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Hutchinson Technology Inc. Message Board

ezdeek 2720 posts  |  Last Activity: Jul 26, 2013 11:54 AM Member since: Sep 3, 2001
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  • Reply to

    Speculation always equals loss. I warned you.

    by ezdeek Jul 26, 2013 11:49 AM
    ezdeek ezdeek Jul 26, 2013 11:54 AM Flag

    I see COBR is down 20 percent, too, on low volume. Must be a Margin Call for the Messiah.......he's figuring out what he needs to sell because he was fully invested in a phoney market. It will get worse, I can guarantee you that. People who are fully invested, let alone fully invested on margin, are making a huge mistake.

    The shoe will drop on a few other debt laden companies in the portfolio, too. Rough sees ahead for all of the sheep.

  • It plays out over and over and over again. You follow your Messiah around and buy into companies that you really don't know all that much about. At some point the price moves up after enough followers jump on board. Then reality hits and the shares plunge.

    Just like LEE Enterprises, which was 30 cents after the crisis in 08 and 09. It then went to $5, then down to 60 cents, now close to $3. Whatever. I bought LEE in the summer of 09 at 55 cents and sold at $1.35. I saw what the idiot CEO was doing (pumper and fluffer of Press Releases).

    HTCH is a little bit of the same thing. You wouldn't even know that this company existed if you didn't surf the Yahoo message board. Yes, it will go up, and it will go down, but you are ALWAYS at risk of a negative surprise because the company mainly exists to make money for management, and to take money from investors and shareholders (exactly like LEE).

    Unless you can honestly say that you would buy the whole company if you had to invest your family money on it then you are playing a fool's game. None of you would spend hundreds of millions in cash to buy this company outright, just like you wouldn't buy LEE and take on all of the debt and liabilities.

    Most of you got what you deserved here (spare me with the "I'm still up huge here"). There may be one or two of you who are actual human beings and decent investors. I hope you got out before this drop. I mean, the stock went up multiple times from the lows and the business didn't improve multiple That is called speculation, and speculation ALWAYS equals big losses eventually. Can you name me one time in history where speculation didn't end badly? You got greedy, and today is your "surprise".

  • I guess it is officially time to NUKE this Yahoo account and call it a day.

    If you have a corporation that does NOT have to pay income taxes on the next 50 to 100 million in income, then that corporation is worth a lot of money. Another company deciding to buy into it, merge, or invest in it will value it more if the corporation can save tens of millions of dollars in by not having to pay taxes in the future.

    I don't really care anymore. If you think Prescott Capital's end-game means that they will take a loss on their 4.5 million dollar investment from 2009 (2.4 million shares...average cost $1.90 per share), then please sell your shares so I don't have to read about it anymore.

    I have given the road map for 27 months. Never wrong about a single material issue. I guess you can say I misread the asset sale amount, when I didn't deduct the 3 million CW cure amount, but that didn't effect any decision on whether anyone would buy, and that was during an exciting hectic time, and the wording was quite ambiguous.

    Other than that I knocked it out of the park all day, every day for 27 months. No big deal, as only 2 or 3 people out of 7 billion in the world are up six figures on their investment in KIDEQ/FOUR in the last decade. Everyone else is down big or took major life changing losses.

    It wouldn't even matter at this point if I missed something and was off a bit, as the margin of safety is so monstrous that even if nothing goes right I still win big even if I started at this 60 cent level. I think the cure might be to NOT even browse here again, as it is basically groundhog day.

    I will cash in my chips when Prescott cashes in theirs. I expect them to make a profit on their 4.5 million investment, plus tons of time and effort spent. They will want to be compensated for the turmoil they went through, as well. The only way shareholders get less than $3.50 or so when the dust settles is if
    Prescott is involved in a takeover where they can low ball at $2 or so.

  • Reply to

    Higs II

    by wmishcom Jul 13, 2013 9:34 PM
    ezdeek ezdeek Jul 14, 2013 4:59 PM Flag

    The bottom line is that even if Lehman is zero, isoblox is zero, legacy licensing deals are worth zero, and everything else is given a zero value, then the NOL's will always be worth multiples of the current market cap to an open market.

