Home OTC Markets Litigation Blog Press Subscribe Racing Contact
   Consultants to public companies, brokers, attorneys, regulators and OTC Markets Group, Inc.
GH Capital (GHHC) Shares Come Up Against a Low Ceiling
 Initially Posted: February 12, 2019 9:20 p.m. PST   

I've been getting questions about GH Capital, Inc. (GHHC) for the last couple of days. Most of these questions have been of the variety:

            (a) Why is the trading volume up over the last six weeks?
            (b) Why is there so much chatter about the stock?
            (c) Why does the share price have a difficult time getting beyond the 2 cent range in spite of all the volume

The answer to all these questions is, "Seth and Curt Kramer", in this case known as Power Up Lending.

The Kramers are well-known toxic lenders to OTC issuers and in the past, their tactics have drawn the ire of the SEC. In addition to helping rape shareholder value away from the issuer, they will pay promotion specialists to generate artificial volume in the stock to draw buyers into their selling. These are the facts and there is no disputing this.

So now let's look at GHHC. On December 26, 2018 their were 71,026,818 shares issued and outstanding, according to the company's own Form 10-K filed with the SEC.

On January 16, 2019, GHHC issued a press release announcing that all of the Power Up convertible debt had been satisifed. Note that the company does not claim to have satisifed that debt with cash. How could they? They have none.

According to the OTC Markets profile page for GHHC, as reported by the verified transfer agent, West Coast Stock Transfer, there are now 144,756,464 shares issued and outstanding, an increase of about 73,729,646 shares or 104% from the December 26th number.

Obviously, those 73,729,646 shares were issued to the Kramers in order to satisfy the convertible debt they hold.

Now don't get me wrong, I am supportive of getting rid of toxic debt, but traders should be concerned about all that stock in the hands of the Kramers. Rest assured they are dumping into the volume. These guys are not investors and will do anything to maximize their profits. This means paying to promote the stock, which leads to chatter about the stock, and the concurrent dumping explains why the stock has a problem getting above current levels. Once the Kramers have dumped their load, I expect the stock may have trouble even maintaining its current levels, absent real and positive developments.

Also, I am not here to disparage the company, at least not at the moment. This is simply a notice of caveat emptor (buyer beware) with regards to the current exuberance in GHHC shares and the particpation of the notorious Kramers.


~ George