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isnt going to happen. i will find out where those shares went, how they reorganized in the dark, and the financial impact of the IP settlements. if the SEC wont bring these facts to light through forced statements/restatements - i will pursue civilly.
there is a fundamental and considerable difference between a poorly executed plan or flawed strategy and direct conversion of funds and/or a blatant failure to uphold fiduciary responsibilities. without holding them accountable for the past - they are provided free reign to continue in the future.
considering the 10 days prior it went from basically the same range it is now UP to $0.008 (and a little higher) where does the trend start/end? If it is a 2-3 week trend - it is flat. if one applies one week - then it is decidedly down. if one looks at 1 year - it is unarguably down. any trend must be put in perspective to time/price and compared to a different time period.
a year ago it was trading at $0.02 and topped out at an intra day high of $0.085 and close of $0.07 back at the beginning of july. with either of those starting points - it is in a significant downtrend.
however, if one considers the bottom that was hit on 10/7 at $0.0028 - it is on an uptrend since as it is right now 150% higher than where it hit on the 7th.
it may or may not go back there (or lower) today or tomorrow. it can just as easily go back to $0.012 as quickly and as unpredictably as it will go down.
as a long term investor - i am comfortable with the last PR and it has reaffirmed some confidence. however, i would like to see/borderline expect a pre announcement prior to earnings to put the results to be filed into context prior to being shared. they will not show $1-2MM in revenues for 3Q14 and any/all expectations of such should be tempered prior to release and put into context where they expect to be end of 4Q15 and if they can reaffirm/adjust 2015 expectations accordingly.
TJG - what do you want the company to do/announce?
they can only report on what is going out the door as they cant claim that as revenue until it is actually paid. now - we can get into a discussion on GAAP reporting and how they are interpreting/reporting but that is somewhat a moot point due to a virtual lack of sales the past several quarters due to being locked down/not having product for sale.
if they provide guidance and give updates about how the brand is being responded to what their expectations are for next year (ie -guidance) - they they are being accused of pumping/doing nothing but providing forward looking statements with no teeth/facts.
right now the stock is a complete free for all with the past dilution (and further impending dilution) creating a haven for traders as it goes back and forth. very little the company can say right now will change that. the only concrete change will come in the reported numbers which are due 11/15. even then - the majority of sales in 3Q14 wont be booked until revenue until 4Q14 which wont be available until 3/30/15.
i have occasionally actively traded/flipped stocks when i have followed them for long periods of time and got a feel for the drivers. i could probably do so here as well with a relatively high level of confidence (relative to risk). however, for me, i see this as a long term investment with a 6-24 month time horizon for results/proof of viability in the market place. i have given the company considerable latitude on the production issues and resulting cataclysmic results as i have spent a lot of time in the mfg environment and ran small businesses and understand how these things can blow up very quickly and destroy small companies. whether right or wrong - i will be able to confidently reconsider 3/30/15 with that report.
at that time - either the brands/company is viable or it is not. they did $2MM in 2012 prior to production issues and they are giving guidance for $5MM in 2015 primarily along the small cstore/small chain operators.
detractors harped they would never get funding.
then they said the funding they got was horrible.
then they said they wouldnt make product.
then they said the product produced wasnt real/wasnt being shipped
then it wasnt being reported on sales amounts.
etc
etc
there is plenty of truth in most of what they say. however, all long term investments must be put into context. is this company in a better position than it was 12 months ago? what was the price 12 months ago and what were the sales/expectations of sales? how many shares were OS then vs now?
roughly twice as many shares now and the price is anywhere from 5-10% of what it was. if one makes the basic assumption that the company is legit and therefore the PRs/Social media posts are not a big ruse to give the appearance of impending success/sales - than the future looks very attractive $5MM vs $2MM when the market cap is a fraction of what it was when they were doing $2MM.
if you have specific concerns or would like to see specific items being announced/reported on - contact the company/Veal and make the suggestion. i have found him to be very attentive and willing to listen/discuss where he is able to.
i can not fault the company for trying to manage the share price day to day when they are in the midst of dilution that was a known entity. volatility will remain until the picture becomes clearer/more certain and the shares being flipped for fractions of a cent get more fully absorbed by long term holders (such as myself). i started buying again today when it breached $0.004. i apparently wasnt the only one who did so. however, the shares i have wont be turned over if/when it crosses $0.01 later this week/next week.
the stock remains highly speculative and there will not be a solid, viable report for investors to really sink their teeth into until 3/30 when they have a full quarter of sales/revenues to report on and three quarters of sales to discuss (3Q-4Q14, and 1Q15 which wont be reported until 4/15/15 but can be discussed in the 10K 2014 to be released on 3/30).
i agree with another poster that i think it is reasonable for teh company to put an actual dollar figure to the pallets as they go out. they can either provide number of pallets or total sales value of the pallets therefore keeping revenue/bottle confidential.
however, the company would be putting themselves into serious legal jeopardy claiming they are shipping all of these pallets and none of them actually being shipped out. further, if they are shipping them with no intent on collecting - how are they going to provide any value for themselves in terms of enriching themselves on the backs of shareholders?
justice - where did the MLOG shares that MOBL owned go?
justicewillbesoon Friday, 03/30/12 11:41:43 AM
Re: cephas7 post# 17342
Post # of 17370
MLOG READY TO EXPLODE =HUGE CONTRACTS NOW ON THE WAY== MOBL OWNS A TOTAL OF 65%
the reports on pinksheets.com show MOBL to own 1.5MM of NUTT but they owned 3.7MM shares of MLOG when there were only 7.2MM shares of MLOG outstanding (which is where your 65% came from).
wright controlled MOBL and was the COB of MLOG. when MLOG last reported back in 2004 - he wasnt listed as a shareholder. how did he secure a controlling interest as a director during a dark period and not inform the public?
how did MLOG go from 7.2MM to 32MM where it was (or around that number) when it did the reverse merger into NUTT?
how did mecc and wright become 5%+ owners?
as a former MOBL shareholders and ardent supporter of the company/mgmt (based on your posts on the MOBL board) - why do you give the CEO/COB a pass on these questions that appear to have taken money out of your back pocket...?
"Anything problem with this company -- I feel great always"
huh...?
here is a more detailed summary that i posted on Yahoo from a request from another poster. i had to split it up in several parts due to the character limits there.
i have followed this company for several years and do not believe it is viable long term. history of failed launches in "hot sectors" and a seemingly never ending increase in shares for acquisitions that dont make sense to the core (which i admit i dont even know what it is anymore) and they have recently authorized the insiders to take salary in convertible shares in lieu of cash. very fishy especially considering the history fo failures with no shareholder follow up. biggest one is their CC SmartWatch which was supposedly launched 12/1/13 accordingly to their PR released and to date - NOTHING has been disclosed concerning results.
PART 1
I ran some general numbers for current and future Fair Value (FV) projections based on trailing 4 quarters revenues and earnings and comparing to future revenues brought on by lottery revenues.
ASSUMPTIONS
USD/RMP = $1/6RMP
Monthly Increase in REV = RMP80MM or $13.3MM
Company will maintain trailing 4Q Return on Revenue (RORev) at 6.74% (I use RORev to model furture earnings since there is no concrete GM numbers provided by company).
Industry PE compared to Apple at 15.75
Current share price of $0.03
CUrrent OS is 79.8MM according to Yahoo
Future OS includes 80MM for lottery dilution and @10MM in future convertible debt (still remaining)
Does NOT include convertible salary that company announced in last 8K
With those assumptions - here are the figures based on the last 4Q providing a "fiscal year"
Trailing 4Q numbers: $4.2MM REV and $284K EARN
EPS = $0.0036
PE = 8.43
RORev = 6.74%
If one assumes a PE of APPL is a fair "target" to compare to and uses 15.75 as that number - than the PE Multiple to Industry Average is 1.87. If that is applied to current share price - than it would provide a FV SP of $0.056 (which is just below where it topped out last week).
Now - if one applies RMP80MM/month into the revenue equation and uses the same RORev estimate to assume what earnings could be obtained - it would provide the following numbers:
Future OS = 169.9MM shares
Future 4Q= $57.5MM REV and $3.88MM EARN
EPS = $0.0228
PE = 1.31
Now - if one applies the same target PE of 15.75 - the multiple is 11.99 and would provide a FV SP today of $0.36 (based on current $0.03 SP).
From here - one can start giving "growth" multiples on industry average. For example - aggressive growth companies are often assigned (by the market) multiple anywhere from 5 to 20 times PE (think Facebook) and can be over 100. If one assigned a modest growth multiple fo 5x - one could multiple the current and FV SP by 5 each and get today at $0.11 and FV at $1.80
PART 2
These obviously show a glimpse of the potential assuming IF the company reaches $13.3MM month and maintains GMs/RORev.
However, if one looks at the trailing 4Q of revenues – they are:
2Q14 $629,000
1Q14 $845,000
4Q13 $1,509,000
3Q13 $1,230,000
These are declining and NOT increasing. Due to these declining revenues, no past history provided on JIFU prior to acquisition (as it was private), and the constant dilution (from Jifu and convertible debt), the stock price has been hammered and the market is not willing to assign a current industry multiple let alone a growth multiple.
This is further exasperated due to never turning past announcements into growth. Mach5 and CCWatch – accounted for what appears to be $10-15K of revenues in past quarter based on quarterly report:
“Our revenue for the three months ended June 30, 2014 totaled $629,448, an increase of $613,420 or 3,827% from $16,028 for the three months ended June 30, 2013. This increase in revenue was primarily due to the acquisition of Jifu in the middle of 2013, which generated revenue of $617,588.”
