Helix Wind Corp (HLXW)

[H8ster]

Good points. Although, the patent will change things because it will change their business model. I do believe at this point in time that they are diluting to keep the company operational.

This is a real company. I know what you mean when you bring up 'shells' and what not. That's how this is behaving. But I don't believe that to be the case. Normally in those cases, shell cases, there is no real business and no product. The history of Helix shows that there is a solid product.

Please bear with me, as I attempt to make an effective argument.

This was once a thriving company. With all the potential in the world, to rise out of their upstart mode and become something special. They had an idea and a product. Unfortunately, by looking at the business decisions that started to occur in the summer of 2009, they grossly overestimated their capabilities and began to bite off more then they could chew. I would go as far to say they got too arrogant. Now, there were multiple business failings at this time, but I believe the crushing blow was the deal with 'ARE', which sent them into a sort of domino pattern where bad decision after bad decision was made to try and fix the previous bad decision. Then, company infighting began and all hell pretty much broke loose. From that point to now we have seen the pps go from $3.30 to $.0007. OS go from roughly 38,715,361 to 1,207,517,634.

Thru all of this, they have remained a fully reporting company. An important stat to me is insider trading. Are they dumping their personal shares? They have been transparent with their dealings ,file 4's, which show insider accumulation, distribution, etc. The last 4's to go thru were last June where Scott Weinbrandt and Kevin Claudio had their stock option exercise prices changed from .10 to .0128. http://www.otcmarkets.com/edgar/GetFilingHtml?FilingID=7319494
There hasn't been any insider selling since Ken Morgan last march when they were all in the middle of bitter, insider squabbling.

Now, lets look at how they have been running business during this time of damage control. From last January 1, 2010 to September 30th, 2010. They shipped 1 S322 model and 6 S594 models to customers in the first nine months of 2010 resulting in $91,457 of revenue with the cost of that revenue being $63,698. Making their gross profit for that time period $27,759. Essentially, just about 11.5% of the previous year's total of $240,788
Of course with that decrease, which does suck donkey balls, all other expenses decreased as well. R&D was down from $1,045,433 to $243,883. A decrease of roughly 77%
Selling, general and administrative expense decreased by from $16,611,513 to $2,200,634. A decrease of roughly 87% These decreases were form share based payments related to stock options, compensation to management and employees decreasing by $236,555, shipping costs decreasing by $249,310, advertising expenses decreasing by $427,097, warranty expense decreasing by $107,490, travel and related costs decreasing by $104,120, rent decreasing by $18,808, employee recruitment costs decreasing by $15,000, telephone and related costs decreasing by $14,560, and various other expenses decreasing by $16,294. However, there was increase in professional, consulting and outside services of $258,536.

Now lets go to the Net Income.
The net income increased by $74,647,145 from a net loss of $60,431,221 the previous year to net income of $14,215,924. Primarily as a result of the decrease for the change in the fair value of the derivative liability of $35,405,299. I don't understand derivatives, so I'll go out on a limb and say thats a good thing. :) Then there was a decrease in interest expense relating to the fair value of the convertible notes and other expenses of $12,204,459, a decrease of shared based compensation of $14,011,014, and loss on debt extinguishment of $12,038,787, all non-cash charges.. The remaining amount of net income relates to operating revenues, offset by various operating expenses.

2 of the 3 original guys that started this company are gone. Ian Gardner and Scott Weinbrandt. Kevin Claudio alone remains. This does scare me. Ian leaving was ok with me. He was instrumental in collapsing the company and his exit was a good thing although it cost the company a ton of cash. Scott leaving sucked. He too had a hand in the collapse, but was instrumental in keeping the company afloat. Yes, the dilution under his command sucks! But its better than a BK filing. Whether it was stress and frustration that got him to quit or simply not making enough money. Or perhaps he had other opportunities lurking. Nonetheless, having just one original founder and employee left doesn't bode well with me. I want to see that CEO spot filled asap.

I'm going to stop there. All and all they are trying to effectively manage the company. Granted the company is f'd! I'm not denying that. All I'm saying is that they are working pretty dang hard to fix things even though it doesn't look like it on the surface. A patent approval will give them a ton of options. I have been following their patent process for a while now and it has been an uphill battle. There have been multiple road bumps along the way, delaying it from their estimated approval date stated last June, which is why that PR never should of been released because the patent office is a complete cluster f^%k of a beaurocracy and delays should be expected. But they have been fighting extremely hard and passionately for this thing. I feel the patent is closer then most of you realize.

I do not believe this a company to invest in long term with information we currently have available to us. That can change depending on future dealings and what not. I do feel an R/S is inevitable down the road to help repair the damage done once the bleeding has stopped. I do believe it will be great for trading in the short term. With a patent the pps will rise and stabilize.

My big gamble right now is adding more shares. With the latest dilution, it'll be a bit harder to get to my 'break even point' and I will need to add more shares to bring my base down further to a point I know the pps can hit. Fun days are ahead.

Cheers.