    One of their accounts, the American Kennel Club account, is actually a really nice money maker which makes nice profits. Nobody ever mentions it.

    I am tempering my Lehman estimates just to point out that even if we get the low end of the Lehman range, the company is still worth 25-30 million if all you did was count isoblox as being worth 2 million, licensing deals a few million, etc. The NOL's are legitimately worth 20 million to an arm's length 3rd party buyer.

    If we get 15 million from Lehman we are worth 40 million worst case scenario, and that is $3 per share. I don't care when it happens. The assets cannot possibly be worth less than three times the current share price even if nothing goes right.

    That is why I wouldn't totally mind a low price for another year. I could add more. It is the investment of a lifetime, as there is pretty much a mathematical zero chance of permanent capital loss, and there are multiple things that could turn out really well.

    People can continue to stay fully invested with Fed Fueled dog #$%$, or they can buy FOUR and really changes their lives for the better in the near to midterm (with close to zero risk). If you tried to create perfect investment you would create one where the risk of loss was close to zero, and the potential for making multiples was more likely than not. This is it. It always has been if people would have read the original contracts with TV Tokyo. Once you are right on that, you just need to hold and get out of your own way. It will happen when it happens.

    There are about 6 people out of 7 billion who even follow this. The FOUR message board has no posters. The list of people who are up significant money here can fit on half a hand. It is probably between 2 and 3.

  • Reply to

    Higs II

    by wmishcom Jul 13, 2013 9:34 PM
    ezdeek ezdeek Jul 14, 2013 4:47 PM Flag

    No, once the three year window is over, then you can merge with anyone and full use of the NOL's can be utilized. The window might be close to over as I type this, as the BK was 27 months ago. It is possible that the the window started just before BK, but more likely than not that it started on the flush out on the BK warning and BK in late March and early April of 2011.

    As it stands, it is almost a certainty that the latest date to when it is "all clear" is April of 2014. The new bylaws essentially guaranteed that the NOL's would retain their value. If the get 15 million from Lehman then that is 15 million less in NOL's. However, the NOL's are so massive, and the company is capable of showing a few million in losses this year anyways, so it will offset it a bit. But even then, there are a boatload of NOL's, as the company took about 100 million in losses between Chaotic, Auction Rate Securities Losses, plus normal operating losses.

    Insiders still have the upper hand, though, even if they couldn't buy during the last few years (they cannot be happy about having retail investors scoop up on the cheap while they can't buy). The reason they will make out is that they will know when the NOL window is over, and they will be able to buy shares on the open market without negatively affecting the tax assets. They know these dates and we do not. That is when they will be buying on the open market (as long as they are not privy to new material non public information).

    By definition, the NOL's can NEVER be lost. It is in the bylaws. Any trade that would jeopardize them would be void ab initio. That is why the value of FOUR will ALWAYS be worth more than 60-ish cents it trades at now, even if Lehman payout is zero. That is what many of you have never understood. It is mathematically impossible for this company to be worth a discounted arm's length sale of the NOL's, which is multiples of the current market cap. And that would be assuming Lehman, isoblox, etc. is worth zero.

  • Reply to

    Higs II

    by wmishcom Jul 13, 2013 9:34 PM
    ezdeek ezdeek Jul 14, 2013 2:23 AM Flag

    One post only since this was a good post (finally). The original lawsuit was for 31.5 million, plus 6 million in interest, plus treble damages of 94.5 million. That gets you to the 132 million total (zero chance)

    Those Auction Rate Securities have already been cashed in, between the time of the suit in 2008 and 2011/2012. 4Kids got a low amount, possibly 20 cents on the dollar.

    The true loss could very well be 20 (ish) million. Now, assuming 40 percent general unsecured recovery and you have 8 million. The absolute low end is probably 20 cents on the dollar, which is 4 million. That is the doomsday bad luck scenario.