The company is showing consistently decreasing revenues on last dilutive acquistion, no announcement/details provided on a major launch almost a year ago now (12/1/13), and now shareholder will take a 100% dilution hit on another, unproven, undetailed, acquisition and are expected to “trust” mgmt that revenues/profits will follow.
That is why I remain very skeptical of long term prospects and consider this stock good only for short term trading opportunities. Until the company definitively proves it can take an idea from concept to profitability and shows sustained revenues with a clear trend towards profitability, it will remain mired in volatility and taken advantage of by traders and hedge funds that will use the (for now) relatively low OS to manipulate and swing the price back and forth with a consistent long term downward trajectory. This is basic market mechanics.
PART 3
The variable/convertible compensation mgmt has just assigned/granted itself is further fodder to attack the viability of the organization. Show me (1) example of a legitimate company providing the option of taking salary in a convertible share format.
Now – if I am wrong, and these are only models and assumptions based on reported facts in figures in filings, past history of company/mgmt, and years of experience with microcaps, then there could be a very good opportunity for rapid price appreciation. However, if the company does turn around the revenue decline and show real gains – I would argue that a long term investor would have the ability to take a large position at a higher price point with substantially less risk. If one can get in at $0.10-$0.20 for a long term gain (based on future growth potential that is substantiated by one or two quarters of REAL growth in top and bottom line) of $1.50-$2.00 share – they will still have a very solid return while absorbing a fraction of the volatility and price declines the company is poised to see in the short term.
Markets are created by varying views on risk/return and investment horizons. Those that have the risk capital to put in play for a long time with highly speculative investments will usually see the highest returns (over a long period of time). However, they will also see more total (or near total) losses (on individual investments) along the way as part of the risk in going for those long term, highly rewarding plays. On the other end of the risk spectrum is grandma and grandpa taking 1.5% on a savings account or 2-3% on long term bonds where the only risk is death or catastrophic collapse of the US Government.
PART 4
While I remain highly critical and skeptical of this company/mgmt (due to the above and what I have previously argued about their history and failed launches that are never discussed afterwards), I have also laid out (not in this much detail) the future potential should they make it. I think their history suggests latching on to “hot” markets and stringing along naïve investors about the long term potential is a major red flag. The lottery business fits the same mold. Very difficult to do any due diligence on the actual business that was acquired to determine where any real value exists.
As I have publicly declared several times on this board and others, I have never shorted this or any other stock. I have never dealt with this company, mgmt, any employees past or present, in any professional or personal regards other than direct communication attempts via phone and email as DD for my investment purposes. To date, those communications have been mostly fruitless. Strauss has routinely dodged or ignored requests for information or clarification on filings that would NOT violate disclosure rules. I have also left voice mails at company listed main number and email asking for information on who to contact to purchase the CCWatch and those have also gone ignored. How do you generate revenues if you don’t respond to basic questions from potential customers on your products…?
Don’t take my word – do your own DD. Call the company and try to get info on CCWatch (or Mach5 for that matter). Another investor did and has shared his information. Contact Strauss and ask him about inconsistencies in filings on the smartwatch release that I have highlighted in past notes (inconsistent timelines, launches, revenue expectations, etc). Ask him about the declining revenues since Jifu acquisition (that you wont get a specific answer but if/how he addresses those types of questions can provide just as much information).
PART 5
Finally – compare and contrast the information and support provided in these posts with Ferrari and his constant attempts to discredit me as a market playing short or disgruntled employee. Challenge him to support his own ridiculous (by nature of no support and complete opposite of what the market is valuing at) price predictions that fluctuate wildly. More importantly – challenge his investment horizon as he has provided personal price targets and two days later has sold about 1000% below said targets. I see that as “pumping” or “hyping.” He suggests providing objective, market and filing supported opinions and models, and overall price projections based on such as “bashing.”
If my assumptions/assertions about mgmt/company viability are incorrect, the share price has room for very substantial increases (based on models presented). But, that can be said for almost EVERY stock in existence. The real measure is how much risk is associated with that future/potential return and if there are better risk/reward scenarios to employ risk capital until the reward becomes clearer and/or the risk decreases.
I welcome any constructive debate as this is the intent of message board forums such as this. I also thank those that have privately shared their own DD.
NP. there is an insane amount of misinformation on this board. some that is probably intentional and a lot from just a lack of DD and/or not remembering some numbers/terms correctly.
for instance - LTCG may or may not be an investor in the company but those shares never came from the company. no one can say whether or not he invested on his own
he is not a "partner" in a share/corporate make up standpoint as he has no standing with the company but he certainly has "partnered with" the company to promote the brand/energy shot. he is not paid/compensated for his promotion via social media or elsewhere but any promotion he does will have a direct effect on sales/money going to his foundation so he does have a vested interest on the eventual success of the shot/brand.
all of the money for his branded products go to his foundation. the licensing fees (up front and paid quarterly similar to WB) goes to the foundation as well as the ongoing royalties on product sold. this is all spelled out in detail in the public filings detailing the relationship.
hard to really decipher his or his foundation's involvement by reading these boards.
japanese agreement is another one. the terms of that agreement were spelled out immediately after announced in the 8K. it was a three year commitment. per the company's last 10Q - the agreement is still in play and has been extended.
i am usually the contrarian and raising the BS flags overwhelmingly more than i am defending a company/mgmt. there are so many penny/OTC stocks that exist as nothing more than shells to enrich a select few and often, naive investors are blinded by potential while ignoring reality. this stock/company sure looks like the same thing until one really starts digging and making some objective assumptions. for me - the biggest difference is being able to "touch" those making, selling, and distributing the product and being able to compare and contrast projections and enthusiasm from the company with what is actually going on on the street. that is very rare in the penny world.
for me - there is a very viable reason for the 2013 collapse. you have some excellent marketers running a public company that relied more on marketing and less on specific filings to promote and image of success. that is fine for marketing products - little tougher when marketing a company to investors. everything was fine until the wheels fell off and the production became an issue. then cash flow was seriously interrupted/near eliminated while they scrambled to rob peter to pay paul to get product.
most on here simply dont understand what it takes to run a small business let alone a public company. i have been in a similar situation where the priority was keeping the doors open and i had to make a lot of decisions that i didnt like but needed to for the short term. i had to be open with good suppliers that i trusted and had to keep others at arms length until i was in a position to negotiate/continue.
big difference - i never had to do all of this while i had thousands of investors in my face demanding answers, destroying my leverage with banks/lenders, and operating under the intense scrutiny of the SEC to remain within the confines of a disclosure rules. that is not easy. many companies hide behind disclosure and all questions are dismissed by IR as "not being able to discuss." i have never had this issue with the company with the people i have spoken to. there are several times when speaking to Veal where he simply said he was not able to discuss a particular question or follow up but addressed the issue in terms he was allowed to speak to or said the company would address with the investing community when they could. in every instance - the company did just that. was it always favorable or in the time frame when i/we wanted as investors? no. but i have found a consistent path of follow up.
another example i had is when i personally called to inform the company i wasnt able to get the HJOE shot open due to not having perforations in the shrink wrap. since i do a lot in the food grade manufacturing environment and packaging - i knew this was a production issue. since i was an investor (and not just a consumer) - i called right away as it affects the brand and my investment. the individual said something along the lines of "it is a known issue and one we are addressing." as it appears in the court filings of the lawsuit - this is one of those issues they had with the mfg that lead to many of their subsequent cash issues. the individual could have made up any number of excuses but addressed the issue without disclosing anything material. i like that approach.
a lot of this interaction has to be done first hand. one has to speak with distributors, c-store distributors and owners, clerks at the c-store, etc to get an idea how the end user is perceiving and responding to the product. i also had some customers at the NACS show that confirmed the traffic in their booth (not to the level that Lux detailed or the company) but did say it was active and vibrant the couple of times they went by. i had asked them to ask a couple of questions for me but they didnt due to the wait which was good and bad for me. it was bad that i didnt get some answers and street level feedback but it was good that the booth was busy enough where they didnt want to wait to talk.
so - when i look at this and consider the fundamentals and try to model the future - it all remains speculative and opinionated. i try to support my opinion with objective facts and assumptions so that it isnt some vague prediction but has real merit that can be discussed or debated (such as why using 4x instead of 10x on Price?revenue or was the booth traffic being driven by interest or gimmicks).
in any stock/company like this - i encourage those that like the story or risk/reward scenario to go out there and field check their assumptions and make sure there is a congruency to the company line and the street line. that is very rarely possible in penny stocks as there is nothing to touch to be able to do so. this is one that allows for a fair amount of first hand DD that only getting first hand will provide any real confidence.
Steven - I dont post on here often due to the issues with posts being removed but I will respond accordingly.
