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Lakeshore has no legal responsibility for disclosing the test results. They are merely the customer of ECOS. The obligation to disclose falls squarely on the Management and Board of ECOS.
To put it as my father used to say They are accountable only to their maker.
actually that logo was on their 2015 website which is still live (ecolocap solutions.com) which still shows MS as President. Not sure it is really anything new.
Actually I think Ihorchu is on to something. The old Zager and Evans song is really about ECOS. Just looked up the lyrics
In the year 2525, if Siegel is still alive
If the digester can survive, they may find
In the year 3535
Ain't gonna need to tell the truth, Kwak to tell no lie
Everything you think, do and say
Is in the ECOS compost you eat today
Why even Zager and Evans second big song (albeit not that big) was about ECOS, the infamous, Mr. Turnkey. I think he has it (or maybe some strange disease).
DS
The dilution point in my note relates to dilution which occurs (if and when) the convertible notes are converted to shares and the warrants are exercised (if ever). GAAP accounting requires a company reflect this potential dilution in their financials under mark to market rules. I didn't say any dilution had actually occurred.
Since it is all but impossible to convert the ECOS notes into freely trading common shares my bet is that the notes just stay out there accruing default interest until they are redeemed (if ever).
You are right JA. That was just reversing a mark to market change they recorded in any earlier quarter on the convertible note derivative and the derivative for the equity (warrants) they issued to LRS. All non-cash adjustments.
The way to think about those derivatives as they are a change in the future dilution (change) to stockholders equity when the notes are converted or the warrants are issued
Before we get all excited about LRS eating WM's world, you might want to look at the WM Sustainability Report
https://www.wm.com/sustainability/pdfs/2016SustainabilityReport_WM.pdf
WM has 43 facilities in North America which convert organics into compost and other materials. Some are actually in the Chicago area. You can see the list on Page 42. They went anaerobic and are diverting waste into energy which they sell back on the grid and biosolids (compost and soil amendments). Last year they diverted 2.5m tons of organic waste.
They show their New York City project on page 45 of their 2014 report.
I bet they need none. They specialize in handling construction and demolition debris and construction material recycling. They are not in residential.
I think this technology has promise but I think ecos is going nowhere fast. I would give this a 2or 3. Since they last reported they have run up another $400k in salaries, the cost to finish the lrs digester and other operating expenses. I don’t see a merger in the offing and I see any cash flow going to pay off salaries and other liabilities.
I think the lighter stuff is ground Construction debris. There is a cement plant just down river from the lakeshore site on California. I know they sell some of the recycled construction debris back to the cement business.
That is true as long as the Korean company can’t terminate the agreement. However all distribution agreements are terminable at some point. If they filed the distribution agreement we would know the answer to that question. Nobody actually knows what is true any more.
Did a reconnaissance mission today
ECOS is no longer at the Oakton address. It is for rent and the office is empty. They are back in Barrington. I assume back at Kwak’s office.
Don’t know if this means any more than reducing expenses by cutting rent for the second office
all I was saying is the way to get from 15 to 120 per the comment from Ecolocap is to add a farm of seven more machines.
Doesn't mean LRS is doing that just means that is how you would get there.
Guys remember the original presser said that the LRS deal contained an option for 7 additional machines (8 in total).
8 times 15 equal 120
This should tell you that the expectation of LRS was that they might add the other 7 machines at California Avenue.
They would need to move some things on the site to add another 7 machines near the original digester, but there are a bunch of abandoned buildings right next to LRS on California. LRS could also move around some things within their site to facilitate adding some more equipment.
yes it is. I left a message and got a call back.
It's actually publicly listed. Just google his name. That is where I found it.
DS
Leave him a message on his answering machine. He called me back after work. His home number is listed.
I agree nobody connected with a public company should ever provide inside information unless they broadcast it to all shareholders.
After my call I wondered a couple of things
(i) whether he filed the name reservation and corporate documents for someone else.
