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The quarterly report is out - and without boring you with all of the reasons why this company is in deep trouble with runaway overhead, interest expense, etc, let me point out one single item that is the most troubling:
When comparing the convertible notes in this quarterly report to the previous quarterly report - the effect of the 1:500 Reverse Split did not affect the convertible notes (i.e. they did not have a corresponding increase in conversion price). The net effect is that the convertible note holder, primarily Vista Ventures, controlled by long time SEC recividist Thomas Cloud and Kathleen Delaney, had the lucky windfall of having their convertible notes increase in value by a factor of 500!!
If this does not disgust you and want to run away as fast as you can from this POS, I don't know what else will!
"Why is this stock not booming?" - good question and there are a number of reasons.
First, for any stock, you must separate falling in love with the product vs. the stock price - just because a company may have a good product, a World Class Management, deals lined up, etc....the stock price is strictly a function of supply and demand and what the market is willing to set for its benchmark. In the OTC world, as you have observed, many companies are B.S., yet have a stellar stock price that is not reflective of its actual product (if any).
So setting aside Walmart, Toys R Us, HEB, Fiesta, Dollgenie, Oprah, Movie deals, Michelle Obama, politics in Iran, etc... - one must look at the current share structure for the first hint of answering your question.
The Company early on made the rookie OTC mistake of shelling out millions of shares for PR services and other frills to toxic lenders. When those notes came due, instead of being frugal with what little cash they had, they went on additional spending sprees and refinanced those notes into even more notes on even lower share price conversion rates to kick the proverbial can down the road. Eventually, the company was put into a position of continuing that cycle into the "billions" of shares, or let them try to convert, take their lumps, and move on. The company did neither - they instead refused to honor their loans and let several (4 that we know of) go to litigation to kick the can a little further down the road in the interest of "protecting shareholder value" - the fallacy with this approach is that they are taking a gamble hoping that the stock price will go up (i.e. the eventual conversion will take fewer shares) when they are eventually forced to honor the contract thru court order, or face the consequences of yet an even bigger dilution if the stock price goes down.
The only way out of the above cycle is thru actual sales of their product and they must do so at a significant clip while maintaining a hefty margin. The problem they are faced is that even with a huge Walmart or other retailer purchase order, the Company does not appear to be able to sell them at a reasonable margin (if any). Simultaneously they are faced with an ever growing and ongoing interest expense that requires the immediate need to raise cash (thru more toxic debt) - the cycle never ends.
The early mistakes of the company, no hard they actually try (or present a perceived effort to try) is a death spiral. In fairness to the Company, many startups face this same dilemma of trying to outspend their way out of a hole. The lesson learned here is that the company's only real currency is its shares available to raise capital to start up and run the business....it is critical to protect that share count at the expense of growing too fast, This company has failed to do that.
Remember - it (the stock price) was never about the Dolls
Nothing new for this "World Class Management Team": http://abc13.com/archive/9509947/
"We have a Hispanic doll, an African American, African, Caucasian. So we have these dolls and each has her name and story. We just girls to be able to embrace their culture and embrace their pretty," McBride said.
yes, but as Louis Renault would have said to Rick...."I'm shocked, shocked to find that is going on in here!"
Kinda figured that was the case, especially in OTC world. So if the note holder in this case happens to be a flimsy store front controlled by the miscreants who are allowing such favorable terms, I suppose there is nothing one can do to complain or raise a red flag about it?
janice - quick question for you (or anyone else that can help answer) on another subject - this is from one of the 10K's from one of the stinky pinkies I am following:
In connection with the 1 for 100 reverse common stock split on May 29, 2015, the conversion rates of the outstanding convertible notes payable were not modified. As a result, in the event all potentially issuable shares were converted, the holders of the existing notes at March 31, 2015 would be issued 27,458,608 shares of common stock representing approximately 99% of the Company’s total shares outstanding on an if-converted basis.