I think the verbiage and format of the release and $5MM target is very important and positive/bullish. unlike the Japanese distribution agreement that was announced - this was presented as guidance which has significantly more teeth. The Japanese agreement (terms and provisions) was immediately detailed in attachments to the 8K that was released afterwards and again in the subsequent quarterly filing. In a prior post (10/5/14 before announcement) - I did fault the company for not being more forthcoming in the difficulties. however, in light of their dire cash/marketing position - I can hardly crucify them for it.
easiest way to put some numbers to the announcement is to apply the raw numbers reelased in previous 10K to forward looking $5MM revenues:
Rev/Bottle $1.15 From 10K/10Q calculating per case
Absorbed cost/Bottle $0.47 From 10K/10Q calculating per case
GM/bottle $0.68
When reporting these numbers – Veal said the fully absorbed costs were expected to significantly decline as production/sales increase. Here are my comments prior to the announcement on 10/6:
“right now the company has around a $400-600K market cap. they did $2MM in 2012. if they do $2MM in 2015 (which i think is very, very doable) there shares should trade at around $0.05-$0.20 depending on the multiple one wants to apply and assuming the OSis at or under 200MM. for example - at $0.10/share and 200MM shares OS - that provides a $20MM market cap. if they do $5MM in revenues in 2015 - that is only a 4X multiple. at $600K market cap - they are trading WELL BELOW fair value in ANY model/multiple situation. the market has this priced at BK levels. while the balance sheet is certainly ugly - does the prospects/launch/field data suggest this company is going under...?”
So – assuming $5MM in revenues is a fair and realizable target and using the same cost/revenue per bottle percentage as above ($0.47/$1.15 = 40.8%) one could reasonable assume they will have roughly $2.04MM in costs for that production and just under $3MM in gross profit. From there, one can look at ongoing SG&A on a quarterly basis ($1.8MM for 2012 and 2013 and slightly increasing in 2Q14 to $545K/quarter) and assume they will have roughly $2.18 in SG&A in 2015 which would provide around $820K in net profit on around $5MM in revenues. This assumes cost per bottle does not increase (more than likely it will decrease) and SG&A does not significantly increase (past $545K/quarter).
I will assume they will probably have/will have secured lines of credit for production of new inventory in light of the sales data that should be non dilutive. If the numbers are robust and really show a definitive path to a conservative $5MM in revenues without any big wins (like clearing regulatory hurdles in Japan to open up that $10MM deal over three years) – then this should be a relatively easy line of credit to secure. Doing $820K on $5MM in revenues provides a robust ROI and ROCE.
As far as paying off debt, most of their debt has/is being converted to shares so they will have little long term debt remaining (from 2014) into 2015 absent of whatever capital arrangements they enter into between here and now. If the arrangements are on production basis and simple terms – I do not think they should need further dilution. They will have a 30-90 day window to need cash until AR catches up to AP and they become “self funding.” Now, an aggressive ramp up will push that back 6-12 months depending on how fast they ramp up. If you aren’t being paid in 90 days – you can not use that money to fund future production that will also be paid in 90 days once delivered. This is where the short term lines of credit will become critical. In the soft launch – these were not an option. There was no data, 12 months of no revenues, and a wreck of a balance sheet. Banks in this capital climate simply do not care about what may or may not have happened to production at the end of 2012 and into 2013..
That being said, once lenders (short or long term) get soft launch data up to and after Vegas launch/introduction that supports 2012 revenues (pre production issues) and forward looking 2015 revenues – all of a sudden the production issues becomes much more believable and how it wrecked the balance sheet. My hope is the results/data are robust enough to allow for lines of credit in the short term for ramp up that is non dilutive. The notes in September were on significantly better terms than the previous ones earlier in 2014. Regardless, none are attractive in terms of dilution for current and past shareholders.
However, as my paragraph above presents – even with the dilution – if the $5MM is real – today’s price is still extremely attractive for new positions. So when it comes to share price, I still contend that the price will remain extremely volatile but I expect it to now have an uphill trajectory instead of down. Risk continues to be removed from the equation while reward increases. However, dilution still remains a question mark and the company still has to turn successful soft launch into a real, national launch. With their precarious cash position and 2013 crash – long term investors will remain very cautious in general and this will be a haven for traders to swing it back and forth.
As another poster has stated (with some futility), it would behoove the company to put a real number to the social media announcements about shipments. If they are sending out 10 pallets today – they could simply say: “we are sending out 10 pallets which represent $82,800 worth of product to distributors in AR, KS, “ etc. This is easily calculated at 10 pallets * 7200 bottles/pallet * $1.15/bottle average(blended revenue)/bottle. This does not compromise individual supply agreements, pricing, etc as no customer names are provided and one can not assign an actual revenue/bottle to any one wholesaler/distributor/c-store. I do agree they should put a real number to these shipments. If they are concerned to that level – give a value to the shipments but don’t say how many pallets: “we are sending out $55K of product to distributors in IN and OH.”
As far as price targets – I think this remains very speculative in the short term (3 months). Investors need to see that 3Q14 report and see revenues have resumed (which will still be small because of soft launch/credit terms) and see that guidance for 4Q14 and then an update for 2015. until the forward looking statements become congruent/with increasing revenues (which will validate viability fo $5MM revenues), the increase will be tepid (but continue to creep up – the trend – not the large swings). Now, compare that to risk/reward scenarios that exist should that $5MM be obtained. At $0.10/share on 205MM share outstanding –that is a $20.5MM market cap on $5MM of revenues – that is only 4X sales. Forget 2013/2014 at near zero or trending to zero – if comparing to 2012 at $2MM to $5MM – that is a monster increase and more importantly – an exponential one. Comparing 2014 to 2015 is somewhat futile in a growth case as it becomes asymptotic and not useful modeling.
My best guess/assumption is we drift back between $0.05-$0.10 /share towards the end of the year as the market gets a better idea of how realistic the $5MM is. If it becomes apparent or more likely that $5MM is realistic – I think we could see the share price drift up between $0.10 and $0.20 1Q15 as the market would be assigning closer to a 5-10X sales. This would see significant dips and spikes throughout and will also depend on future dilution. Last week saw significant volume that was absorbed pretty handedly and volume has backed off significantly.
I started buying on the drop to $0.018, became more aggressive when it breached $0.014, more so as it approached $0.005 and very once it dropped below $0.0045. I started buying again after it dropped down again from the brief run to $0.012 and will probably resume if it significantly breaches $0.0045 again. Based on buying – it seems like others feel similarly. I am not a trader. I am a long term investor and not looking for a short term flip. If the price spikes to $0.05/share from here on very high volume – I will take some off the table with the expectations of buying back when it dumps. If it doesn’t – I will have a large, core position.
you are and you arent missing anything. it is near impossible to track down anything verifiable on the company's products or its acquisitions. another investor who posts on the Yahoo board was able to find a distributor for the ccWatch and actually bought one but it has been near impossible to get any information out of the distributor about the mfg and the investor cant even verify who the mfg is as XCLL's name is nowhere on it.
i just had several posts on this on yahoo if you are interested in reading.
there is certainly a pathway for some of the seemingly ridiculous "targets" presented on here but due to the history of past failures with the company in acquisitions and launches - the market certainly is not providing this latest attempt with any credibility or risk premium.
i only insinuated where the leaders/mgmt have refused to detail ongoings in publicly filed documents REQUIRED BY SECURITIES LAW.
how did they become 5% owners of MLOG without reporting and while in a dark period? where did those shares come from? it is only with their share gathering would they have had the shares needed to even approve/move forward the reverse merger without going to the general shareholders.
what happened to the other 1.5MM shares of MLOG stock that MOBL (MobilePro) owned? only 1.7MM are listed on the current NUTT major shareholder report (on last quarterly filing on pinksheets.com). they owned over 3MM at the time of their implosion and Wright was running the company at the time. where did those shares go? how did Mecc and Wright come into their shares and 1.5MM go unaccounted for from MBOL (to this day)?
why did Mecc and Wright not update MLOG financials prior to reverse merger as was reported they would do when originally announced?
why do Mecc and Wright still refuse to provide MLOG shareholders with accounting statements when they have a legal obligation and all legal terms are met for request?
why have they yet put out a 10K/year end statement to the private shareholders?
these are and remain very legitimate questions and are absolutely fair game in light of how NUTT came into existence during a dark period. the insinuations that there was "wrongdoing" during those times is supported by the rules and regulations for publicly traded companies during dark periods (which i have cc'd here).
further, in light of those ongoings - it is well within my right as a shareholder of both entities to question and assert concern over the legitimacy of what is reported with NUTT in lieu of what WASNT reported with MLOG (and still isnt).
the longer shareholders wait to question the financials of MLOG and/or go the SEC to open a formal investigation - the easier it is for those in control of the company to convert funds from IP settlements into salaries, bonuses, and such with ZERO public oversight (now that they are conveniently private).
all the talk of sunshine and roses down the road do not negate the path that was taken to get there. further, that tainted path will prevent any future potential until they come clean with the past irregularities.
if the company is willing to settle - i will forego further comment on past filings and failure to disclose if they make a reasonable and compelling offer for my MLOG and NUTT shares. to date, they have not taken me up on that offer.
What is "solid" about the company?
No full financials to really analyze the company and how they are using cash or what the terms are for capital.
No compensation figures for execs, BOD members, or the 5 special advisers in last 12 months.
No real growth/acquisitions in 2014 which is what their primary objective is according to website.
Any foundation they are hoping for with respect to trust going forward is anything BUT solid.
You will be fighting the never ending selling/conversion by the insiders. Good luck
This has been one of my more bizarre investments. I still dont know what to make of it. It remains very closely held so it wouldn't take much selling to drive it down. I still have no confidence that the capital group will reinvest. They have the most to lose but also may cut strings and recover what they can on the sale of the distillery and liquidate.
Wodka still is being advertised and in the stores in my market where they previously were (which was very few as I am in Michigan and not a key market). They are still very active on social media but that isnt really driving any expense.