(ii) whether he took ownership of the name to force ECOS (or any other suitor) to buy the name from him later for a fee. They can't complete a deal without the right to do business. What might that be worth. More than the couple hundred dollar filing fee.
apple owns their name in all 50 states. Big companies qualify to do business in all fifty states to protect their name.
In Illinois anything other than Ecolocap Solutions.
I contacted the lawyer who bought the ECOS corporate name. Actually very easy to find him and he was personable (though busy). He intimated I was not the first person to call to ask him about the ECOS shell. Here is what I learned.
1) His creation of an ECOS shell has nothing to do with ECOS or LRS. He owns a number of corporate shells (real estate investment, tech investment and business consulting). He is a passive investor in each of these businesses. He said this shell has something to do with an environmental consulting business a friend is launching, not him personally.
2) He did meet MS a couple of years ago for lunch. Was introduced through a mutual friend. They talked about diesel fuel emulsion. Hasn't spoken with him for at least 2 years (maybe longer). Has never met the Kwaks or anyone from LRS.
3) he is actually a tax lawyer by training working for Fortune 500 companies. Because of his role he has done a fair amount of M&A.
4) He doesn't own any ECOS or LRS stock.
5) The shell has nothing to do with his current employer. His employer uses a large outside firm to establish all of their companies. Not the same firm as LRS.
If anyone want to verify any of this feel free to contact him.
TW
This is so far afield from CF core business I think this has nothing to do with them. The last few deals they did were large multibillion dollar deals in the fertilizer manufacturing industry.
CF produces more nitrogen (11m ammonia equivalent tons per year) than LRS could ever produce with thousands of digesters. I think them doinga deal with LRS & ECOS is serendipity.
TW
Look at the enterprise value ($16bn) and market cap ($10bn) of CF. LRS couldn't acquire CF if they wanted to.
CF's business is nitrogen fertilizer manufacturing and distribution. They are the largest in North America and the 2nd largest in the world. They are not in recycling or waste. They are a commodity chemical company.
I would go back to the LS ECOS rumor.
Nope but you own the right to use the name Ecolocap cap in Illinois which the Nevada company can’t.
He told me was starting a new consulting company. I googled and found out he owned a real estate company and a tech business in addition to his real job.
Would but it rained like a son of a bitch yesterday afternoon and it is like playing in a marsh. At least the beer is flowing and the cigars are smelling sweet
But they can’t sell ecolocap without the name. They can’t make the rep that says they are qualified to do business Illinois which is critical to an lrs transaction
Sorry business. Typing and trying to play golf. Neither is going smoothly
It just means they can’t do busier as in Illinois as ecolocap.
DS
The Illinois Secretary of State just posted today that the name Ecolocap in Illinois is no longer owned by MS and the Kwak’s but rather by the lawyer from Deerfield.
JA
I agree personal attacks have no place anywhere on this Board from anyone and attacks on people's families (or former families) are even more uncalled for.
Just to make sure people aren't confused by the rest of your message.
The real debt of ECOS isn't $8m. The $2m derivative liability is only real if the notes are paid in shares. The real cash debt was $6m and has been $6m for a while.
The increase to $16m (with a derivative liability of $10m) was an error in their GAAP accounting and their correction back to $8m (with a derivative liability of $2m) was intended to correct that error.
The way to think about the derivative liability is that it is the potential dilution to equity holders from the issuance of additional shares on note conversion. Since they can't covert the notes to shares to sell it is now a phantom liability.
To the shareholders
April 5 via a PR update (link attached) and a clarification to the PR issued on twitter on the same date
https://www.sec.gov/Archives/edgar/data/1290506/000172171618000040/exh-991.htm
Hopefully he hasn't lost his voice
call him and ask him. or just wait for it to show up.
Actually wrong.
The name is reserved for 90 days during which period the party who reserved the name has the right to incorporate a company using the name. If they don't incorporate in 90 days the name is available for anyone to reserve or incorporate. I checked that rule with the Illinois Secretary of State.
Guess what I also learned the lawyer actually filed to incorporate Ecolocap Solutions Inc. yesterday. You can call him and verify that fact.
