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They flipped over backwards to get rid of Cornell because they knew they were leaches and were going to suck shareholder value dry. Follow the filings and you will see how hard they worked to run Cornell off.
That is not the hallmark of a company out to destroy shareholder value by dilution.
If you look at the terms of the preferred you will realize that the whole reason they increased the AS and issued the preferred in such a manner was at the insistence of Cornell. Had it not been for butthole Cornell, non of the preferred would have been issued at all nor would the float have been increased.
So to say that there is intent here to dilute is a misnomer in my opinion since the AS and preferred issuance should be looked at in terms of why. If they wanted or needed to sell shares, they had plenty to sell available under the 500 million cap already.
-----------------------------
"The letter of intent also required the Company to increase its authorization of common shares from 500 million to two billion shares and to do so no later than November 1, 2007. The debenture holders also agreed to extend the maturity dates of each debenture by one year in exchange for warrants to purchase three million shares of the Company’s common stock at a price per share of $0.004, on a cashless basis, for a term of five years. (See Notes 10D and 12C).
Most of the transactions specified by the debenture holders’ letter of consent did not occur as contemplated. The Company had originally intended to include a security provision in the new securities, as the letter of consent from the existing debenture holders specifying the various restrictions on the new preferred did not preclude such a provision. The security provision would have been liens on the Company’s assets, but such liens would have been junior to all existing liens. However, the Company shortly determined that the issuance of secured convertible preferred stock, even though permissible under a “blank check” umbrella, was not advisable.
Accordingly, the Company then determined to offer non-interest bearing secured convertible debt, with the terms of such debt being sufficiently similar to the preferred stock described in the letter of intent that the debenture holders would still consent. In particular, the conversion terms would be virtually identical to those contemplated in the letter of intent and any funds raised in excess of $1,000,000 would still be applied against the 2006 and 2007 debentures as required. In September 2007, $600,000 was received from two accredited investors, including the rollover of a $100,000 bridge loan from a shareholder of the Company. As then contemplated, the new debt was to automatically convert into common shares of the Company on the earlier of (i) five days following the full and complete conversion by the holders of the 2006 and 2007 debentures; or (ii) October 31, 2010. The conversion price in effect on the conversion date was to equal the volume weighted average conversion price per share of all conversions of those debentures.
During October and November 2007, the Company received another $625,000 from accredited investors, with such monies initially designated as being for the new non-interest bearing convertible secured debentures. However the November deadline for completing the financings contemplated by the August 7, 2007 consent letter had not been met. In addition, during this period the Company determined it might be able to raise sufficient funds to completely repay all amounts outstanding under the 2006 and 2007 debentures, and accordingly had begun negotiations with the debenture holders to reach an agreement providing for such repayment.
On December 6, 2007, the debenture holders issued a substantially revised letter of consent authorizing the issuance of the new preferred, conditioned upon the repayment of the debentures. This letter stipulated that if sufficient funds were not raised to allow the Company to repay all amounts due under the 2006 and 2007 debentures by December 31, 2007, the Company would have to return all monies subscribed for the new preferred. As the Company had not obtained the debenture holders’ written consent to issue new convertible secured debt, it followed that the issuance of such instruments had been contractually prohibited, and accordingly, such instruments were void “ab initio.” However, since the now necessarily void securities had been non-interest bearing, the Company anticipated that substituting preferred stock with senior liquidation rights was likely to be acceptable to the investors.
As the Company had concluded that the non-interest bearing secured convertible debentures had not been validly issued, the Company sought rescission letters from each of the subscribers. The rescission letters were obtained and each subscriber rolled the previously paid amounts into the Series A Preferred, which now resulted in a transaction for which the debenture holders’ consent had been obtained. In retrospect, the Company determined that the monies paid for the non-interest bearing debentures were deposits or subscriptions for the Series A Preferred that were now validly issuable. "
Insiders bought out Cornell with their own money and they are willing to spend the equivalent of 20 percent of the entire market cap of the company on people to sell Teleblock in the coming year.
Think about it.
Are you sorry you sold Friday or what?
That's cool. I didn't recall that, maybe in my initial read I saw it and it popped up later in my head. The magnitude of the sales force or sales people or whatever is measured by me by the dollars they anticipate spending or not spending so I don't care what they call it.
