@JasonCoombsCEO
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Probably yes. I don't understand why producing a product and selling it to customers is so hard for some people no matter how much capital they raise. But hoax promotions come naturally?
It was your call for an investigation that I was referencing in that post.
It was a different post in which you said this lawsuit could be a big problem for LiveWire.
There is huge potential in LVVV, everyone agrees with that sentiment even the mouthpiece for Asher who tries to convince everyone to sell so the toxic debt conversion will result in more shares for Curt Kramer.
And you could be right that HUGE NEWS will come and LVVV will be profitable with millions of customers and meaningful business partners in the future.
But you can't ignore the disturbing signs here that indicate this stock is being used as a fraud by insiders and affiliates rather than as a way to allow the public to invest and to materially share in the business.
It would be easy enough for Bill to solve these problems, to stop the endless useless dilution that doesn't even raise any capital for the company, and to avoid creating the conditions in which LVVV appears to be violating securities regulations.
I am telling you that Bill has chosen not to make it clear to me what is going on with ADIA or whether he will ever disclose the existence of Adia Nutrition in any LVVV regulatory filing. I am telling you that a lawsuit against LVVV for fraud and theft appears to be my only remedy, and Shelly Singhal has already hired a lawyer and we've started pre-litigation.
You can believe in the power of huge news to create another pump and dump if you wish, but in my opinion the power of being honest and trustworthy and complying with federal law while growing LiveWire would make the stock far more valuable. It is my opinion that nobody should tolerate a stock fraud, and I do not see enough evidence yet to establish that LVVV is anything but one.
The confusion and inadequate disclosures should cause everyone real concern. It is totally irrational and self-destructive for LVVV not to be clear and comprehensive in its regulatory filings and investor communication.
When the shareholder knows of the violations, deceptions and omissions then no, they cannot escape liability for knowingly distributing unregistered securities in violation of regulation.
But my point was that LVVV is liable, not necessarily the shareholders. So we're in agreement on that point. Except Curt Kramer, he obviously knew he was not eligible to continue engaging in his illegal activities and probably should not have been allowed to invest at all even if he never sold his position.
LVVV has the right to refuse the lifting of restricted legends when shareholders attempt to sell. The transfer agent will notify LVVV whenever a Rule 144 sale is attempted, and if the company knows its shareholder is not eligible to rely on Rule 144 then the company must refuse the request. It is then up to the shareholder to fight for that right if they believe the company is mistaken or has no right to block the unregistered securities from public resale.
The Rule 144 exemption is not available when the issuer is engaged in 10b-5 violations and you know it. The quarterly and annual filings are not sufficient to establish that the shares were bought or sold without fraud, deceit or insider trading violations of 10b-5, as you already know. Here's a reminder:
http://en.wikipedia.org/wiki/SEC_Rule_10b-5
Missing 8-K filings is not the only problem. There are others. Doesn't it look to you like Curt Kramer is not allowed to do any of the things he and his company have reportedly done this year with LVVV stock? Blacklisted as a bad actor, right? I told Bill this last year when it first happened, when Bill told me that Asher was not permitted to convert and was out of the picture, so how do you explain the existence of the convertible note again this year?
The failure to ever even mention ADIA and Bill's new position as CEO of ADIA in any regulatory filing, the misstatements and false statements, and everything else that is wrong with LVVV's 10-Q and 10-K filings make it perfectly clear that LVVV shareholders were not supposed to have been relying on Rule 144 during the latest hype cycle and stock promotion. Don't you think the SEC warned about the fraudulent promotions like this one when they published this investor warning?
http://www.sec.gov/oiea/investor-alerts-bulletins/ia_marijuana.html
Do you have reason to believe that the trading activity in LVVV that occurred because of its marijuana promotion was NOT related to this kind of fraudulent microcap promotion abuse?
http://www.sec.gov/News/PressRelease/Detail/PressRelease/1370542594818
There are so many things wrong with what happened this year, this is just the beginning. The fact that the problems are not being resolved in a timely and ethical manner tips the scales into being deception and fraud. Bill Hodson and LVVV no longer deserve the benefit of the doubt. It would be very easy for them to repair the defects and material omissions in their filings, yet they choose not to do so on a daily basis. There can be only one reason: fraud.
You're wrong. When I file a lawsuit for fraud and it becomes clear that LVVV knew that it withheld material information from its SEC filings, the fact that the 10-Q and 10-K filings were submitted does nothing to help after-the-fact to repair the material deficiency of those filings.
