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Value - the answer is no. I have suspected for a while that someone owns a lot of shares that could potentially be dumped on the market. The annual report confirmed this. If those shares come on the market, I hesitate to guess what it will do to the share price. If those share wind up in the company treasury or management's hands, this will make my second concern almost a sure thing, IMO. I don't want to hold onto shares in a company that may not be run for my benefit. Not saying that will be the case, but if I was in charge, I might well be tempted to act in a way that is not necessarily favorable to you and the rest of the shareholders. It's not a risk I am willing to take. There are other places to put my money where I think I may get treated better.
I can't say for sure, but I can only guess that he was looking for someone to come in and help scoop up some of the shares outstanding. The less shares in independent hands, the easier the task becomes.
I don't know the reason. I can only guess that he and the 'independent' director did not see eye to eye on the company direction. As for why he put an independent on the board in the first place maybe it was to placate some of the institutional holders.
I only know that as of now, he can run the company as he chooses. Unless you have voted recently, and I don't see where that is the case, he doesn't have to deal with any of you as shareholders. You are party of a minority of public holders unable to sway management to act in a way that would benefit you. And that's not good for your financial well being. Again, this is all my opinion only.
As best I can tell, iGourmet is a mini version of IVFH. I feel absolutely comfortable that IVFH can turn this around. There should be significant synergies offering plenty of opportunity to cut costs and push new products to existing iGourmet customers. This is not an issue IMO.
The issue I referred to is that I am firmly convinced that Sam is preparing to take the company private. He is increasingly running this as a private company. The board does his bidding. We've seen that. There is no voting because management and friends owns the majority. There are no more conference calls, because, well just because. He doesn't need to have them and so he won't.
The day will come when all these people thinking this is worth 15 x PE or $2 to $4 per share will awaken to see a leveraged buyout at a price that they will not be happy about. And that's it they are lucky. What if Sam just decides to run this as a private company for the next 20 years without ever buying the minority shareholders out? How will that change from today's relationship? Hint - it won't. Nothing will change. It will look exactly like it does today because that's what is happening.
You can find a lot of things to say about Sam, but dumb is not one of them. This is financial engineering. I believe Sam is going to find a way to acquire those outstanding shares from the former Fresh Diet owner. Whether he buys them or he returns them to the company, it doesn't matter. His cohort will own a larger percentage of the company and his authority will be even that much more absolute.
This is just my opinion, but I think this process was confirmed when the director resigned.
No argument on that point. If clients want rubber bullets or bean bags, sell them rubber bullets and bean bags. There's a time and place for these non-lethal weapons, especially in crowd control of a mob that is getting out of hand. But if we are talking school or mall shootings, you can't bring a knife to a gun fight. Only pepper will incapacitate an active shooter without killing him. Tasers are very expensive, require charging, and force someone to aim at a guy with a gun. With a pepper grenade, close is good enough.
Schools have to do something if only to demonstrate that they are taking some measures. Money is being made available. LLLI has the production capability and the broad product line. Whether it happens this quarter, next or the one after that, the deck is stacked in their favor. At 1.5 cents/share, it seems almost too easy. Just understand that schools are public institutions. They don't move quickly. 6 months for them is quick. Change won't happen overnight. But I like the odds as of today.
Hi kids. I've been reading but trying to maintain a low profile. There's just so long I can play that game.
Grease - you hit on it. Allow me to fill in some details. Let's go the the 10-K
YS Catering Holdings, Inc., et al. vs. Attollo Partners LLC, Rajesh Rawal, Vojkan Dimitijevic, Asif Syed, Roy Heggland and Innovative Food Holdings, Inc., Case No. 2017-007504-CA-01, Eleventh Judicial Circuit in and for Miami-Dade County, Florida
On March 26, 2018, YS Catering Holdings, Inc., et al., filed suit against Innovative Food Holdings, Inc. YS alleges claims against IVFH that are almost identical to ones pending in the PNC Bank vs. Fresh Diet, et al. federal court litigation (Case No. 17-cv-21027-KMM) in what we believe is an improper attempt at forum shopping. In addition, YS seeks injunctive relief with respect to the removal of certain trading restrictions and other restrictions on its restricted shares. IVFH intends to move to stay the case pending the outcome of the almost identical PNC federal court litigation involving YS’s principal Zalmi Duchman. Discovery in the case is ongoing. While IVFH intends to vigorously defend against this lawsuit, the outcome of this lawsuit cannot ultimately be predicted.
