if the group has more than 5% of the total outstanding shares - they should retain an attorney and demand a seat on the BOD. there are "vacancies" and it certainly is legally, ethically, and morally required of the company to have those voices heard in light of the $45MM raised, spent, and nothing to show for it.
if LK refuses to allow the seat - take her to court and petition the SEC to step in and force the conversation.
if Hicks is doing a death spiral round of "financing" - by the time you get the details it will be too late.
the only way to get this to a concluding point is make it personally, financially unattractive for LK to continue as is. the only way to do that is to make her spend her money to defend her actions. there is ZERO MONEY from the company to provide representation/counsel for her. the company is dead broke. if she starts getting drained fighting off civil suit(s) and SEC inquiries/investigations - she will be levered into a negotiating position. personally i dont think there will be anything worth getting in the end but either way - it will bring the saga to an end or allow a realistic shot at bringing the product to a viable market.
however, the longer one waits - the more worthless your shares become due to the increased dilution required to recapitalize the company should value exist.
that had been consistently happening while it drifted up to $0.50 prior to earnings release. however, now it could be frustrated longs moving on. it doesnt make sense from an impact standpoint to unload all at once regardless of frustration. my assumption would be anyone with that large of a position probably would have the saavy to unload systematically and more efficiently.
either way - it goes back to the lack of competition by having one MM.
either someone is completely fed up and is getting out or this is MM playing games. either way - another miss for MGMT not addressing the lack of competition by having only one.
has a plan and this will be detailed in the late 3Q13 and late 2013 10K. and - his plan is going to be putting up his own money with minimal dilution to existing shareholders. this from the man who has been investigated, charged, and found guilty by the SEC of several, major violations and has a history of death spiral financing. so - did the guy have an epiphany and decide arbitrarily that benevolence was the key to salvation and is just going to front his own money to save all of the long suffering shareholders who in large part, brought this on themselves through years of inaction and allowing a select few to siphon all wealth/value from the company?
why would any individual (let alone that one) put up money for a small, fixed rate return when there is a major, major risk of default and ending up with nothing? where is the risk/reward calculation for that individual or group? just isnt going to happen.
if this tech is viable for its intended purpose (and i have never seen anything compelling me to believe it is) - anyone coming in is going to want complete control, a clean separation from existing mgmt, indemnity from past harm, and will recapitalize with a monstrous increase in shares and then later, a subsequent monster R/S that will effectively wipe out any long term shareholders. that is just the way the market works.
here - i see that happening with out any long term viability simply because someone can. the shareholders have left themselves with very little to no leverage. hicks has no current liability for mgmt's past bad decisions. he can do this with very little liability unless the common shareholders en masse, warn him of future action should he proceed accordingly.
go after the clowns that enriched themselves and clean that mess up. then find out for yourselves if there is anything of value worth recapitalizing. you certainly dont need someone with no industry expertise and a history of tanking companies doing that for you.
yahoo reports 92MM shares as the float and 156MM outstanding. i think you flip flopped the numbers. insiders control roughly 40% of the float. regardless - my guess is those who follow this board could control 10-15MM shares collectively representing which could be close to 10% of outstanding and and 16% of the float. that is a considerable voice. certainly not knee shaking leverage but if it is a unified voice, it would bring pause if for no other reason - to ensure there is no legal action considered or taken collectively.
i dont believe there is anything criminal going on. if so - i would be lighting up the SEC. rather, i think there is a major disconnect between the BOD/mgmt and the shareholders on expectations and timeframe for profitabiliy/long term viability. there is certainly a disconnect shareholder expectations (non inside) and performance bonuses.
prior - i think it behooves all concerned shareholders to have a conversation with Ma personally. if he is not able to assuage concerns or reframe his CC comments - than we go the board individually and collectively.