    But the claim is not simply a restitution claim. There was fraud involved on the part of Lehman. The three individual brokers settled with 4Kids for 489K in late 2011 to avoid going to arbitration, and it is those exact same facts that guide this claim.

    4Kids has that bit of leverage going for it. Without a Lehman bankruptcy, 4Kids would have a somewhat legit chance of getting lucky and getting close to the total claim amount of 132 million. But everything would have to go right, and they would still probably have to wait out appeals. But that doesn't matter, because Lehman IS in bankruptcy.

    The most likely result is that 4Kids and the Trustee come to an agreement. Second most likely is that the BK Judge gets involved. The third most likely is arbitration. The least likely is that the Trustee suggests an amount between zero and whatever, and the Judge agrees. It is close to 100% chance of mutual agreement.

    I'll take 15 million, a $1.50 share price before year end. Then sit back and see if isoblox takes off, plus potential buyout involving NOL's. Buyout in the $3.50 range within 18 month is fine. I prefer a NO DECISION end like that (everyone gets out at highest tick that way).

    General unsecured will get a percentage, so the Trustee/4Kids could agree to a number like 35 million, in order to get to the desired of 15 million payout.

  • I have posted less this year than ever before. There has been a little flurry of late from me, just so that I establish a record for people in the future to see how these things play out, including how it feels to hold shares in something like this.

    The main point all along was that if 4Kids was correct on the TV Tokyo licensing dispute, then a windfall would eventually be had by those who had shares before the dispute was settled. That is still true, as everyone could have bought shares between 6 and 19 cents from April 2011 through December of 2011.

    Now, life is not so easy that you can buy in 2012 and get a similar windfall (quickly and automatically). If that were the case then everyone could be a billionaire by waiting for big news to break and reacting after the fact. However, there is going to be at least a triple from every price you could have bought in 2012, and that means over $2 per share. That will come sooner than you think, but it really doesn't matter when it happens, as there is essentially a zero chance of permanent capital loss from any price you could have bought since well before the bankruptcy ($1 buys in early 2010 will make multiples).

    As to the Lehman potential settlement. There is very little chance at an official objection from the Trustee, as the claim is legit. The three scenarios are 1) Settlement between 5 and 30 million between Lehman estate and 4Licensing, 2) Arbitration where the potential for a higher amount is possible, or 3) A trial before the bankruptcy Judge. There is conflicting case law on whether a Bankruptcy court can rule on disputes such as this, by overriding the arbitration clause.

    The NOL's are worth 10's of millions to a third party. It is impossible for them to be worth less, since the new bylaws make it so that nobody can acquire 5 percent and jeopardize them. The isoblox/Pinwrest deal could be along term winner. Legacy licensing revenue and cash on hand just adds to the value. FOUR is the place to be. Goodbye.

  • Reply to

    Phil Frohlich, Prescott Capital, NOL's

    by ezdeek Jul 4, 2013 2:25 PM
    ezdeek ezdeek Jul 4, 2013 2:38 PM Flag

    Remember, that Prescott's 4.5 million investment (2.4 million shares) was worth just 140K during the dog days of December, 2011, when the shares hit 6 cents for a few days. Once the verdict came out, everything was in place. At that point they know, that in time, their 18 percent ownership will be worth more than their original investment, as it is simple math......NOL's are worth tens of millions alone, and their 18 percent is worth more than their 4.5 million original investment. Throw in the Lehman potential windfall, which would be gravy, and Prescott can take out 15 million here if all goes well. But even with no luck at all, they are practically guaranteed to get their 4.5 million back at some point in the next two years, either by way of a $2 stock price, or other payout/liquidation/sale, etc.

    But if the shares are worth so much more than 50 cents, why are the shares trading at just 50 cents? Well, the verdict was out on December 29th, and Prescott new about the verdict and could have bought shares on December 30th and 31st of 2011, but obviously they couldn't, as it would be insider trading, and it would also jeopardize the NOL's. Don't you think that they would have loved to buy shares at 7-10 cents at that time?

