Shell Summary for Jan. 11, 2019
THE TSX Venture Exchange closed up 4.84 points to 601.77 Friday, ending the week up 14.33 points. Steve Bajic’s 10th capital pool shell, Huffington Capital Corp. (HU: halted), has released the terms of its qualifying transaction, which is the acquisition of Nano Graphene Inc. (doing business as Grapheneca). The shell, which has 1,575,000 shares issued, will issue 60 million shares to its target’s shareholders.
Nano Graphene has a facility in Brooklyn, N.Y., where in 2017 it began producing graphene flakes, graphene paste and graphene composites (with titanium dioxide or silicon dioxide, for example). As of September, 2018, however, the company had not yet made any sales. In connection with its launch on the TSX-V, Nano Graphene must sell a $4.5-million to $6.6-million private placement at 30 cents. Nano Graphene was co-founded in 2016 by Boris Goldstein, who holds a PhD in applied mathematics. He has co-founded or founded more than a dozen companies, mostly private and mostly tech firms. In 1989, while still living in Latvia, he founded a financial and enterprise software company called Software House High Technologies. In 1991, he moved to San Francisco, remaining the chairman and chief executive officer of Software House until 1995. Since 1999, Dr. Goldstein has been the managing director of Pacific Venture Fund. Through this fund, he has worked with various start-ups including website designers, app developers and an Ecuadorean gold ex plorer. Among the websites being designed is Lend Index, a blockchain-based website that will supposedly facilitate the loan application and approval process between borrowers (specifically small businesses) and lenders. Lendindex LLC, of which the chairman and president is Dr. Goldstein, expects to launch the Lend Index website in June.
Dr. Goldstein is the chairman of a medical device company, Brain Scientific Inc. (BRSF), which has a portable EEG (electroencephalogram) device that is approved by the U.S. Food and Drug Administration. Brain Scientific had not yet generated any sales as of September, 2018. That same month, Dr. Goldstein took the company public on the pink sheets through an all-share deal with a dormant listing. Brain Scientific has not traded a single share since it listed. There are bids ranging from 0.1 U.S. cent to 10 U.S. cents; there are no offers. Dr. Goldstein and his tech investment fund, High Technology Capital Fund LP, hold a combined 7.42 million shares or 74.2 per cent of Brain Scientific.
Evidently a man of many interests, Dr. Goldstein used to be a yoga instructor. These days, he teaches a class on desert survival. On closing of the QT, the largest shareholder of the resulting issuer will be Dr. Goldstein’s High Technology Capital with about 23 million shares or 30 per cent.
Dr. Goldstein will be joined on the board of the resulting issuer by Irina Migalina and Dr. George Anastassov. Ms. Migalina lives in Latvia and was a financial adviser for 12 years with the Europack Group, a Russian manufacturer of industrial packing equipment and storage systems.
Dr. Anastassov lives in New York and is a medical doctor as well as a dentist. He is the founder and chairman of the OTCQB-listed Axim Biotechnologies Inc. (AXIM: $1.36 (U.S.)), which in October, 2016, was trading below 50 U.S. cents. In January, 2017, the stock shot up to $19.80 (U.S.), after Axim released positive preclinical results for its CanChew gum as a potential treatment for symptoms of irritable bowel syndrome. CanChew contains cannabidiol (CBD). In the two years since then, investor excitement has subsided. Axim is now conducting phase 2 clinical trials on CanChew. It is also working on CanChew RL, a potential treatment for restless leg syndrome. Axim has another CDB gum, MedChew, which it says is a potential treatment for pain and spasticity resulting from multiple sclerosis. MedChew is undergoing phase 1 clinical trials. Axim, a U.S. company, also hopes to one day sell its products (once they are ready) here in Canada with help from Revive Therapeutics Ltd. (RVV: $0.10) and pending Health Canada approval. Dr. Anastassov was the one who developed Axim’s CBD gum formulation. Huffington Capital listed in April, 2016, with a $200,000 initial public offering at 20 cents. It is Mr. Bajic’s 10th capital pool shell. His first nine shells yielded six successes and three failures for their IPO investors, as we discussed in detail in the shell summaries for Sept. 9, 2015, and Sept. 13, 2018. We consider a shell to have been a success for its IPO shareholders if they had sufficient opportunity to get out of their investment with a profit, reasonably soon after the shell closed its QT. At Huffington, since there is no proposed rollback, the IPO investors will need 20 cents to break even.