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A reverse split allows the stock to go below effective 0.0001
While any new share they happen to issue will be "worth" $0.0001 or more, according to the mechanics of penny stock prices.
For example, the current HPNN shares, translated into pre split (5000 to 1 !) HPON values, are worth $0.0000001, unless I fumbled a decimal
Also, I expect that after a RS, the Hop-On administrators re-issue themselves privileged shares, as to never lose control of the company.
I'm curious, how is Hop-On accounting for the interrest running on its $9M-odd debt ?
Are all those old debts magically interrest-free ?
If anyone of the suppliers they stiffed years back was to sue them, they would ask for full interrest on their long-unpaid invoices, would they not ?
Who on his right mind would pay $1 to acquire $19M of debt ?
Still way too early to release 2Q results
They can sit on those financials for, oh, say, 4 more months, or until the OTC forces them to do so.
That's not like they had any profits to report.
A glass of orange juice contains about 90mg of vitamin C.
How much vitamin C does a Re-Medical "patch" contains ?
How's the price of a Re-Med patch compares to the price of a glass of OJ ?
Do we know who are the Re-Medical officers ?
The company is registered in Delaware, for a change.
USAcig shipping department: VIP Solutions
More like $600K.
Since another $200K, the proceeds from newly issued stock sales, was transferred to the Green Frog fund in 2009 too.
Uncatchable, according to the financials, PM has destroyed $27.4M worth of shareholders and suppliers money so far, with nothing to show for it.
The fact that he and HPNN are "still here" is a testimony to the toothlessness of the SEC, and the gullibility of penny stock investors both.
There's one kind of lawsuit missing
Maybe HPNN will announce that, after due diligence,
they have decided not to purchase their founder's company,
using whatever money their founder left them to play with ?
I know. As far as I know, those millions never went near HPNN's balance sheet.
But the new Hop-On would never make grandiose announcements that never materialize.
Hop-on Raises $17.4 Million Financing
06/11/2007
Hop-on Raises Approximately $17.4 Million Venture Capital Financing
...and they racked in $826K selling those 2B-odd shares on the open market.
And they did it in less than 3 months !!!
$426K of the proceeds were added to the Paid-in Capital deficit
and the other $400K disappeared from the balance sheet into the Green Frog Fund
So, HPNN real business is not selling glycol tubes or antirad pugs, it's selling "shares".
And it works. The public loves it. If there were 5 billion more shares, they would buy them all!
The USAcig "acquisition" is just another way for the owner of both companies to transfer money from his right pocket to his left pocket, but, as usual, with the right press releases, it raises the stock price!
As Hop-On is completely broke (huge debts, can't even afford an accountant, posted another loss in 1Q), the only conceivable way to "acquire" their sole client, would be to issue billion new shares.
Remember to act surprised when it happen.
Yes, lotsa goodies like their Reality TV Show: The Biggest Glycol Inhaler
The casting dates are To Be Announced later. The show will air at a much later date, on late late late TV, or maybe a little later than that.
And then they're gonna sell surplus Kin phones, at $-10.00 each.
And then they're gonna sue Apple over the iPhone. Hop-On owns the Patent(s) over all flip phones, all MP3 phones.
And then they will start selling shares of the Brooklyn Bridge, say, 10 trillion shares.
No cash needed.
They can "acquire" USAcig (which happens to be their sole supplier, and apparently, their sole soyrce of revenue) in a no-cash transaction... by issuing them, say, 5 billion shares.
Maybe the company is worth it. We'll know if they are in maybe 6 months time, when HPNN posts financials that contains both books.
If HPNN is still trading by then.
That doesn't compute.
How many privileged HPNN shares does PM owns ?
And will he vote to sell them to himself, after suitable due diligence ?
Re-Medical, why don't they buy Re-Medical ?
That would diversify their operation, by "buying" another Peter Micheals dummy company
And those "Woody Patches" gonna sell like crazy!
Remember, Hop-On has already one MOU to acquire a VOIP company
They announced that Memorandum of Understanding about 4 months ago, and there was to be a 45 days Due Diligence period.
And now, HPNN is about to "acquire" their sole customer/supplier/twin company using the $428 dollars they have in the bank !!!
They call that "diversifying their operations"!!!
HPNN financials might be rotten, (and late), their coffers bare and then some, but the company itself is a neverending source of entertainment!