  • Gee, Wally, do you think that Mr. Frohlich has a plan to utilize the NOL's? DO you think that plan was hatched in 2010 when Prescott got seats on the board and immediately allowed the shares to go to the pink sheets?

    Do you think they can orchestrate a return on their 4.5 million investment from 2009? They also have invested thousands and thousands of hours. I wonder if it would be a good idea to buy shares at 50 cents, knowing that Frohlich and Prescott got theirs at $1.90 and cannot buy now due to insider trading laws.

    Phil Frohlich is the founder of Prescott Group Capital Management, L.L.C., an investment management company for high net worth investors. He was formerly president of Siegfried Companies, Inc. and a tax principal with what is now the international accounting firm of Ernst & Young. He received a BBA in economics from the University of Oklahoma, an MBA from the University of Texas at Austin and a law degree from the University of Tulsa.

  • Samuel Newborn sure has a lot of info about the history of 4Kids, and he has his hands in the Isoblox deal, as well. It wouldn't surprise me if he somehow shows up again down the road in some sort of buyout deal. I never even wrote off Al Kahn, either, as I know he still has his shares. I think the pot of gold Lehman settlement, plus NOL's, TV Tokyo dispute, plus BK journey was better off not having Al Kahn around anyways. Kahn still has his shares, and Newborn, though he didn't ever have a lot of shares, has maintained a relationship with 4Kids/4Licensing, as is evidenced as being an attorney on this Isoblox deal. Newborn is the guy who knows the most out of anyone, with Bruce Foster probably second. Will Newborn play a part in a deal down the road, or is his involvement just part of his transition out (we'll give you some work on your way out the door)?

    Document Date 3/15/2013
    Document Type Agreements-Purchase and Sale Agreement
    Agreements-Asset Purchase Agreement
    Mergers & Acquisitions-Asset Purchase Agreement
    Property - Personal-Purchase and Sale Agreement
    4Licensing Corporation
    Dodd Group LLC
    Newborn Law Group PC
    Oak Stream Investors II, Ltd, Paramount Capital Investments (Private Equity), LLC, STELAC SPV VIII LLC
    Pinwrest Development Group, LLC
    Industry Recreational Products
    Corporate HQ
    Ticker Symbol FOUR
    ACT Group 34
    Fiscal Year End 1231
    Sector Consumer Cyclical
    SIC Code 6794
    Governing Law Texas
    Related Companies 4LICENSING CORP
    1.2 - Purchase Price.
    1.3 - Assumption of Liabilities.
    2.1 - Closing Date.
    2.2 - Allocation of Income and Expense.
    3.1 - Conduct of Business.
    3.2 - Review of Seller.
    4.1 - Existence and Good Standing.
    4.2 - Authorization.
    (a) - Seller

  • Reply to

    Within 60 days, we are 50-50 to be over $1

    by ezdeek Jul 4, 2013 3:06 AM
    ezdeek ezdeek Jul 4, 2013 3:08 AM Flag


    You have to turn over a lot of rocks to find those little anomalies. You have to find the companies that are off the map - way off the map. You may find local companies that have nothing wrong with them at all. A company that I found, Western Insurance Securities, was trading for $3/share when it was earning $20/share!! I tried to buy up as much of it as possible. No one will tell you about these businesses. You have to find them.

    You don't need another Ben Graham. You don't need another Moses. There were only Ten Commandments; we're still waiting for the eleventh (j/k). His investing philosophy is still alive and well. There are disciples of him around, but all we are doing is parroting. I did read Phil Fisher later on, which showed the more qualitative aspects of businesses. Common stocks are part of a business. Markets are there to serve you, not to instruct you. You can often find a couple of companies that are out of line. Find one; get rich. Most people think that what the stock does from day to day contains information, but it doesn't. It isn't just something that wiggles around. The stock market is the best game in the world. You can take advantage of people who have no morals. High prices inside of a year will typically be 100% of the low price. Businesses don't change in value that much. That is simply crazy. There are extreme degrees of fluctuation, and Mr. Market will call out the prices. Wait until he is nutty in one direction or the other. Put in a margin of safety. Don't find a bridge that says no more than 10,000 pounds when you have a 9800 pound vehicle. It isn't a function of IQ, but receptivity of the mind.

