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I think it's imperative that the truth be known...
Once again, other than the overt attempt to continue to beat a dead dog with old news concerning Labor SMART, there is no correlation between the two events.
If you beat a dead dog a hundred times, at the end of the day, it's still a dead dog. DUH!
Actually, a perfect example of NOT being objective.
First, when I look at the statement, "Mr. Schadel paid himself off" that is neither a clear or accurate assessment of what really happened.
When Labor SMART was incepted, Mr. Schadel provided the initial funds that seeded the working capital and growth for the company. I don't know where it is stipulated that a CEO is NOT allowed to recoup his loan before his company turns profitable. Regardless, the fact that everything was recorded, stated and publicly disseminated properly shows that he and the company kept the transaction very transparent to the shareholders. The only thing I see "shady" is the actual statement that he "paid himself off."
Second, unless irrefutable proof can be shown that actual monies that should have gone to payroll taxes instead went into Mr. Schadels pockets, then that statement is highly inflammatory and without any merit or foundation.
Of course, if there is some type of documentation that exists that would actually prove otherwise, I would love to see it. However, just because a reckless theory is made and thrown out there, it does not make it the truth.
At the emd of the day, whatever issues LTNC had with their payroll taxes, those issues have been resolved with the IRS. As of today, they are considered current with all their payroll tax obligations and we can take solace in knowing that under the Agreement they have with the IRS, the issue of them falling behind in payroll taxes can never happen again.
These are substantiated facts that can be proven. I, for one, would much rather deal with facts than fiction.
Actually, what a shareholder needs is OBJECTIVE information in the form of both positive and negative information concerning Labor SMART.
No need for only one-sided, misleading and overtly negative information. One can never make a fair assesment that way.
I have never seen a young aggressive growth company that was run with perfection since inception. Mistakes are made in order to learn from and in order to build a stronger foundation, which will eventually lead to success.
Anyone who has done any due diligence into LTNC's industry knows that the accumulation and creation of critical mass is the secret to success with bottom line profits for any company like Labor SMART.
In the case of LTNC, I'll take the following positives over any short term negatives:
Year after year, triple digit growth in revenues since inception
Year after year, triple digit growth in customer base since inception
Year after year, triple digit growth in asset accumulation since inception
Year after year, triple digit growth in branch locations since inception
Proven corporate infrastructure and dynamic management team with a proven track record
Gross Profit Margins increase from 15% to 23% in the last 12 months with a goal of 28% over the next 12 months
Positive EBITDA within the first 30 months of operations
Ridiculously undervalued stock price when comparing it to the short term success and growth of its operations
I like the odds of this company!!!
If this is truly your very last post on the LTNC board then I wish you the very best with your future investments.
As I have stated in the past, life is much better by focusing on the positives then dwelling on the negatives.
Good luck!
The email, the email, the damning email...
As a matter of seemingly important significance....
There is nothing that is either tragic or ironic when it comes to Labor SMART's previous payroll tax issue.
The problem was never a material event and was resolved appropriately. As of today's date, the IRS considers Labor SMART current with their payroll taxes. Because of this, there can be no justification with comments stating they are deliquent.
Young aggressive growth companies constantly run into cash flow problems. As a young company showing triple digit growth, there are bound to be issues and mistakes made on the path to achieving success. What is more important is Labor SMART's ability to rise above any adversity while also learning from their mistakes.
Facts are facts and I am more interested in LTNC's current events and not with dwelling on the past. Especially, when it has absolutely no effect or outcome on this company's future!
If I wanted perfection, I would not be investing in a young aggressive growth company that trades on the OTC market.
There was zero LACK of disclosure by Labor SMART or its CEO.
Every fully reporting company has strict guidelines that they have to adhere to, by both FINRA and the Securities and Exchange Commission.
Also, liability is assumed by that company's SEC auditor, accountant, Principles and SEC counsel, in the final preparation of any SEC filing.
In this case, the statement "There was a lack of disclosure by Labor SMART" is an opinion NOT an actual fact.
Additionally, any time there is an event that could have a material effect either positive or negative on a public company, they are legally required to file an 8K through the SEC. In the case regarding Labor SMART's payroll tax obligations, it didn't even meet the "material event" criteria. Probably because it wasn't a big enough problem to have any type of material effect on the company.
If we don't want to accept the rules handed down by the SEC regarding disclosure issues that is fine. Possibly, we should reconsider investing in the market if we don't believe that FINRA or the SEC is doing a good enough job in requiring public companies to keep us informed concerning every single event that goes on in their operations..
However, it is absolutely unacceptable to throw around words like fraud and deception when a company has followed all the rules and committed no violations to its governing bodies.
I also wonder why, if this is such a big issue, NOT A SINGLE question was asked regarding this issue during Labor SMART's recent 2nd quarter earnings report a couple of weeks ago. EVERY person on the call had the ability to ask Labor SMART's CEO questions. I know that if a CEO "allegedly" lied to me, I would call him out in front of an audience, the very first opportunity that was given to me. But that didn't happen. There were many great questions asked, but not a single question calling out the CEO for lack of disclosure or any other negative issue I have personally read on this board.
Seems like when given the floor and an opportunity to be heard, no ones cares to hear the answers to these issues.
JMHO
Once again, I am trying to be lead to believe that Labor SMART is not fully compliant with their SEC disclosure issues and that Ryan Schadel is the one leading the way to all this information being kept from us.
Because of the strict rules and guidelines placed by the SEC, Ryan Schadel does not get to pick and choose what is included and conveniently deleted from LTNC's financial statements. The company's SEC Auditing Firm has absolute control over what information is included, how it is recorded and ultimately disseminated on the company's financial statement.