Well, they didn't really say "sales force" in the 10k. I took to mean the $400,000 to $500,000 they anticipate paying to sales people during the next year as meaning several, which I would call a sales force. If you really read it, that could mean a lot as they have been doing quite well with no salespeople.
I think to this point, sales growth has been pretty much word of mouth and referrals.
It's a bit of a conundrum in that the call center chooses the COPI partner who provides the logistics however making that partner a Verisign subscriber I think would be the target of the sales force which would most likely have some Verisign backing.
I'm not actually sure that the $500,000 they anticipate spending on a sales force would not be better off saved since Verisign is seemingly on a tear in India and Teleblock is the best solution out there currently. There is definitely a shift to India for outsourced call center solutions and Verisign seems to be positioning themselves for a "take-no-prisoners" stance regarding future growth in India.
If you really think about it, the recent Verisign position on India could very well be the reason they have NOT proceeded with a sales force. COPI has partnered with the best in the business, and the best in the business has recently indicated that they intend to be the frontrunner in emerging markets, so why not let the Verisign experts take the lead in obtaining new customers? That would be the smart move in my opinion.
Verisign has made a recent commitment to infrastructure improvements in India and the improved COPI margins within the VOIP framework I think are encouraging. I think the fact that they even realize it is virtually here bodes well for COPI going forward. When you have the best product and you are partnered with the industry leader, it really doesn't make a lot of sense to spend money on a sales team I think.
I guess the bottom line is this.
COPI will most likely be profitable some time in 2008.
If you bought COPI in the last 3 weeks hoping for a 100 percent gain in a few days then you should sell if you are disappointed. That is probably the reason for Friday's decline.
If you bought COPI hoping for a 3 or 4 bagger during the next 9 months then it could happen.
I don't care if you sell or don't sell.
After all, COPI does have less than a $5 million market cap.
That's the way this stuff goes down here.
That is what I said.
"Fifth, they anticipate spending $400,000 to $500,00 on a sales force. That equates to around $42,000 a month. If you look at their anticipated cash flow burn rate of $242,000, they are within $50,000 a month of becoming CF neutral and THAT is the full 2007 average, not a 3 month average"
Does anyone know if they are having a CC?
I would love to have more information about who owns the other 92 percent of the Series A.
Hmmmm...
First, many, many, many companies issue a going concern out of sheer CYA needs. As for the raising cash, they have stated that they have funds for the next 9 months, and have even put out the $242,000 a month number (if I remember the figure correctly). The thing about the number and I won't rehash all of it because I did it already in an earlier post, is that this number also includes the approx $10k of back pay due Dean. It is payable over the next 6 months, 3 of which have already passed. (There are many other things included in that number which are mentioned in the 10k as well).
Below is the excerpt from my other post which does NOT include the $10k in back pay due Dean.
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"Fifth, they anticipate spending $400,000 to $500,00 on a sales force. That equates to around $42,000 a month. If you look at their anticipated cash flow burn rate of $242,000, they are within $50,000 a month of becoming CF neutral and THAT is the full 2007 average, not a 3 month average. (I cannot emphasize this point enough, it is KEY) Also, consider that $12,500 of that would be an interest payment of .01 on the 1,250,000 shares of Series B that Barry owns 100 percent of....more to come with this thought later once I've postulated on it for a few days"
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If you put all that together I think you will find that they are about $20,000 a month at a rough guess from becoming CF neutral. I haven't looked to see what they based the number on, could be they used last year's numbers which I believe has significantly improved, however it would qualify for the CYA aspect of forward looking statements.
And actually, there should be virtually no variable costs and few fixed costs with upgrading the Teleblock software package or small modifications in order to accommodate new customers. Possibly, we could see a need for more access capacity from Verisign to COPI in the way of T1 lines or such, but even those costs are relatively small and the whole system is hosted by Verisign on their SS7 network. That fact that this is scalable with minimal cost is most of the beauty of the whole process and it is something that few have taken the time to think through thoroughly.
They have picked up multiple customers over the last 6 months just by "being here" and offering the product. There are probably 10 times that many customers within easy reach.
You are correct in the assessment that Q1 will be all telling. I think it will be quite amazing from what most people here think. Just my opinion.