The brands still seem to have value and if the distillery drives revenues on a contract basis until they regain the lost ground under the mismanagement - then the ship could quickly be righted. I wish I had confidence this would happen. Certainly wont read about it since they arent filing.
Interesting thought on playing chess with the filing to drive off remaining sellers. I havent sold any. Unfortunately my holeings were too large to make any dent/difference with the light volume and tanking price.
Still seems there is a lot more to this story than we are privvy to
What accusations. ..?
Doesnt take long to do an internet search on Nortel Networks and accoungs scandal to find pages and pages of news articles. I clearly said I didnt know if he was directly or indirectly involved but he WAS the CFO and the company DID have numerous restatements. I said I would do further DD.
I also noticed you once again ignored the questions:
How many of the 5 special advisers that NUTT brought on in the last year are still with them?
What are they being paid?
I didnt ask but why do they need all of these advisers. Right now they are running nothing more than a basic repack facility and a very small honey operation. Not exactly food science revolution. Why dont they invest in salespeople to sell out the production capability and find acquisitions where they can vertically integrate where product it is immediately accretive?
What happened to the Gardenburger LOI? Why did that fail?
it isnt like it is hard to be critical of that release.
first of all - he was CFO of Nortel Networks. that company was ultimately did in by accounting scandals/irregularities that lead to multiple restatements and even some of those had to be restated. several c-level execs were fired over it and several of those had criminal charges brought against them. not exactly a ringing endorsement. i am not sure if he had anything to do with those but i will do some digging later.
this is the 5th special adviser in the last 12 months. what are these guys being paid? are they all still on board? what are they actually contributing to the organization in their role and why do they require 5? also - if they are that valuable and are being compensated - why not make them directors and attach some fiduciary responsibility to the role?
corporate governance seems to be in his background. GREAT! let him dig around the MLOG reverse merger and encourage wright and mecc to put to bed all of the negativity surrounding their 3-4 years of silence, capital structure reorganizations that were not announced or reported, and how they became 5% owners while the company was in a dark period. I ENCOURAGE THIS IN DEPTH LOOK AT PAST CORPORATE GOVERNANCE TO DISPEL THE ASSUMPTIONS MADE BY ME AND OTHERS DUE TO NOT HAVING ACCESS TO FINANCIALS!
so - call your buddy Jay and ask him how many of those advisers that have been brought aboard the in the last year are STILL with the company and what they are (or were) being compensated and post that here for the board. i previously asked on the first three and was ignored and/or told that the information would be made public when they were a "full filing company"
Those werent mine. But they sat for a long time. Put in your order for a GTC
I showed you my shares. You know they are available and at what price. You arent taking what is available lower.
No thanks Jay...
whatever. your rhetoric and bravado doesnt match the real life trading. i showed it to you prior. i have put in offers in the $0.18 of size when the ASK was around $0.25 and you werent taking (or anyone else).
i will wait for the company to get a real pump cycle going in earnest and then you can have them.
Based on the volume - not only are you not loading up - NOONE is loading up as it remains at or near zero. Plenty of shares have been available. I have put 10-20K up several times at or below ASK and have had some of them under $0.20. Why havent you taken those?
If you believed that fervently in ths prospects - you wouldnt be squabbling over nickels and would be buying at the ASK to secure shares before others discover this "gem" and bid it up.
Show me tomorrow bow much you believe in this stock and go after the ASK
Same people that ran MLOG and MOBL are running NUTT. the past failures in mgmt/transparency have not been resolved. Until they are - there is no expectation that the current mgmt will operate NUTT any differently. So they have been, are, and will be until wright and mecc address those issues. In that regard - they remain totally relevant to NUTT and why even with guidance being provided and profitability being around the corner - the market is ignoring them.
The company has still not provided any terms of the capital arrangments announced in 2014 or compensation terms for officers/mgmt of NUTT. highly relevant.
sackler is doing everything right...?
what about cleaning up the past to remove the negativity and resistance to invest him any further...? why leave that shroud up when you could open up your investor base 10 fold? you consider that doing everything right?
how did he and Mecc end up with all of those shares during a dark period?
why didnt they file financials prior to completion of reverse merger?
where is/did the money go from the IP settlements?
why have they not filed detailed compensation agreements for the officers/mgmt? what kind of options/incentives?
long, long way to go before investors as a whole will probably agree with your opinion of doing everything right.
guess my last post got removed. must have hit too close to home for someone.
volume isnt too bad all things considering. i wasnt expecting an immediate tanking but more like slow speed with surges here and there.
the main debt holder has the largest vested interest in seeing this succeed than anyshareholder and they remained investing and capitalizing throughout 2014. so what changed if anything? they are still pushing Wodka hard on social media and the distillery should have been producing product in 3Q.
biggest risk for common shareholder is the value of BK for the debt holder as an "asset" to offset gains elsewhere. tough spot for the common holder to be in but a real possibility.
flip side - SO (Sarbanes Oxley) legislation compliance is VERY expensive for small companies (probably starting around $250-500K and up) and just may nto be worth it with the small shareholder base and limited capital. besides, with the debt holder controlling a majority - they really do not need to rely on shareholder votes for any major decisions.
if they remain legit and above board - they can still report through pinksheets.com at a fraction of the cost and keep the stock trading viably.
Well shareholders just got fvcked right in the a $$ hole on that 8K. Never good on a Friday postmarket release but I certainly wasnt expecting deregistering.
Not sure how they can claim negligible assets since they have the distillery on the balance sheet even if it is offset by the subordinate note.
goldie - i just came across your reply. have you followed the NUTT board? looks like a crony of Jay's. kind of ridiculous replies/posts about the past doesnt matter, they have turned over an new leaf, yada yada.
did you ever file a complaint with the SEC? if not - i would urge you to do so. i can not prove it is criminal but it is certainly suspect and without getting access to the financials (of course by now they have probably scrubbed them) - it cant be proven.
that being said - somehow they went from being non shareholders to controlling the company while it was in a dark period. that is not allowed and they are able to be sued for doing so.
2. Stockholders may bring litigation against the board of directors for, among other things, (a) breach of fiduciary duty caused by decreased liquidity and trading price resulting from “going dark,” if that in fact occurs, (b) insider trading by officers and directors on the basis of material non-public information (because no periodic reports have been filed or adequate information released), or (c) repurchases by the corporation on the basis of material non-public information.
http://www.dorsey.com/going_dark_voluntary_delisting_deregistration/
i encourage you to file a formal complaint with the SEC and encourage any others you know that were caught up in this. i highlighted the share differential when NUTT provided limited disclosure to pinksheets.com.
i am a chemical engineer by degree, have a strong background in finance (didnt bother getting the initials to "prove it"), have worked for Fortune 5 companies, and also run my own.
most serious, long term investors do not make one capital investment (stock purchase) and then never look at it again. if they did - then early investors would be staring at a significant/near total loss based on the close price friday.
however, that is an overly simplistic view of the investment. most will adjust their investment based on changing fundamentals. those that buy shares now based on long term expectations will dramatically lower their cost basis compared to a one time investor that bought x shares at $0.40/share three years ago. for those - they may take awhile to see a return (however, if my past models accurately reflect teh potential - it is certainly feasible in a couple of years).
if one looks at the current fundamentals and potential - the risk/reward scenario remains compelling. the company has a market cap of $600K (give or take) and should be able to, at minimum, eclipse 2012 revenues of $2MM. if those revenues are close (or even in the same ballpark) the closing price Friday remains very undervalued based on that potential. my last post provides the details for why. but - to specifically address this post - that is an over simplified look at ROI
luxe - thanks for the reply. i still would like to speak with you offline prior to the NACS show. i am trying to rearrange the schedule to make it but i dont think i am going to be able to attend. i wanted to bounce some ideas off of you and also ask a few questions about the show in general.
thanks
zackster - i disagree with your assertion about the company making too many mistakes in the beginning. the following is long and involved but i will walk through why i disagree and how i viewed, and now view the company in terms of an investment and the risk/reward. generally speaking - i think they made one, big mistake when looking at all things considered. the rest i think are perpetually debatable when applying context and attractive alternatives for different decisions/actions. again -it is long but for anyone trying to better understand the company/investment, or, try to reason their own investment (whether to buy more, hold, or sell), hopefully this gives you perspective to start your own objective approach to determine fair value for the stock and whether it still fits your risk profile.
with very limited capital or distribution presence - this small group of guys put this product in a new category in the largest c-store chain in the world and put it on shelves across the US and Canada. that is very impressive and i dont think many long time investors appreciate how difficult that is.
as far as the rest of the "mistakes" - which of those arent directly attributable to the manufacturing issue? i am not sure if anyone here has ever been involved in running their own company or dealing with a start up but cash is king and even if you micromanage every detail, at some point when it comes to manufacturing - you have to rely on your partners unless you are making every part yourself.
i have posted before concerning this but it bears repeating. the company had (and still does) very limited capital and relied on 3rd party mfg to produce the product. if you have ever run a start up and dealt with managing capital tightly - you realize you constantly are putting faith in the product moving and the ensuing revenues to fund the rest of the growth/operation. cash coming in pays for new inventory, operating costs, interest on debt, paying suppliers, and employee overhead (which in this company there was very little starting out).
when you have a major interruption in cash flow, you immediately start robbing peter to pay paul. there was no line of credit - they were a public company and operating in one of the tightest (and still very tight) credit markets since the 70s. from what i have gathered in reading the court filings and speaking to those in the company - they assumed the production interruption was a limited issue. i would say their biggest mistake was putting too much trust in the mfg after the first mistake and not putting their feet to the fire after the botched shipments. however, only knowing limited details - they probably had little leverage.
