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Something is brewing.
If you read the prior filings, it is evident that all parties (note holders, those awarded shares as payment for loans or purchase of FIN/Vapestick) need to come to some resolution here.
There is only about 70m shares left to convert which at current prices will not be able to resolve the commitments outlined.
What can they do?
Correct me if I am missing something, but as I see it:
1. They could try to increase the share count, as proposed. reviewing the old filings makes it difficult to sort out what the obligations remaining but it appears this would not solve their problem given the amount of the debt outstanding and obligations to prior FIN owners and current share price.
This is also unacceptable to many existing retail investors, based on our straw poll posted here.
2. Raise additional capital
3. Renegotiate with note holders and prior groups acquired.
4. Default
No one wants the latter, particularly the note holders, and it is unlikely given that we have a company that is likely to have annualized revenues in the 100m+ range and growing.
The ability to raise capital very recently, and add senior experienced management as well, leads me to believe(IMO) that they will renegotiate with note holders and announce this within the next month.
Solving this conundrum will allow management to focus on growth and continued global distribution, and uplisting on NASDAQ.
The earnings and positive news will create a huge uptick in ECIG, and those who accumulated shares down here will be amply rewarded.
I agree with this.
As noted previously, I intend on voting no.
It is unlikely the note holders are going to try to force ECIG into bankruptcy, so the opportunity to negotiate is strong.
If they can renegotiate terms, and deal with the debt, this company's price will start to follow its revenue growth again.
Woof Woof Indeed
If we could all conduct ourselves like dogs, we would all be much happier, and wealthy.
Thank-you for the update Sporty, and the excellent work.
I need to buy a treat for your beautiful dog!
Thank-you YerBoss for keeping us on track.
Is there a way to block those who post negative, misleading, or factually inaccurate statements?
In turn, I would be delighted to have a rational, evidenced based negative post.
This would allow me to challenge my investment thesis.
In reality, I haven't read a single intelligent post from the short crowd.
I am a new and free member to ihub, however, I would pay if I could have these posters blocked.
The inane, useless, and thin posts provide no benefit, and are irritating.
They are essentially mosquitos that one must continually delete, yet keep buzzing around.
I agree.
What a ride.
I bought as low as .05, but didn't pick up any below that.
Those of us that are long, know the huge upside, while recognizing the risks.
If we had some communication from ECIG, I would have purchased more.
Still, one has to question: Who is buying these millions of shares?
6 months ago this was a thinly traded stock.
Is it hedge funds? Big tobacco?
I did a search on SEC, and there have been no reported buys/sells by insiders recently.
Clearly retail is absorbing some shares, but one has to think something is at play here.
Exciting times.
I agree completely.
I like the idea of a representative contacting them.
It provides for a unified , coherent voice.
I would be delighted if you could do that.
Absolutely.
If they had to sell the company, FIN alone would net us a profit.
This is a pathetic approach they have suggested.
The share price will take off with good revenues reported and a clear plan that is communicated to the street.
It the easy "solution" for them to have a R/S, and award themselves more equity in the company.
Easy, if they can convince the majority shareholders, that is.
Well said.
Sorry missed the post.
Too many to read through.
1,275,000
No
Having a representative speak to them, I vote SportyNorty, is the best route.
They are out of touch.
They must think retail investors are sheep.
This is a small portion of my portfolio, but I will , on principle, keep it, and push for what is right.
The share conversions have resulted in giving control of the company to others, including us.
The key is we need to be organized, and unified.
They could quell the growing dissatisfaction if they start to communicate, and quickly.
No BSing
I have a truckload, and I am not dumping them.
I will vote, and vote No.
I would change my mind if I see a detailed plan before the meeting.
A R/S at these levels is ludicrous.
This stock could and should be north of 1.00, if they would start to communicate better immediately.
I agree
I just posted with the same sentiment.
I would even support a representative to show up at the meeting, and cast our votes by proxy.
I am expecting excellent corporate governance going forward.
I agree yerboss.
We need a clear plan that is communicated to shareholders before the vote.
Many won't attend, so we need to be certain that we have the facts to vote by proxy.
There is a real business here, and I want my share.
Interestingly, with the recent filing, it appears some of us have as many, if not more shares, than held by some members of the BOD.
I suspect the members of this board have enough votes to determine the outcome, if we are organized.
At this point, I want to hear the plan relating to:
1. Debt
2.Conversion of shares
3. Preferred shares
4. Future disposition of shares to the directors.
ECIG could be brought above 1.00 if they articulate this, and report strong earnings this quarter.