Their wish to sell 125,000 every month would certainly believe they have or are about to unleash IRG to start promoting COPI. There is much more to publicize in the current (almost ended) quarter than many realize.
Actually, it does not mean guaranteed for anything.
"Which means; Guaranteed, NOT Even cash-flow neutral,
until The 4th Quarter, of 2008, AT THE VERY EARLIEST ."
No more than they guaranteed that they would have a million bucks in the bank, or they guaranteed that they would have a sales force out there at this time, or that they guaranteed that the insiders would sink a huge amount of funds into the company, or that they guaranteed jack sheetz.
Nothing is guaranteed. That is why the market cap is less than 5 million bucks. Guaranteed as of today.
It's a very deep read. You almost have to have been following COPI for a while to really understand what it means.
Couple of questions I haven't had the time to research yet is:
The other 92 percent of the preferred A shares. Who owns them? Generally I am thinking Verisign or probably Paetec but did I miss this somewhere in the filing?
There must be an astounding amount of DD available on Barry's "other company" and their ties within the industry. What do they do, where are they at, etc? Obviously, Barry has a lot of cash and thus there is lots of DD out there on him somewhere. Who has it?
More to come, I've just given it a casual read so far. Not bad really despite the knee-jerk reaction today.
You may be unhappy with the disappointing pps as opposed to the "disappointing results".
The results were actually very much in line, draw a vastly improved balance sheet, and positive YOY improvement in different areas. They indicate even better things to come should you take the time to read the entire 10k.
http://investorshub.advfn.com/boards/read_msg.asp?message_id=28023002
Well, there is a lot to digest in the 10k. It is difficult to read, however the parts add up to more than the whole. Today was a knee-jerk reaction to what on the surface does not support a short term pop, but does support a steady pps rise going forward.
There is nothing left to hide. All intents and actions are out there for all to read. 3 percent of the OS traded today, largely by short term traders I suspect.
Hell I'm glad it sold off.
Nothing but grass and prairie.
You can see as far as you can read.
Good thing to tell the flippers bye.
Look who owns the preferreds and figure out why and you can read too.
I agree wholeheartedly. All it takes is a read past page 19.
Read past page 19.
Gotta tell ya, I was more than a little disappointed when I started reading the 10k. Even down to page 19 I was fuming quite a bit regarding the amount of the loss and the revenues. Revenues were way below what I anticipated and the loss was a bit more than what I thought it should be.
I could restate some poor results and negatives here, but I really think most of the people who read the first 19 pages probably sold today and didn't read the rest of it and didn't care to read the rest of it because they were looking for a 20 percent pop and then to be gone.
However, there are some really great things mentioned in there that are worth taking note of:
First the preferreds are owned largely by Dean and Brooks.
They anticipate selling 125,000 a month for the next 12 months. They can convert the preferreds and have a buttload of shares to sell if they wanted. If they intended to dilute the heck out of us, then they would be committing to sell a shitload more shares than 125k a month. It's nothing. I take this as outlook = pretty damn good.
Barry owns 8 percent of Series A.
Barry owns 100 percent of Series B.
Barry and Dean together own 70.2 percent of Series C.
Together they have a BUNCH of shares.
Second, they paid over $500,000 in interest in 2007. Forgive me for not including the exact number, I cannot find it now, but much of that will not be incurred going forward. I think
Third, they recognized $320,661 as a fluff conversion loss.
"At various dates from December 12, 2007 through December 31, 2007, the market closing price of the common stock was greater than the $0.01 conversion price, thereby resulting in the recognition of an aggregate beneficial conversion cost of $320,661. The 2007 loss of $1,510,814 includes this beneficial conversion cost and is taken into account when calculating loss per common share."
Fourth, they lost $60,140 for early cancellation of the debentures. That will not be repeated.
Fifth, they anticipate spending $400,000 to $500,00 on a sales force. That equates to around $42,000 a month. If you look at their anticipated cash flow burn rate of $242,000, they are within $50,000 a month of becoming CF neutral and THAT is the full 2007 average, not a 3 month average. (I cannot emphasize this point enough, it is KEY) Also, consider that $12,500 of that would be an interest payment of .01 on the 1,250,000 shares of Series B that Barry owns 100 percent of....more to come with this thought later once I've postulated on it for a few days.
