Here's a business idea:
- Hire a bunch of hot women
- Tell them to pretend to punch each other on camera while wearing just a string bikini
- Go public (kind of) and hope to sell $20 million worth of stock which you paid a few hundred bucks for before making even one dollar in revenue
- Profit
That's exactly what Las Vegas-based Lingerie Fighting Championships [10] (LFC), formerly known as Spaking Events, Xodetec Group, Xodetec LED and Cala Energy Cor,p which has a very appropriate OTC Pink trading symbol: BOTY, decided to do according to its just filed amended S-1 statement [11].
Only it is not exactly a public offering: the company's stock which rarely if ever trades on the pink sheets, is selling 3.9 million shares of selling shareholder stock for total proceeds of just under $20 million, as part of a reverse acquisition (no, not a reverse merger, a reverse acquisition) of its predecessor shell company with LFC.
The offering is part of a broader transaction involving a reverse acquisition using a shell company, the trademark of "unshady" deals:
On March 31, 2015, we acquired Lingerie Fighting Championships, Inc. ("LFC") in a transaction which is accounted for as a reverse acquisition. As a result of the reverse acquisition, we ceased to be a shell company and our business became the business of LFC, and our historical financial statements became the financial statements of LFC, to the extent that such financial statements relate to periods prior to the completion of the reverse acquisition transaction. In connection with the reverse acquisition, we changed our fiscal year to the calendar year. Since LFC was formed in July 2014, we do not show results of operations or cash flows for any periods prior to LFC's organization in July 2014. On April 1, 2015, LFC was merged into us, and our corporate name was changed to Lingerie Fighting Championships Inc.
Boring stuff: the company's description is more exciting:
We are a development-stage media company, which is in the process of developing and implementing a program of original entertainment which we plan to make available predominantly through live entertainment events, as well as through digital home video, broadcast television networks, video-on-demand and digital media channels. Our business is focused on developing mixed martial arts fighting techniques, known as MMA, together with fictional character persona portrayed by beautiful women in attractive costumes based on their respective fictional characters for the purpose of providing entertainment.
On August 8, 2015, we presented our first program, Lingerie Fighting Championships 20: A Midsummer Night’s Dream, at the Hard Rock Hotel and Casino in Las Vegas, Nevada. The program featured eight matches with 16 fighters. The fighters are beautiful women in attractive costumes. Each of the fighters has a specific and unique persona and appearance. Our event was live and carried on pay per view cable in United States and Canada. We expect that the program or a one-hour edited version will be available through video on demand in a number of countries, including the United States, Canada, Mexico, most of South America, the United Kingdom, Italy, India, Australia and New Zealand. Our source of revenue from this program includes a percentage of the fees received by the media distribution companies who carries our program, as well as from ticket sales and products related to the program. We may also receive additional revenue from sales of products through our website and from sale of the program through video on demand and other post-event media distribution. We are commencing discussions with respect to our second program, which we hope to schedule for October 2015.
We promote our events in a manner to create interest in each of the fighters and in the success of each fighter against the others, in the manner similar to a MMA league. We believe that our female fighters and their characters will enable us to develop and maintain an audience willing to attend our events or watch our events either live or through video on demand, and well as buying merchandise related to the events. Some of the fighters have followings independent of their participation in our events and perform in their character in other media or venues.
The punchlines above, in addition to "beautiful women in attractive costumes" is that this is a "development-stage media company", and sure enough, a quick look at the financials reveals just that: zero revenue...
[12]
... but a whole lot of outstanding shares, shares which the selling shareholders are now rushing to liquidate:
[13]
Why are they rushing to dump their holdings. That actually is a very interesting question.
We find this riveting description in the related transactions section:
On December 31, 2014, Mr. Butler, Mr. Chan and one non-affiliated person each made a $12,000 loan to us (then known as Cala Energy Corp.) and received a 10% senior promissory note in the principal amount of $12,000. The notes were due December 31, 2015 or earlier in the event that we completed a private placement of our stock. The notes were paid from the proceeds of a $200,000 private placement of our common stock on March 31, 2015, contemporaneously with the completion of the reverse acquisition with LFC. Mr. Chan was not a related party at December 31, 2014, and is deemed to have become a related party solely as a result of his acquisition of more than 5% of our common stock on March 31, 2015 pursuant to the Share Exchange Agreement relating to the reverse acquisition transaction.
In February 2015, Mr. Butler and Mr. Chan each made a loan to LFC in the amount of $1,925. The notes had a September 30, 2015 maturity date, and were converted into 1,925,000 shares of common stock pursuant to the share exchange agreement relating to the reverse acquisition. At the time of the issuance of the shares upon conversion of the promissory notes, neither Mr. Butler nor Mr. Chan held any equity interest in our securities. Two non-affiliated individuals, Giselle Dufourcq and Natilia Lopera, who are selling shareholder, each made a $700 loan to LFC and received 700,000 shares of common stock pursuant to the Share Exchange Agreement. Neither Mr. Butler nor Mr. Chan had any stock or other equity interest in our equity securities other than the convertible notes prior to the completion of the reverse acquisition.
In addition, during 2014, Mr. Butler made a $100 advance to us, and Mr. Donnelly made a $115 advance to LFC prior to the reverse acquisition. These advances are included in loans payable at March 15, 2015.
Through December 31, 2014, Mr. Butler had accrued compensation of $270,000, which represented compensation through August 31, 2014 from us, then known as Cala Energy Corp. In February 2015, Mr. Butler forgave $270,000 of accrued compensation which was treated as a contribution to our capital. The forgiveness of compensation was effective prior to the reverse acquisition transaction.
Pursuant to the share exchange agreement relating to the reverse acquisition with LFC, on March 31, 2015, Mr. Donnelly exchanged his common stock in LFC for 9,350,000 shares of common stock, representing 47.3% of our outstanding common stock after giving effect to the shares of common stock issued in connection with the reverse acquisition transaction and the related private placement. Prior to the issuance of these shares, Mr. Donnelly had no equity or other interest in us. He became our chief executive officer and a director as a result of the reverse acquisition transaction.
So a couple of people lent out the company a few hundred dollars (literally) for which they got millions of shares in stock, and now they are looking to sell these shares at a price of up to $5/share? Something tells us they won't succeed not just because the "company" has no chance of ever generating any actual material revenue, let alone a profit, but because even a cursory glance at the "relationships" section reveals this is nothing but a fraud.
Still, in a world where CYNK, a company without assets, operations or frankly anything except for an office in a stripmall and one employee can soar to billions in market cap on zero volume and then crash just as fast to zero, all of that is largely boring especially to the SEC and the Feds who certainly should be looking under the cover of Lingerie Fighting Championships very closely but they won't, so let's cut to the chase.
Here is the company's one and only "product" - "beautiful women in attractive costumes."
Chloe "Ladykillah" Cameron [14]
[15]
[16]
[17]
[18]
Feather “The Hammer” Hadden [19]
[20]
[21]
Suzanne “Hawaiian Punch” Nakata [22]
[23]
[24]
Shelly “Aphrodite” DaSilva [25]
[26]
Lauren “The Animal” Erickson [27]
[28]
[29]
Jenny Valentine [30]
[31]
[32]
[34]
[35]
Some more deep research into the nature of the company's future revenue stream:
And remember: if anyone gives you dirty looks for scouring through a post of semi-naked women at work, just say it's due diligence for an equity offering, which incidentally is what all the bankers who were caught on Ashley Madison should be telling their spouses and girlfriends.