Bots Inc (BTZI)

[lesgetrich]

Let's take your points one by one...

1. we lost value in MCIG immediately

The value of the shares issued in the spinoff, which we declared as income on our tax returns, was $.0001/share. I argued at the time that this number was insignificant and sure enough, the per share value of mCig was adjusted down by $.0001/share on the day of the spinoff. We gained it back in the first few minutes of trading.

According to the 8-K announcement of the Malecon reverse acquisition, VTCQ owed mCig 217,394.03 of which $95,000 will be paid back by Malecon via a promissory note. Consequently, mCig lost $122,394.03 plus the time value donated by mCig execs during the time VitaCig was spun off.

2. There were no free shares, the amount pulled from MCIG (thusly lowering MCIGs value) was the shares given to MCIG holders at the time in VCIG shares.

OK, the shares weren't free. They had a value of $.0001/share. The share cost to mCig would have been roughly $27,000 ($.0001 x 270,000,000 dividend shares).

3. how is 10% in malecon more valuable than 47% ownership. That makes no sense.

Would you rather own 47% of VTCQ or 10% of GW Pharmaceuticals (GWPH). Don't think that would be a hard choice.

I'm not saying that Malecon is another GWPH but you get my point. Vitacig was bringing in under $300,000/yr in revenue. Malecon is bringing in 3 to 8 times as much just on their pharmacy operation alone and they have hard assets like inventory to boot. We have no idea how much more their online specialty pharmacy is bringing in but I'm sure Malecon didn't decide to go public just to support a brick and mortar pharmacy operation. mCig also wouldn't have any reason to keep 10% of VTCQ if they thought, after their due diligence, that Malecon would tank post acquisition.

The true (book) value of VitaCig is being returned to mCig with the product lines which now also include nicotine oils and CBD products. While mCig owned 47% of VTCQ, due to GAAP rules, they could only book 47% of any earning to their financials. Now they can book all of VitaCig's revenues plus they have 10% interest in Malecon, which they wouldn't have had without the original spinoff. The market value of that 10% (roughly $500,000 today) can immediately be added to mCig's books as an asset. Consequently, while they lost $122,000 in loans plus $27,000 in dividend value, they gained $500,000 in asset value plus the current value of the Vitacig product lines as well as their revenue stream. Conservatively speaking, that's a 335% gain in value ($500,000/$149,000) over the 1 1/2 years that VitaCig was spun off. I'd say that's a pretty good gain on an investment. I suspect this will increase substantially once Malecon reveals details of its financials. Each $.01/share increase in it's pps will mean $1,000,000 in additional asset value to mCig.

I don't see how anyone can possibly argue that mCig didn't do great on this spinoff.