Chess Supersite Corp. (OTCMKTS:CHZP) Is Moving Again
tags: CHZP
Chess Supersite Corp. (OTCMKTS:CHZP) had spent many months in illiquid obscurity, before it was targeted by a couple of paid pumps back in May. Back then, its ascent didn’t last all that long – but it seems like the ticker is on the move again.
QualityOTC and EliteOTC did what they could to move CHZP stock around a bit, but overall, their attempts seemed lackluster then. And is it really any wonder that this is the case? After all, the compensations for said pumps were little more than pocket change, even by the OTC Markets’ current lowered standards.
Still, the fact that the ticker flirted with the paid pumpers is an unsubtle hint of the nature of the company in question.
And it’s not like the paid pumps are said pumps are the only red flag that due diligence on CHZP reveals. One look at the company’s latest 10-Q reveals the fact that last time it reported, its overall financial situation looked pretty bleak:
- Cash & Total Current Assets – $203 thousand
- Total current liabilities – $1.1 million
- No revenues
- Net loss – $428 thousand
And after discussing the paid pumps and the company’s meager financials, it would probably be a good time to address the other elephant in the room. We are, naturally, talking about the company’s tendency towards toxic funding.
In the last 10-q, the company had 300 thousand worth of debt that were ”convertible at a fixed conversion price of 45% of the lowest trading price …. for the four (4) prior trading days”. A 55% discount is simply horrendous – but hold on to your hats, because the fun doesn’t stop there.
It seems like CHZP is not the least bit shy to pick up even more debt – like that $75 thousand dated May 19, 2016, which is convertible at a rate of “52% of the lowest closing bid price of the Company’s common stock for the twenty (20) trading days prior to the date of conversion”.
With this in mind, it should be obvious why the ticker spent all this time under the investors’ radar. Indeed, it is something of a miracle that CHZP has managed to get so much traction these last few months, and in yesterday’s trading in particular. Unfortunately, some glaring red flags that pop up with even a bit of superficial due diligence on the company – a fact that doesn’t really bode well for ite chances of retaining its gains.
