MONTVALE, N.J., Feb. 5, 2013 /PRNewswire/ -- Beneficial
Holdings Inc. (OTCPK: BFHJ) today announced updates to corporate
activities and developments.
"New Management has resolved the activities of the Company's
prior management and controlling interests and has appointed the
requisite professionals to assist us in our corporate governance
and assurance functions," according to Gregory N. Senkevitch, Chairman, President and
Chief Executive Officer of Beneficial Holdings, Inc.
"House cleaning is a necessary task to ensure we are on sound
footing as we move forward with our business plan. Now that
we have defined the status of our Company, we look forward to
concentrating on our core businesses," he said.
"While we cannot be assured of the success of our business plan,
we believe that concentrating our efforts on service-oriented
businesses in the real estate, financial services and energy
management sectors with U.S. domestic revenue sources will benefit
the Company over the near term," Senkevitch pointed out.
COMPANY BACKGROUND AND HISTORY
Beneficial Holdings, Inc., a Nevada Corporation (the "Company"),
was incorporated on December 20,
1990. The Company had been engaged in several lines of
business since its formation and became inactive in 2004. In
April 2009, a private investor group
("Old Private Investors") acquired control of the Company.
Old Private Investors appointed a management team ("Old
Management") and began to seek opportunities in the gaming and
hospitality sectors. Old Management invested in a
non-controlling interest in Grupo Beneficial, SA, a foreign company
engaged in gaming and hospitality.
In April of 2012, a new private investor group ("New Private
Investors") acquired control of the Company from Old Private
Investors and installed new management ("New Management").
Subsequent to April 2012, New
Management has concluded the activities of Old Management and has
disposed of assets acquired by Old Management effective
June 30, 2012.
New Management is seeking to acquire and invest in
service-oriented businesses in the real estate, financial services
and energy management sectors. It is expected that such
operations will have a significant portion of their activities in
the United States of America.
Upon the assumption of control by Old Private Investors, the
appointment of Old Management and the re-starting of business
operations in April 2009; the Company
was a development-stage company.
Development Stage Activities
The Company is presently in the development stage with no
significant revenues from operations. Accordingly, all of the
Company's operating results and cash flows are related to
development stage activities and represent the cumulative from
inception amounts from its development stage activities reported
pursuant to Financial Accounting Standards Board ("FASB")
Accounting Standards Codification ("ASC") 915-10-05, Development
Stage Entities.
As a developmental stage company, the Company has limited access
to the capital markets, and the Company's ability to continue in
business is dependent upon obtaining sufficient financing or
attaining profitable operations. There can be no assurance
that New Management will be successful in obtaining additional
funding or in attaining profitable operations and, therefore, the
Company's ability to continue as a going concern is subject to a
high degree of risk.
CHANGE IN MANAGEMENT AND CONTROLLING INTERESTS
In December 2011, the Company
issued 2,000,000 shares of Preferred Stock to Old Private Investors
("Series B Preferred Stock"). The Board of Directors of the
Company determined that the Series B Preferred Stock shall at all
times have voting rights equal to 2,000,000,000 shares of the
Company's Common Stock. Additionally, the Series B Preferred
Stock is at all times convertible into 2,000,000,000 shares of the
Company's Common Stock ("Conversion Amount"). The Conversion
Amount is to be adjusted for any issuance of Common Stock by the
Company subsequent to the date of issuance such that the adjusted
Conversion Amount shall at all times be no less than 51% of the
aggregate amount of outstanding Common Stock, inclusive of the
Common Shares to be issued to the Series B Preferred Stock,
assuming all the Series B Preferred Stock is converted.
In April 2012, New Private
Investor acquired control of the Company by purchasing all of the
outstanding 2,000,000 shares of the Company's Series B Preferred
Stock and appointed New Management as described above.
NON-CONTROLLING INVESTMENT IN FOREIGN SUBSIDIARY, GRUPO
BENEFICIAL, SA
New Management has determined that the Company's investment in
and activities of its 97% owned subsidiary, Grupo Beneficial, SA
("Grupo"), were unverifiable under U.S. management and reporting
practices. The shareholders' agreement between our Company
and the minority shareholders of Grupo precluded our Company from
exercising control over the day-to-day activities and capital
transactions of Grupo. Furthermore, Grupo was not required to
provide financial data to the Company.
Under the Agreement, Grupo indemnified the Company from any
losses associated with its operations and actions. While Old
Management had invested upwards of $160,000 in Grupo through the date New Management
was appointed; our Company was not obligated to fund any capital to
Grupo for any reason. In Summary, our Company had no
authority to approve, control or manage the activities of Grupo,
nor did it bear any of the risks or rewards of its investment in
Grupo.
Thus, due to the fact that the Company exercised no control over
the operations of Grupo, nor was the beneficiary of any of the
income or gains of Grupo, nor was responsible for any losses or
deficits of Grupo, nor was obligated to support the capital
structure of Grupo and was fully indemnified against any loss
resultant from the acts or operations of Grupo; the Company has
determined that it should not consolidated the operations of Grupo
with its results of operations and financial position at
December 31, 2012 and 2011, in
accordance with New Management's understanding of U.S. Generally
Accepted Accounting Principles (GAAP). As a result of these
and other factors, the Company terminated its involvement with
Grupo and all of its activities effective June 30, 2012. The Company also sold its
97%, non-controlling interest in Grupo to Grupo's minority
shareholders effective June 30, 2012
for $400,000. The Company does
not expect to receive any cash from the sale of Grupo and has
provided a valuation reserve for the full amount of the sale price
($400,000). No gain has been
recorded on the sale of Grupo.
