Here's my current take:
I found Dr Carlson to be very affable on the phone. And he clearly is a very smart man. But the employment contract contradiction is real. It basically says employment at $150k begins Sep 1 2015, and there will be no other employment. I'm told there was an addendum to fix the contradiction. Could very well be, but that should have been filed. Small matter? Let's hope so.
Cyberdin appears to be legit. The question is whether the white paper is legit, as well as the quality of their testing. My friend said it may not mean as much as it sounds like, so I have forwarded the report to him. As I mentioned, Cyberdin has not verified the information to me.
Two cybersecurity experts were negative and both said the tech is old tech and both said it doesn't solve a problem anyone has and both literally called it 'snake oil'. They were 2 different people. I reached out to one of the company scientists for clarity on whether they are wrong, but he has not replied. A third, a friend of mine, was more open and interested, but wondered if the data is on their servers, saying that would make sales very difficult to achieve (as nobody - esp the govt. wants Cipherloc to have that kind of access). I am waiting for his further feedback on that issue, re your alleged response from Dr Carlson as well as some quotes I found from the CEO in prior interviews.
The CEO comes across in interviews as credible. And the background story makes some real sense: A long history in the same field (medical software/data), led to a quest for better encryption, which led to Cipherloc. Secrecy while in development makes sense too, as does a relatively long period of development.
But the CEO was involved with some ugly lawsuit a few years back. It isn't clear to me his level of guilt, if any, but someone here posted he knew that the CEO received bonuses/commissions on sales that were later cancelled, and stored the product in his own garage. Who knows what the real story was -- maybe he gave the commission/bonus back? But, the fact that he carried along to his next company (this one) the CPA that had only recently been found guilty of profiting from misrepresenting herself in a stock certificate fraud doesn't come across very well. And, the filings under that CPA included very unusual language regarding an anti-rs, which appeared to be very unfriendly to retail shareholders. Thankfully the split was fine for shareholders in the end. But, added together, the combination makes one wonder.
The $1m in revenue that never came is not a good thing. Why record it when the technology apparently wasn't ready? The restatement will correct it, but its existence is fishy.
REAL revenues have been zero for over 9 months. That's a real concern, especially given the impression that the tech was ready for sale, and had been demoed to over 1000 companies.
The lack of retail volume in the stock is hard to explain if the level of exposure has been as high as claimed.
There have been some pretty big missed projections:
Increased revenues stated in Aug, 2014. The reality? No revenues since then.
Pilot with Intnl bank expected to begin by June, 2015. Never happened.
The agreement with Hemp was opportunistic IMO a way to jump on the marijuana hype bandwagon. That can be viewed as good or bad, depending on one's personal perspective, but normally not what I would expect from a credible medical software company..
Preferred shares can be converted to 15m shares at any time. That's no big deal if this is legit. It's a huge deal if it isn't.
It's too soon to read very much into the lack of response from the company to my emails or phone, but it illustrates part of the problem that exists with shareholder confidence.
SO, MY TAKE:
There are enough red flags that logically I'd say something just isn't right. And yet, part of me believes this. I don't think it is just the greed or emotional part. When I see and hear the CEO, I believe. When I hear Dr Carlson, I believe. But, I can't allow myself to believe whole-heartedly without having some better answers to many of these obvious red flags. That's where it would be nice to have a better dialogue with the company.