The filings might as well be blank if they're not going to be accurate and complete. Regulation requires reasonably-accurate and complete information or the filing has not satisfied the regulatory requirement.
But you're free to advocate for LVVV if you wish.
Did you look at the EDGAR filings?
Have you seen how large the free-trading float has become?
You're ignoring the proof because you don't want to see it.
Who said conspiracy? The public record contains incomplete information about LVVV and there are tens of millions of shares being added to the free-trading float without prior registration. Bill has a duty to ensure that this is not happening unless there is adequate current information.
I didn't say conspiracy, I said borders on fraud and is already obviously a securities violation.
Here's the EDGAR raw filing URL for LVVV:
http://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0001421289
Read the S-8 filings and the 10-Q and 10-K filings. Do the math on where the shares are coming from that have caused the free-trading float to balloon.
Notice that there are no registration statements being filed for tens or hundreds of millions of newly-issued shares.
Nearly all of the increase in the float is attributable to sales of unregistered securities, while a portion is attributable to S-8 stock compensation for insiders.
This is immediately apparent if you look and read.
Now ask yourself again if it matters that LVVV doesn't bother to file 8-K reports for material events, that it isn't bothering to disclose anything about ADIA, and that it keeps causing new unregistered shares to be issued and allows restrictions to be lifted while inadequate details about the company's operating and financial condition exist in the public record. Yes, it matters.
These disclosure failures could also be resolved trivially if they cared to resolve them. Ask yourself why they choose not fix the problem, when fixing it would guarantee that they are not violating federal securities regulations.
Absolutely, yes, but I believe it is the end result that matters.
As long as LVVV turns itself around, as long as management cure these disclosure defects and stop helping insiders and affiliates dump unregistered stock on the market the way they've apparently been doing, then it would be hard for investors to prove any harm.
They still have a window of opportunity to make LVVV legitimate and viable.
Shares are definitely being resold without prior registration and without adequate current information. That's what 8-K filings are for, to ensure that everything material is published in the place investors go to evaluate the investment before and after buying the shares.
When the market creates billionaires it doesn't always do it in the ways we expect, and often does not do it in the same ways it did before.
I agree that it is very unlikely in this case, but you must admit it is possible that LVVV will stumble upon some miraculous unexpected unique product design or marketing strategy that would cause a billion people to suddenly want what it sells...
Improbable but not impossible, and if LVVV wants to make it more probable then it must do certain things and it must raise capital from people who believe in the true potential of those things, rather than raising capital by manipulating insider and affiliate access to the money sitting in retail brokerage accounts at brokerages like E-Trade.
It is a violation of federal regulation for LVVV to fail to file 8-K reports providing adequate current information.
I consider the failure of LVVV to even mention ADIA in any of its SEC filings to be a serious violation and to border on fraud. What do you think this failure means?
http://www.sec.gov/investor/pubs/microcapstock.htm
"Caution: By law, the reports that companies file with the SEC must be truthful and complete, presenting the facts investors find important in making decisions to buy, hold, or sell a security."
I am increasingly worried that Bill Hodson is indeed unethical and dishonest.
When we were discussing the potential acquisition of ADIA last year he told me that Asher was not allowed to convert, and that they were out of the picture.
Then the exact opposite appears to have happened this year. Not good.
Monster Energy was a startup in the early days, too.
Arguing that LVVV has no potential to go from startup to Monster Energy is nonsense. Somebody needs to show Bill Hodson what the CEO of Monster did to produce scale and growth so there's a reason to believe LVVV can follow a path to success rather than a path to dilution through endless public resales of unregistered stock through retail brokerages like E-Trade.
See: http://www.sec.gov/News/PressRelease/Detail/PressRelease/1370543133526
You make valid points about consumers being wary of buying probiotics over the Internet from a company that seems to be in the party and recreational drug business. But there is a valid market niche there, if these potential customers are marketed to with the LiveWire party brand image. You don't have to be part of the party scene to invest in it, obviously.
For marketing of probiotics outside of the party scene, LiveWire has indirect control over Adia Nutrition. That should enable all potential customers to be within reach of LVVV's probiotics manufacturing capacity.
The problem here has nothing to do with a fraudulent product. The problem is that Bill and Tony seem to be incapable of demonstrating that LVVV is not a fraudulent stock promotion.