CAPITAL STRUCTURE
Upon recommencing developmental stage operations in April of
2009, Old Private Investor had funded the operations of the Company
through a Convertible Note Facility dated April 25, 2009 in the amount of $250,000 bearing interest at 10% per annum.
The Convertible Note Facility allowed for the conversion of all or
part of the balance of the note (inclusive of accrued interest)
into shares of the Company's Common Stock at 70% of the lowest
trade of Common Stock on the prior business day.
Through July 24, 2012 (the payoff
date of the Convertible Note Facility), Old Private Investor funded
$222,461 under the Convertible Note
Facility. From time to time in various transactions through
July 24, 2012, Old Private Investor
converted portions of the outstanding note balance to Common Shares
of the Company totaling 3,105,143,517 Common Shares.
On October 20, 2010, the Company
entered into an additional agreement (the "Additional CNF") with
Old Private Investor for additional funding of $80,644. No amounts were funded under this
facility. The Additional CNF was terminated in July 2012.
In April 2012, the Company granted
the Company's Chief Executive Officer an option to acquire up to
10,000,000 shares of the Company's for $0.03 per share. The amount of shares
issuable under this agreement (and the strike price per share) are
adjustable for stock splits and dividends but are not adjusted for
any reverse stock splits or share buy backs by the Company.
In May, 2012, the Company issued New Private Investor
300,000,000 shares of Common Stock in exchange for funding of
certain of the Company's expenses.
At December 31, 2012, the Company
entered into a line of credit arrangement with an affiliate of New
Management (the "Credit Agreement"). The Credit Agreement
allows the Company to borrow up to $25,000 through December
31, 2013 when the Credit Agreement matures and is due and
payable. The Credit Agreement bears interest at a rate of 12%
per annum, compounded monthly. Substantially all of the
Company's assets are pledged to secure borrowings under the Credit
Agreement.
At December 31, 2012, the Company
was authorized to issue up to 4,600,000,000 shares of Common Stock
at $0.00001 par value per share
("Common Stock"). As of December 31,
2012, the Company had 4,099,099,952 shares of Common Stock
issued and outstanding.
At December 31, 2012, the Company
was authorized to issue up to 2,000,000 shares of Series B
Preferred Stock at $0.00001 par value
per share ("Series B Preferred Stock"). As previously
discussed, the Series B Preferred Stock at all times maintains a
minimum of 51% of the voting power of the total of the Company's
Common Stock, inclusive of shares to be issued in conversion of the
Series B Preferred Stock, assuming conversion. At
December 31, 2012, the Series B
Convertible Preferred Stock was convertible into and had the voting
power of 4,267,346,889 Common Shares.
CORPORATE DIRECTION
The Company has prepared unaudited financial statements for the
years ended December 31, 2011 and 2012 reflecting the
activities described above. These financial statements will
be examined by the Company's independent public accountants.
Upon completion of their audit, the Company will make the
appropriate release of its financial results for 2011 and 2012.
The Company will seek to redirect its mission towards acquiring
and investing in service-oriented businesses in the real estate,
financial services and energy management sectors. Previously
announced negotiations in other areas have been concluded, and the
Company has withdrawn from all such Memorandums of Understanding
without any obligations.
ABOUT BENEFICIAL HOLDINGS, INC.
Beneficial Holdings, Inc. is a holding company seeking to
acquire and invest in operating service-oriented businesses in the
real estate, financial services and energy management sectors.
For more information on the Company please visit our web site at
www.beneficial-holdings.net.
FORWARD-LOOKING STATEMENTS
This news release may contain forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. As a
general matter, forward-looking statements reflect our current
expectations and projections relating to our financial condition,
results of operations, plans, objectives, future performance and
business. These statements may be identified by the use of
forward-looking terminology such as "may", "will", "expects",
"plans", "estimates", "anticipates", "projects", "intends",
"believes", "outlook" and similar expressions.
The forward-looking statements contained in this news release
are based upon our historical performance, current plans,
estimates, expectations and other factors we believe are
appropriate under the circumstances. The inclusion of this
forward-looking information is inherently subject to risks and
uncertainties, many of which cannot be predicted with accuracy and
some of which might not even be anticipated. Future events
and actual results, financial and otherwise, may differ materially
from the results discussed in the forward-looking statements.
Statements regarding the following subjects, among others,
may be forward-looking: our business and investment strategy; our
projected operating results; estimates relating to our ability to
make distributions to our stockholders in the future and economic
trends and economic recoveries.
All information in this release is as of February 5, 2013. The Company does not
undertake a duty to update forward-looking statements, including
its projected operating results. Readers are cautioned not to
place undue reliance on these forward-looking statements, which
speak only as of the date of this news release. The Company
may, in its discretion, provide information in future public
announcements regarding its outlook that may be of interest to the
investment community.
CONTACT:
GREG McANDREWS & ASSOCIATES
Gregory A. McAndrews
(310) 804-7037
greg@gregmcandrews.com
SOURCE Beneficial Holdings Inc.
