Manufactured Housing Properties

Management acknowledged as inexperienced in running a public entity (except CFO Michael Anise). The loss of key members of the management group could adversely affect financial condition and cash flow. CEO Raymond M. Gee received no salary in 2017 or 2018.

“With the exception of Michael Z. Anise, our president, chief financial officer and a director, our management does not have prior experience with the operation and management of a public entity. As a result, they will be learning as they proceed and may be forced to rely more heavily on the expertise of outside professionals than they might otherwise, which in turn could lead to higher legal and accounting costs and possible securities law compliance issues.”

Metrolina Loan Holdings, LLC is a related party lender with a $3,000,000 convertible line of credit. As of June 30, 2019, the outstanding balance was $1,270,000 (with an additional $1,730,000 drawn July 31, 2019). Metrolina was originally awarded 455,000 Common Stock shares as compensation for the original note; upon amendment in 2019 received an additional 545,000 shares (total 1,000,000 shares), with Metrolina also purchasing 254,506 additional shares for $68,717 in June 2019. Metrolina has a right to maintain up to 10% equity interest for seven years.

“On May 8, 2017, we issued a convertible promissory note to Metrolina in the principal amount of $3,000,000. The convertible note is interest only payment based on 8%, and 10% is deferred until maturity to be paid with principal balance. The convertible note originally awarded Metrolina 455,000 shares of Common Stock as compensation, which resulted in making Metrolina a related party due to their significant ownership.”

The company borrowed up to $1,500,000 from CEO Raymond M. Gee on a revolving basis for working capital. As of June 30, 2019, $878,567 was outstanding with no annual interest and no payments made since issuance. This is a zero-interest related-party loan from the controlling shareholder.

“On or about October 1, 2017, we entered into a revolving promissory note with Raymond M. Gee, our chief executive officer and chairman of our board and beneficial owner of a majority of our outstanding Common Stock, pursuant to which we may borrow up to $1,500,000 from Mr. Gee on a revolving basis for working capital purposes. This note has a five-year term with no annual interest and mandatory principal payment is deferred until the maturity date. As of June 30, 2019, the amount owed by us to Mr. Gee under this note is $878,567, and no payments have been made by us since the date we issued this note to Mr. Gee.”