  • It is going to be a big summer for us.


    When investing you don't have to invest in all 10,000 companies available, you just have to find the one that is out of line. Mr. Market is your servant. Mr. Market is your partner and wants to sell the business to you everyday. Some days he is very optimistic and wants a high price, others he is pessimistic and will sell at a low price. You have to use this to your advantage. The market is the greatest game in the world. There is nothing else that can, at times, get this far out of line with reality. For example, land usually only fluctuates within a 15% band. Negotiated transactions are less volatile. Some get this; others don't. Just keep your wits about you and you can make a lot of money in the market.

    Berkshire owned the Washington Post, the ABC network and Newsweek. It was selling for $100 million based on the stock price. No debt. You could have held an auction, and sold off the companies individually for $500M total, but $100M was the price. In other words they were willing to sell us money that was worth $1 for $0.25. According to efficient markets, the beta was higher when the stock was at $20 than at $37. This is insanity. We bought what was then worth $9 million that is now worth $1.7 billion.

  • Reply to

    Deek - quick question

    by charboneus Jul 3, 2013 9:45 PM
    ezdeek ezdeek Jul 4, 2013 2:54 AM Flag

    One thing that could happen, and consider this a gift to the board from me (like the one I gave on December 31st) when there was still time to buy after I found out about the verdict), is that there is a possibility that one day, there could be a positive mention on the Trustee site that at least mentions 4Kids as having a legit claim, or even mentions an exact settlement amount before 4Kids announces it.

    There could also be something there which could make it obvious that we are home free. Something like all of the unsecured objections having been listed with no mention of 4Kids. These are the types of things you need to look for daily if you want to get ahead in life. You don't get many layups like the one where the verdict was out and nobody knew about it. In hindsight I cannot believe I didn't have ever friend and family member buying hand over fist the day I figured it out before anyone else. 80,000 shares on that info was nice, but should have had someone go with the plunge for me. It was free money. I should have made the once in a lifetime move, there. I didn't have any more dough to buy at the time. The next time I see a situation like that, even if it is something like spotting something about the Lehman amount, I will be making sure I get all that I can (and everyone I know does the same) before I make an announcement.

  • Reply to

    online article from June 7

    by charboneus Jul 3, 2013 10:04 PM
    ezdeek ezdeek Jul 4, 2013 2:42 AM Flag

    Also, if you ever type something really important, make sure you copy it before pressing post. There is nothing like making a long passionate post and having it disappear. It really takes the wind out of one's sails.

  • ezdeek ezdeek Jul 4, 2013 2:38 AM Flag

    “Now, if you come back, and the value you assign the company is $400 million, and the company is selling for $400 million in the market, you still have a story but it doesn’t do you any good financially. But if you come back and say it’s $400 million and it’s selling for $80 million, that screams at you. Either you are saying that the people that are running it are so incompetent that they’re going to blow the $400 million, or you’re saying that they’re crooked and that they’re operating Bob Vesco style. Or, you’ve got a screaming buy when you can buy dollar bills for 20 cents. And, of course, that $400 million, within eight or 10 years, with essentially the same assets, [is now worth] $3 or $4 billion.”

    That is not a complicated story. We bought in 1974, from not more than 10 sellers, what was then 9% of the Washington Post Company, based on that valuation. And they were people like Scudder Stevens, and bank trust departments. And if you asked any of the people selling us the stock what the business was worth, they would have come up with an answer of $400 million. And, incidentally, if it had gone down to $60 or $40 million, the beta would have been higher of course, and it would have therefore been [viewed as] a riskier asset. There is no risk in buying the stock at $80 million. If it sells for $400 [million] steadily, there’s much more risk than if it goes from $400 million to $80 million.