In other words, because the convertible notes were not modified (ie reduced by a factor of 100), the effects of the 1:100 reverse split resulted in the debt holder instantly receiving 100 times more value for their convertible notes!!
Question: is this legal/legit practice?
My plain English reading of this statement: "How I turned diversity into million-dollar sales for my toy company" - dated May 1, 2015, 5:00am CDT.
Clearly the word "turned" is past tense, meaning he had already accomplished $1 million in sales in between the 10K being filed on April 13 and two weeks later on May 1. From the 10K - sales were only $130k since inception (plus another $739 for Q1 file May 19 AFTER he made this statement), and there was no mention of subsequent events in either the 10K or latest 10Q to indicate impending 9-10 fold increase in sales.
From the financials: "We record revenue from the sales of dolls and accessories in accordance with the underlying sales agreements when the products are shipped"
yes - should be interesting to see how 2nd quarter sales are with respect to confirming Trent's statement that OWOO has made "Million dollar" sales: http://www.bizjournals.com/houston/print-edition/2015/05/01/how-i-turned-diversity-into-million-dollar-sales.html
"I did not expect Amazon to reorder this early..." - yes indeed, those doll sales of $739 (at a loss of $329) are selling like hotcakes on Amazon.....simply flying off the virtual store shelves....
One item....in fact, the ONLY item from the 10K that matters:
In connection with the 1 for 100 reverse common stock split on May 29, 2015, the conversion rates of the outstanding convertible notes [to Vista Ventures] payable were not modified. As a result, in the event all potentially issuable shares were converted, the holders of the existing notes at March 31, 2015 would be issued 27,458,608 shares of common stock representing approximately 99% of the Company’s total shares outstanding on an if-converted basis.
In other words, because the convertible notes were not modified (ie reduced by a factor of 100), the effects of the 1:100 reverse split resulted in vista Ventures instantly receiving 100 times more value for their convertible notes!!
Vista Ventures is controlled by Thomas Cloud, son of the late penny king scamster JT Cloud. Vista Ventures is administered by Kathleen M. Delaney, also a long time scam queen among many other stinky pinkies.
PinkyKing10 - I think that is a measured approach. One thing to consider is that during the most recent runup to $0.01, it literally took hundreds of millions of shares to reach that plateau - on the positive side, the company was able to generate support through timely news releases to attain that kind of volume (and someone clearly profited), but on the negative side, despite that kind of volume, it only went to $0.01 and quickly fell to 1/3rd of that value within days. If the company, through its PR efforts, is unable to break through $0.01 (OTC QB minimum requirements to get the "stinky pinky" label lifted), how will it ever reach loftier goals of ever getting on a legitimate (Nasdaq, AMEX, NYSE) exchange?
On the sales side, getting into +/-2900 Walmart stores may seem like the saving grace - however, looking over the sales history, after figuring in cost of sales, even selling $1 million+ dolls this year would only generate a modest gross margin (if any). Factoring in the runaway O/S's, interest expense, corporate G&A, marketing, debt, and convertible notes - the prospect as a shareholder of retaining any value is dismal at best.
This notion that OWOO is being shorted simply defies common economic sense. Brokers require investors to put up collateral to guarantee against potential losses in the form of margin requirements. Often times, brokers will require OTC investors to have $2.50 of margin per share to short a stock under $2.50, which can make shorting penny stocks very costly.
For example, if an investor shorted 2,000 shares of a stock at $0.50, you have to have $5,000 in your account. All along, the maximum profit for this position would only be $1,000, if the stock went to zero. Some may think the risk/reward at this level might be worth it.
However, in our case, with OWOO trading at +/- $0.0040/share, lets say if you wanted to short 1,000,000 shares (assuming you could find a broker to find the shares), you would have to have $2.5 million dollars in your account to cover the margin requirements, all just for the opportunity to make a maximum profit of $4,000.