The important clause concerns injunctive relief with respect to the removal of certain trading restrictions and other restrictions on its restricted shares. Now the question is - how many shares? I have my guess and I leave you to your guess. But in terms of days trading, I'm guessing the volume is measured in Months, not weeks and certainly not days. That's one heck of a lot of stock overhanging the market. Until that restriction is gone, it cannot be sold. But someday, it will come off and that stock may flood the market (unless IVFH buys it).
And we'll talk about the second huge potential problem in a later post.
And General Motors made tanks, refrigerators, trucks, and dozens of other things. But they were known as a car company. If they didn't sell cars, they didn't make money. Same thing here. LLLI may make 300 products. If 70% of sales and 220 of the 300 products are pepper products, then they are a pepper weapons company in my book.
Do you have a problem with my post? Why should he respond?
A little perspective is needed here. Lamperd only does one thing - they make pepper based products. They obviously don't have a large marketing budget. And its not clear that they would have shown significant progress even if they had spent twice the marketing budget in prior years.
Small companies have trouble getting their message out when the world doesn't care about the message. It can be done, but it makes the job that much more challenging.
So it's not that LLLI has changed that is so important. They are doing what they have done in years past. It's that now there is a recognition that we have a serious problem that needs to be addressed. So instead of a headwind, the company now has a tailwind. Every week brings another circumstance where LLLI's products could have helped. Yesterday's YouTube shooter was just one more case. Timing is everything for small companies. I am comfortable that LLLI will be the beneficiary of being in the right place at the right time with the right products.
The sales process has to start somewhere. With products like LLLI has, it is also a matter of timing and funding. Two years ago, the issue of school and public facility security was below the radar. Now, that is not the case.
Nobody who is rational wants to see schools arming teachers. Insurance companies will respond immediately jacking up insurance rates ten fold. This is not a good situation for anyone, especially the tax payers who will bear the cost of this. Pepper weapons are the best immediately implementable option. Now that school's will have funding for this alternative, they can begin to put them in place, if for no other reason than to say they have made some effort to be proactive.
The timing is right. Lamperd Less Lethal's attempts to market should now gain traction. At 1.5 cents per share, this has far more upside potential than downside. IMO, well worth making a modest investment in this company.
Why stop at a 15 PE? Why not shoot for 20? That's the ticket.
A company that is 72% reliant on a single distributor does not qualify for a 15 PE. A company with a Board of Directors that only knows how to approve decisions with a rubber stamp does not merit a 15 PE. And a management team that has decided it no longer needs to answer questions from shareholders even four times a year does not merit a 15 PE. One can only imagine why the company management insists that it not be degraded to talk with the little people even four times a year.
Agreed. He has done an excellent job since he dumped Fresh Diet in early 2016. But let's not go overboard. I don't trust him to act in the best interests of his shareholders, especially his smallest shareholders. His apparent disdain for any small investor contact leads me to be highly suspicious.
I'll give him his due for the fine strategy he has crafted and executed for the last 18 months or so. And he did some beautiful work prior to buying Fresh Diet. I still think he takes this private and screws all the small shareholders. Seen it before and he's on script.
2nd Quarter report is available on sec.gov. Looks very good. The company is paying down the debt. Lots of dilution, but I would expect Sam to execute a buyback to correct that. The dilution should end soon.
Looking a lot better than it was 5 years ago.
Agreed. Investors just have to learn from experience that picking bottoms is a poor investment strategy.
I know a bit about this business. As a rule, this business model doesn't work. There are exceptions, but they tend to be small, niche based competitors. That does not describe Blue Apron.
You have to love hope based investors. They feed everyone else.
Looking to break $7 in the AM? In Canadian dollars, maybe.
Amazon is not the problem. Yet. This company has much more fundamental problems. Its large competitors are also losing money. There are no barriers to entry in this business, and even more serious, this business model does not work on a national level. It barely works on a local level for many market participants. Add in the huge costs of establishing regional hubs, the protein limitations imposed by price, and decreasing LTV's as the company advertising attracts less dedicated users, and this business is break-even at best. Why invest in a business with a break-even ceiling?
Going lower. Give it time.
I'm tell ya. I feel it. Someone is going to put this back in play. Could be the return of Jimmy. But whoever it is, good to see them snap up those shares.
Don't spend all your found money in one place. I think the 50 cent Frosty deal is still going on at Wendy's. You can make a lot of people happy and buy a round for crowd.
Trust Sam at your own risk. They tell me that there is a seller for every buyer. 200,000 shares bailed for a few cents. Looks like a huge vote of no confidence for a stock one could argue is worth 20 or 30 cents more.