They should be required to prove that their stock is intended to hold the value of the business they are building, and if they can't prove this then the stock should be halted. Same with ADIA and Apple Rush.
When LVVV graduates from development stage its management merely need to update the company profile information on OTCMarkets.com -- you should take it seriously that they have not changed this "Business Status" profile information since 2011.
The perceptions of the company management tell us almost everything we can know about what a company is, so we rely on them to be honest and accurate. What do you suggest we infer from that information which hasn't changed since 2011? Maybe they don't consider the development stage to be complete until the company is operating profitably.
Wrong. LVVV is still a startup. A company doesn't stop being classified as a startup just because it has some revenue.
There's no fixed definition nor "bright line" test for when a company stops being a startup. It's like the famous Supreme Court definition of pornography, everyone just knows it when they see it.
http://en.wikipedia.org/wiki/Bright-line_rule
http://en.wikipedia.org/wiki/I_know_it_when_I_see_it
Look at the self-reported "business status" publicized by LiveWire:
"Business Status Development Stage Company a/o Dec 08, 2011"
http://www.otcmarkets.com/stock/LVVV/profile
cap table = capital structure, or capitalization table. it was clear that LVVV's cap is 150m shares not $150m and it's often shortened to just "cap" in real world discussions.
since last year I've appreciated your input but suggested it would be more constructive, and more informative for everyone else here who wants to learn what the risks and rewards of LVVV might be, to focus less on telling everyone else how wrong they are about everything all the time.
I share your concern that LVVV's management are just going to keep dumping shares until nobody will buy any more of them, but there's a price at which the risk of that happening no longer outweighs the reward if they don't.
If LVVV operates the way that you and Drugdoctor recommend, and stops issuing tens of millions of new shares every month, what is the right price for this company's shares? As I said last year, it's a startup. The average valuation for a startup launched by former employees of Google is $5M+ at the seed capital round. Now that LVVV is beyond the seed round and the outrageous pump and dump from the reverse merger is over with, surely you'd agree that a $1.5M valuation would be very reasonable and even below-average.
That looks like a penny per share given the current cap table, but only if the Preferred are eliminated from the discussion (as they always are when people discuss this here for some reason) ... If we're looking at 900 million shares coming soon, after the Preferred and all the convertible debt is factored-in, then a $1.5M valuation for LVVV means a price per share below $0.002 just like last year's low.
I don't understand why Bill and Tony ignore the fact that this looks like the trajectory and the business plan they're executing. Who's going to invest if the company can't get this under control and find a more reasonable way to raise capital?
The problem, Jesse, is that buying shares through a broker is not "investing in LVVV" it is giving some unknown seller some liquidity.
If people want to invest in LiveWire they should be doing it directly so that Bill and Tony will actually have some funding. The securities regulations that presently prohibit direct investments by non-Accredited investors might be changing soon under the JOBS Act. See:
http://www.sec.gov/spotlight/jobs-act.shtml
and specifically, Title III and Title IV might permit LVVV to make public offers in the future and to accept capital directly from investors.
Title III
http://www.sec.gov/comments/s7-09-13/s70913.shtml
Title IV
http://www.sec.gov/comments/s7-11-13/s71113.shtml
The proposed Rules have not specified yet whether a microcap OTC-quoted registered issuer such as LiveWire will be eligible to utilize crowdfunding portals or Regulation A+ so watch closely for the answer to this question when the final Rules are published, and ask yourself what "value" is the right value for free-trading LVVV Common Stock when the company might be able to raise capital selling shares under the JOBS Act Rules.
Is the right value higher or lower if that happens? Everyone wants to know. In my opinion, the value should be higher because then LVVV would not be stuck in a toxic debt spiral but only if management is honest and capable of producing a profit with the capital that is raised...
He said ~150m shares outstanding not $150m market cap.
Exactly. Agreed on all points. I also like you, Jessie, and hope everything works out well for everyone who is placing their trust in Bill and Tony.
You mean just as namtae predicted, it isn't truly free.
Seems to me the irrational pessimism is intended to help price the conversion of the convertible debentures.
The lower the price goes, the more shares Asher gets when they convert.
That, by itself, isn't offensive -- that's just how the market works when toxic debt financing is being used, and everyone who expects LVVV to be a legitimate long-term investment just needs to understand it.
