Replies to post #141915 on Minerco Inc (fka MINE)

[312Moneyball]

Love it

[Sooah]

Issues are being confused here. If you look at MINE's financials submitted to the SEC--what's been submitted to the SEC matters--MINE did not have sufficient cash to meet the required minimum of $100K for the VitaFIZZ Brand Management Agreement:

3. Initial License Fee.

(a) Fee. In consideration for the costs incurred by Licensor for manufacturing and maintaining its existing inventory of Products, inclusive of any raw material costs, Licensee shall pay Licensor an initial license fee of Thirty Thousand Dollars ($30,000) upon the execution of this Agreement, as an advance against license fees due under paragraph 4 below.

(b) Proof of Sufficient Financial Resources. During the six (6) months following the execution of this Agreement, Licensee shall provide, to Licensor on a strictly confidential basis, as and when requested by Licensor, sufficient proof that Licensee’s financial resources to be dedicated to the Brand and the marketing, distribution and sale of the Products are in excess of One Hundred Thousand Dollars ($100,000.00), inclusive of the Thirty Thousand Dollar ($30,000) initial advance license fee paid as set forth above. During the next succeeding six (6) month period, Licensor shall continue to have the right to request, and Licensee shall continue to provide on a strictly confidential basis, information related to the sufficiency of its resources to market and sell the Products.

MINE had cash of $24,579, hence after paying the $30,000 initial down payment which appears "paid" they fall short of the mentioned $100K. The agreement reads that if any of the conditions within the agreement is not met, Powerbrands has the right to cancel the agreement. Seeing as disclosures were completely omitted for the recent 10Q, did something happen during the reporting period that we should be aware of? Why was nothing said? Not having sufficient cash is a BIG RISK FACTOR so this is an issue that should be discussed and the public made aware of.

Tie this to the recent 10Q where disclosures concerning VitaFIZZ were completely omitted, it draws questions about the disposition of this agreement and whether MINE/Level 5 has or will have sufficient funds in the next 6 months (next succeeding six months) to retain this agreement.

Further, I direct your attention to this particular discussion:
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=101374676 wherein I questioned the economic merit of the agreement. Based on the now completely omitted disclosure and there being no discussion of cost structures in the CC, it is nearly impossible to derive what economic benefit (net/net) this agreement has for MINE/L5. Information lacking prevents the public from making a reasonable determination about the merit of this agreement. And that the agreement mentions a 51% of net revenues without discussions of who carries "cost of goods sold", the agreement is not only ambiguous but highly misleading at best.

When the agreement was entered, MINE/L5 management must have had some 'cost guidance', right? So, why did they not provide further discussions of what investors/shareholders could expect in the REQUIRED FILINGS/DISCLOSURES WITH THE SEC? The onus falls on the issuer to provide updates on material agreement via properly filed reports to the SEC. So, the criticism from my side is not an unfair one.

Finally, I mentioned the botched up numbers concerning inventory depletion:

On the 10/31/2013 Q, MINE reported the following:
Quote:
As of November 30, 2013, Level 5 had depleted 1,042 cases (12,504 units) of RISE™ and COFFEE BOOST™, including a revenue sales count of at least 400 cases (4,800 units) of RISE™ and COFFEE BOOST™. The depleted case count includes sales, samples, promotions and consignment of our LEVEL 5™ products.

On the Q for period ended January 31, 2014 they reported the following:
Quote:
To date, Level 5 has depleted 784 cases (9,408 individual bottles) of LEVEL 5™ products.

If we were to evaluate the robust "demand" for these products, can Powers or Vanis please explain how depletion decreases from 1042 to 784?

You will note the color and emphasis on "at least" -- Revenue sales count cannot be "at least" or an estimated number for reporting issuers which MINE is simply because numbers have to be exact. This raises questions about the integrity of their inventory figure (in the balance sheet) and revenues as a whole. This is like saying, "We had at least $1 million in revenues but we are not sure." What is the actual revenue number?

It is MINE's responsibility to make sure their filings are accurate, no one else's.