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Good analysis there, I commend you on it.
i dont agree with your projections i dont but thats matter of opinion.
Only thing i can almost guarantee is that theyre not gonna make it to 2013 with only 2billion OS if they carry on spending at the current rate they're gonna dilute this into the multiple-billions out of necessity or do an RS...again out of necessity.
If they stop the ridiculous spending and calm down on the unnecessary costs then that may change. IMO if they dont do that they;re gonna have to dilute this into the ground.
Its not an obsession about holding long. Any stock needs some people to believe that it could pay off long term or it would be worthless. Flippers dont help to make a stock valuable....you just provide liquidity... if there werent believers in the stock then flippers wouldnt enter it at all because there would be no interest in the first place. There are much better stocks to flip than this one in any case.
Dumb reference? No way, these guys had the opportunity to go either way from their $1.60 start price. Sadly that 2700 that you say was traded about $1.50 would now buy 270,000 shares for the same amount.
This stock was heavily traded in the 30cent & 90cent range and even more so between the 5cent and 15cent range.
Of course flipping doesnt hold the PPS down....we need flippers to buy from when we wanna buy and to sell to when we want out. What has brought this stock down is massive dilution at the current round of shareholders expense.
As a little addition to my remarks about huge and ever increasing losses.....
The thing that really bugs be about these guys is that a lot of their spending isnt necessary. I know a small comany will take losses in its early years. I know money needs to be spent on product development, distribution, advertising, brand awareness, wages etc etc
But dont waste money oh huge management bonuses, dont give your co-vice presidents huge pay increases when your company is sinking, dont give away lamborghinis and spend millions on "training centres" that arent needed and certainly dont spend huge abounts on corporate entertainment.
The fact is these guys could have, and should have, tightened the belt a long time ago but they dont want to.
Thats what it boils down to.
maybe the new CFO will whip them into shape. but who knows.
lol well there are so many different terms all meaning the same thing...but as you say it all points to the fact that MSLP are losing money! and at ever increasing rates.
aha i see so you posted their net loss figures, i see that now. corect, and doesnt paint a pretty picture.
Musclepharm dont get any revenue at all from Jackson or anybody they sponser.... believe me I wish they did :P
They pay them in cash and/or shares depending on the deal in exchange the athlete is supposed to actively talk about and promote Musclepharm products. thats all.
The Lambo was an outright gift from the company to Jackson. Which would be fine if MSLP was a big profitable company with cash in the bank to spare on such antics. But when they are a huge loss making company and constantly diluting shares its just a kick in the teeth to shareholders.
Youre absolutely right that sales growth wont help these guys as long as their spending remains higher (and it is a LOT higher) than their sales.
But where are you guys gettng your revenue figures from?
Q1 2011 - sales revenue $3,517,776
Q2 2011 - sales revenue $3,802,806
its here in the most recent quarterly financials from the company http://musclepharm.com/sites/default/files/musclepharm_corp_10q_20110816.pdf
They got nothing in return for the Lambo.
They already had a sponsership deal with Jackson and the Lambo added nothing to that deal...they got a couple of nice photo's od Jackson's smiling face driving around in his lambo that likely was paid for with 100million diluted shares.
Okay i dont have proof of that but i guess the Lambo was $300k and they probably diluted at 2cents.
Either way they threw away money as always just to look cool and its things like that that really annoy me with these guys.
Absolutely it would be better for them to dilute more responsibly. They wouldnt necessarily get "more" money but they wouldnt have to sell as many shares.
My guess is at this point in the game they dont have choice but to dilute for a penny a share. They made some very poor dilutive decisions in the past and now are having to dilute just to pay the monthly bills.
I guess we will have to disagree on that one....i recognise that these guys have a business and are diluting heavily to fund that business whereas a lot of pinkies are in the business just to sell shares.
however in two years these guys have diluted the share price from over $1.50 to $0.015 - thats 99%. or in other words for people who bought in at those high levels they will need a 9,900% increase from these levels to break even.
Alright i know not many people who bought in at $1.50 will still be holding...they will have all sold at a loss already. As will the guys who bought in at £1.00 80c 60c 40c 20c 10c etc etc. Apart from a few flippers on the very few up days this stock has had there have been no shareholders who havent lost money on this.
Now Musclepharm as a company has a very very good shot of succeeding but I question wether the current batch of shareholders will profit from that success. The fact is the company is making huge losses.....even with increases in sales their expenses are going through the roof and show no signs of slowing down. Yet they do stupid things like giving themselves huge salaries and bonuses and ridiculous entertainment(read partying with their buddies) spending all paid for by selling more and more shares.
