ScripsAmerica Inc. (SCRCQ)

[coolerheadsprevail]

Do you really believe Mr. Schneiderman doesn't care about expenses? He's building a business and it cost money to build a business. Please tell me what business you built in the last few years and how you built it without having high expenses during the infant stages of development.

(1)
Are you actually trying to suggest that only someone who has built up a business from scratch is capable of properly assessing an SEC filing to be able to see that a company's expense run rate is too high? Ooooookayyyy...

(2)
But even in this bizarro world where Bob is a flawless diety worthy of small animal sacrifices, you are in luck because over the past 10 years, while holding down my dayjob, I actually DID startup a new company from the ground up and then sold it 2 years later after it became profitable and I proved the business model.

I also know many others who have built up their own business -- and WITHOUT EXCEPTION -- we watched every single expenditure like a hawk.

(3)
Whether or not there is a need to incur higher expenses as a startup vs not being a startup is still not the point. The point is to be mindful of how you allocate limited resources -- and most well-governed startups are more cognizant of this than established companies.

(4)
And, yes, I am waiting for BS to demonstrate via the quarterly SEC filings that he understands the importance of not squandering the limited resources SCRC has, because so far he has NOT. For example:

(4a)
During Q2 and Q3 of last year, he expensed over $2M in "investor relations related consulting expenses" for JOSEPH ZAMPETTI and his core of Section 17(b)-violating promoters to orchestrate the P&D. The vast majority of LEGITIMATE PROFESSIONAL promotional IR/market awareness firms would have run this 1-1/2 month long campaign for approx $150k -- and would have had access to exponentially more eyeballs than what ZAMPETTI et al did. This was a complete waste of money and a gross over-spending that not only killed the P&L but resulted in unnecessary dilution that cratered the sp once the restricted shares issued as compensation unlocked during Q4'13.

(4b)
In the middle of Q4'13, SCRC entered into a horrible financing deal with GEM. This deal was so obviously toxic and even included a Share Lending Provision that required SCRC to lend shares to GEM in order GEM to short the stock directly. This deal was widely panned by many legitimate market participants -- but was praised by the same voices who praised the Ironridge deal, offering up the same "If [insert financier name here] took a peek inside the SCRC castle and liked what they saw, then that is good enough for me to want to go buy more shares!"

Less than a quarter later, SCRC cancels this subscription deal before GEM ever even funds a single penny to SCRC. BUT, in consideration for agreeing to void the deal, SCRC had to dole out a boatload of new warrants to GEM at a cost of over $550k that hit SCRC's bottom line.

So in essence, Bob rashly entered into a poorly conceived financing deal, then a few months later changes his mind. So even though SCRC got ZERO financing out of this, we still have to pay over half-a-million buckeroos to GEM.

$550k+ down the drain for NOTHING. And, like the first example, this carried the double-edged sword of not only killing the P&L but also dilution. It would be a gross understatement to call this a WASTE...

(4c)
SCRC disclosed that it incurred in JAN-2014 $150k worth of consulting expenses paid to 3 individuals in relation to their Global Pharma Hub services. The timing of this strongly suggests that it is in relation to securing the inaugural order of RapiMeds for Hong Kong. This initial order was only for $200k. Factoring in COGS, this is a money losing deal where the benefits don't appear to justify the magnitude of "consulting" fees. In addition, keep in mind that SCRC only gets 37% of Global Pharma Hub net income. And, once again, because this expense was paid for in -- you got it -- more stock, this also hit the P&L while also diluting shareholders.

(4d)
During Q'13, SCRC's Board of Directors (which is comprised of Bob's own cronies), outlined a simply objective that Bob had to accomplish in order for him to double his salary in 2014. Bob failed in this objective and the BOD refused to increase his pay.

In response to this, Bob called an audible and executed an end-around in APR-2014 where he decided to award himself and Jeff almost half-a-million dollars worth of options, which effectively made up for the salary hike that he failed to earn. Per the Q, this $440k expense will hit in Q2'14.

This expense may be the difference between whether SCRC becomes cashflow positive in Q2 or not. Knowing how important this cashflow metric is to the Street, it speaks volumes that Bob could not wait until Q4 to award himself these options. Supplemental compensation is intended to be rewards for accomplishing something. I do not believe Bob deserves anything for all his failures during 2013, but should be rewarded for 2014 once the year is completed and we see that SCRC is not only cash flow positive but is reporting positive quarterly earnings.

To claim these options NOW and burden shareholders with a $440k hit to the bottom line in a period where SCRC's finances are already in a precarious state is simply reckless and speaks volumes as to Bob's priorities.

(4e)
Shall I go on?