since they had limited credit and more than likely the majority of their capital was tied up in unsaleable product - their best bet at the time was probably to play nice and work with the mfg to "make it right." they cant threaten to take the business elsewhere because they had no money for preproduction/start up let alone to pay for the production run. this isnt like putting an order in for 10 widgets. when producing food/beverage third party - you pay for the entire production run up front. the mfg has no use for product that isnt picked up, not being paid for, or if a company goes BK prior to taking the order.
in this scenario (and i am making some assumptions based on conversations, filings, speaking with distributors/wholesales, etc), what other option did they have other than trying to get the mfg to honor the commitment? i notified the company early on about an issue with trying to get the shrink wrap off the lid of the bottle. there were no/very limited micro perforations. i didnt realize it at the time but the company couldnt tell me why. they had to limit the conversation to "production issues" but thanked me for bringing it to their attention. obviously - they new about it but what can they do at that point...? they had to move product. i inform companies regularly about failed/off spec product. being in the production environment and now sales - i appreciate people (distributors or end users) bringing the matter to our attention productively so that we can investigate, do due diligence, and correct the issue so that it doesnt happen again. i just had a conversation with Con Agra on a lid issue on my kids' pudding cups. being an engineer that has spent a lot of time in food grade mfg environments - i recognized the sealing issue and sent a polite email with pics showing them the issue. with the issue at HJOE - it made more sense since i was also an investor.
i have read several comments on here about they should have been at the facility inspecting every shipment/run. that just isnt feasible. they had 3-5 guys. they were responsible for everything including and most importantly, building relationships with distributors and retailers to accept and try the brand. further, as it is now known - they were already speaking with other mfg to replace the one that was failing. how does one expect someone from the company to babysit production? that is what contracts, QA/QC commitments, and trust in suppliers is for. when that trust is breached, you give them the opportunity to correct and if that doesnt work - you move forward. again, in this case, due to the very tight capital, they were highly leveraged and needed to play nice trying to appeal to the better sense of commitment from the supplier. obviously now that didnt work.
from there - everything snowballed with the capital tied up in unsaleable inventory. suppliers want to be paid for advertising, for rent, for tradeshow space, etc. TCA wanted the interest on the loan. major customers are demanding volume/supply based on contracts. how does a company with very limited resources manage the demand and allocate remaining capital appropriately? we know they had to honor the larger contracts (like 7/11). we also know that TCA owned/controlled a large part of inventory based on filings. it isnt surprising (looking back) that revenues dried up even though limited product was being shipped and some orders filled.
now - it is easy to blame this all on "excuses." however, i was noticing a supply crunch early on in 2013 when i started investing. several retailers and distributors i spoke with said "it sells very well when i get it but the company (or distributor if it was a retailer) has a hard time keeping up with orders." now - at the time i considered that as growing pains. since i had spoken to several across the country where it was heavily marketed (Vegas and New Orleans) and in areas where there was limited or no marketing (my area in the midwest) i was getting a consistent response. the larger/key areas were first in line for obvious reasons and they were crunched later.
in speaking to the company about supply and comments from the field, again, the company was vague. they had to be for two reasons. one - they dont want customers, distributors, and investors to know they had a major supply issue and two, they had to deal with disclosure rules as a public company. i knew at the time the guy was holding back and wanted to say more (and as an investor - i prodded where i could), but he kept going back to disclosure and pointing me back to filings (past or future). i had posted comments about 3Q13 being critical based on the revenue slump. however, by the time those numbers were to be due (11/15/13) - the supply issues were already a known entity. from there - knowing what i knew and starting to put the pieces of the puzzle together - the dried up revenues made sense. i also knew they were in a very dire position and i limited any further investment.
i was excited and encouraged about the Japan announcement but i did not invest further. i wanted confirmation that it was happening. i realized it would be chasing at the time but i had a considerable investment already and was ok with my position. i think this was and remains their biggest mistake. not so much the announcement, but the lack of disclosure/follow up once the regulatory issue holding up teh deal became a known entity. when the energy shot was announced with LTCG - that changed things dramatically for me. i looked at where they had been, the cash issues, the supply issues, etc and thought - why would a major name/brand be investing heavily in a venture that was going to fail? now - cynics will argue zackster - i disagree about making too many mistakes in the beginning.
with very limited capital or distribution presence - this small group of guys put this product in a new category in the largest c-store chain in the world and put it on shelves across the US and Canada. that is very impressive and i dont think many long time investors appreciate how difficult that is.
as far as the rest of the "mistakes" - which of those arent directly attributable to the manufacturing issue? i am not sure if anyone here has ever been involved in running their own company or dealing with a start up but cash is king and even if you micromanage every detail, at some point when it comes to manufacturing - you have to rely on your partners unless you are making every part yourself.
i have posted before concerning this but it bears repeating. the company had (and still does) very limited capital and relied on 3rd party mfg to produce the product. if you have ever run a start up and dealt with managing capital tightly - you realize you constantly are putting faith in the product moving and the ensuing revenues to fund the rest of the growth/operation. cash coming in pays for new inventory, operating costs, interest on debt, paying suppliers, and employee overhead (which in this company there was very little starting out).
when you have a major interruption in cash flow, you immediately start robbing peter to pay paul. there was no line of credit - they were a public company and operating in one of the tightest (and still very tight) credit markets since the 70s. from what i have gathered in reading the court filings and speaking to those in the company - they assumed the production interruption was a limited issue. i would say their biggest mistake was putting too much trust in the mfg after the first mistake and not putting their feet to the fire after the botched shipments. however, only knowing limited details - they probably had little leverage.
since they had limited credit and more than likely the majority of their capital was tied up in unsaleable product - their best bet at the time was probably to play nice and work with the mfg to "make it right." they cant threaten to take the business elsewhere because they had no money for preproduction/start up let alone to pay for the production run. this isnt like putting an order in for 10 widgets. when producing food/beverage third party - you pay for the entire production run up front. the mfg has no use for product that isnt picked up, not being paid for, or if a company goes BK prior to taking the order.
in this scenario (and i am making some assumptions based on conversations, filings, speaking with distributors/wholesales, etc), what other option did they have other than trying to get the mfg to honor the commitment? i notified the company early on about an issue with trying to get the shrink wrap off the lid of the bottle. there were no/very limited micro perforations. i didnt realize it at the time but the company couldnt tell me why. they had to limit the conversation to "production issues" but thanked me for bringing it to their attention. obviously - they new about it but what can they do at that point...? they had to move product. i inform companies regularly about failed/off spec product. being in the production environment and now sales - i appreciate people (distributors or end users) bringing the matter to our attention productively so that we can investigate, do due diligence, and correct the issue so that it doesnt happen again. i just had a conversation with Con Agra on a lid issue on my kids' pudding cups. being an engineer that has spent a lot of time in food grade mfg environments - i recognized the sealing issue and sent a polite email with pics showing them the issue. with the issue at HJOE - it made more sense since i was also an investor.
i have read several comments on here about they should have been at the facility inspecting every shipment/run. that just isnt feasible. they had 3-5 guys. they were responsible for everything including and most importantly, building relationships with distributors and retailers to accept and try the brand. further, as it is now known - they were already speaking with other mfg to replace the one that was failing. how does one expect someone from the company to babysit production? that is what contracts, QA/QC commitments, and trust in suppliers is for. when that trust is breached, you give them the opportunity to correct and if that doesnt work - you move forward. again, in this case, due to the very tight capital, they were highly leveraged and needed to play nice trying to appeal to the better sense of commitment from the supplier. obviously now that didnt work.
from there - everything snowballed with the capital tied up in unsaleable inventory. suppliers want to be paid for advertising, for rent, for tradeshow space, etc. TCA wanted the interest on the loan. major customers are demanding volume/supply based on contracts. how does a company with very limited resources manage the demand and allocate remaining capital appropriately? we know they had to honor the larger contracts (like 7/11). we also know that TCA owned/controlled a large part of inventory based on filings. it isnt surprising (looking back) that revenues dried up even though limited product was being shipped and some orders filled.
now - it is easy to blame this all on "excuses." however, i was noticing a supply crunch early on in 2013 when i started investing. several retailers and distributors i spoke with said "it sells very well when i get it but the company (or distributor if it was a retailer) has a hard time keeping up with orders." now - at the time i considered that as growing pains. since i had spoken to several across the country where it was heavily marketed (Vegas and New Orleans) and in areas where there was limited or no marketing (my area in the midwest) i was getting a consistent response. the larger/key areas were first in line for obvious reasons and they were crunched later.
in speaking to the company about supply and comments from the field, again, the company was vague. they had to be for two reasons. one - they dont want customers, distributors, and investors to know they had a major supply issue and two, they had to deal with disclosure rules as a public company. i knew at the time the guy was holding back and wanted to say more (and as an investor - i prodded where i could), but he kept going back to disclosure and pointing me back to filings (past or future). i had posted comments about 3Q13 being critical based on the revenue slump. however, by the time those numbers were to be due (11/15/13) - the supply issues were already a known entity. from there - knowing what i knew and starting to put the pieces of the puzzle together - the dried up revenues made sense. i also knew they were in a very dire position and i limited any further investment.