We only have complete financials up until end june 2011 so i will work on those. 6 months ending June 2011 they made $7.3million in sales. Great! but their costs were close to $20million! $20million costs for a company employing like 14 people? come on! So anyway that resulted in a net loss of $12.45million for those 6 months. Even with the fantastic sales these guys are short $2million a month and they have NO other way to pay for this other than diluting. And to raise $2million at current prices would require diluting 130million shares PER MONTH. Unsustainable and irresponsible surely? by the way over $9million expense is listed as "Other Expenses" - we know what that means.
here is the report by the way incase anyone suspects my figures are wrong http://musclepharm.com/sites/default/files/musclepharm_corp_10q_20110816.pdf
Anyway i do think they company will succeed but i also think it will be at the cost of the current round of shareholders. Sales growth alone isnt going to get these guys out of the hole they are in and the gagged TA doesnt help inspire confidence.
having said that however....the last couple months hasnt apparently seen much diluting and i see they have hired a decent CFO now and perhaps the deal they made with Southridge will help them in the long run.
which is why all in all i dont share an opinion on wether 1.5cent is a good enough price to buy this stock at. They will have to pull something pretty special out of the bag to get their finances into a sustainable shape....and i think we all know they arent gonna do that through sales alone in anywhere near the short to mid term. I would get back in when i see that they have a real plan to stop the dilution. they havent showed that yet. if i get back in at 0.0001 when that happens then great. If i see that happeneing at 5cents then great too, i will pay 5 cents. But I personally wont touch it til i see the dilution coming to an end. Maybe that time is now. But probably not.
No doubt about it... a fantastic few years as far as growth in sales figures goes. Their revenue is increasing all the time and they are becoming a more well known brand all the time also.
But its costing them more and more and more to make those sales and they dont show any sign of slowing down their spending. Apart from using cash to grow the company they are funding lavish lifestyles with ridiculous salaries and corporate entertainment budgets (buying rampage jackson a Lamborghini as a gift for example) with money they dont have and are funding it through massive dilution of shares at lower and lower prices.
i sold 90% of my position here at .04 which was almost 50% loss for me but looking back glad i did. Im not saying the company is done...by any means.... i just know that their relentless and irresponsible dilution needs to stop or slow dramatically before i can be at all confident of a decent rise in PPS.
No dilution??? Dilution has been the biggest problem us shareholders have had to deal with from these three clowns in "management" they dilute relentlessly which is why we are sitting here at 1.5cents.
I'm not going to give my opinions on wether its a buy at this level or not...cos honestly i dont know.... but just so you dont invest thinking they wont dilute this thing into the ground (more than they already have) just look at their quarterly report http://musclepharm.com/sites/default/files/musclepharm_corp_10ka_20110927.pdf for period ending June 2011.
Just glancing at the "Unregistered Sale of Equity" starting page 36 shows how they love to dilute the stock. Just look at the ridiculous dilution from only 3 months! and this is typical of them....this wasnt a particularly dilutive 3 months for these guys.
buy the stock if you like it......sell it if you dont..... but just realise that its the constant and extremely irresponsible way that these guys dilute their stock that has caused us to be sitting here at such a low PPS and also such a low market cap.
i would advise anyone looking to make any decisions on MSLP to read their reports thoroughly and realise what they have been doing to raise money and what they spend their money on before making any decisions.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.
On April 6, 2011, the Company issued securities exempt from the registration requirements of the Securities Act pursuant to Section 3(a)(10) of the
Securities Act, to a third party fund. Pursuant to this transaction, on April 6, 2011, the Company directed its transfer agent to issue and deliver to the
third party 2,000,000 shares of the Company’s common stock subject to adjustment, in satisfaction of a debt in the amount of $50,000.
On April 15, 2011, the Company issued securities exempt from the registration requirements of the Securities Act pursuant to Section 3(a)(10) of the
Securities Act, to a third party fund. Pursuant to this transaction, on April 15, 2011, the Company directed its transfer agent to issue and deliver to the
third party 2,000,000 shares of the Company’s common stock subject to adjustment, in satisfaction of a debt in the amount of $58,644.
