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And if his creation of a new company in the same area copying the business model completely is in fact indicative of a real company he plans to run, then he shouldn't be at Sunworks at all right now since his interests are counter to the interests of the company. It is in the best interests of Abe that Sunworks fail. Again, assuming that the website and business license and contractors license means what it looks like.
Abe, personally, has enough cash from selling shares of Sunworks to start a company larger than Sunworks was when he sold it.
If his business partners join in with him again, they could create a company larger than Sunworks is NOW just from using money made from selling shares they got when they sold Sunworks.
So they will be fine.
The cost over-runs are just the company making corrections for cost estimates that were too low stemming from 2016. It's not a failure of capability to manage projects, it's a failure to accurately account for them. The costs were not higher than they should have been, or will be, they just underestimated costs early so they have "overruns" later to make up for it.
If they had made the correct estimates back then they wouldn't have been able to get all their stock comp, but that is another story.
Sure there are better managers than Abe. But Abe and his partners are the ones who created all of the relationships between Sunworks and their clients, so them potentially setting up shop in competition with Sunworks is very dangerous.
As for who is buying... who knows. I doubt the reason has anything to do with anything any of us have been talking about here though. Definitely not because they shaved $50K from board salaries.
But for about $20-50K you could hire someone who can generate this kind of volume from their follower / client base, this company used to do stuff like that all the time. And this is the first time we see a big volume move like this from what seems to be nothing.
If I had to guess this might continue for a while depending on how much resources are behind it.
Also I am seeing other people spreading baseless blockchain rumors so who knows: https://twitter.com/buysellshort/status/946027968186347520
About us page from Abe's new company: http://webcache.googleusercontent.com/search?q=cache:http://independantsolarenergy.com/about-us/
This part in particular:
If Abe is leaving (and competing with Sunworks to boot) - and this move made everybody forget that seems to be happening, then it's likely that Emil and Mike will also leave.
All of them got the same number of shares and same contract with Sunworks when they were acquired.
All of them often sell a bunch of shares all at once, and all of them have a bunch of shares left to sell.
This would be FAR from the first time the stock went up without explanation just before insiders were getting ready to sell, only to go down in the weeks to follow.
Perhaps this will be the first time out of many many many times now that these types of moves hold, and they won't be disappointed for once.
Interesting indeed, thank you to jwalking for providing today's entertainment.
Abe was also removed from the Sunworks license last month. Well it's been less than 24 hrs and we already are pretty sure that PR about Abe continuing at Sunworks is probably misleading at best.
https://www2.cslb.ca.gov/OnlineServices/CheckLicenseII/PersonnelList.aspx?LicNum=441690&LicName=SUNWORKS+UNITED+INC
A new guy was also added (and Wasson is still there despite the company saying it was a mistake half a year ago)
DONALD WAYNE PEEK
Who is this?
Edit (its this guy): https://www.linkedin.com/in/don-peek-ba754856/
There isn't enough volume nor shares available to short this in a big way right now, even interactive brokers only has 95K shares available.
Better than Greg Boden who converts his shares just before bad news comes out. He is a man of very good fortune! He also happens to share a business address with Jim Nelson, but that is surely pure coincidence!
The company was desperate to keep Abe before.
In response to an article I wrote about how the company altered Abe's promissory not to be 3x more valueable (~.50 conversion instead of 1.50) an author who was talking to the CFO at 4AM in the morning had this to say.
By the way this level of analysis is coming from a guy who plagiarized the first part of his article straight from the 10-K, it's my opinion someone fed him this answer (though he denied this at the time):
Just some documents related to Abe's new company for reference:
https://www.scribd.com/document/367629837/AbeCompany1
https://www.scribd.com/document/367629836/AbeCompany2
For now, the company is an inactive shell, but it's taking lots of steps to longer be that. Combined with Abe stepping down, seems like an important issue. Thanks jwalking20 for discovering it.
The website for Abe's new company uses the same company behind the PowerPay app:
http://upbrandcreative.com/
Cached version of website I found: http://webcache.googleusercontent.com/search?q=cache:http://independantsolarenergy.com
Contact for Abe and his wife at bottom of the page, the ICANN reg was 100% him.