i was excited and encouraged about the Japan announcement but i did not invest further. i wanted confirmation that it was happening. i realized it would be chasing at the time but i had a considerable investment already and was ok with my position. when the energy shot was announced with LTCG - that changed things dramatically for me. i looked at where they had been, the cash issues, the supply issues, etc and thought - why would a major name/brand be investing heavily in a venture that was going to fail? now - cynics will argue that the name/brand doesnt care about the long term prospects of the company as long as they get their licensing fees up front. and i am sure there are many celebrities that dont care - i dont see this with LTCG. if you look at his foundation and read through his interests - this guy gives a disproportionate amount of income to his charities and he balances his time between his comedy and doing charity events. he is also on the top of his earning curve with major endorsement deals (Prilosec) and not looking to thrown his name anywhere just to keep the lights on.
when i looked at the whole picture with the energy shot - it became more compelling. who is the target demo for energy shots? working folks, blue collar folks, etc. who does LTCG appeal to? is there a better slogan/catch phrase for getting a boost of energy than Git-R-Done...? you dont need a shot of energy to sit on your arse.
i started investing heavily again on this announcement and have continued to do so. i think the mgmt team is committed to making this a success, they brought on the outside talent (Veal) when it was obvious they had limitations with running a public company (two founders). they are still taking in very limited compensation and much of that has been defered at no interest (how many penny companies can you say that about?) the brand resonates with people i have discussed it with. and everything else considered, the product WORKS for me without the caffeine or sugar. i have never taken other energy drinks/shots until i started investing with this company. i took others to compare taste/effects. while my vested interest in recovery/energy shots can not rule out placebo effect - it has a muted effect when it comes to taste or the feeling like i wanted to gnaw off someone's face after taking 5HR. i fully admit that i drink/consumer very to no little caffeine and the only time i had prior to this shot when i was driving late at night and needed the occasional Dr. Pepper to keep me alert/awake or when ruining a perfectly good bourbon with some coke. since the energy shot came out - i take that when driving late at night or if i hit a lag in the afternoon while driving long stretches (i cover 5 states so i do a lot of driving). for me - it usually takes about 15-20 minutes and then my mind/focus is right back to where it normally is and i didnt even think about the "transition." that is where i think the shot has HUGE potential over the competition. on the recovery shot - when i have meetings or late nights with customers that might involve said bourbon - taking the HJOE shot right after getting up has left me with no energy drain/malaise through morning meetings/appts and i usually dont start dragging until around 2 (which usually happens around 3 anyways).
i wasnt happy about the short term convertible debt when it was announced in early 2014. i questioned the validity of needing it vs other viable streams. i also questioned the early September debt just announced. however, i think about others that i personally know looking for terms/credit in various businesses and without a solid, very solid revenue/earnings streams - the capital market is still puckered up. as an example - i have a family owned distributor that has been in business 60 years that has a very cyclical business nature (specifically cash cycle due to seasonal customers and traditional payment terms). he was put in a crunch by some past bad deeds and has been fighting banks for the last 6 years trying to increase capital lines to grow. they tell him that they want him to prove he can grow before they lend him the money. let that sink in. THAT is the mentality of the credit markets right now. he has doubled the company in the 10 years he has run in and looking for further growth and now, even with a $20-25MM/year business where most of the years have been profitable - they still have put the screws down because mfg was hit hard after 2008 andthey are suspect of his industry (despite the fact that he only had one negative year since the crash (2009) and has been increasing bottom line positively since).
i firmly believe they will use the data (as announced) from the soft launch to prove viability and then get access to real/more favorable capital. if the soft launch is/was successful (in my DD in the field - it has been), the capital will come, exponential growth will follow, and there will be more people lokoing to buy the stock then sell. that will mean the share price will go up. it is hard to tell how many shares will end up with this dilutive phase but it could be limited to 180-200MM shares. while that sucks from an investment standpoint - it is still better than having nothing. further, the shares coming on the market now will still look ridiculously cheap if the company's launch is successful.
right now the company has around a $400-600K market cap. they did $2MM in 2012. if they do $2MM in 2015 (which i think is very, very doable) there shares should trade at around $0.05-$0.20 depending on the multiple one wants to apply and assuming the OSis at or under 200MM. for example - at $0.10/share and 200MM shares OS - that provides a $20MM market cap. if they do $5MM in revenues in 2015 - that is only a 4X multiple. at $600K market cap - they are trading WELL BELOW fair value in ANY model/multiple situation. the market has this priced at BK levels. while the balance sheet is certainly ugly - does the prospects/launch/field data suggest this company is going under...?
this is a long look at why i invested in, remained invested in, and aggressively increased my position. i am fortunate that i have a high risk tolerance, risk capital that is allocated for this class of security, and have a longer term time horizon (i am primarily an investor and dont day trade although i occasionally swing trade on large irrational movements up or down on stocks i own/follow closely). based on the valuation above (and i have posted more detailed valuation based on actual sales based on early assumptions on initial production runs based on average revenue per bottle and absorbed cost per bottle), i think this remains a very strong risk/reward proposition.
finally, going back to the "mistakes," i think the Japan deal either should have been worded differently, or more importantly, should have been addressed sooner and specifically as soon as they realized there was a regulatory issue. that shouldnt have taken that long. the rest of the mistakes need to be put in context of the situation at the time and judged against viable alternatives that might have existed. when i use that metric, using information i have from filings and individual research, and then applying objective assumptions based on my own mfg experience - i cant assign specific blame/fault for most of these decisions. many detractors said they wouldnt make it through 2013. they said the energy shot would never hit the shelves. the dilution would kill the stock. etc. but - the company appears to be poised to capitalize on a major launch with seemingly good data and they did this by limiting the dilution during a dire time from somewhere between 35-50%.
so - for you and anyone else trying to justify the investment, buy more, sell, hold, etc - i would challenge you to critically examine the steps taken and then contact the company and speak with the IR folks and ask the questions. if you dont like the answers, feel like you are being sold a line, or just dont get a good feeling, take teh loss and move on. if their answers seem rational and justified and you are able to apply context - then you will feel much better about the decisions you made and the decisions you will need to make.
booth sharing - take a look at location
while on the surface it might seem cheap - one has to consider the trade show format and positioning of the booths. the longer one attends the show - the better location they get. take a look at where booth 618 is on the floor layout. it is up front near registration. it is on the side aisle but on a major corridor. it is much better to split costs with a partner and get a favorable booth position than get a low traffic spot and pay full price.
further - it isnt like this company is flush with cash. if they were - they wouldnt be taking out unfavorable debt to finance production for soft and full launch. would you rather them drop $50K for a major booth in this show or produce $50K worth of product to sell and maybe split $5-8K with one of their partners...?
it is a small booth (10'x10') but it is in a good location up near registration and in the same general area as some of their primary competitors. trade shows are tricky. the best booth in the world doesnt mean anything if the floor traffic is low.
mecc and wright's refusal to provide financials to shareholders when legally requested and/or when demanded by SEC rules and regulations is a direct violation of SEC and civil rules/laws.
i can not prove or disprove what inside those reports is right or wrong but the adamant refusal to provide shareholders financial records that they have every legal right to IS WRONG. the appearance of impropriety is in play here and THAT is where the onus is ON THEM to prove there was nothing improper done.
its not dwelling. its called persistence and providing justice for shareholders and holding those holding fiduciary positions to remain responsible for their actions. it will happen whether it is through the SEC or the civil courts.
that premise is faulty because it suggests i should just ignore history and hope it doesnt repeat itself.
wright/mecc also promised updated filings the year prior to the reverse merger and then again to update prior to the reverse merger after it was announced. nothing.
the most positive thing in that PR was they have moved the fully reporting timeline from 2-4 years to 2-3.
there are 32MM shares OS, a lot more authorized, and no one knows the terms of the last year capital offerings. are they loaded with convertible debt?
this is all somewhat moot as there cant be any trust of their motives/intent until they come clean with the past.
how did they gain control of MLOG during a dark period?
where are the financials for the company in the three years prior to reverse merger?
specifically - what was the impact of the then and ongoing litigation in terms of revenues/damages that MLOG was able to secure for the successful IP suits?
i am not going to just go away. period.
i dont get your correlation... headlines are supposed to grab one's attention and get them to read the article. they signed the distribution deal and the actual agreement was included as an attachment with the 10K. my guess,as i stated prior, the company was not aware of the issue until after the announcement. maybe an over exuberant distributor/wholesaler that wasnt aware of the laws/classifications or misunderstood the extent. obviously the agreement wasnt ready to go forward but to suggest it was all a charade is disingenuous at best.
i agree the headline should not have read as "sells" and should have stuck with the signed agreement for 10MM bottles over the three years. when i read that - i pretty much ignored the "sells" as soon as i read the rest of the PR about the agreement.
the agreement still stands and has been extended if it passes the regulatory hurdle. based on my DD - my guess is the picamilon is the sticking point. i will contact the company and ask if that is the issue. i am not sure whether that will require public disclosure or if they can confirm/affirm that point.
the larger point is whether or not the soft launch of the energy shot in July will provide significant results to bring in attractive capital for the full launch starting with NACS and whether the results are scalable. if, and that remains a big if, they are - then sales should quickly surpass 2012 results. further, they are shipping recovery shots again. if these are confirmed in 3Q14 filing and guidance is provided based on initial launch results for year end and into 2015 - i would contend more people will want shares and that will cause the price to rise.
i could list off 10 stocks off the top of my head where i was the antagonist blowing holes in every argument of a story stock. i firmly believe this is not one. i have spoken with retailers. i have spoken with distributors. i have spoken with company reps and IR. i have seen the product (both) in stores. i have several clients that own multiple c-stores and have discussed the brand with them (i am not in this business but it happens to be an ancillary business for several of my clients).