On April 15, 2011, the Company issued 100,000 shares of the Company’s common stock to a consultant for services to be rendered at a fair value
of $8,100 ($0.081/share), based upon the quoted closing price trading price on the date of issuance. The issuance of such securities was exempt from
registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On April 27, 2011, a convertible noteholder converted $8,225 in principal into 350,000 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On April 27, 2011, the Company raised gross proceeds of $40,000 through the sale of a (6 months) convertible note at a conversion price of 60% of the
average of the lowest three closing prices in the ten days preceding a conversion date. The notes bear interest at annual rates of between 8% - 10%. The
issuance of such securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On April 27, 2011, the Company raised gross proceeds of $40,000 through the sale of a (6 months) convertible note at a conversion price of 60% of the
average of the lowest three closing prices in the ten days preceding a conversion date. The notes bear interest at annual rates of between 8% - 10%. The
issuance of such securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On April 28, 2011, a convertible noteholder converted $25,208 in principal into 892,326 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On April 29, 2011, a convertible noteholder converted $25,170 in principal into 923,685 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On April 30, 2011, the Company issued 319,149 shares of the Company’s common stock to a consultant for services to be rendered at a fair value
of $15,000 ($0.047/share), based upon contract value. The issuance of such securities was exempt from registration pursuant to Section 4(2) of the
Securities Act and Regulation D promulgated thereunder.
ITEM 1A. RISK FACTORS.
36
On May 1, 2011, the Company issued 3,723,404 shares of the Company’s common stock to a consultant for services to be rendered at a fair value
of $175,000 ($0.047/share), based upon the quoted closing price trading price on the date of issuance. The issuance of such securities was exempt from
registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On May 1, 2011, the Company issued 500,000 shares of the Company’s common stock to a consultant for services to be rendered at a fair value
of $23,500 ($0.047/share), based upon the quoted closing price trading price on the date of issuance. The issuance of such securities was exempt from
registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On May 2, 2011, a convertible noteholder converted $25,219 in principal into 951,667 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On May 6, 2011, the Company raised gross proceeds of $125,000 through the sale of a (6 month) convertible note at a conversion price equal to the
lesser of (i) the average of the lowest two closing prices during the five days preceding a conversion date or (ii) $0.025/share. The notes bear interest at
an annual rate of 12%. The Company also issued 5,000,000 common stock purchase warrants with an exercise price of $0.03 per share to certain
accredited investors. The issuance of such securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D
promulgated thereunder.
On May 11, 2011, a convertible noteholder converted $36,400 in principal into 1,400,000 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On May 11, 2011, a convertible noteholder converted $36,400 in principal into 1,400,000 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On May 12, 2011, the Company issued securities exempt from the registration requirements of the Securities Act pursuant to Section 3(a)(10) of the
Securities Act, to a third party fund. Pursuant to this transaction, on May 12, 2011, the Company directed its transfer agent to issue and deliver to the
third party 3,023,040 shares of the Company’s common stock subject to adjustment, in satisfaction of a debt in the amount of $75,576.
On May 17, 2011, a convertible noteholder converted $10,228 in principal into 417,467 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On May 17, 2011, a convertible noteholder converted $10,228 in principal into 417,467 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On May 17, 2011, a convertible noteholder converted $2,018 in principal into 82,834 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On May 19, 2011, a convertible noteholder converted $10,067 in principal into 402,667 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On May 19, 2011, a convertible noteholder converted $40,088 in principal into 1,083,450 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On May 19, 2011, a convertible noteholder converted $10,024 in principal into 237,256 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
37
On May 19, 2011, a convertible noteholder converted $9,018 in principal into 243,722 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On May 19, 2011, a convertible noteholder converted $10,022 in principal into 230,388 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On May 19, 2011, a convertible noteholder converted $50,110 in principal into 1,186,025 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On May 19, 2011, a convertible noteholder converted $25,110 in principal into 865,848 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On May 19, 2011, a convertible noteholder converted $25,110 in principal into 865,848 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On May 19, 2011, a convertible noteholder converted $5,034 in principal into 165,048 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On May 19, 2011, a convertible noteholder converted $25,170 in principal into 825,241 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On May 19, 2011, a convertible noteholder converted $10,068 in principal into 335,598 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On May 19, 2011, a convertible noteholder converted $5,140 in principal into 102,805 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On May 19, 2011, a convertible noteholder converted $15,102 in principal into 554,199 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On May 19, 2011, the Company issued securities exempt from the registration requirements of the Securities Act pursuant to Section 3(a)(10) of the
Securities Act, to a third party fund. Pursuant to this transaction, on May 19, 2011, the Company directed its transfer agent to issue and deliver to the
third party 4,031,853 shares of the Company’s common stock subject to adjustment, in satisfaction of a debt in the amount of $100,796.