I don't know, however, I would note that in prior and initial filings the initial investors were based out of Canada.
This is when Victory(later ECIG) did the reverse takeover of TCKM for OTC listing.
I suspect there are some that have been following this stock for over a year.
If they have,and didn't dump when the restriction was lifted and they would, by definition, be long!
I remain invested and recognize the turbulence will continue until we have clarity.
I am willing to take a risk for the potential upside.
We do need ECIG to educate the street on what the plan is.
By all accounts they have a growing and real business.
Confirmation of debt resolution and future funding is all that is needed to send this north in a hurry.(all IMO)
I agree
I made the point earlier about the limit on dilutions to 300m, in response to a unsubstantiated claim by a poster.
The value here is tremendous
Hi pennydaytrader,
Just read a number of your posts, and it is good to see a little more thought around the downside of ECIG. (Compared to what is typically posted: Ecig =at .00000 in 1 minute)
A few thoughts around your comments. (correct me if I have posted these incorrectly)
Please also take my comments as constructive criticism/debate.
My only interest in this board is the discussion of the merits of investing in ECIG, for the benefit of capital appreciation, and hopefully being a long term investor in a emerging industry.
pennydaytrader:
"Jprise, thanks for your statement, i respectfully disagree. Debt is a big reason why PPS is down so much. If you look back at Q10 3 months previous to last one,,,debt was i believe around 88 million if i am not mistaken, pps i think was around $5 at a time...following Q10, showed debt to be 44 million and $1.5 dollars PPS....it will continue to go down unless Management comes up with debt restructuring plan. imo"
This may be partly to blame, but it is unlikely this is the major cause for the reduction in share price.
It is not uncommon for an emerging company to have debt. What is interesting here is that the group has built a real company with growing revenues.
I believe the major reason for the drop is, as stated previously:
1. Failure to uplist to NASDAQ spooked the market
2. Initial investors that were locked up in the NASDAQ up listing, subsequently had free shares and were frustrated after waiting over a year dumped their shares
3. Debt conversion
pennydaytrader:
"I want to see 8k proving restructing is complete…"
Good for you.
I take a different approach.
I figure that the best potential for share price appreciation is to purchase early, as long as the value and margin of safety is present.
As Buffet says:"if you wait for the robins, spring will be over"
Still my risk is greater in initiating a position before the restructuring is clearly resolved.
I fully accept the risk, and am prepared to accept a full loss of my position, as this is the high risk portion of my portfolio.
pennydaytrader:
"Shorts are covering..nobody accumulating...when you saw those big trades..they are not neccessarily buys....you know?"
I respectively disagree.
I cannot provide hard data to disprove your suggestion, other than a personal opinion.
i have accumulated approximately 1% of the company in the past few weeks.
Some investors are accumulating, this I know.
pennydaytrader:
"Thats not the point. The point is we are trading at 0.10 range and we should be at a dollar at least..but that will never happen unless debt restructure happens."
This is pure speculation.
There are countless examples of wide and wild swings in share price, irrespective of fundamentals.
pennydaytrader:
Take-over.-No.-Not-a-chance-in-the-world.-They-don't-hold- patent-to-e-cigarattes-do-they?-I-can-make-my-own-company-and sell e cigarretes, can i not? Then how does E cig such a great buyout opportunity? It is not at all.
",,,,,,,,,Do you often go look for companies to buy that have debt....44 million dollars of debt?
On the other hand....IF...IF....ECIG...hold a worldwide PATENT..and and had 100% right to it...and every company that sells E cigarettes would have to pay royalty to ECIG then MOST DEFINITELY YES YES YES ...ECIG would be very much on TAKE OVER dish for big tabacco compaies…"
Again, speculation.
Lorrillard acquired blu .
Inturn, Imperial Tobacco Group Plc sued Lorillard Inc. (LO), NJOY Inc., Vapor Corp. and eight other makers of electronic cigarettes in U.S. patent lawsuits alleging, at the time, they infringed its intellectual property.
This is a matter of fact. In other words, patents are not a significant part of a takeover bid.(Although having one would enhance the value of said takeover)
It is brands, distribution channels, revenues, and the management team that seem to be important in the takeovers of the ecig space.
pennydaytrader:
"No reason to blame shorts. That is very ammature to do that. Ask yourself, how did Ecig get itself in so much debt. Someone should be fired in that company. in my opinion. I would love to be hired as CEO with my resume goes like this, "ummm yes, in the past one year , i managed to get pps down from $60 dollars to 0.05 in a record time of one year" ......"can you hire me?"."
This is a gross simplification, misrepresentation, and erroneous interpretation of the share price of ECIG, and performance of the CEO for ECIG.