ICANN shows a website created with the name www.independantsolarenergy.com in mid October. Registed with privacy proxy, but the timing fits. Who else would misspell their name in the same way at the same time.
Website says it's under construction right now.
https://whois.icann.org/en/lookup?name=www.independantsolarenergy.com
I just dialed the number and asked if it was for "Independant Solar Company"
Whoever owns that number knows who I am. It sounded like Abe but that is just a guess.
He didn't answer the question just asked who was calling.
He laughed for a bit then hung up immediately after I told him who I was.
I get the feeling he doesn't like me very much. Oh well.
See if he does the same to you.
Nelson and his friends DO NOT CARE about the share price.
Nelson works with people like Greg Boden, Jonathan Lei, and Beifuss.
These are not ordinary venture capitalists.
These people make money by financing failing businesses and having their friends (like Nelson) run companies by spouting off misleading information to get retail investors to waste their money buying shares.
That is how the business really operated, it operated to make 3 or 4 people rich, not to create sustainable value for shareholders. The massive damage Nelson did to the company didn't have to happen, the company was looted.
And as long as Nelson is able to control the board of directors, and therefore the company, there is no reason to think anything has changed. Nelson still has dictatorial control over the direction of the company. He is not incompetent, he is corrupt.
Decisions were made at several key points that had ZERO effect but to create more money for Boden et al, and less for shareholders. I am working on something now to be more specific to that last point, email me / message me if you want to see it.
I don't think you understand, these guys will vote with Nelson 100% of the time no matter what. Before 5 people would do the same. It's not a matter of persuasion, it's a matter of loyalty and it runs deeper than just this company.
And before you would still have to persuade just one person to stop a vote.
It's actually easier from a logistical standpoint for Nelson to win a vote now because he just needs his family member and friend from Utah to vote with him instead of his family member and three friends from Utah.
And the biggest problem with the board (Franklin Hunt) who is Nelson's cousin / audit committee chairman / former partner of a firm de-certified for their negligent audits on frauds is still there.
Abe stepping down is a big red flag as to why this move means nothing. Why did Abe need to step down? He is much more important and less of a Nelson loyalist than Mace, yet Abe is gone and Mace remains. Abe is not a Nelson loyalist (he seems to be interested only in boosting his own paycheck, which by the standards of this company isn't the worst thing) there was no reason for him to step down unless part of the deal was to ensure that the votes remained stacked in Nelsons favor.
Before this change Nelson controlled the votes, and he still controls them now.
The board went from 5/8 Nelson Loyalists to 3/5 Nelson loyalists.
Now it's Nelson, his cousin Franklin Hunt + Mace on one side
Cargile and Rhesh on the other
Basically a reduction from 63% Nelson loyalists to 60% Nelson loyalists.
Nothing changed
Did a little research on the auditor for Sunworks, Liggett and Vogt. I was able to find most of their clients by digging around the SEC website.
- Sunworks is the only company audited by them listed on a major exchange
- In terms of revenue and current assets, they are bigger than all of those companies COMBINED
- The typical auditor client is some lame OTC company with limited operations, not a "serious" solar installer
- This auditor received multiple PCAOB violations, for inability to verify revenue, and problems resulting from Mergers and Acquisitions
Why did Sunworks choose to use such a lame auditor?
Also anybody else notice a few select companies that make this list? All those other Santa Barbara companies that supposedly have nothing to do with Sunworks.
Hypersolar, BioSolar, CarbonSciences, CloudCommerce... makes you go hmmmmmm
What is this? From last year.
Is this routine or something else? I don't know.
https://www.sec.gov/Archives/edgar/data/1172631/000000000016076939/filename1.pdf
Edit: Apparently the SEC had some questions about the change to the bylaws in 2016:
https://www.sec.gov/Archives/edgar/data/1172631/000000000016076303/filename1.pdf
https://www.sec.gov/Archives/edgar/data/1172631/000149315216010034/filename1.htm
I didn't notice this before.
I think this was when the board granted themselves more power.