Just to put that figure in perspective, here is the O/S share count over time:
November 18, 2013 = 1.1 million (post 1:750 R/S adjusted)
April 14, 2014 = 21.9 million
August 14, 2014 = 25.9 million
November 12, 2014 = 48.9 million
April 13, 2015 = 251.3 million
July 13, 2015 = 356.9 million
If you graph this out in excel and assume the current trajectory(42% increase per quarter) continues, it predicts that the max. authorized limit of 500 million will be attained prior to the end of this year (~ November 1).
Gel Properties, LLC v. One World Holdings, Inc.
Plaintiff: Gel Properties, LLC
Defendant: One World Holdings, Inc.
Case Number: 1:2015cv01217
Filed: February 19, 2015
Court: New York Southern District Court
LG Capital Funding, LLC v. One World Holdings, Inc.
Plaintiff: LG Capital Funding, LLC
Defendant: One World Holdings, Inc.
Case Number: 1:2015cv00698
Filed: February 11, 2015
Court: New York Eastern District Court
WHC Capital LLC - v. - One World Holdings, Inc.
Case Number: 606422/2014
Filed 12/03/2014
Nassau County Supreme Court
Status - Pending
Darling Capital, LLC - v. - One World Holdings, Inc.
Case Number: 653388/2014
Filed 11/04/2014
New York County Supreme Court
Status - Disposed - summary judgment in favor of Plantiffs
Welcome back HC....here are a few more new tidbits (lawsuits) of "transparancy" that the company failed to mention:
Gel Properties, LLC v. One World Holdings, Inc.
Case Number: 1:2015cv01217
Tuesday, May 12, 2015
STIPULATION AND AGREEMENT OF SETTLEMENT: Plaintiff, Gel Properties, LLC (GEP or Plaintiff) and Defendant, One World Holdings, Inc. (OWOO or Defendant) hereby enter into this Stipulation and Agreement of Settlement (the "Settlement Agreement"), subject to the approval of the District Court. IT IS HEREBY STIPULATED AND AGREED:
1. OWOO agrees and shall pay to GEP the sum of $98,000.00 in three separate payments and subject to adjustments pursuant to the terms of this Settlement Agreement (the "Payments"), as follows: a. OWOO shall pay GEP the first Payment of $20,000.00 on or before May 21, 2015; b. OWOO shall pay GEP the second Payment of $45,000.00 on or before July 2, 2015; c. OWOO shall pay GEP the third Payment of $33,000.00 on or before August 13, 2015, and the following as further set forth herein. The Parties agree that Judge Lorna G. Schofield of the Southern District of New York maintains jurisdiction of this matter, including this Settlement Agreement. (Signed by Judge Lorna G. Schofield on 5/6/2015)
LG Capital Funding, LLC v. One World Holdings, Inc.
Case Number: 1:2015cv00698
Status – LG requesting default judgment against OWOO - pending
Nope. Trey being the son of a 4 time murderer psychopath or working as a stock boy out back at Target does not preclude him from having the credentials to be a successful VP of Marketing at OWOO - in fact he appears to be a quick study unlike his CEO that has banking experience but she does not seem to know basic financial terms such as Share Structure or Capitalization Structure.
Sounds like a measured approach.
The "other" guy on the phone I think is Trey (VP of Marketing) - for a guy who previously worked at Target Logistics (ie the guy out back unloading boxes off the truck) - and for being the son of a convicted murderer (see the history on his dad, Walter, here: http://harriscountycriminaljustice.blogspot.com/2011/01/walter-waldhauser-cop-who-wouldnt-quit.html), he sounded actually pretty good and polished.
Inept is what comes to mind for me... clearly this CEO has no concept of even the most basic definitions of financial terminology.
Let's start with her comment within the 8K that she states she is explaining the "share structure". By definition, Share Structure is: Share Structure is a breakdown of the amount of, and types of stock the company has issued. The number of 'outstanding shares' (O/S) as well as the number of available shares on the market, the 'float'. Corinda has no concept of what this is otherwise she would have provided us with some numbers of where we are at right now.
