PFG Capital

Noteholders are bound by mandatory arbitration provisions that severely limit rights to pursue litigation in state or federal court, including for federal securities law claims, and restrict class action lawsuits.

“By agreeing to be subject to the Arbitration Provisions, Noteholders are severely limiting their rights to seek redress against the Company in court. For example, a Noteholder may not be able to pursue litigation for any claim in state or federal courts against the Company, the Manager, or their respective directors, managers, officers, and employees including with respect to securities law claims, and any awards or remedies determined by the arbitrators may not be appealed.”

After paying noteholders their principal and interest, all profits go to the Manager (Pine Financial Group), leaving no residual for note investors beyond their stated 8% return. This structure reduces fund liquidity available for redemptions.

“Our Manager is entitled to 100% of the distributable cash of the Company on a monthly basis. Our Manager is entitled to 100% of the distributable cash of the Company. The Manager may be paid this monthly. Since all of our distributable cash, with the exception of a minimal amount of retained earnings, will be distributed to our Manager, we may not have enough cash to redeem Notes upon request.”

The Company's financial statements have not been reviewed or audited by an external auditor, increasing the risk of materially inaccurate financial information.

“Our financial statements are not audited. The Company is providing financial statements that have been reviewed by the management team but have not been reviewed or audited by an external auditor. Therefore, potential investors should proceed with caution when relying on our financial statements.”

Notes are unsecured obligations with no indenture and no sinking fund. Investor redemption requests may not be honored if the Company lacks sufficient liquid cash, as most assets are illiquid loans.

“The notes are unsecured and we do not have an indenture agreement with any appropriate indentured trustee. The Notes are unsecured obligations of the Company. In addition, the Notes are not subject to an indenture agreement and subsequently, the interests of potential investors will not be protected by an independent trustee.”

The notes are unsecured obligations of the Company with no independent trustee and no sinking fund for redemption at maturity, increasing investor risk of non-payment.

“The notes are unsecured and we do not have an indenture agreement with any appropriate indentured trustee. The Notes are unsecured obligations of the Company. In addition, the Notes are not subject to an indenture agreement and subsequently, the interests of potential investors will not be protected by an independent trustee.”

The Company purchased $13.9M of mortgage loans from affiliated fund PFG Fund III in 2021, and in 2022 sold one loan of $243,000 to PFG Fund II and purchased three loans totaling $747,000 from PFG Fund II. These transactions are with affiliated entities controlled by the same manager with no independent review.

“During the year ended December 31, 2022, the company sold one loan of $243,000 at par to PFG Fund II, LLC, an affiliate. During the year ended December 31, 2022, the company purchased three loans totaling $747,000 from PFG Fund II, LLC.”

Manager is entitled to 100% of distributable cash (profits) after noteholders receive interest and principal. No sinking fund exists, and this structure may leave insufficient liquidity to honor early redemption requests from noteholders.

“The Manager will also receive 100% of distributions available after the Noteholders have received their return of principal and promised interest payments under the Notes.”

Pine Financial Group manages two other competing hard money funds (Pine Investments, LLC and PFG Fund II, LLC) that make similar loans. Kevin Amolsch will not devote full working hours to PFG Fund III and may favor other entities when allocating deal flow.

“The Company's Manager, Pine Financial Group, Inc. and its CEO, Kevin Amolsch, have multiple conflicts of interest. Kevin Amolsch, CEO of the Manager, is a principal of other entities and, as such, he may have a conflict of interest between his responsibility to manage the business to business loans of the Company for the benefit of the Investors and providing himself with a return on his investment in the Company. Pine Financial Group, Inc. is the manager to two other hard money funds.”

During 2021, $2,000,000 of line-of-credit proceeds were deposited into an affiliate's bank account; $150,000 remained at year-end 2021 and was transferred back in February 2022. This reflects co-mingling of fund assets with affiliated entities.

“During the year ended December 31, 2021, $2,000,000 proceeds from line of credit was deposited into an affiliate's account. As of December 31, 2021, $150,000 remained and was transferred to the Company's bank account in February 2022.”