    But that’s all there is to business. But now you say “I don’t know how to evaluate the Washington Post.” It isn’t that hard to evaluate the Washington Post. You can look and see what newspapers and television stations sell for. If your fix is $400 and it’s selling for $390, so what? You can’t [invest safely with such a small margin of safety]. If your range is $300 to $500 and it’s selling for $80 you don’t need to be more accurate than that. It’s a business where that happens.

  • ezdeek ezdeek Jul 4, 2013 2:37 AM Flag

    Staying with the advice giving theme, Buffett recounts a story in a 1991 speech at Notre Dame about when Bob Woodward asked him how to make some money in the stock market. Buffett advised Woodward to go out and research a company like he would a news story. If the company was an obvious bargain, Buffett told him to buy it, if not, take a pass. It is clear from the speech that Buffett uses private market valuations in his business valuation process.

    “Bob Woodward one time said to me “tell me how to make some money” back in the ‘70s, before he’d made some money himself on a movie and a book. I said “Bob, it’s very simple. Assign yourself the right story. The problem is you’re letting Bradley assign you all the stories. You go out and interview Jeb Magruder.” I said “Assign yourself a story. The story is: what is the Washington Post Company worth? If Bradley gave you that story to go out and report on, you’d go out and come back in two weeks, and you’d write a story that would make perfectly good sense. You’d find out what a television station sells for, you’d find out what a newspaper sells for, you’d evaluate temperament.” I said “You are perfectly capable of writing that story. It’s much easier than finding out what Bill Casey is thinking about on his deathbed. All you’ve got to do is assign yourself that story.

  • In order to value a business, you need to do your home work. In a recent article in Fortune entitled “Best Advice I ever got”, Jim Rogers talks about how you can get an edge on the vast majority of people on Wall Street if you simply read everything you can on a prospective investment.

    “The best advice I ever got was on an airplane. It was in my early days on Wall Street. I was flying to Chicago, and I sat next to an older guy. Anyway, I remember him as being an old guy, which means he may have been 40. He told me to read everything. If you get interested in a company and you read the annual report, he said, you will have done more than 98% of the people on Wall Street. And if you read the footnotes in the annual report you will have done more than 100% of the people on Wall Street. I realized right away that if I just literally read a company’s annual report and the notes — or better yet, two or three years of reports — that I would know much more than others. Professional investors used to sort of be dazzled. Everyone seemed to think I was smart. I later realized that I had to do more than just that. I learned that I had to read the annual reports of those I am investing in and their competitors’ annual reports, the trade journals, and everything that I could get my hands on. But I realized that most people don’t bother even doing the basic homework. And if I did even more, I’d be so far ahead that I’d probably be able to find successful investments.”

    Rogers likes to lay out the data on a company in spreadsheets that go back ten to fifteen years. He believes it is essential to have a long-term historical view of a company. When he sees a period of difficulty or decline, he wants know why, and likewise for periods of prosperity. Copies of Rogers’ spreadsheets can be found in the appendix of John Train’s “The New Money Masters”. I have adopted them for my own work and found them to be highly useful. It is worth noting that they involve no projections.

  • Reply to

    Deek - quick question

    by charboneus Jul 3, 2013 9:45 PM
    ezdeek ezdeek Jul 4, 2013 2:31 AM Flag

    Funny you mention that, as I was looking at the first wave of unsecured objections coming in today. What I have done in the past is just type in 4Kids in the place where it ask for Docket Text. I have also tried 4Licensing and FOUR. Today, however, I went through each objection and exhibit, making sure to look at every one in case it was listed as 4Kids, 4Licensing, and just in case it wasn't listed alphabetically, and somehow the 4 was stock in the middle of the list, which seemed to be alphabetical.

    It was a bit of a nerve-wracking sweat, even though I wasn't expecting to see anything. What I also looked for was anything related to auction rate securities, and I found nothing. I was going to post here about today's developments, mainly general unsecured creditor objections being filed, but 1) I am trying not to post, and 2) If there does appear an objection with our name on it, it still has to withstand a challenge, and I didn't want to #$%$ anybody and have to stare at a 39 cent bid again.

