The second former employee filed his initial claim with the Labor Commissioner’s office against InternetStudios and OnlineFilmSales.com, LLC on August 24, 2001 alleging non-payment of wages plus expenses, interest and penalties. On May 29, 2002, the former employee received an “Order, Decision or Award” (sic) from the Labor Commissioner against InternetStudios and OnlineFilmSales.com, LLC in the amount of $26,578.24. As of November 14, 2002, no payments have been made to this employee.
On or about September 5, 2001, Total Creative, Inc. filed a complaint in the Superior Court of Los Angeles against OnlineFilmandTVSales.com, Inc. for money allegedly due for work and services allegedly supplied by the claimant. On November 27, 2001, the claimant received a Default Money Judgment in the amount of $34,531.49. As of November 14, 2002, no payment has been made to Total Creative.
Certain former employees have indicated an intention to pursue alleged claims against the Company by taking legal action. To date no actions have been filed against InternetStudios.
Global Media Management
On January 23, 2003, InternetStudios announced a strategic relationship with Global Media Management out of Memphis, Tennessee.
quote.bloomberg.com
A phone call made to the investor relations department told us that Global Media is a “multi billion dollar” fund. Maybe these guys should do their homework on their prospective partners. Global Media Management is a company that is run by a gentleman named Sam Cooper. In the link below we see that Mr. Cooper has a history of making empty promises. But then again, does Internetstudios really care or was it nothing more than an announcement.
tsc.state.tn.us
The Icing on the Cake
Stocklemon sent a reporter by the Santa Monica Headquarters of InternetStudios to see if people were hard at work. Our reporter went to the address of 1351 4th Street, Suite 227 Santa Monica, California. This address has been listed for the company in their SEC filings as recently as the S-8 Registration of theirs back on December 11, 2002. What we found out was amazing. InternetStudios has not been there in over a year. A phone call to the building manager found out that the company was evicted in December of 2001, and is in arrears for over $80,000 to their landlord.
Conclusion
Maybe the concepts behind InternetStudios was solid back in 1998, when nothing had to make sense as long as it ended in .com. In 2003, this company is nothing more than a lemon as they have no cash, no business. Bankruptcy should be around the corner for this piece of citrus. |