Are we looking at different 10-Q's? Telsa is losing a lot of money, especially as Model 3 roll-out continues to have significant issues. But people believe in Tesla, and they worship Musk almost to the status of being a minor diety, so I don't think it's safe to short it. But the company, as another analyst put it, is structurally bankrupt. They will need continuous cash infusions from the outside to survive. Fortunately for you, Musk will probably be able to manage to obtain them for some time to come.
Nelson is not a bean counter, nor is he an engineer, he's just a con artist who ripped off his shareholders to enrich himself and a few of his cohorts in Santa Barbara.
From my understanding the over-runs are a result from management drastically underestimating costs back in 2016.
By underestimating the costs they were able to inflate revenue for the first half of that year. Apparently this is still coming back to bite them.
They use % of completion accounting which is why this was able to work the way it did.
In case people don't know it works like this:
Take a simple example project with ESTIMATED costs for a $20M contract are $10M total expenses. Let us say this project is completed over four quarters.
If in the first quarter you spend $2.5M (25% of total estimated expenses) on the project, then you can book $5M in revenue (25% of total project revenue). This is regardless of what you actually billed or actually completed.
But let's say your estimate was very bad and the project actually cost a lot more, say $15M and those extra costs are all in the last quarter.
Your financial reports would look like this:
Q1: 5M rev - 2.5M exp - 2.5M operating profit
Q2: 5M rev - 2.5M exp - 2.5M operating profit
Q3: 5M rev - 2.5M exp - 2.5M operating profit
Q4: 5M rev - 7.5M exp - negative 5M operating profit
So by having bad estimates you would consistently over-estimate revenue and profits at the start of projects, and consistently have higher costs (cost overruns) and lower profits at the end.
This is why the company had to disclose a weakness in their controls in their 10-K, because the process of making these estimates was flawed.
This also happened to inflate operating profit at precisely the time management needed it to be higher in order to obtain their stock compensation bonuses last year.
TLDR: This stuff was from before Chuck took over and there wasn't much he could do to stop it.
That said I don't think it is likely that Chuck will be able to turn around the company at this point, I just don't think he deserves much, if any, of the blame for it's failure.
Or maybe trusting scammers like Nelson was just a bad idea.
It's not like there wasn't a large track record of failing business surrounding this guy and his friends in Santa Barbara.
That's the reason that I think the cell is still important. The fact this guy tried to convince people that he and Changwan were on the cusp of realligning the energy industry and then just took the money and ran shows what kind of person he is. And if he is willing to do that with a cell... why be surprised when his other ventures dont work?
In any case direct compensation to management + the financiers of this venture is probably over $20M by now. And all of that came from them marketing shares to unsophisticated retail investors, whose only fault was to trust a charismatic scam artist.
Nelson failing miserably is finally starting to pay off!
Bear Creek is linked to IRTH represented companies - At least ATNM, XXII and MSRT - not a good sign, IRTH companies are all garbage in some way or another.
If this weird quote has anything to do with Sunworks and not just Nelson - it's more of an indicator of stock promotions / capital raises. So far I won't read too much into it.
Also it's funny Nelson still claims to be the CEO (as well as Chairman) on his LinkedIn.
They just ran one a few weeks ago and it wasn't that effective, massive daily volume, but no lasting price movement.
Pretty much all grand plans have gone away in regards to cell, growth by aquisition etc.
The only thing still out there is their rapid multi-state growth plan, which like those other things before they went away, is way behind schedule with nothing but empty promises to show for it.
In this interview they claimed to be in Texas and New Mexico, but it's hard to find any evidence which suggests their presence is minimal to none.
Also thanks to you asking me this question I just found something else out that is quite amazing.
https://www.bizjournals.com/sacramento/news/2017/03/30/sunworks-names-new-ceo-after-unexpected-loss.html" rel="nofollow" target="_blank" >https://www.bizjournals.com/sacramento/news/2017/03/30/sunworks-names-new-ceo-after-unexpected-loss.html
You can read it here by looking at the HTML since the article is paywalled (starting around line 2240 or so)
Nelson pretty much admitted in an interview when he retired that the quarterly results from last year were manipulated (but with no "malfeasance").
