Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Interest expense increased to $508,318 from $22,698
for the six months ended March 31, 2018 and 2017, respectively.
Interest expense increased due to interest incurred on the Company’s convertible notes payable.
3,469,000 shares sold for net proceeds of $3,034,120.
NOTE 8 – RELATED PARTY TRANSACTIONS
In February 2018, the Company’s Chief Executive Officer converted his 9,000,000 shares of preferred stock to 13,500,000 shares of common stock.
NOTE 9 – SUBSEQUENT EVENTS
In April 2018, the Company paid off the Peak One note at a redemption cost of $375,000.
Subsequent to March 31, 2018, there were 3,469,000 shares of common stock sold for net proceeds of $3,034,120.
There have been no other reportable events that have occurred after March 31, 2018.
the Company issued to Peak One Opportunity Fund LP (“Peak One”) for the total consideration of $375,000. Why would you like dilution??
The 3/31 10-Q will be very interesting. Be sure to READ it, especially the "total consideration" for the convertible notes.
12.5% cash + est. 12.5% common stock = 25% commission paid to Paulson Investment.
Source: Form D filed on 3/19/18
Another terrible deal made by the CEO
The writing's on the wall.
CEO Converts 9mil preferred to 13.5mil common shares
From Page 10 of 12/31/17 10-Q:
NOTE 8 – SUBSEQUENT EVENTS
On January 22, 2018, the Board of Directors authorized Michael De La Garza, Chief Executive Officer of the Company, to convert his 9,000,000 preferred shares, at a conversion rate of 1 to 1.5 common shares, to 13,500,000 common shares, restricted pursuant to Rule 144. On February 15, 2018, Michael De La Garza converted his 9,000,000 preferred shares to 13,500,000 common shares.
From Page 1 of 12/31/17 10-Q:
Class: Common stock, $0.01 par value
Outstanding at February 16, 2018: 20,569,411
Why wouldn't an investor be disgusted and furious?
There are no signs of a CLOK and EFSI agreement showing revenue. Nothing of mention in CLOK financials indicating any revenues earned (only mention is the one customer, GAWK, which relates to the 2014 software sale for $1.125mil, which GAWK still refutes as being delivered.
So, no cash from revenues for any non-deferred revenue for 2015, 2016, 2017. In fact, the only revenue-related activity has been in legal settlements for past litigation regarding software sale dealings originally generated by MDLG, CEO of the discontinued Cloud MD operations.
Success? Not really. Seems more like a beta test imho. Similar to Cipherloc google play app. Surprisingly, CLOK google play app paid more.
$3.99 x 5-10 installs = $19.95-$39.99
https://play.google.com/store/apps/details?id=com.cipherloc.mobile&hl=en
P/R Past: No sales reported. No new hires. Nothing indicative of anything more than a shell. It's unfortunate.
To do proper due diligence, you need to look at the SEC filings and disclosures, not the press releases. The press releases are pretty much website and de minimus product updates. They are website mentions, not press releases. The press releases are part of MDLG's smoke and mirrors.
The facts remain--MDLG has gutted the piggy bank and the common and preferred shares. The 9/30/17 10-K will be alarming.
16% commission on $25k raised since last Form D/A?
It's supposed to be 8%, so maybe Spencer was paid twice??
If MDLG takes his normal 35-40%, then that might leave enough for rent and utilities...
My guess: The "Oz" is next to get chopped.
The next "press release" will be interesting too.
Agreed. Pie in the Sky sales and marketing is ridiculous. MDLG has proven to be ineffective as CEO. How much more proof is needed?
Insolvency is more likely than a paying customer.
Mr. De La Garza was not authorized to act on behalf of former company..:
https://www.sec.gov/Archives/edgar/data/1384522/000114036109014548/form8k.htm
I'm sorry, but I don't have any expectations that MDLG will be able to make anything "positive" happen for CLOK.
Yes, that was awful. And very indicative of MDLG's track record for overpromising, underdelivering, then having to "settle" and do damage control.
Also, issuing himself $12mil in stock (one instance, not total, mind you) was terrible for the shareholders in more than one way.
I don't understand why people are still expecting positive results when there are literally no positive indicators suggesting that MDLG has any interest in serving the shareholders first, rather than himself. It seems like his only motivation is to continue to raise $'s so he can grab as much as he can. Can anyone justify the CEO of this company paying himself over $2mil in cash compensation and over $15mil in stock compensation? Why do so many people overlook this fact? What MDLG did is downright criminal, in my opinion.
I'm curious what the SEC would think about all of this.
MDLG has wasted too much time and money for CLOK to be successful. MDLG has tried and tried to oversell something that was either not available for use and/or was not well explained in his videos and presentations. Doesn't anyone remember the Google App fiasco?? It's obvious that he doesn't know what he's doing.