On May 20, 2011, the Company issued securities exempt from the registration requirements of the Securities Act pursuant to Section 3(a)(10) of the
Securities Act, to a third party fund. Pursuant to this transaction, on May 20, 2011, the Company directed its transfer agent to issue and deliver to the
third party 3,774,744 shares of the Company’s common stock subject to adjustment, in satisfaction of a debt in the amount of $83,044.
On May 24, 2011, a convertible noteholder converted $39,000 in principal into 1,500,000 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On May 27, 2011, a convertible noteholder converted $25,000 in principal into 1,250,000 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
38
On May 31, 2011, a convertible noteholder converted $78,000 in principal into 3,000,000 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On May 31, 2011, the Company issued 333,333 shares of the Company’s common stock to a consultant for services to be rendered at a fair value
of $15,000 ($0.045/share), based upon contract value. The issuance of such securities was exempt from registration pursuant to Section 4(2) of the
Securities Act and Regulation D promulgated thereunder.
On May 31, 2011, the Company raised gross proceeds of $10,000 through the sale of a (1 Month) convertible notes at a conversion price of the average
10 day trade pricing divided by 200% of the outstanding principal balance. The notes bear interest at a rate of 8%. The issuance of such securities was
exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On June 2, 2011, a convertible noteholder converted $125,345 in principal into 3,679,355 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On June 2, 2011, the Company issued securities exempt from the registration requirements of the Securities Act pursuant to Section 3(a)(10) of the
Securities Act, to a third party fund. Pursuant to this transaction, on June 2, 2011, the Company directed its transfer agent to issue and deliver to the
third party 4,932,500 shares of the Company’s common stock subject to adjustment, in satisfaction of a debt in the amount of $98,650.
On June 3, 2011, a convertible noteholder converted $15,000 in principal into 625,000 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On June 3, 2011, the Company issued securities exempt from the registration requirements of the Securities Act pursuant to Section 3(a)(10) of the
Securities Act, to a third party fund. Pursuant to this transaction, on June 3, 2011, the Company directed its transfer agent to issue and deliver to the
third party 2,777,777 shares of the Company’s common stock subject to adjustment, in satisfaction of a debt in the amount of $50,000.
On June 7, 2011, the Company issued a noteholder 402,667 shares of the Company’s common stock in consideration for an extension of the
noteholder’s note. The issuance was recorded as interest at a fair value of $14,778 ($0.037/share) based upon the quoted closing price of the Company’s
common stock on the date of issuance. The issuance of such securities was exempt from registration pursuant to Section 4(2) of the Securities Act and
Regulation D promulgated thereunder.
On June 8, 2011, a convertible noteholder converted $50,000 in principal into 2,840,910 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On June 9, 2011, a convertible noteholder converted $63,473 in principal into 3,100,000 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On June 14, 2011, the Company raised gross proceeds of $40,000 through the sale of a (9 months) convertible note at a conversion price of 60% of the
average of the lowest three closing prices in the ten days preceding a conversion date. The notes bear interest at annual rates of between 8% - 10%. The
issuance of such securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On June 20, 2011, a convertible noteholder converted $50,000 in principal into 4,132,232 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
39
On June 20, 2011, a convertible noteholder converted $71,663 in principal into 4,500,000 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On June 23, 2011, a convertible noteholder converted $47,775 in principal into 3,000,000 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On June 27, 2011, the Company issued securities exempt from the registration requirements of the Securities Act pursuant to Section 3(a)(10) of the
Securities Act, to a third party fund. Pursuant to this transaction, on June 27, 2011, the Company directed its transfer agent to issue and deliver to the
third party 3,636,363 shares of the Company’s common stock subject to adjustment, in satisfaction of a debt in the amount of $40,000.
On June 29, 2011, a convertible noteholder converted $15,000 in principal into 955,414 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On June 29, 2011, a convertible noteholder converted $20,000 in principal into 1,273,885 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On June 30, 2011, a convertible noteholder converted $6,600 in principal into 417,722 shares of the Company’s common stock. The issuance of such
securities was exempt from registration pursuant to Section 4(2) of the Securities Act and Regulation D promulgated thereunder.
