Of course Rositanos only care about number of sign-ups even if free not revenue because they get $50,000 EACH for each 1MIL sign-ups (even if bogus or repeats), $75K for 5MIL AND that becomes part of their base compensation which increases 10% each 6 months NO MATTER WHAT.
With the 1MIL signups paid or not they each were entitled to a base compensation package of $200,000 which increases 10% every 6 mos. SINCE SIGNING in January 2014 so it's already higher. There are 2-3 other highly paid executives as well.
Those salaries/ compensation packages/ preferred shares etc. just are added to the company losses that they have to finance somehow, with lousy interest rates. According to the filings I posted, the company bleeds red to the tune of about $650,000 including admin./salaries and interest EVERY QUARTER while revenue is inconsequential. A good chunk of that interest seems to go to CMI which developed the software i-Hookup is using: the Rositanos also own CMI and are also management/Directors of that company,
being paid as such even as HKUP is paying off the purchase debt.
When will this turn around? Seems only by a major buy-out.
Sure some freebies will translate to paid memberships, but there have been criticisms that once they do so they have trouble opting out, keep getting billed; that some of the "girls" are fake etc.
I wouldn't know, this is strictly an investment for me -- frankly,
if all those guys get is some sexy pix and the girls don't show up at their local coffee shop or Motel 6 to rendezvous as they expect, IMO they've gotten what they paid for, buyer beware.
But that's strictly my opinion, this isn't something I would do, and I have a hard time believing college kids need to resort to it,
that as claimed it's booming on campuses. But maybe it is, if it's a huge campus, and there are always those too busy or too geeky or social challenged to meet up in more natural ways.
Still IMO only a synergistic buy-out with a company with money and an actual revenue base, can save this thing long-term.
Meanwhile the only silver lining is that this top management has the option to convert their preferred shares to 9 commons for each share, and will want to do it at the highest possible price --
giving an incentive to bump this thing back up somehow.
The financiers had their chance to drive it to the dumps through end July to buy cheap by that deadline -- I'm surprised it's gone down even further since to one-year lows last week.
That may have been low support.
I'll be watching and waiting for any bump which the Rositanos and other management may take advantage of: it may be a hail Mary pass.
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