Today, SEC auditing and accounting firms are held to an extremely high standard and have to follow very strict guidelines. Anything less can carry severe liabilities and career ending consequences.
Personally, if I felt that a company was purposely holding back information and being deceitful, I would liquidate my position and move on to something more productive and positive. That is obviously not the case here.
JMHO
Labor SMARTS Conversions have been brutal???
Labor SMART has gone from 19 million to 27 million shares outstanding in almost 3 years and THIS is what I should consider BRUTAL dilution?
I can think of at least 10 OTC companies that have gone from 20 million shares outstanding to over 1 Billion shares outstanding within the last 12 month period of time.
THAT'S WHAT I CALL BRUTAL!!!
I guess I shouldn't discount the fact that I am speculating in the OTC market. There is no reason to hold an OTC company to the same standards as a stock that trades on the NASDAQ, AMEX or NYSE.
I am here to speculate and with speculation comes risks!
Risks do not equate to controlled growth, conventional forms of financings or conservative operating tactics.
If I want a company with a long term operating history, proven track record and established net income, I'll go find a more conservative investment on a larger exchange.
Until then, I am perfectly happy with what I see for the future of LTNC.
JMHO
I am not defending anything other than what is stipulated by the SEC on their S-1 Registration Statements.
Actually, I agree that the SEC should broaden their language in regards to this matter so it is clear that never is actually "Within the last 10 years."
What I don't agree with is any attempt to construe that Ryan Schadel purposely committed any type of fraud or deception with his answers. He was given specific guidelines by what was requested on his S-1 application and answered them appropriately.
In my opinion, the only reason this keeps coming up is because there are factions who would like us to believe that the CEO cannot be trusted. Quite honestly, if they want me to believe that, then they better come up with more accurate and current information.
Turning lemons into lemonade needs only a matter of perception....
Should Labor SMART have used Payroll tax money to fund their growth?
Hmmm... No, they should not have done that.
However, every successful company goes through their share of making mistakes. It's ridiculous to think that a growth company runs perfectly and never makes mistakes. What's important is how they deal with their mistakes and ideally what they learn from them.
At the very least, we can now take solace in knowing that the IRS now considers LTNC currrent, and with the Agreement in place, they now have to maintain a current status, so we no longer have to worry about IRS delinquincies.
Of course, we could always ignore these facts and continue beatng a dead horse, but why bother?
SEC Rules and Guidelines are NEVER subject to interpretation. We are expected to accept what they determine their rules and guidelines to be factually.
So while we can ignore them, or just plain not accept them, what is not acceptable is to pretend they don't exist, so that we can prove a personal and biased point. Nor, should we be making any type of implications pertaining to fraud or deception, when in fact, all SEC rules are being fully complied. They are the ULTIMATE decision maker when it comes to what they believe full disclosure to an investor should be.
The SEC is very clear that when asking questions regarding the backgrounds of individuals on S-K Registrations, they want to know within the last 10 years.
Labor SMART's S-1 Registration Statement was no different.
Maybe, they too, could give a rats ass about what someone did as a teenager.
JMHO
Well, if we want to talk about stating facts regarding specifics about LTNC then so be it...
Not much of a theory considering that this company has proven a consistent pattern of paying off their notes in order to avoid dilution. Use of phrases like "waves of dilution" as it pertains to LTNC are laughable when one looks at the facts and see the slow and methodical increases in the outstanding share count that this company has experienced over the last couple of years.
Also, at the current bid price, the conversion(if one were even to take place) has a floor set at .15 cents which currently equates to a 16.6% haircut to market. Because of this, the accredited investors actually have an opportunity to make more money if the stock appreciates as opposed to staying at its current level and much less to none if it were to drop any lower.
Sorry, but terms like these in a convertible note are virtually non-existent and unheard of. That is, unless the accredited investors truly have a reason to believe that this operation will be succesful, and that this stock trades at a much higher price over the next several months.
BROAD DEFINITION?
Securities and Exchange Commission:
Definition of Accredited Investors
Under the Securities Act of 1933, a company that offers or sells its securities must register the securities with the SEC or find an exemption from the registration requirements. The Act provides companies with a number of exemptions. For some of the exemptions, such as rules 505 and 506 of Regulation D, a company may sell its securities to what are known as "accredited investors."
The federal securities laws define the term accredited investor in Rule 501 of Regulation D as:
1.a bank, insurance company, registered investment company, business development company, or small business investment company;
2.an employee benefit plan, within the meaning of the Employee Retirement Income Security Act, if a bank, insurance company, or registered investment adviser makes the investment decisions, or if the plan has total assets in excess of $5 million;
3.a charitable organization, corporation, or partnership with assets exceeding $5 million;
4.a director, executive officer, or general partner of the company selling the securities;
5.a business in which all the equity owners are accredited investors;
6.a natural person who has individual net worth, or joint net worth with the person’s spouse, that exceeds $1 million at the time of the purchase, excluding the value of the primary residence of such person;
7.a natural person with income exceeding $200,000 in each of the two most recent years or joint income with a spouse exceeding $300,000 for those years and a reasonable expectation of the same income level in the current year; or
8.a trust with assets in excess of $5 million, not formed to acquire the securities offered, whose purchases a sophisticated person makes.
For more information about the SEC’s registration requirements and common exemptions, read our brochure, Q&A: Small Business & the SEC.
Sorry, but I fail to see how anyone would consider the SEC's view of what an Accredited Investor is as "broad" in definition.