You may be comfortable that Management has wrapped themselves in a cone of silence (with apologies to Get Smart). They no longer deem it worth their time to speak to the great unwashed as they release quarterly statements. One has to wonder what other ways management is working on to show current and prospective shareholders just how valuable they are to the organization.
Another article out.
https://seekingalpha.com/article/4090138-unknown-growth-play-food-industry-offers-great-value-proposition
IMO, this is a little one sided and only looks at the bright and shiny aspects of the company. The valuation analysis table is a mess. The author mentions the Fresh Diet sale but never discusses its purchase. The board's rubber stamp ineffectiveness is never discussed. And the author identifies IVFH's reliance on US Foods, yet he implies that someone else might buy the company.
All that said, I agree with his conclusion. This is worth more than 67 cents. The question is how much more. I believe Sam is positioning to take this private. If I were him, I would do it. I'd screw all the small shareholders and offer them nickels while I pocket dollars. It's happened to me before in the penny world. The signs are there. Could be coincidence, but I don't believe in coincidence.
You have considerable more faith in the justice system and the executive team than I do. I've been screwed several times before on penny stocks. I know what's possible. And I know the SEC and and the Florida AG will do nothing to protect the rights of minority shareholders. Been there before. Both refused to lift a finger. Minority shareholder rights only exist if you have the cash to hire lawyers to pursue them.
Sam's decision to end quarterly calls and the low stock price are two glowing red lights. Both happened for a reason. I do not believe in coincidences. If I were in management's place and interested in acquiring the company by taking it private, it would be mine in a few months.
Had the warrant holder converted those shares, they might have become a major supply of shares as the stock moved up into the upper sixties and low seventies in the future. Now that is unlikely to happen. Sam is crafty enough to have included a lock-up agreement as part of the deal. This will prevent the warrant holder from selling the shares for some period of time.
Assuming that next quarter maintains the positive trends now in place, the anti-dilutive effects of the deal should beneficial to shareholders, at least in the short term.
Those shares represent almost 1% of the fully diluted shares. That's not a lot, but as a voting block, they probably pull more than twice their weight. Many people hold their shares in street name and don't vote. In the event that someone attempts to take the company private, 1% may not be an ace in the hole, but it is a nice piece of the potential voting block. It is a possibility. It's what financial engineers do. So be careful in deciding what is good news and what is not.
Seems positive because it is. This is Sam doing what Sam does best. Sam has a history of success dealing with the company's debt and equity holders, other than the retail public. He effectively rescued the company from the disaster that was the previous CEO. Sam is not without a skill set. He has proven himself a capable financial negotiator. This is just another example.
He just took 2.2 million share, or about 6.5% out of the fully diluted share count without spending a dime (beyond some legal fees that won't be cheap). Looked at as a singular action, it is very positive. The open question, however, remains Sam long term strategy.
Agreed. I would have cancelled the CC also if I were Sam. Why would I want someone questioning me as to why the stock's performance has been so dismal in one of the largest bull markets in history? Good call there.
Just 70 more days until the next quarterly report. Going back to sleep now. Yawn.
I am rarely distracted. But I will call Mr. Saunders. I may have something you might find much more interesting than a low margin food company.
And you are one of the people in the Texas or Oklahoma investment group? There has to be a reason to mention WFCF, because that is not a company one runs into in the normal course of a day.
Grease - I've seen this stock before. Either you and I check out the same people or you are the guy from Texas. There is an investor in Texas who filed a 13-D on IVFH about a year ago. He also owns a lot of Where Food Comes From. So if you are not him, that's a lot of coincidence.
I don't see the attraction in WFCF. Never have. I think IVFH was a great turn around story coming off of the massive failures of the previous management group. The attraction of the IVFH story ended with the FD debacle. There were hints of pending problems before then, but the FD acquisition was a major disaster. At least Sam had the brains to declare victory and retreat with his remaining troops before the entire company collapsed.
I could make the case for a re-energized IVFH. But I don't trust Sam and I don't trust the Board. So as attractive as the stock may be, it may get a lot more attractive.
I am not suggesting that this is Sam's agenda. But Sam is nothing if not crafty. I will bet this has crossed his mind. As a long time penny stock investor, I have seen some absolute theft jobs pulled by management on small shareholders. I saw one guy take his 40% ownership and buy all the company's assets in exchange for his 40% ownership. I had a CEO sell the business for virtually nothing in exchange for a sweetheart management contract. He got a nice salary, a signing bonus and shares in the new company. We got rolled back 73:1 into a POS. The list of horror stories in the penny stock world is extensive.
I can tell you from experience, the SEC will do nothing. The FBI will do nothing. FINRA claims this has nothing to do with them and they will do nothing. What you and I might consider grand theft, they all regard as a civil matter between shareholders.