No I spoke with the attorney. He actually owns a few other companies (home building, a tech company) in Illinois and works for a large multinational. He has no relationship to Kwak, Siegel or Ecolocap. He just went out and reserved the name since he was starting another company.
That gives them charter for the State of Nevada. It means you have a Nevada company qualified to do business in the fine State of Nevada and that is all.
To do businesses in other States you actually need to file as a foreign corporation to qualify to do business in that State. They actually had the name in Illinois and MS let the Illinois charter go into forfeiture in 2016.
yes he does. I called the Illinois Secretary of State and they confirmed he owns the name Ecolocap Solutions.
or by simply buying the name back from the person who owns it.
I have never believed the RM with LRS was ever possible. What I am pointing out in my post is that
(i) ECOS doesn't own any technology or tradenames. The technology is all owned by the Korean company. They are a distributor of products.
(ii) the fact that no technology is protected in the US makes it a lot easier for someone to come into the US digester market. Their Korean supplier is not the only Korean aerobic digester manufacturer or the only aerobic digester manufacturer in the world.
(iii) ECOS revenue comes from any profit on the machines sales (which they share with LRS) and any output sales. They don''t share in LRS subscriber revenue from its organics pick up service.
(iv) in order to expand in the Midwest the need to deal with LRS protected territory or let them into any new deals. Negotiating that right was a brilliant stroke by LRS as it ties ECOS hands. It gives LRS a lot more leverage over ECOS,
(v) ECOS is very poor at maintaining corporate niceties. They are not qualified to do business in Illinois and they don't even own the name Ecolocap in Illinois. One of the reps that they would need to give in a merger is a corporate existence merger (qualified to do business where they are doing business). They can't give that rep as long as someone else owns the name in Illinois. The lawyer who owns the name actually plans to use the name Ecolocap in an environmental consulting business. ECOS could fix the name issue by changing their corporate name to another name and then redoing their stock listing and other corproate documents (all of which is costly) or try and buy the name Ecolocap from its owner.
I still think this is a viable business. If they can build out a recurring stream of machines I think the company could be worth $10m (in a couple of years).
Guys guys
Let's state some uncontroverted facts here.
1) ECOS does not have any patents on file or pending with respect to the digester. You can all check this with the US Patent and Trademark Office.
2) ECOS owns no trademarks for anything (whether or not related to the digester). Again this can be validated with the US patent and Trademark Office.
4) ECOS isn't even qualified to do business in the fine State of Illinois. The name Ecolocap in Illinois is owned by a lawyer on the Northshore of Chicago who has nothing to do with Ecolocap. I actually found him through a Secretary of State search. He confirmed he had nothing to do with Ecolocap or the Kwak's. You can confirm who owns the name Ecolocap by calling the Illinois Secretary of State in Springfield.
3) Certain aspects of the technology are patented in Korea by the manufacturer. They don't have a patent on aerobic digestion, just some of the methods used by their machine to facilitate digestion. They are not owned by ECOS and ECOS has no ownership stake in them.
4) The LRS agreements provide that LRS has a protected area. However, if you read the agreements the right is more in the form of a right to participate in new installations within the protected area. I would read this as ECOS needing to offer LRS the right to participate in any non-LRS digester sales in the protected area, not an absolute bar on any competitive sales.
5) Kenny you and DS are talking by each other. The monthly fees that LRS collects from residents in certain communities to participate in their organics program are paid to LRS and kept 100% by LRS. LRS and ECOS share in the net profits from the output (fertilizer) of the system. These are two separate income streams.
Kenny
Fife is in a bunch of tickers with convertible notes and convertible preferred. Not surprising he would be in another company like Cirque. (Asher who was in ECOS was also in Cirque).
This is really a different technology. It takes waste and uses it to feed small scale power plants. The technology is in use in Europe. Note Cirque has a product (which is a Northrop Grumman product) but no sales.
They have a lot in common with ECOS
- financed by convertible notes
- delinquent in their SEC filings
- distribute a product manufactured by someone else
- "deals" which don't seem to turn into reported revenue