I have never believed the RM with LRS was ever possible. What I am pointing out in my post is that
(i) ECOS doesn't own any technology or tradenames. The technology is all owned by the Korean company. They are a distributor of products. (ii) the fact that no technology is protected in the US makes it a lot easier for someone to come into the US digester market. Their Korean supplier is not the only Korean aerobic digester manufacturer or the only aerobic digester manufacturer in the world. (iii) ECOS revenue comes from any profit on the machines sales (which they share with LRS) and any output sales. They don''t share in LRS subscriber revenue from its organics pick up service. (iv) in order to expand in the Midwest the need to deal with LRS protected territory or let them into any new deals. Negotiating that right was a brilliant stroke by LRS as it ties ECOS hands. It gives LRS a lot more leverage over ECOS, (v) ECOS is very poor at maintaining corporate niceties. They are not qualified to do business in Illinois and they don't even own the name Ecolocap in Illinois. One of the reps that they would need to give in a merger is a corporate existence merger (qualified to do business where they are doing business). They can't give that rep as long as someone else owns the name in Illinois. The lawyer who owns the name actually plans to use the name Ecolocap in an environmental consulting business. ECOS could fix the name issue by changing their corporate name to another name and then redoing their stock listing and other corproate documents (all of which is costly) or try and buy the name Ecolocap from its owner.
I still think this is a viable business. If they can build out a recurring stream of machines I think the company could be worth $10m (in a couple of years).
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