The other statement she makes is that she was going to tell us about the Capitalization Structure. By definition it is: The proportion of debt and equity in the capital configuration of a company. Capitalization structures also refer to the percentage of funds contributed to a firm's total capital employed by equity shareholders, preferred shareholders and debt-holders, in the form of common stock, preferred stock and debt. A company's capitalization structure has a significant bearing on measures of its profitability and financial strength, such as net profit margin, return on equity, debt-equity ratio, interest coverage and so on.
Again, Corinda in her ineptness, fails to even begin to give us any figures as it relates to the Capital Structure.
All that she did was answer a few questions with a sense of vagueness that further solidifies my opinion of her ineptitude.
"They'd be idiots if they repeated the same three Q/A's that were in the PR in the 8-K" - good call, you got that right.....
As expected, the opening statement of the 8K starts with a lie:
"In the letter to the Company’s stockholders, our CEO reviews the Company’s share and capitalization structure...." - neither of which were stated in the 8K....nice job Corinda!
Reminds me of this letter in January where she stated:
"We have already implemented those plans and are pleased to report that we saw a significant reduction in some operational costs for the third and fourth quarters of 2014." - however looking at the ACTUAL results posted in the quarterly statements, neither of these things happened.
For the record, this stock (recently) has opportunities to make a good day trade or two - too risky for my appetite, but someone is making some money - best of luck to you on it.
I assume your DD has factored in the convicted felony history of the founder (http://investorshub.advfn.com/boards/read_msg.aspx?message_id=97228439), Robert Hines, OWOO Director and former CEO of SEC suspended EVSO (http://www.sec.gov/news/press/2011/2011-120.htm ), the 1:750 reverse split disaster from about a year ago, the meager (~$700+) sales (at a negative gross margin), the $11.1 million loss for the most recent quarter, the hopes that a $1 million sale (before cost of goods, overhead and more expenses) to Walmart along with a possible article in Parents Magazine, will stop the long slide of convertible debt (including pending lawsuit for breach of contract), broken promises/change of plans (movies, share repurchase, reducing debt by 50% by 4th quarter 2014), and a runaway share count (somewhere between 250 million and 2 billion) - more importantly, why would you be asking the question if you have already come to the conclusion that you like what you see and read?
NEWS FLASH: "In order to give shareholders true transparency about our share structure we are making an announcement to tell you that our upcoming 8K will specifically not give you any information about our share structure. "
"Too much good happening!"...agreed....$739 in gross sales (at a loss of $329 after cost of sales) while operating at $11.1 million dollar loss for the quarter after operating, expenses, depreciation, interest derivative liability etc, is just WAY too much of a good thing to pass on this gem....
As explained in several of my earlier posts, shorting at this level makes no economic sense - simply put, the margin requirements are so astronomically more than the potential profit margin, shorting anything on ANY penny stock below about $0.50 is nonsensical.
To further my point, call your broker and ask them what the margin requirements are for shorting OWOO and report back to us your findings.
".20 is 100 million valuation on a fully acquired float." - this so nonsensical, I am not even sure where to begin....
100 million/$0.20 per share is 500 million shares - the current issued and authorized . the A/S count is not the "float" - but rather whatever the company makes it to be. From the most recent financials, the company has stated that this number could jump up to the 2 billion range if existing convertible notes need to be converted, as the current A/S is insufficient to cover it.
Even using your pseudo math, why not pick a larger number, like $3/share (ie Nasdaq type of stock)? This would put your "valuation" at an equally absurd number of $1.5 billion for this 5 man operation making a little over $700/quarter in gross revenue. Or using the 2 billion A/S figure if fully ramped up this would put us in the $6 billion range! At that price OWOO can start thinking about taking over Mattel instead of the other way around, right?
silly me.....
sure you are.....show us the money
Why would it? The stock over the last couple of weeks has churned over close to 1/2 billion shares, yet barely touched $0.01 - without any "news" to build on the "might be in Oprah's Parenting Magazine if current affairs do not bump us" and the "we can't tell you about our sales because it will offend Walmart, but we can tell you it is not a test run" (like they really care...)...what could possibly push us into that territory?
semipro - QualityStocks is in fact a veteran (paid IRP). The interest is purely one of paid compensation.