Thanks, Tom. But what about operations ?
My question wasn't (directly) about stock price, but about operations.
Michaels and Pignatello have been promising multiple "revenue streams".
What kind of revenue can we expect to see from anti-radiation button sales, in the past quarter ? Enought to cover its own expenses ?
What about Graffiti Partners, how is it funded, how much of the $428 of cash will it take to acquire a VOIP company like Dibara Inc ?
Re-Medical didn't launch in the past quarter, so we can forget about "revenues. from patches.
Ditto for the gaming initiative.
I already pointed out that, if Hop-On is serous about blaying a distribution company, we should see expenses related to distribution, like, say, inventory software, and much much more.
So, my question is, how many quarters will it take, before we see HPNN break even from operations, so its gross profits are sufficient to cover its expenses ?
Then, we may have to worry about thing like making interest payment on their $9M debt, actually paying their $200K-odd Payables, paying accountants to audit their accountinf, etc, etc, etc.
Meanwhile shareholders will have to hope that the stock doesn't get diluted to 10 billion shares as it happened before.
What to expect in Hop-On's 2Q financials
..and when to expect those ?
I'll start with #2: HPNN will not post their (unaudited) financials till the OTC Markets slap them with a big red STOP sign.
What to expect, well, anything goes. If they were a real distribution outfit, you would see a lot of expenses like trucks and warehouses.
So far, apparently, HPNN/USAcig seems to rely on UPS for distribution...
Another point I want to bring, shareholders have shares in Hop-On, not USAcig. For the sake of argument, USAcig could be entirely successful with their product, and Hop-On, as their exclusive distributor, could be losing heaps of money.
It is unclear who is bearing what expenses. And what is HPNN cut on USAcig sales.
So far, HPNN has been acting more like a PR agency, than like a distributor.
Is Distribution and Marketing one and the same ?
So, in the next Q, we should see (much) increased expenses, and, if the glycol tubes actually sell, increased revenues. Unfortunately, I don't expect HPNN to break even. Ever.
And there's the dozens of other projects that Hop-On has floated, like cell phone gambling, or a VOIP acquisition, or Re-Medical kindergarden patches. I expect to see no traces of any activity in those would-be "revenue streams" in the past quarter, but I expect to hear PR noises about them in the coming months.
What do you expect to see, guys ?
Yes, Chaser, Hop-On is no longer filing insider transactions or any other kind of disclosure with the SEC, so these transactions are perforce old.
It is just context to establish that Green Frog Fund has been a player within HPNN for a long while, even owned shares in the company.
I have a theory that the $200K funnelled to Green Frog in '09 may have been used to start up USAcig.
I have connex theory that USAcig is mostly a "virtual" company, it doesn't own a factory, it just subcontracts the work of filling the E-cigarettes with E-Juice to VIP Solutions, which provides the warehouse, the employees, handles the mail orders, etc...
Michaels boasts:
Michaels, who says he is launching with the help of angel investors but is also hoping to finance the venture with purchase orders, is unabashedly excited about the prospects.
Angel investors, not batracian investors. Wrong quote anyways.
Since the Default Judgment is disclosed in the interim financial report of September 30,2009
then the 20-day period to contest a default judfgment has clearly ran out.
Another Hop-On so-called "Partner", Global Verge, recently won a default judgment against ZER01.
ZER01 is the company who announced revolutionary UNLIMITED cell phone contracts at $69.99 in early 2009. The "service" was never launched, and the phones "revolutionary" VOIP technology was never demonstrated convincingly.
Global Verge inistially sued ZER01 to recover the $179K that they had foolishly "loaned" to one of ZER01 investors; at the time, ZER01 was telling journalists that they were a multi-billion $$$ corporation, whose business address happened to be a Nevada PO box.
The ZER01 lawyer, after several continuances, informed the judge he had been unable to contact his principals, and asked leave from Court to be relieved from the case. Then Global Verge increased their damages claims to $44 Million dollars, which were awarded as a Default Judgement. Zer01 and Ben Piilani then failed to contest the ruling within the prescribed period.
A default ruling against a PO Box type company does not bring any dollars, but you can legally seize any asset that you can locate.