As a minority shareholder, the only rights you have are those you can afford to enforce. If you own $5,000 worth of stock, are you going to send your lawyer a $10,000 retainer to begin legal proceedings? Of course not.
Again, I am not suggesting this is in the works. I will suggest that IF one were planning to do this, the actions you are seeing lead this way. And that is just one of the reasons why the stock price may be so low.
Grease - Let's play devil's advocate for a minute (something I am comfortable doing. BTW - the devil is right more than one might care to guess, especially in the penny world.).
Let's assume management owns 20+%. And let's assume two small funds own another 14+%. So management calls up the two funds and says I have a deal for you. The stock price is not a reflection of our value. Let's take this private, we'll set up a management company and we'll run the company as if we own all of it.
I have seen this many times before in the penny world, so let's not say it can't happen. They delist the stock. The two ownership groups form a management company which the rubber stamp board approves. The management company A)sucks the cash out of the company, B) lays claim to nearly all future earnings and C) awards themselves huge amounts of stock for doing such a good job managing the company.
Shareholders continue to receive their regular dividends ($0). They continue to have no say in the company. The company returns zero phone calls from investors. Small investors can attempt to sue at the their own cost but will not because A) they are unorganized, B) their investment is relatively small, C) no lawyer will take the case on a contingency basis (tried this before - not a single one), D) their chances of winning are small and E) the SEC will never, repeat never, help a small investor in a case like this.
Don't think it can't happen and that may be one very good reason why the stock is declining. It is pure speculation on my part that this is management's plan. I am simply pointing out that the CEO has taken an initial step towards becoming untouchable. He may go no further. But if he does, you can all convert your shares to worthless wallpaper for a doghouse.
As one who does not believe in coincidence, I am concerned that there is a reason for this decline. I am not buying the general market decline theory. I am also not convinced that all those shares being issued is the reason either. This condition has been going on for many quarters. Why now is the selling pressure such a problem?
If you buy the smart money concept, then something is up. And it's not positive. I have done some really stupid things with money in my life. This stock price is getting very tempting. I am seriously thinking about buying. There are only a few events I can imagine that might happen to justify the current price or lower. The question is whether one or more of them is in process.
All things considered, I would see a further decline as a huge red flag. Personally, I don't expect that to happen. It could, and that is why you can't buy and forget about a penny stock. But for those who have been here for many years, this stock has been undervalued for a long time before. It's not the undervaluation that is the big concern here. It's the decline either in spite of or because of a 10-K. Not buying the coincidence of decline and 10-K.
There has always been selling pressure on this stock due to its liberal use of stock based compensation. But it seems to have accelerated since the earnings report.
In taking the recent SA author's advice, Sam has now eliminated the conference call. The scum and vermin will no longer be permitted any communication with the king. How dare they question his decisions as if they were his business partners!! To be fair, Sam has never encouraged support from the retail community. So when selling pressure occurs, the offsetting support is minimal. Obviously, Sam is comfortable with this practice. One can also assume he is comfortable with the consequences of this policy. In fact, he may be more than comfortable, but that's a topic for another discussion.
I believe something in the 10-K sparked this reaction. Last quarter, the stock stayed up for several days following a positive Q4 report. This time, it stayed up for hundreds of minutes following what appears to be a positive Q1 report. There was some pretty good volume in the weeks before the Q1 release. Sellers had plenty of opportunity to get out in late April and early May. I think they saw something they didn't like. If that's not the answer, then we are back to the topic for another discussion.
Something has obviously spooked the stock market. I am sure that the lack of a quarterly conference call has not helped. But I think Rado's find in the 10-K is the real source of the sell off.
"In addition, we are currently exploring the introduction of a variety of new product categories and new product lines, including private label products and proprietary branded products to leverage our existing foodservice and consumer customer base.
No assurances can be given that any of these plans will come to fruition or that if implemented that they will necessarily yield positive results. "
Is this another attempt to spend $millions to prove the company's inability to function in the B2C environment?
I can think of two other reasons for the sell off, but both are highly speculative. Anyone else have a possible reason for a stock declining 6% on an otherwise positive earnings statement?
This is the source of my confusion. RSU's and stock are not current liabilities. Both are equity accounts. I just looked this up to confirm my information. The only way they can become liabilities is if someone has forced the company to cash them in. Then the company might reclassify them to recognize that there may be a cash payout for these items.
Without a forcing mechanism, neither the RSU's nor the stock should be classified as liabilities. If I had to guess, that forcing mechanism came from an attorney. The company already identified the cash payout to a former FD employee. I still wonder if all the FD related problems are behind this company.
