I would like to throw this out for discussion to see how other shareholder’s feel about what is occurring with the continuing dilution of GHDC shares by management.In 2008, there were 178 million shares of GHDC outstanding, of which approximately 50 million shares were considered the float or freely tradable.The other 125 million plus share were owned by either Pierre Quilliam, New Vision Financial LTD., or William Martens.Today, there are approximately 240 million shares (this number will probably be around 260 million on the next 10-K) outstanding, of which 77 million shares are in the float.Pierre’s ownership of GHDC stock has gone from 30% to almost 40% in 3 short years.The reason for this is due to compensation for management and services provided being paid in stock in lieu of compensation.I didn’t have a problem with this as long as SFMI was not generating any revenue.

At the last shareholder’s meeting, Pierre promised that starting at the beginning of this year, SFMI would start paying its lease and royalty payments.In December of last year the Board (Pierre) announced they were deferring (that means forgiving) all lease and royalty payments from SFMI for the next 18 months even though SFMI is producing more than enough revenue to fund those payments.These are the payments that were to be used to pay GHDC’s salaries and operating expenses and to preclude any further dilution of the existing shareholders.

This is definitely a very BIG conflict of interest and I believe (I’m not an attorney) a breach of the Board’s fiduciary responsibilities to represent ALL of the shareholder’s best interests.I think it’s time for the Board to suspend all stock in lieu of compensation going forward.They need to either defer or accrue any of this year’s compensation until such time the Board of Directors makes SFMI pay the lease and royalty payment due to GHDC.

We need to solve this problem ASAP and let Pierre know how we feel about more share dilution created by our own Board’s actions.