So, there is a short list of what may befall on HPNN at any time
1. They may file for Bankruptcy. Assets: $154K, Liabilities: $10M
2. The SEC can have their stock registration revoked for failute to file timely audited financials.
3. Their assets may be seized by their Mexican (Chinese) manufacturer/partner.
Apart that, they're in lousy shape.
Default Judgment
"Hop-on filed a law suit against a prior acquisition for Fraud and Breach of Contract. The opposition received a default judgment against Hop-on. Hop-on, will file to set the default aside and pursue litigation. "
That exactly it. HPNN sued their Chinese manufacturer "partner", but Hop-On could find no lawyer willing to take their cause, or no lawyer willing to be paid in HPNN's $0.0001 shares.
So, the the other party asked for damages, and in the absence of representation from the plaintiff, the judge ruled in favor of the defendant. That's a Default Judgement.
HPNN financials should contain a provision to the amount of the judgement against them.
Merely stating that they intent to have the ruling reversed is not enough.
With such a default ruling in hand, the prevailing party can send its agents at anytime, and take possession of Hop-On assets (if any), till the debot is satisfied, with full support of the law.
This could happen any day.
With HPNN's opaque accounting, maybe that liability is hidden within the $9M of "long-term liabilities". Maybe not.
Caveat emptor.
Of course he didn't steal that money
He merely forgot proper footnotes in the financials, explaining the purposes of that off-balance-sheet entity, the Green Frog Fund, and how transferring Hop-On capital to it benefits HPNN shareholders.
I'm sure this is a silly mistake.
The auditors will fix that overlooken footnote as soon they go over Hop-On accounts.
Which accounting company audits HPNN accounts, anyways, I think I forgot.
The Green Frog Fund also owned HPON shares
...back when HPON/HPNN still bothered with niceties like reporting insiders transactions
http://www.quote.com/us/stocks/insider.action?datatype=Planned&symbols=HPNN&page=incst
IMVHO the first $200K of the Green Frog Fund, the amount stolen in 2009,
may have been used to start USAcig.
I don't think P.M. used his own money to start his new company.
But VIP Solutions offers "subcontract packaging, assembly, and fulfillment resources".
Just the part-time "factory" USAcig needs to fill glycol tubes and assemble packages, ship internet orders.
They can package the antirads buttons there too. Their ad shows an employee with a small bright-colored carton product of similar size than the antirad button Hop-On sells.
Nothing wrong in such a business arrangmement as such.
P.M. may be stretching the truth when he's calling it his factory.
I still cannot figure out why an established non-profit company like VIP lets Michaels claim their 3 offices in 3 cities as his own "headquarters"/factory/offices
I checked on Google, no other company seems to claim the same addresses as theirs.
All other address references are associated to VIP Solutions.
Catch, I responded to your #24111 twice,
and both post, 3 hours apart, vanished.
I saw the title of your reply for a minute, but I was unable to acess it.
Somehow, I doubt it is moderators censorship, or a spambot automatized censorship.
Hopefully it is a bug on the board software, somehow.
Subcontract Services
As long you know you're gambling at a crooked table, Catch.
Did you foresaw that HPNN would quadruple the number of outstanding shares ?
If not, you're as much a mark as any shareholder that bought that dud.
Being new here, I may have missed the posts where you contributed you valuable analysis on the prospects of that puvlicly owned company.
Could you repeat the most attractive points you see in this company, and when do you expect them to post a break-even quarter ?
Of course, the book value of the company is a long, long, long way to ever become positive, not with $9 million of accumulated debt.
Duff, the Temecula factory seems to belong to a non-profit organization, VIP Solution.
The 3 addresses listed for USAcig are also the exact same addresses for that non-profit corporation, who has been in operation for several years now, and doesn't list any Peter Michaels on its board or donators. I'm at loss to figure out how the USAcig CEO convinced them to let him use their headquarter address.
USAcig boasts they are the only fake cigarettes with glycol tubes manufactured in the USA.
They also acknowledges that their components come from China.
I infer that the tubes are being filled with E-Juice by VIP-provided personel, then packaged for shipment at Temecula.
The USAcig CEO claims he employs 8 employees at Temecula, and "50" at his "distribution centers".
With an operation like that, why he ever hired Hop-On to mess it up is beyond me.
Duff, maybe it is as simple as phoning VIP Solutions and asking them to visit their model Temecula factory.
And then, discreetly ask them what is their business relationship with USAcig ...