per my post on risk/reward - everyone will have a different way to quantify and evaluate risk and reward. for me, i have risk capital that the scenario is attractive for me. i am not here to flip or for weeks/months. i can wait a couple of years for this to realize potential. i realize many on these forums have a much shorter time horizon for a return and other than short bursts - this is probably not attractive (although today's volume provided plenty of opportunity).
all that being said - my primary point on posting the specifics of the Japan contract was it was real, it was documented, there are regulatory concerns that were not obvious at the onset (they exist - i am assuming they werent known), and the company has addressed those issues in their public filings. as well - they filed the actual agreement which is very rare at this level. i think that provides a lot more legitimacy than 99% of the penny stocks out there - or at least the ones i have come across/researched.
finally - i have posted this several times but it bears repeating - the insiders/mgmt are making NOTHING with the trading that is going on. there is no inside selling, dumping, options, conversion, etc. there is significant salaries in deferral and they are non interest bearing (compare that to company "loans" be insiders/mgmt at19% interest and highly convertible which i have seen frequently in pennies).
i certainly would not recommend this stock to anyone without risk capital with high tolerance and an extended time horizon. it remains very speculative and that is particularly focused on soft launch results and if they are scalable. that will determine future capital, diminished dilution, and forward looking results that can be modeled to provide a fair value for the stock looking forward.
from 2013 10K on Japan Deal:
"In December 2013, the Company announced the signing of a distribution contract for the sale of Hangover Joes Recovery Shots in Japan, in which management believes the Company may be able to distribute its recovery shots through up to 8,600 drug and food stores; however, the Company is waiting on Japanese regulatory approval necessary to distribute under this agreement. In addition, in January 2014, the Company entered into an agreement with Git-R-Done Productions, Inc., which allows the Company to launch a new non-caffeinated, all natural healthy energy shot, Git-R-Done-Energy. The launch of this new product is planned for the Spring / Summer of 2014 (Notes 2 and 6)"
further:
"Hangover Joes is also pursuing an approach internationally; Hangover Joes has had success in Canada, New Zealand, Australia, with arrangements in Japan and Lebanon set for 2014. Warner Brothers helps use internationally as it provides the distributor names so we can shortcut some of the initial work and proceed with step 1 above.
Generally, manufacturers of dietary supplements do not need to register their products with FDA or get FDA approval before producing or selling these supplements. Under FDA regulations, all domestic and foreign companies that manufacture, package, label or hold dietary supplements, including those involved with testing, quality control, and dietary supplement distribution in the U.S., must comply with the Dietary Supplement Current Good Manufacturing Practices (CGMPs) for quality control.
Outside the United States, the production, distribution and sale of our product is also subject to numerous similar and other statutes and regulations.
We added an additional 3 year license to sell our product in Japan under similar terms and conditions in January, 2014"
seems clear that the deal/intent to distribute under original terms/context of the original contract (which is an exhibit filed with 10K) are intact and viable. also is publicly stated that they are waiting regulatory approval in Japan for the deal. they may or may not get that depending on how the government decides to view the recovery shot.
was mgmt premature on announcing this deal? maybe, maybe not. more than likely - the distributor partner probably was lacking in DD and/or was under the impression they would not require regulatory approval and then found out after the fact. maybe they were trying to lock up distribution rights and took advantage of the lack of understanding on HJOE part. regardless, the contract was valid. the intent was clear. and the intent remains as is evidenced by the additional 3 year license that was extended. that does not mean that it will get approval and the deal will be consummated. however, for those on here to suggest that there was no deal and nothing but a headline to spur interest is void of fact. the public filings demonstrate otherwise.
what drives a stock's price:
i posted this elsewhere:
if everyone had the same thoughts, analysis, and came to the same conclusion - there would be no market. the competing ideas on capital, risk, reward, and personal appetite for those are what creates supply/demand and a constant flow of capital.
many believe that Wall Street is a zero sum game - for every one that makes a profit - someone has to take an equal loss. that is simply not true. investment horizons continually change based on age, education/experience, available disposable capital, etc. while the risk here is completely acceptable for me as a long term investment (and certain short term opportunities), i would not recommend this to most of the people i know due to the risk being way too high for their tolerance/comfort. however, those with higher risk tolerances and available capital - will generally make higher returns long term.
understanding how others process this and apply it to any particular investment vehicle provides a wealth of information to individual investors to understand what moves/motivates people to buy or sell. when people understand the differing and opposing metrics used, they can get a better understanding of how to enter/exit their own positions. this in a nutshell is where TA is mathematically derived from and/or quantified. while not studying individual behavior - that collective behavior can be somewhat accurately predicted by when the general market will come in or exit a security. however, it also becomes a self fulfilling prophecy over time as more traders rely on artificial buy/sell points provided by the computer instead of looking at fundamentals and applying changes to the overall sentiment. neither is right or wrong. understanding how those interact though can provide much better information for one's own entrance/exit points.
apply the same metrics to poker. knowing the odds of the cards in any situation will not guarantee your bet is right. but long term - your odds dramatically improve.
the price today on any stock is a measure of relative value based on the current buyer/seller's assumptions that the price will rise or fall in the future. with HJOE - it becomes more involved as artificial supply dramatically affects the price point due to conversion. those convertible shares are held by institutions that have ZERO interest in the long term price/potential of HJOE. unlike a typical investor in a security - their investment is completely wrapped up in a short term return on the money lent out. that only happens if there is volume and they are able to unload that stock to willing buyers who assume the price will move higher in the future. cynically - there are many stocks with zero change of improving and there are many stocks that trade purely on that irrational hope (or fear of losing investment) and keep investors strung along.
is HJOE one of those? time will tell. balance sheet is a wreck. however, if one assumes as a premise the train wreck occurred when manufacturing supply was derailed end of 2012/beginning of 2013 by off spec product - it is a linear path to where they got to today. the off spec product could not be sold and due to their tight cash position - they could not sell that product to have more product made to continue to sell, fill orders, and grow. from there - the wheels fall off. they have no money to create more product, they can not pay off existing suppliers because all of their capital is tied up in unsaleable product, and they have no financial position to get more capital. the TCA deal was not a good deal but it was also considered to be short term.
from there - the company takes unfavorable debt to release commitments to TCA, get product rolling, pay royalties/licensing fees that are required, and continue as a going concern. was it the best path? maybe, maybe not. but the financial position was not going to get traditional capital/terms let alone that the financial markets are still being VERY conservative with lending.
product is on shelves. i have seen the energy shot in michigan and in indiana. i saw the recovery shot last time in Vegas (several months ago at a Terribles and a 7/11). I dont know when the product was manufactured or how long it had been on the shelf but there were only a few bottles in each case. teh company has listed a number of stores (300-500) in various states where distributors will be placing it. call or visit them if you are local. ask the counter people or the owner. ask them who their distributor is and call the distributor and ask about it. most are willing to talk if you are polite, up front about why you are calling, and offer to help them in return (by suggesting potential new customers).
so - will the price go up or down from here? my guess is it will remain very volatile due to being sub penny and the recent volume has attracted a lot of short term players. however, if the results frmo the soft launch are positive and they have a good showing at the NACS show - then they should be able to confirm future strong revenues and at that point, capital will become significantly more attractive as the risk to the lender dramatically subsides. at that point, one can look at OS and model what type of revenues or bottles sold at a absorbed cost of $0.43/bottle will provide profits and what the future ratios will look like (PE, P/S, etc). from there one can make a guess what the relative value of the share price will be based on those future revenues and earnings and what the acquisition price might be from a larger entity or what growth multiple to assign based on the company going alone and introducing new products/revenue streams.
unlike the vast majority of pennies out there - a lot of this information can be verified. product can be found on shelves. costs have been shared by the company (absorbed cost in last 10Q/10K) and one can make objective assumptions on revenues based on costs to produce, capital raised compared to fixed costs (per 10Q/10K), and number of stores product is going in (which can be cnofirmed by calling stores/distributors). this is rare in penny land and right now - my guess is the price will increase substantially as the picture becomes clearer and the average investor gets more facts verified by the company instead of individual DD.
the stock/company remains high risk and speculative (mostly on execution of this product launch and getting more attractive capital to limit further dilution). however, again, it is the competing ideas on capital, risk/reward, time horizon, and available capital that create a market and fuel supply/demand.
i dont know if this is the ingredient which is making the product get held up by Japanese authorities but it makes sense based on the DD i have done. it is considered a drug due to the membrane interface and acting as a carrier agent across the membrane (which makes it so effective). it also is this mechanism that cause some to pause to debate whether or not that should be considered a natural event or induced event and where the debate starts.
from there - it goes to what level does it become intrusive or harmful and/or can impair other cognitive functions. the recovery shot contains 50mg of Picamilon.
from several sites in the US - recommended dosage is anywhere from 50-500mg. HJOE recommends no more than two shots per day which would be consistent with the 100mg. the dosage would depend on weight, general tolerance to medication, and potential interactions with other medications - mostly blood pressure/thinners.
my guess is the debate is whether this level can be considered a dietary supplement in Japan or if ANY level requires a prescription. i have not been able to find anything specific on how Japan classifies dosage or if any level is considered beyond a supplement. there is a lot of information on Gaba and its use/natural sources in Japan. this provides a direct path to the receptors that allow Gaba to be more effective.
one more item that provides a pretty good, succinct summary:
Picamilon is an amazingly powerful compound with antioxidant properties, which has been available for over 25 years. Its primary use has been to support normal structure and function during aging. According to the third party literature, Picamilan has been used for nutritional support in the following situations: 1) tiredness and irritability, 2) depression, 3) decreased energy, 4) misuse of alcohol, and 5) anxiety.