I stand corrected. Good find. Not sure why they referred to them as liabilities.
Of course it does bring up the issue as to why they would spend $1.2 million for one former FD employee. Seems like a lot of money given that RSU's, like warrants, are valued at a discount to the share prices due to tax issues, etc.
It has nothing to do with the RSU's. That is covered in another section. The section clearly has to do with discontinued operations. Since IVFH only has one recent discontinued operation, it must be FD related. The company took a $120K expense for converting the RSU's. That is stated elsewhere in the 10-K.
Besides, RSU's are not company liabilities. They are claims on equity, but technically not liabilities. CPA's generally are pretty precise in the words they use. This wording was clear designed to obfuscate the specific reasoning for the $1.2 million payout.
As for recurring, it most certainly is not a recurring expense. Could it be indicative of additional liabilities associated with 'discontinued operations'? That remains to be seen. Where there is one, there are often many.
Anyone care to hazard a guess what this means from the 10-K?
4. DISCONTINUED OPERATIONS
Effective February 23, 2016, the Company closed a transaction to sell 90% of our ownership in The Fresh Diet, Inc. (“FD”) to New Fresh Co., LLC, a Florida limited liability company controlled by the former founder of FD. The consideration to Innovative Food Holdings consisted primarily of a restructuring of our loans, which includes the ability to convert to additional amounts of FD under certain circumstances. Aside from any payments related to liabilities previously accrued by the Company, there were no other cash outflows related to the discontinued operations. During the twelve months ended December 31, 2016, the Company accrued the amount of $850,000 representing the amount due based on an agreement signed in 2017. The agreement involved the purchase of rights to 1,450,000 RSUs and the purchase of 642,688 shares of the Company’s common stock. During the three months ended March 31, 2017, the Company paid cash for liabilities related to discontinued operations in the amount of $1,230,497. The Company also retired 642,688 shares of the Company stock to treasury.
"...paid cash for liabilities related to discontinued operations..." Just a guess but it looks like an old Fresh Diet liability. Lawsuit perhaps? More coming? That seems like a lot of money to just bury in a footnote.
But hey - don't want to appear negative. Wouldn't be right. Enjoy the conference call. I'll catch it on the replay. Or has the Imperial Presidency officially begun?
Any else beginning to see why after another great quarter there is a collective yawn from investors and on the company chat board?
But hey - don't want to appear negative. So I'll just go and hide for a while. You guys carry on the great discussion you were all having about the stock going north of $1 soon.
10-K is out on sec.gov. I cannot find notice of a conference call. Is Sam taking the advice in the article last week and ducking out? He's never done this before. Reading now. Some very interesting stuff.
Great entry point. Anything with a 5 handle or less is going to pay yuge dividends (as the Donald might say).
If it wasn't for us, you'd have nothing but crickets on this board. You had a mostly favorable article come out last week and you have the Q1 report coming out on Monday. And other than Seeds and myself, these two events generated 3 comments last week?
Yeah, we're squeezing out the real content and distracting from the bigger conversation. As soon as we figure out what that is, Seeds and I will take this offline. Until then, at least you have some entertainment and possibly some intelligent conversation (at times).
Had to say it. Seeds, I'm gone until at least the conference call is done. Curious to see if Sam takes the author's advice.
You got me Stocks. You win. I have to come clean. I have personally been holding down this stock price for almost two years.
I hope you feel better, because I know I do. I did it. I set out to hold down IVFH's stock price by telling the world about Sam's poor management and decision making concerning FD, his attitude toward shareholders, his failure to exploit the molecular food movement of a few years ago, his salary and bonus for nearly bankrupting the company, the rubber stamp Board...
I confess. I made these all up. None of them are true. I personally have held this stock down with my posting. And I want to apologize to the entire IVFH community for holding this company down for so long.
I'm going to go away for a while. Monday, you'll get a big beautiful quarterly report and by Tuesday morning the stock will be over a dollar because I went away for a while. Fear not, I reserve the right to come back and run amuck again if I get the urge. So you'd better take the buck and run. Then again, we can work together. You talk it up to a buck with happy talk and nonsense, sell the stock, I'll come back and talk it down to 60 cents again and we can do it all over again. What do you say Stocks? We can be a team!!
Yeah, OK. I almost believe that. I'm sure someone believes that a person who has all day to post here is busy making money. Personally, I don't know who that person may be, but I'm sure someone believes it.
Next time you post here, just know that your point of view has been proven wrong several times before. And no, I have never been fired. Came close a few times, but never been fired. So chalk up another error.
Go back to toiling. It sounds so industrious.