The PRs COULD, arguably, be legit
...but, based on past non-performance, likely are not.
The case in favor:
Their website for selling glycol tubes has been only for less than a month, launched about May 11, 2010. Getting 15K with an unknown % of sales in 20 days would not be half-bad.
The case against.
The level of expenses doesn't square with a serious distribution effort, even counting the Amazon flop. Once you substract the cost of the MarketWire PRs (those things are not free), it leaves almost nothing as actual marketing expenses and all the other expenses to create a distribution networks, you know, the kind were box leave by truck, to warehouses, and are then distributed to convenience stores according to restocking levels.
Of course, some expenses may have occured in 2Q. Also, we cannot know what expenses are borne by USAcig, and which by Hop-On. Hop-On has only 3 employees and share the same president and the same website than USAcig.
The Anti-Radiation pug was launched on May 19, so in the 2Q financials we should see the cost of a box of buttons.
There are no traces of expenses related to "the acquisition of a profitable VOIP company", no budget for the production of a reaity TV show. Actually, their financials doesn't detail any marketing budget at all.
So, we are down to 2 possibilities:
2Q will see expenses commensurate with the PR promises
or
2Q will show half-assed expenses, consistent with HPNN past practices of grandiose PR announcement, and the barest traces of execution.
In both cases (higher, realistic expenses, or make-believe expenses) we may also see anemic revenues, and perpetual losses from operations. This is also to be expected if HPNN repeats its past non-performance.
As an aside, Pignatello's old company, Tobacco One, also announced the upcoming acquisition of an actual tobacco company, which was followed 2 months later by the discreet announce that the deal was off. Of course the initial announce, repeated on every penny stock site, caused the stock to rise.
Just saying.
Do you also agree HPNN is seriously delinquent ?
Re-doing the accounting of the past 5 years, and getting those accounts audited could cost as much as $200K. Auditors charge extra for companies whose accounts are not current, and even more to distressed companies.
Not to mention that an audit could land Peter Michaels in jail.
Note that a SarBox compliant Financial report must be signed by both the CFO and the CEO. Hop-On latest (unaudited) financial was signed by Peter Michaels as "President".
Of course, without up-to-date financials, after 3 years or so, the SEC can sends a summons and suspends trading for 15 days. A court hearing follows within 30 days. As I understand it, if the company doesn't pay huge fines and shows the judge an Affidavit that an Audit is already underway, the stock registration is REVOKED. This administrative procedure is pretty routine. They do about 20 companies in a single day, usually beginning by the same letter. That's what happened to Jay Pignatello's company, by the way.
You can no longer find a broker to trade your shares. Your already-worthless shares are now truly worthless. They aren't even worth the paper they aren't printed on.
Remember that your shares are only a number in your broker's computer.
Also, nothing seems to prevent Hop-On to DOUBLE the number of issued shares anytime they feel like it, apparently. They have already done it twice this year. They can do it again.
The volume of E-Cigs sales is unknown.
It is likely to stay unknown sunce USAcig does not file public reports.
Hop-On is the exclusive distributor for USAcig. Why ? They don't own warehouses, nor trucks, and their past distribution mojo was zilch.
So, HPNN gets a % off every glycol pack sale. What % ? unknown.
HPNN seems to allow the indirect sales via banners. The banner site gets 10%. The ShareASale banner management company gets another ??%.
So far HPNN costs of goods appears as $0. Their revenues are NOT sufficient to cover their expenses, by a long shot.
HPNN also carries huge debts, $210K in Account Payables (bills), $1.2M in "Current Liabilities", whatever that means, and something like $9M in "Long-Term Libabilities", whatever that hides.
HPNN has many ongoing business plans, like selling antiradiation pugs, buying a profitable VOIP company, producing a Reality TV Show The Biggest Baghilder, and fattening its pet Green Frog.
Question: how did HPNN register 2 billion shares ?
I was under the naive impression that companies that were delinquent in their SEC filings were not allowed to register new shares.
How did HPNN managed to do it ?
Maybe this CA record:
http://businessprofiles.com/details/GREEN_FROG_FUND_INC/CA-C2831249
Name GREEN FROG FUND, INC.
Entity Number C2831249
Date 03/22/2006
Status SUSPENDED
Address 3943 IRVINE BLVD., #120, IRVINE CA 92602