An important benefit of using Pickamilon is that it is not a sedative, which means you can use Pickamilon and still drive and operate machinery, unlike when using tranquilizers (Picamilan, however, is not a substitute for medications prescribed by your physician.)
Picamilon shows different results at different dosages. A: The lower dosage, 50mg 3 times a day will achieve a tranquilizing nutritional effect. B.Increasing the dosage to 100 mg 3 times a day will bring about the nutritional stimulation effect and increase endurance.
The effects of Picamilon are felt quickly, most people will notice an impact within an hour and the body usually retains Pickamilon for up to six hours. It crosses the blood brain barrier easily, which is why the results are normally experienced so rapidly.
Pickamilon is a cleverly combined combination of the nutrients GABA and NIACIN. This chemical bonding of the two means the manufacturing process is formidable. Picamilon is an excellent substitute for minaprine and pramiracetam.
When Picamilon is used at the highest level, (250-300 mg per day) studies prove it to be more stimulating than piracetam and to have a more pronounced effect than vinpocetine. Other studies have shown Pickamilon has the ability to support blood circulation, and blood supply to the brain, in a manner far superior to the results achieved with either Hydergine or Xanthinol Nicotinate.
Picamilon has an extremely low toxicity and has shown no carcinogenic properties. In summation, as a nutrient Picamilan is a stimulating tranquilizer and can produce results more quickly than other products like Hydergine, Piracetam and Vinpocetine.
Description: Picamilan was first synthesized from nutrients in 1970. It is a white crystalline power that is odorless, highly hygroscopic and readily soluble in water. It is a combination of niacin and GABA in the same molecule, which increases to potency of each component (n-nicotinoyl uniquely bonded to GABA - gamma aminobutyric acid).
Method of Action: Affects cerebral circulation and neural regulation in similar manner to gamma aminobutyric acid (GABA). Anti-edematous action of Picamilan is linked with a change in energy metabolism in neurologic tissue.
Suggested Intake
Normal dosage(.01 to .05 grams). Acts on cerebral circulation and neural regulation to support a natural tranquilizing effect, restore balance between sympathetic and parasympathetic nervous systems, reduce the emotional effects of life stress and inhibit anxiety and aggression. May also be helpful in the nutritional support of Premenstrual Syndrome and Migraine Headaches. In higher doses (80-160 mg/kg) has a reciprocal stimulation effect. Does not induce muscle relaxation, drowsiness or lethargy.
Dosage and Administration: Time course of accumulation of Picamilan in the brain correlates with its blood level. Effect In: Approximately 30 minutes.
Adverse Reactions: Picamilan produces no known allergenic, teratogenic, embryotoxic or carcinogenic effects..
Known Interactive Effects: Valerian Root may inhibit the breakdown of GABA thereby enhancing its activity in the brain. Ginseng may also potentiate the activity of GABA
another reference for Picamilon:
http://smartdrugsforcollege.com/what-is-picamilon/
Picamilon, also known as pycamilon or pikamilon or in chemical terms nicotinoyl-GABA, is one of the widely used drugs. It was first synthesized by the All Union Vitamin Research Institute in 1970 in the Soviet Union. The official rights for the drug is with a pharmaceutical company in Russia as Russia is the country where this drug was first tested. Further studies were undertaken both by Russia and Japan, and now it is sold as a prescription drug in Russia. In the United States of America, picamilon is used as a dietary supplement.
PicamilonPicamilon is a combination of the GABA and niacin, hence the name nicotinoyl-GABA. GABA or gamma amino butyric acid is a neurotransmitter present in the brain, which carries the neural signals from the brain to the muscle or the effector organs through the neuromuscular junction. GABA has an inhibitory effect as it lowers the muscle tone as can be seen in patients with upper motor neuron lesions where the patient has spasticity in the muscles and generally GABA derivatives are prescribed to them. Niacin or vitamin B3 belongs to an important class of vitamins that are important for the coordination of the body. Niacin is responsible for maintaining the integrity of the skin, muscles and even promotes widening of the blood vessels. Deficiency of niacin can cause pellagra, which generally occurs in the underdeveloped, or developing countries where the prevalence of poverty, malnutrition further aggravates the niacin deficiency. The effects of both the components when combined together gives us the picamilon drug.
Benefits:
It is an excellent drug to cross the blood-brain barrier. The picamilon drug has significant effects on disorders of the brain wherein the cerebral blood flow has been disturbed such as the cerebral ischaemia.
It has a significant effect on lowering the blood pressure due to increase in the blow flow to the brain which causes the disturbed neural signals to normalize once the cerebral blood flow has been restored.
In psychological conditions, such as depression, anxiety or senile psychosis, it has shown good results. The picamilon has shown to have tranquillising and stimulating effects but unlike, other tranquillizers it does not induce drowsiness, muscle relaxation or lethargy.
Picamilon has shown good results in alcohol withdrawal symptoms. Chronic alcoholics have been able to overcome the urge by the intake of the picamilon.
Due to the niacin component, which is a potent vasodilator, and the ability of the picamilon to cross the blood-brain barrier at an effective rate, it is also used in the treatment of the migraine headaches.
Other uses are when there is any kind of craniocerebral trauma, which causes increased cerebral bleeding. At this time as picamilon can cross the blood-brain barrier at a faster rate in comparison to other drugs, such as the papaverine, nialamide smartdrugand complamin, it can restore the integrity of the cerebral tissues and prevent its further deterioration.
Picamilon is generally prescribed in 0.01gms, 0. 02gms and 0.05 gms of tablets and has a useful shelf life of about three years.
My Review
My first time trying Picamilon yielded results akin to what I would expect from a mild GABA inhibitory drug. I swallowed one capsule, and after about 45 minutes, felt more alert yet relaxed at the same time (similar to a nicotine nootropic), and overall, had a diminished sense of social anxiety, atop much more self-confidence when conversing with others. I later would research to find this is because of an increase in GABA receptors in the brain, and of picamilon’s mechanisom of action-it blocks excitatory neurotransmitters to help relax you, ie: clearer thinking, less anxiety, better social skills.
Final Thoughts
Picamilon is a great drug for the long term in those suffering from anxiety, anyone who is looking for a mild-moderate cognitive boost, and overall anyone who would like to improve their social skills long term by improving self confidence, and eradicating fear. We have picamilon available here in our nootropics store!
- See more at: http://smartdrugsforcollege.com/what-is-picamilon/#sthash.HN5FV9q8.dpuf
another references for Picamilon. here it only shows Russia requiring a prescription but references Japan considers it s a prodrug (which infers it would require a prescription).
Picamilon
From Wikipedia, the free encyclopedia
Picamilon Picamilon2d.png
Picamilon3d.png
Systematic (IUPAC) name
4-(Pyridine-3-carbonylamino)butanoic acid
Clinical data
Trade names ??? ???
Legal status
OTC US Rx only Russia
Routes Oral
Pharmacokinetic data
Bioavailability 50%–88%
Half-life 30 minutes
Excretion Renal
Identifiers
CAS number 34562-97-5
ATC code N02CX
PubChem CID 60608
ChemSpider 54634 Yes
Synonyms nicotinoyl-GABA
Chemical data
Formula C10H12N2O3
Mol. mass 208.214 g/mol
SMILES[show]
InChI[show]
(what is this?) (verify)
Picamilon (also known as nicotinoyl-GABA, pycamilon, and pikamilon) is a dietary supplement formed by combining niacin with GABA. It was developed in the Soviet Union in 1969 by the All-Union Vitamins Scientific Research Institute[1][2][full citation needed] and further studied in both Russia[3] and Japan as a prodrug of GABA.[4]
Picamilon is sold in the United States as a dietary supplement, while in Russia it is sold as a prescription drug. The rights to the drug belong to the Russian pharmaceutical company NPK ECHO ("??? ???").
Picamilon requires a prescription in Japan and is a key ingredient/differentiator in recovery shot.
not to hard to find the answer to this:
http://www.profiderall.com/blog/the-power-of-picamilon/
Picamilon is a prescription drug in Russia and Japan, but it is still available as a dietary supplement in the United States. And for a reason… it works! Picamilon helps to improve your cognitive performance, decrease anxiety and stress, and have a positive effect on your energy level. Picamilon is not as widely known as some other supplements. But it’s only a matter of time before the pharmaceutical industry gets its hand on picamilon. But for now, it’s by far the most powerful over-the-counter “smart drug.”
Picamilon… the future of Cognitive Energy Enhancement.
Picamilon (nicotinoyl-gamma-aminobutyric acid) is the only nootropic that is able to cross the blood-brain barrier… meaning picamilon can deliver the neurotransmitter, GABA, directly to receptor sites where synapses occur, which explains its unparalleled efficacy.
Picamilon is 10x more effective than GABA alone! Neuropharmacological studies show picamilon is absorbed quicker and retained in the body longer – taking effect within minutes and lasting for up to 6 hours.
where is all of the buying...? posters here the last couple of days were talking about $1 by the end of the year. doesnt matter if the stock is $0.03 or $0.05 - if it is going to $1 both are ridiculously cheap. so - where is the buying? plenty of shares pop up on the ASK once any buying takes place.