To quote his bio "Brent Willis was the Global CCO, President, and on the Board of Management for InBev and Board of Directors for AmBev (NYSE: INB.BR, ABV) and developed and implemented the strategy that led to the creation of the world’s largest beer company."
There are many other accomplishments of Brent Willis, but this is pivotal and crucial to our thesis.
He has been centrally involved in a similar venture. That is, he has a proven ability to consolidate, and develop distribution channels for consumer goods.
His accomplishments in this regard (Bringing Bill Fields on board, Acquiring FIN/VAPESTICK/VIP, and establishing international distribution channels) are tremendous accomplishments.
Granted, the failed IPO was a colossal error, but I wouldn't blame him entirely.
He did bring Wells Fargo and Cannaccord to the table, it just didn't happen.
Blame him for being abmbitious, and likely (IMO) failing because he (again likely) struck a hard bargain, and didn't get the investors to bite at a higher share price.
In doing so, however, wasn't he trying to benefit those same shareholders?
As they say, " you need to break a few eggs to make an omelette"
Still if he had been successful, we wouldn't have this discussion now, and we wouldn't have a chance of the lifetime to get in at a significant discount (IMO, again)
The 5-50, occurred when there was limited liquidity
Unless there is some information that isn't public, then yes 500m is fabricated.
How is this possible without a proxy vote?
Please explain.
The reason ECIG BOD filed the amendment , approximately 1 year ago, allowing 300m shares to be issued was to prevent a takeover, and to fund accretive acquisitions.
Times are different now, and with impairment of goodwill they may not hold control, given convertibles pending.
So for a company seeking takeover, it may be out of their hands now.
Hopefully, we will have a chance to pick up more shares before this takes off.
I think this is possible.
So who is buying?
I don't think retail investors have picked up all these shares.
Several questions and potential reasons:
Regarding light volume:
1. Majority of shares were restricted (Insiders had >51%), and initial investors were restricted until end of June, 2014
2. The story wasn't well known. Remember, the story started with Victory with <2m revenues. The growth has been well documented here, in SEC filings, and on the company website.
Regarding increasing volume:
1. Restriction was lifted in 2 phases:a) Initial investors that declined a second lockup had shares restriction lifted in July b) Second group of initial investors that agreed to a second lockup , had this lockup lifted after failed IPO
2. Please see previous posts regarding conversions and other factors
Forget about the shorts.
I am new to Ihub, but ask yourself this: Do you believe the logical and evidenced based rationale outlined by many posters or the brief, unsupported rants posted by several members?
It doesn't really matter to me.
I joined Ihub to have a chance to put forth and read thoughts that would challenge my positive position with ECIG.
if there were an intelligent argument put forth by shorts I would be keen to engage that discussion.
Why?
Risks abound in investing, and I want to be challenged.
My hard earned capital is at risk, and I don't foolishly put it down.
The silly banter by shorts here (sub zero by...., grey sheets by... Substitute some idiotic unsubstantiated phrase), don't warrant a response
I may upgrade to a paid subscription just to filter this.
What is the best service to see OTC streaming data?
Nice sentiment for all those of us long.
Still, I don't think the board will have a huge effect based on the number of shares being traded.
Thats why I ignore the noise from shorts.
What will move this eventually, and I believe it will, is resolution of the debt, and additional investment in this growing business.
Once this happens, I suspect institutional investors will also join the growing retail investors. (After all,funds which hold the conventional tobacco stocks may want to hedge)
All in all, I will wait patiently, although the management needs to make a deal and soon if they want to see the share price climb back and see less volatility.
I am taking the day off to enjoy the holidays-happy trading to those trading, and happy holidays to all.
I agree.
One has to think they will refinance or execute a deal very soon.
If they didn't want to dilute the company on an IPO with a low price, why would they continue do it down here?.
Willis is a proven deal maker, and we have to trust he will continue to do so.
Clearly he needs to do so soon, to maintain the value,and o continue the growth.
A deal now should lead to a rapid reversal, and establish a new floor.
All IMO
Absolutely nothing.
Just joined Ihub, because I took a position in Ecig, and this was the place with greatest activity.
Some of the activity is pure noise.
Just signing in after spending the day out
This is my understanding as well from prior S1s
Multiple postings on possible reasons for the drop.
Possibilities:
1. Failure to uplist to NASDAQ spooked the market
2. Initial investors that were locked up in the NASDAQ up listing, subsequently had free shares and were frustrated after waiting over a year dumped their shares
3. Debt conversion
4. Bear hypothesis
I believe 1-3 are operative.