On June 30, 2011, the Company issued 500,000 shares of the Company’s common stock to a consultant for services to be rendered at a fair value
of $15,000 ($0.030/share), based upon contract value. The issuance of such securities was exempt from registration pursuant to Section 4(2) of the
Securities Act and Regulation D promulgated thereunder.
thanks i will check it out. im not lazy to look myself just didnt know where to go to find it. thanks again
Thanks for the link, that SS sure looks good!
uuum sorry to keep harassing but i still dont understand the thing you said in some posts about "After today 9 trading days to cover by law" - can you explain or link me to something that will help me understand?? thanks!
hi Vikingz I'm really trying to understand what it is that made 9 trading days from now (7 now i guess) a point where the shorts must legally cover. Could you or anyone else be so kind as to explain or link me to something I'm really trying to learn but google wasnt much help. thanks!
I'd be interested to see those links too so i can try understand it all. thx.
11 more trading days before shorts/naked shorts must cover by law...
In fact I will correct myself...SFIO proposes it is selling 80% of its Belgian Subsiduary "Smokefree Bvba". It is unclear as of yet what geographical area this subsiduary has distribution rights for, but it may be all of Europe. Or perhaps not.
Hi jdodd, no it doesnt change SFIO shares. SFIO shares remain the same...all that is proposed will happen is that SFIO is selling 80% of its European Subsiduary "Smokefree Bvba" to another company. The rest of SFIO remains the same.
This doesnt affect the DTCC lock in any way.
Its worth remembering that what is reported in the PR is only a "letter of Intent" and nothing will happen until an actual contract is signed anyway.
The company did indeed achieve significant growth in that time. They completed their application for patents in Europe aand the US, they created new lines of products, they moved to a new premesis, and since the REAL was on sale just a couple months later they clearly finalised production and logistics in order to sell their product through their website as well as maintaining or growing other areas of their business.
I've never seen anywhere where SFIO said that it had already made significant revenues or revenue growth. I have only seen them predict revenue for the future ones full distribution is achieved.
Wether people think the company should have already been at a point where we are in full distribution and profits are coming in or wether they believe the company is capable or incapable of doing everything they said they would is personal opinion right now.
I just dont think you should be telling people not to trust SFIO because they lied about revenue and profits in former PR's because its just not true.
Denverson / SFIO PR now on Denversons Website
http://www.denverson.com/index.php?option=com_frontpage&Itemid=1
Not new news as such, but nice to know Denverson is excited about it too.
You should read the PR again as you appear to have misunderstood it.
The letter of intent proposes that SFIO would 80% of its Belgium Subsiduary "Smokefree Bvba" in exchange for cash and notes valued at circa $1million plus future unspecified collaboration and royalties. SFIO isnt getting 80% of anyone elses stock.
It isnt a "mysterious subsiduary" at all.. just google it it's been part of the company for ages.
I have read all of the SFIO PRs and the only ones that I see have missed it so far have been the ones surrounding delays deliveries and customs issues. The ones that talked about "huge profits" as you call them were obviously projections based on when the product is distributed fully. You know full well they have never claimed to have made profits so far.
Investment Banks provide finance to development stage companies all the time because of their POTENTIAL to make money in the future. But you know that already. Why do you think Investment Banks and Venture Capital firms exist... to lend money to profitable companies that dont need it?
Of course SFIO has losses so far...they have spent their time and money developing a product, getting patents, ensuring FDA compliance and running their company. Now they have done the hard ground work and are in a position where they can legally sell their product and have protective patents and patents pending to protect their product. They need the finance and partnerships to do this correctly now.
In any case, I'm not blind to the postives or negatives surrounding this or any company. We do need more clarity as to the details of this potential deal. But to say there is no way that unprofitable companies can get financing is untrue. And to say that this company is over is untrue. This company has worked too hard and achieved too much and clearly George Roth is working hard to achieve his goals and make this company into what it should be.
LOL FofoH. youre too smart to think that a development stage company with no revenue as of yet cannot gain funding. Arent you??
Apart from anything else there is already up to $3.5 million funding package available as stated in the PR
"I have also been informed by the Mr. Dube, Chairman of the Denverson Board, and its Investment banking Company, that the Denverson Management has already been able to create a Bond Security funding package of up to US $3,500,000 as collateral backing for the company."