Salas was the last hope, and he's gone.
Until CLOK technology can be thoroughly utilized and tested, it is kinda like selling "clear coat". And it's more than just "all we need is one big client".
Just my honest opinion.
MDLG has taken close to $2mil <<CASH>> from CLOK.
So, you're wrong; MDLG is the only one to get rich off of Cipherloc. Next in line would be M Spencer, broker dealer of the PPM.
I concur. The only winners now will likely be those with "short" positions. For the cheerleaders that are trying to do damage control, I feel for you.
Investing is less about emotions, and more about sound management, sales, and sustainable growth. CLOK has none of the above. And please don't tell me about a non-revenue producing "agreement" or the GAWK deal. Very sad indeed.
IMHO, the CEO personally owes the company shareholders about $2.5mil.
Not waiting, just analyzing...
I am reviewing the posted financials, and also waiting for the FYE 9/30/17 10-K. Proper financial analysis takes time. When the 10-K is released, I'll be very interested in stitching together the numbers.
Clok-em, I'm not into "hot air rhetoric or hopes n' dreams talk" (please refer to MDLG videos, M Spencer video--if you can find it archived online somewhere, or even forum member posts!).
Why would MDLG commit to a $300k for $330k note instead of taking it out of his own pocket that he took from CLOK coffers? Maybe it's because he doesn't have the money and he doesn't manage money well? Ask MDLG if he has ever declared bankruptcy. We know that he's been sued for failure to perform before. And he had to issue approximately $1mil in company stock to settle with the doctors? Do you see a pattern here?
Please feel free to provide a defense, if possible. I'm all ears...but my eyes see that MDLG is not good.
I was able to "get out" of my CLOK position. No more wasted time and money.
Note: There will be more facts brought to light very soon
Here are some "truths" that can be confirmed by filed financials:
MDLG, CEO paid himself at least $1.5mil in Sal & Ben from QE 9/30/15 until QE 6/30/17. It is probably beyond $2mil now.
This amount ($1.5mil) represents 34% of money raised from PPM (another 8-9% of PPM $'s raised was paid in cash/stock to Broker Dealer)!
MDLG, CEO also paid himself $12.4mil in stock comp during same period!!
MDLG, CEO payments exceeded amount paid to Sales and R&D combined!!!
CEO pay should have been tied to performance, which would have probably saved the company $2.5+mil...easily.
And don't get me started on Oz. Overpaid, and overvalued.
Good luck CLOK buyers and sellers!
I guess now's the time to gobble up those CLOK shares at $1.50/share. Oh wait, were you serious about that or just fluffing things up?!?
B I N G O slojab!
If you look at the Q's and K's since MDLG has been CEO, mgmt performance appears to be very very poor. But what do you expect from someone who may have never had the skills to begin with?
The numbers don't lie, especially for a small company with audited financials. And Salas came from a REAL company and has REAL sales and marketing experience. MDLG? Questionable everything. Lots and lots and lots of hot air (has anyone seen the videos or heard the mocked up radio shows??).
Dive deep enough into CLOK and I bet there is something good to sell, but when you continue to raise dollars, especially discounted dollars (what was he thinking??), one has to start asking themselves what the heck is going on with a CEO who keeps peddling for cash and can't keep his hand out of the cookie jar??
IT sector continues to perform at the top of all sectors (up 1.28% today).
CLOK should have big news coming out very soon.
This is all about Sales and Rev. New revenue, mind you.
I'm positive for reasons other than Oz and MDLG, because sometimes even a blind monkey can find a banana.
It seems (from the client website) that the CLOK client handles the transactions, but it doesn't appear that the CLOK client has the assets under management.
The problem might be that CLOK mgmt is taking shortcuts (see MDLG videos) to being a sustainable company and may not be using available resources efficiently (see CLOK 10-Q's and 10-K's).
If shareholders really want to hold onto a stock that will trend upward, then it would only make sense that they would expect to see simple and modest improvements in key performance indicators (increased usage of CLOK products, increase in sales and licensing agreements and an increase and focus on strategic alliances) and also expect responsible spending and heightened accountability. It would be nice to see CLOK mgmt have more "skin in the game"...i.e. have pay tied to performance, for starters.
The price is still right, just not so sure about the game show host. :/
Many great ideas are not properly executed until proper leadership is in place...
less than 10 users, it appears. this may include internal users as well
Cipherloc path to success needs focus and usage:
While sales would be great, I am more curious about the number of users of Cipherloc products. Rather than try and hit a "home run", going for "singles" would be more encouraging. Or, increased visibility through an active partner company(or companies) would be great.
There is nothing wrong with providing trial versions to gain a subscriber base. As you get the subscribers and see the usage (demand), the value will become more apparent.
...Just an educated and humble opinion