What I find offensive and intolerable is any failure by management to do the right things and tell the truth about what's going on and why. Hopefully that problem gets solved soon...
We would all like to know how shorts violate RegSHO
How do you short LVVV without complying with RegSHO?
According to required short selling regulatory reports there has never been significant short volume, but this is obviously not accurate:
http://www.otcmarkets.com/stock/LVVV/short-sales
Sept 15, 2014 31 shares of short interest, total.
The branding, packaging and marketing aren't what matter -- what matters is that Bill Hodson is honest and ethical. There's nothing wrong with LiveWire producing its own brand of probiotics, provided that the company is not going to continue to ignore ADIA in its regulatory filings, etc.
What you're concerned about is the result of LiveWire not taking care of basic administrative duties and minimal investor communications. Why they would choose to behave this way when it is so counterproductive is still a mystery...
$78,500 divided by $0.01 conversion = 7,850,000 shares
Assuming Asher sells short at average of $0.08 per share, $628,000 comes in and the short is covered with the conversion later at a cost of $78,500 for a net profit (roughly, not including the 8% interest) of $549,500 which isn't bad for Asher. If this educated guess is correct, then the volume is over and done with because no buying to cover at market ever happens.
One wonders whether the market should be paying half a million dollars to Asher just so LVVV can manufacture and sell $100K of product. That's a very, very high cost of capital. Obscene even...
Where is there talk about LiveWire not promoting the Adia products?
With a 1-for-100 reverse split the company could start paying $0.01 per share dividends, if it keeps up the recent pace of revenue growth and manages operations and capital structure with the intent to pay dividends.
Bill Hodson needs to at least explain how the company intends to create value for hundreds of millions of Common shares, or what reason is there for those shares to exist? People will buy them as souvenirs, but that market isn't very deep. Maybe if LiveWire were to become a Marvel superhero the Common stock certificates could become sought-after collectibles.
I know Curt Kramer. I raised capital from him in 2008 for PIVX/ADIA which is one of the reasons the company survived the global financial crisis.
You're wrong to think his investment in LVVV had no positive impact. Where would Bill Hodson have raised capital at all if not for Asher?
That is hard for you to believe? Have you looked at the number of free-trading shares? Have you noticed that the only products that LVVV seems to be willing and able to promote are probiotics and CBD oil? Doesn't it look like the business value of those two product lines is intended by the CEO to be stored in equity OTHER THAN the Common shares of LVVV? As an ADIA investor, wouldn't you be upset if the business value of the probiotics product, operations and growth were secretly transferred to some other equity asset in which you were not invested?
The reason things are the way they are right now is that the CEO is not doing his job, and the method that was used to create market demand for LVVV was absurd -- in my view, the only reason LVVV went up and became liquid with tens of millions of free-trading shares outstanding was Asher and the "expertise" of Curt Kramer.
ADIA is a non-reporting company. Form 15 was filed in 2008 to deregister the Common Stock so the company would not be revoked as you described. To file 10-K and 10-Q reports again to become fully-reporting the company would first need to re-register.
http://www.otcmarkets.com/stock/ADIA/profile
Reporting Status Dark: Alternative Reporting Standard
Deregistered a/o Sep 25, 2008
I would rather watch a live stream of Bill Hodson sitting at his desk trying to create real growth and a scale of operations and capitalization that justifies investment by others than to read or watch nonsense involving people who have no authority nor desire to do meaningful work for the benefit of others.
The legal definition of a "security" in the "Howey test" requires Bill Hodson or others to try to create profit for everyone who buys LVVV stock:
http://en.wikipedia.org/wiki/Securities_and_Exchange_Commission_v._W._J._Howey_Co.
"... which depends solely on the efforts of a promoter or third party"
In my opinion, if profits are not being legitimately pursued by Bill and his team/family of companies then there's no investment being offered. Shares of stock can still trade in that case, but in the absence of an investment thesis the shares would be nothing more than an empty shell waiting for another idea and a new team who are willing to promise to try to make a profit for others.
Perhaps the strategy is for LVVV to become a former shell company conglomerate, amassing wealth by scooping up as many former reverse merger OTC-quoted companies as possible and "grooming" young management teams?
What I'm seeing, and not seeing, at this point in my opinion warrants regulatory intervention to suspend trading unless the management problems here and misinformation are cured immediately.
You read right, but is Bill at fault? That's what we do not know yet, but I have expressed my growing doubt and I am demanding corrective actions.