Cargile stated in the same interview that millions of dollars of expenses were pushed from earlier quarters to the final quarters as well. The Cargile admission is quite amazing because of the implications.
This just happened to lead to Q2 looking amazing (just in time to hit the stock comp metrics that led to massive losses). Without the accounting errors shareholders would have saved millions.
If Cargile was telling the truth in this interview, then Sunworks management, through either deliberate or non-deliberate faulty accounting did not earn the stock compensation they paid to themselves.
They stole from investors blatantly because of bad accounting. That in my opinion is the smoking gun.
I will be calling Cargile (IR is useless and never responds) ASAP about this, and will be publishing about it soon after.
This was just about the PowerPay App which lets anybody who downloads it get referral bonuses when they sell a solar system. They have launched it twice now but it's not sticking, probably because selling solar systems isn't easy and the rewards are pretty lackluster. I would say it's pretty much a non-factor either way.
<100 views each since June, between 100-500 downloads for the App.
This thing flopped.
Apparently nobody wants to sell $30K+ solar systems for $100. Who knew.
It's not a change, they have been applying for permits in states even before they put the map up.
They have yet to do any meaningful business there though, which longs were banking on as the catalyst for the last year.
Here is an interview where Nelson talks about this:
https://www.solarpowerworldonline.com/2016/10/contractors-corner-sunworks-ready-compete-big-boys/
Regarding Florida rumors.
Unless there is other information I am not seeing it looks like somebody got too excited and assumed an old (and now defunct company) was our SUNW.
This is their website: http://www.sunworkssolar.com/
Notice that the LinkedIn info uses "systems" in the name.
Here is their page on Buildzoom, where you can get the contracting license number: https://www.buildzoom.com/contractor/sunworks-solar-systems-inc
Their business license in the state of Florida, now defunct. https://www.myfloridalicense.com/LicenseDetail.asp?SID=&id=C200B362076EFAB4D90541EDD5DC2C28
The real Sunworks has a bunch of licences all over the country (including Florida). However it's quite easy to submit some paperwork to register a business in a state. Having a license to do business and actually doing business are shockingly not the same thing.
Sunworks has been getting licenses all over for a while, and people get exited every time, and then as usual with the company nothing materializes.
Ask yourself three questions:
1. Is drawing Michigan correctly difficult?
2. Did Sunworks draw Michigan correctly?
3. Why can't Sunworks even get simple things right?
Everything about this company is always more interesting / compelling BEFORE you find out the truth.
Why spoil the fun?
This is just excuses. Nobody ever draws Michigan this way and it looks really ugly. They were also not consistent deciding to make the border the international boundary or the coastline.
For instance, take a look at this portion of the image which depicts central Cascadia:
In this instance, despite there being a non-Oceanic body of water separating this political entity from Canada, they choose to use the physical coastline instead of the international border.
This proves that my initial theory, that the big news being mentioned is that Sunworks is close to figuring out a way to properly draw Michigan, is likely what is being referred to.
The big thing that is being referred to the Sunworks R&D team is active again and has been working on a way to properly draw Michigan after over a year of disappointing results. But it's still in prototype phase, seeking a lithography partner, and it is unknown when it will be unveiled to the general public.
As you can see they removed the map from this page recently: https://sunworksusa.com/why-sunworks/contact-us/
Some might say it was removed because it wasn't at all accurate and was misleading people into promoting unfounded theories about the growth of the company.
I however believe this is in preparation for the unveiling of the new map which will have a properly drawn Michigan.
A reminder of what the old map looked like before it was removed:
Can also be seen at this archived version of the page: https://web.archive.org/web/20170307025833/https://sunworksusa.com/why-sunworks/contact-us/
Finally. The CEO has is saying what I was saying years ago about the merger. The cell was simply a marketing tactic to inflate the share price so insiders could make more money from retail investors, and it worked. It made them almost $10M before the buyout and who knows how much more later. Calling the company a shell as Cargile did, is a completely accurate and appropriate term.
I am not that hopeful for SUNW future obviously, but at least this guy isn't running around lying all the time. It's nice. Would have been much better, obviously, for shareholders if he came on board before Nelson destroyed the credibility of the company, and almost the the company itself.