Regarding bashers, you may wish to at least give some credence to balanced information for making an informed decision on your investments. Regarding their product - it simply does not exist - this is a one man operation who has made many broken promises over the last few years trying to hitch a ride on the latest "hot" topic in the investment community. Take a look at the history of initiatives that never happened:
1. Custom Mobile Audio Stereo systems
2. Printable solar panels
3. Wireless service in South America
4. Pursuit of Government Incentives for various business models
5. Bikini Clad, Drunken Women Reality shows
6. Penny Auctions
7. Chinese Markets
8. Mobile Apps
9. Protection and Security Systems
10. Facial Recognition Services
11. In-vehicle Emergency Responder devices
12. More mobile apps
13. Overseas online travel services
and now.....
14. Uber Trucking
Without any capital, employees, experience, or managment acumen, how does one expect any success on any of these initiatives??
The old and disillusioned bagholders welcome the new bagholders.
BTW - congrats to those who played this for what it is - a short term pump - pretty amazing volume and spike in price.
For those still thinking this is "all about the dolls", one should consider the following:
1. The Founder is a convicted felon with a number of charges including tax evasion, fraud, and breach of contract.
2. The dolls have been selling at a loss or breakeven for the past year. One Million (or tens of millions) of doll sales does not erase the fact they are not selling for a profit.
3. The Outstanding share count has been growing at a blistering pace over the last two years. The company's latest financials show that they may need to increase further into the "billions" to cover outstanding convertible note liabilities that may be converted.
4. WHC still has a pending lawsuit for breach of contract with the company - if WHC is successful in getting a judgment in their favor, the result will be significant dilution.
5. Robert Hines, Board of Director at OWOO, History: http://investorshub.advfn.com/boards/read_msg.aspx?message_id=83768067
Summary Default Judgment against OWOO entered in the Darling Capital case appears final now - the courts agreed that OWOO must pay the $58k plus interest, costs, and attorney fees to Darling for Breach of Contract.
Apparently Corinda and her crackerjack team of lawyers could not even file a response....
"....There will be no support on this pile anymore..." **
**Except for the $1700 found in the kids bank account that HC will use to get another million shares (less commisions)....
The ugly truth comes out in the 10K - pay particular attention to the huge amount of convertible notes to Vista Ventures (Thomas Cloud) made the KMD (Kathleen Delaney) at the insanely low (less than a penny) conversion rights - literally a personal ATM being used to rob the company.
Pretty amazing write up - thanks!
Whitley - same bunch that gave legal opinions for SEC suspended EVSO and I am sure for many other stinky-pinkies.
I am just bewildered - I really do not know what this company actually does (besides churn out press releases) - this press release is so generic it leaves one wondering if they even have a product or service to offer. What does George Zimmer's clothing industry have to do with trucking? How exactly does OMVS intend to generate revenues off of this yet to be developed and unveiled "cutting edge platform"?
So let me get this straight.....
OMVS, the one man disbarred lawyer who brought you SEC Suspended GAEC (http://investorshub.advfn.com/boards/read_msg.aspx?message_id=110717852 ) with no experience in having contacts in the trucking industry, expects "substantial future revenue growth" with his non-existent "upcoming" cutting edge products still under development, with no specifics as to how this platform will "provide a steady stream of income for OMVS", as he targets tech savvy truckers who still find work by reading hand written notes at truck stops....is his plan to visit those truck stops and start hawking shares of OMVS?
Feel free to email my yahoo account with same user name.
Sorry...couldn't resist! Just having fun with ya - best of luck on hoping it runs today.
"....should experience a massive bounce or at least a good move upward, at the very least go sideways. If she goes down again today, most likely this stock is done." - YUP Nostradamus, I think you covered all the possibilities !
My condolences on your loss.....