Finally...
"The balance of the proceeds raised from the Series A offering will be used to fund the Company’s operating shortfalls over the next three quarters."
Pretty bad read down to page 19, but it got a helluva lot better after that.
Well, all I'm gonna say until I read the 10K is POO-POO. Regarding the volume, it seems that most of the 24 hour time frame speculators might be gone once the first goob decided to sell a few thousand. In reality, it's not very much volume considering the float (at least I think). Looking forward to a good read though. Good job to those who grabbed those low to mid threes today. Wish I had been here.
First, nobody is singling you out for anything. You are the one bringing the PRs to the board and you responded to my posts.
Emotional attachment is always bad for your checkbook regarding the "man crushes". That's all. The same little scenario went through my mind when it was ACUP.
I'm over getting scammed by Rudy out of $1500 or so with the 9000/1 RS. So now I figure I win either way. My 27 shares can go to da moon, or I'll sell them next year and take $1500 off of my other profits.
With no vested interest either way, it's easy for me to tell the truth about Rudy and company.
Well, I guess "man crushes" and daily PRs go well together. They both entice people to buy into things that lack unsubstantiated information.
That was a very good sign Kermit that the buying is getting serious I think.
OK BBD, I see where you are coming from, and you are correct.
Selling a share short is (in theory) a commitment to purchase the share back at a later date. The short seller hopes to purchase the share back at a lower price and thus profit the difference.
I'm all for a large short position here. I wish it were 20 million.
However, the short sale temporarily increases the sell pressure on one side of the equation, and later increases the buy pressure on the other side of the equation.
I'm with ya bud.
Don't care too. I still have my 27 shares to sell next year as a tax write off.
You have people excited about something that they know nothing of other than the relentless BS pump jobs Dilutey and co are foisting on the unsuspecting investors. It's really a shame.
Those who fail to learn from history are doomed to repeat it. Take heed, motivational speaking for a 30 plus year old one-time event must not be paying too well these days. Any time you see PRs this close together, it's to sell shares.
Do you have any idea where the additional shares are coming from? There were 43,300 last I heard. Amazing to trade the float multiple times in a single day isn't it?
Share beans share! All the more fun if more people are looking at your stocks too!
So you say you think you would like to be short here?
Pre R/S the market cap was like 1.4 million and now it is 35 times that. No, there will be no getting off of the ground, only dumping.
40 million is low?
That sheetz just wrong for dem turds to play with it like that though. I saw the shares go by at .04 today and it wasn't even enough to make a good bid whack!
Well I chased it on up until I got filled because in the end it's pretty irrelevant. Freakin turdds playing around with this chart though, and IRG needs to help us just a tad here pretty quick. Dang punch down to .04 today triggered the SAR on the daily but I really think it is going to be short lived.
421,829 shares short as of March 14. Woe for those suckers on this volume, lol. Even my piddly buys of late the MM take advantage of.
On this volume, with the float just not out there for sale at this pps, that is a lot of shares. I think the farks did it again today just to take the SAR down. That little tick down to .04 triggered the SAR on the daily which sucks.
Ain't skeered though, the freaks can short all they wanna.
I think Blue is correct. I bought more a week or so ago and was flipping screens between L2 and order entry. I hit the enter for the buy AT THE ASK, went to my L2, and within 2 seconds the ask went up 3 ticks. Crazy crooked sneaky snakes I think these MM are, especially with low volume like this and periodic trades.
Would tickle me pink to see them uplist one day at least out of the vulture range maybe to the next raptor food category at least.
And with costs of postage going up every year, why not make that call instead?
http://www.the-dma.org/postal/
That's what they do. Sneaky snakes they are.
Well, Sneaky Snake drinks Root Beer and he just makes me sick
When he is not dancin', he looks just like a stick
Now he doesn't have any arms or legs, you cannot see his ears
And while we are not lookin', he's stealin' all of our beer.
- Tom T. Hall
I spoke too soon, back now.
Interesting that GNLN has moved from the ask.
Good for you! I'm jealous!
That is such BS trying to drive it below the SAR with peeeeetiful volume. Ain't skeered.
I find myself in the same unfortunate situation.
AUTO trapping himself. Only one moron down there.