    I think we will make it through. If we see 4Kids in the objections, it will likely be to the punitive damages amount, as the claim is listed at just over 130 million, and that won't be happening (trust me). My guess is that there have been discussions, or will be discussions, and that the objections we will see are truly claims that shouldn't be allowed, anyways. I read one of the big ones, and it was obviously a bad claim. There are tons of small dollar claims listed, as well (in amounts like tens of thousands of dollars).

    I'm on top of things, as usual. It will be life changing money for me if we get at least 10 million, as the price should double immediately from here. The stakes are pretty high, but I would never sell even if we get zero here, so I'm not sure if I would be in the mood to shout to the world the news if I see that we have a fight on our hands. I haven't particularly enjoyed sitting on this low price for 18 months, when everything has gone right.

  • ezdeek ezdeek Jul 2, 2013 2:55 PM Flag

    You are thinking like a winner, but I am showing a bit of restraint as to the actual payoff that happens. Though I see the potential for a windfall that sends this whole board into retirement, I feel that 15 million is the feel good number for me. If we get that, we are all in great shape. Even if we get 6-7 million, we should be off to the races here. Anything above 15 million and the party is on.

    I certainly believe that they are owed more than 15 million, especially when 4Kids/4licensing will be able to show that what Lehman did essentially forced them into BK (though it really didn't), so there is a possibility, though not a probability of a payout of 25 million or more.

    6-7 Million. I'll take it. Move on. Price heads to $1 or more
    15 Million. Now we're talking. Price could head to $1.50 or $2 real quick
    20 million plus. Special dividend to shareholders time, or just sell the whole thing to a third party. Add NOL value and we are talking legit 40 million plus sale of the whole company if Lehman is at least 20 million.

    Until Lehman is over and the NOL's are used in a transaction/sale, then my original thesis is 100 percent on track.

    $3 per share is very realistic relatively soon. Lehman is the first domino that starts it all off, in all likelihood. Prescott has had 4.5 million tied up for 4-5 years. They know that they have leverage in the Lehman situation, and they will be looking to cash out at some point in the next few years, when 4licensing is merged with a company that can use the NOL's.

    You are right about the Tax. If we get 100 million in the miracle of all miracles, that won't be taxed, as the previous write downs/losses will cover it.

  • 4Kids filed their claim to go to arbitration many months before Lehman filed Bankruptcy. So, there were two disputes in the pipeline, one against the individual brokers, and the big one against Lehman. Even during bankruptcy, in 2011, in order to avoid going to arbitration, the brokers settled for 489K.

    Now, 4Kids considered their claim to be secured claim, though they are listing it as an unsecured general creditor claim. I'm not so sure that this particular designation is final. It could be final, but maybe the Trustee made an initial determination that it was an unsecured claim. However, 4Kids/4Licensingstill has the right to go to arbitration for the whole enchilada, so if Giddens (Lehman Trustee) doesn't offer enough in the form of a settlement then 4Licensing management could take it to arbitration (15 million minimum). Remember, it will be the exact same set of facts that caused the brokers to settle.

    In any event, my guess is that the absolute worst case scenario is 20 cents on the dollar as a general unsecured claim. That is equal to the current market cap now of 6-7 million. Plus, we are likely getting close to the point where the window for 5 percent holders closes, which means that insiders could buy, assuming that they had no other material non-public information (like settlement progress with Lehman).

    There are still a handful of small claims to settle in the next month that management is looking to have the Judge expunge for various reasons (see recent filings). Once those are clear, then I expect an announcement of a Lehman settlement/payout. Things are setting up nicely here, as the overall market is in a very dangerous positions, with lots of companies at all time highs. This should be the slingshot move that is the holy grail of extreme up move for FOUR holders, while the rest of the market tanks. That is a high possibility as we hit the half way point of 2013.

2.00+0.08(+4.17%)2:49 PMEDT