Details of the package need to be made clearer to us, when and if the deal is signed, but to state that a company cannot afford the what it states in the LOI because of a zero balance sheet is ridiculous!
http://finance.yahoo.com/news/Smokefree-Innotec-Enters-Into-prnews-3214503494.html?x=0&.v=1
Great post from you too Yoda, Thank you for the reminder of how TINY TINY TINY volume has reduced the price of this stock as you pointed out...but thats expected since almost nobody can trade it right now. Indeed the current price of SFIO wether it be 0.005 or $1.00 means nothing at all because almost anyone that would want to trade it is locked out.
I agree George Roth has done really well in working to find finance for the company without diluting on shareholders. I have never ever lost confidence in this stock because i know what we own and its clear to anyone that Roth is working very hard to make this a success. But I'm even more sure now than I was 3 days ago that things are moving ahead nicely.
Time will tell all the details of this deal if and when it goes through but i doubt Roth would go into anything that wasnt going to be a good deal for SFIO!
I disagree completely, i know youre very negative on this stock and are entitled to your opinion of course.
But Denverson going public has nothing to do with the running of SFIO's own public company. SFIO would be given convertable notes that they could choose to convert into X amount of Denverson shares then decide if they want to keep or sell them. They certainly wouldnt have access to anything that would allow them to make company decisions or have any say in the issuance of Denverson shares or anything like that. They would merely be a minority stockholder in the newly public Denverson.
I wish i could see where you are coming from to get your ideas, but alas i cant.
No probs, I had to do a little search myself just to make sure all the entities mentioned are for real and exist...and they do. The PR is a little too vague in many respects to know exactly what each companie's plans are...i guess once its all thrashed out and the deal is signed we will know more.
I still think its a very positive sign though
SFIO is only selling 80% of it's Belgian subsiduary (Smokefree Bvba)...not 80% of the entire company. We are not talking aqcuisition here at all, nor a new ticker. Companies spin off subsiduaries all the time, just look at HP...they are trying to sell off their PC subsiduary right now.
SFIO is selling a section of its business to get cash, SFIO the company remains intact.
The PR talks about some numbers.. $1mil s.tanding out for the purchase. Doesnt say how much of that is cold hard cash or how much is in notes which may not be convertable for a while. This will need to be made more clear, along with what SFIO plans to do with the money. We have no idea how much cash or company debt the Belgian subsiduary carries so its not possible right now to answer difinitively wether SFIO or Denverson is getting "the better deal".
On the business side of things, if we are to take the PR at its word, then it appears a very good relationship for SFIO (remember sharing of usage rights to intellectual property, SFIO to receive royalties from Denverson etc) and not forgeting that SFIO (parent company) will still retain 20% ownership of the Belgian susiduary.
All in all if SFIO gets a decent amount of cashflow from this deal, and uses it wisely, its a very good thing for us.
My own personal opinion is they need to cash to push through their US campaign and have decided the best (perhaps only??) way to get that cash now is to sell off a subsiduary. Denverson is obviously paying for the chance to get their share of a great product and hopefully SFIO is smart enough to ensure they get a good deal out of whatever final contract is signed.
Personally I would have rather seen SFIO do a direct dilution of 50 million shares at .02 or higher to get the cash...but i guess TS screwed that for them, so they are doing the next best thing. This is far better than any other kind of toxic financing that they could have pursued, and which most pinkies do.
Good news and I'm happy its happening.
an average cigarette yields about 1 mg of absorbed nicotine (first few words of second paragraph in link).
http://en.wikipedia.org/wiki/Nicotine
so by your logic....instead of smoking ordinary cigarettes, save your money and hold and suck on a pencil or pasifier. Or your thumb!
Thanks for your reply. Yes i noticed the date was July 15th which is why i was concerned. At that time they didnt have enough cash to pay off the debt.
Are you sure they have paid it off before this new news came out?
I cant see that the company has PR'd or that there are any filings about the payoff. Did you receive some info on it?
I ask because obviosuly if they need still to pay off 19million with their 22mil sale then it only leaves them with 3mil "cash" from the sale.
I notice in the Quarter 1 financials under section 9 it says:
""The Company has related party debt totaling $19,232,753 which is due July 15, 2011. If the Company is unable to repay its debt or extend repayment terms, the Company may cease operations""
does anyone know if this debt was paid off or the loan extended? Or will the proceeds of the sale today go to pay that off???
if anyone can shine some light on this it woule be appreciated
here is the financials if anyone wants to take a look:
http://precisionir.api.edgar-online.com/EFX_dll/EdgarPro.dll?FetchFilingHTML1?SessionID=TBNkFFV5kdj2-nS&ID=7931801