My bids got hit around 2pm and I just got another large allotment, around .08.
Thank-you to those who sold.
Someone needs to shake the branches at the head office to get something going soon.
Brett Willis has a track record, and has been successful thus far in several ventures.
Get it going!
I don't know the exact reason, except from reading the filings and as noted unfavourable market conditions.
What were these "unfavourable market conditions"
Certainly the IPO market was weak, but...
Could it be that ECIG set an unrealistic price that the investment banks and clients wouldn't fill?
I suspect this as the terms outlined in the filings, required a certain share price to finance/close prior acquisitions.
I suspect they pushed for such a price to avoid dilution.
If so, now they are getting that anyway.
If so, this is both our pain and opportunity.
Still, they need to act quickly to find a deal, partial sale, or strategic investment of some sort, yesterday, so they can continue to grow.
Brent Willis comes from with a world class education and management background, and doesn't look sound like he likes to lose. Listening to interviews with him he has a personal motivation as well.
He does need to strike soon.
If they announce any such deal, this will take off.
In the meantime, I will sit here patiently holding onto a growing amount of ECIG shares
I agree.
I was just indicating the dilution wasn't intentional, but intended to use the shares as currency to fund acquisitions.
That would be about right, based on prior float and the 300m they approved on the prior filings.
The 300m was for new acquisitions, I believe not to make up for lost goodwill.
True.
Even speculators/traders recognize that wisdom.
As Jesse Livermore said:
"It never was my thinking that made the big money for me. It always was my sitting. Got that? My sitting tight! It is no trick at all to be right on the market. You always find lots of early bulls in bull markets and early bears in bear markets. I've known many men who were right at exactly the right time, and began buying or selling stocks when prices were at the very level which should show the greatest profit. And their experience invariably matched mine--that is, they made no real money out of it. Men who can both be right and sit tight are uncommon."
They have a limit on what they can dilute to.
Correct me if I am wrong, but based on prior filings, it is at 300m
So we can work back the numbers, and still find a valuation above 1, in the worst case.
They did buy FIN and VIP with great revenues, and potential.
The dilution hurts the insiders as well, as they had or sold companies for the same shares we are buying at pennies.
I have no idea when this will turn, but I am holding tight and won't consider selling until it is well above 1.00.
I would rather Lise everything than give up this opportunity.
Still, I am frustrated the management isn't communicating something.
There is no reason why they can't give us some information.
The IPO is dead, so let's hear what the plan is.
We don't even need NASDAQ with this liquidity-OTC or not
The value should be based on a multiple of revenue and price per share determined resulting, and of course, depending on the markets demand.
Lorillard acquired Blu at about 4x revenue ( acquisition at 135m based on 35m revenue).
Is it current or expected revenue of Ecig?
What is the share count based on debt conversion, and acquisitions that were funded partly with acquisition of ECig shares as currency?
If we take 80-100m shares, and 80m revenues, one could derive a price of 4 at least.
If the revenues continue to take off, the share price should be north of 5.
I suspect that is what the CEO was thinking when he was asking for 6+ for share price in previous financings.
If the fair market value is incorporated into this and the share count is 300m, the price could be north of 1, at the wors
In any event, this should never have gotten to a penny stock, although glad it did.
Itwon't remain there, anyway
If the management acts quickly and resolves the debt and conversion issues this will take off beyond 2 in a hurry
I am glad I had a chance to accumulate a decent position, and depending on what I hear, will add even more on the way up.
I agree tbone.
Essentially, ECIG tanked when they failed to secure the IPO, and several events occurred to drive the stock down. Importantly, the initial shareholders in the .25 round received their shares, and almost certainly dumped them into the market. I suspect waiting over a year for an uplifting that didn't materialize left some pretty frustrated shareholders who drove this down.
It is demand and supply.
Now we are in a situation where many of those shares are gone, and those remaining believe in the company, and there is a growing demand as this story has become better known and the value emerged.
The only catch is the conversions as you note.
Still, there have been buyers for the the massive influx of shares, and now the tides have shifted.
Aside from the technicals, this company is growing revenues, has a growing distribution network, and first class management team.
It is essential they deal with their debt, and allow them to continue to grow the company as they have.
It is interesting that the Mansour group investment(20m) exceeds their market cap.
So, this is a great risk -reward
Patience is key here.
I bought 900,000 shares at .09., and think this can get back to 2.50, based on multiples compared to enterprise value of the other Ecig companies that were bought out.
A little bit of good news and this thing will take off.
Now we need the management team to do something quick, and communicate to the street to see this reversal.