either way - i think there is power in numbers. they spent a couple million to tread water removing 6-8MM shares from the float. do they really want to worry about 15MM shares being dumped? while not likely to happen - they certainly do not want to defend that. besides, several of us are probably some of their best ambassadors and doing as much as the marketing group in terms of promoting
what were the revenues in the first two quarters of 2013? i thought those were factored into the 3Q13 numbers post merger. if not - then my mistake. i thought they had $2.7MM total in 2013. that would make sense based on yours but unfortunately - provided a less impressive 4Q13 to meet target.
still doesnt explain reasoning for the lack of update on smartwatch/security solution.
norm11 - where are you sending the emails? send directly to amanda or ma. dont go through the generic IR domain. if you dont have theirs - call the company main line and request their email addresses.
i have always been replied to. that is a big part of the issue for me. i feel relatively certain that the issue is more communication than it is execution but it has gotten to the point that the communication has now completely stalled execution.
sunny - i disagree with KCSA. to fault them would be to say that the last four IR firms VASO hired were ALL non performers. IF that is the case - then still - that would go back directly to the CEO for not being able to manage or hire competent talent.
while i certainly dont have direct language, from conversations i have had with two of the individuals at KCSA, it seems somewhat obvious that they are being drastically limited by mgmt in allowing them to actually help. mgmt is simply too conservative and has too many preconceived notions about marketing/promotion. they want a PR firm to rubber stamp their ideas to "validate" them to the market/shareholders. that is why there has been a revolving door. no PR firm wants a loser tied around their neck regardless of what they are being paid (unless they are desperate). KCSA is not desperate.
i dont think the team is the issue. i think Ma leading the team is. he ran the former VASO contractor that manufactured the EECP beds and was heavily endorsed by Sybrnik brothers and Kerns. big difference between running a small,private manufacturer and leading a public company. he never had to answer to shareholders or deal with direct Q&As. part of that might be culture based as well as the chinese are used to a more rank and file approach of leadership/following. regardless - he does not appear to have improved or certainly not enough and now it has become an obvious and costly detriment.
he certainly has the ability to right the ship though his time is running very short.
PJ - there are two distinct flaws in your logic: the first is you think shareholders that disagree with mgmt should not be invested or just sell and move on. before providing the theoretical to illustrate the point - how does your opinion and buying habits change if the stock were to get back to $0.04/shares and Ma started making $3.0MM a year in salary starting in 2015...?
"If you don't agree with the company management and, especially, if you think you can manage the company better than management you should not own the stock."
to further illustrate - if the shareholders take that view en masse - what is to prevent mgmt from going rogue? what if the BOD agrees to pay Ma $3MM a year and all of the BOD gets 1MM below market options every quarter for their service to the board? then what? once you get fed up with the lack of performance, you just sell and move on with the other shareholders. there is ZERO incentive for mgmt/BOD to make changes as they get high salaries and low cost options which they can immediately turn over in the market. this works until the most ardent shareholders finally give up.
second point: " if I was trying to buy some vaso stock now I would do just like the current buyers." the problem is - you aren't. and neither is the majority of the long term shareholders. hence the precipitous decline. there is no support. at what level do you start buying again? tapped out and cant start buying? at what point do you cut strings before the loss becomes no longer worth the wait. you assume that at some point buyers will come back, the company will perform, and new investors will recognize the value and the price will go up. that is either naive or willfully ignorant. that is NOT the way the market works and that is especially true with microcap/pink sheet/OTC stocks. hedge funds and institutional shorts can bury this before you even have a change to formulate a liquidation plan.
it is worse. who are you buying shares from in that $0.27 range...? once you are finished increasing your position - who will be the next long term shareholder to support the price and absorb that supply?
currently, a bulk of the buying is probably being done by the MM who is thankfully unwinding those short positions while also increasing a small supply to sell into runs. he is able to walk the price down and close positions without it being obvious. he is almost always win win here without competition.
there are long term shareholders selling - sunny is one of them. who is going to step up and absorb that supply? new investors? absolutely not. insiders? they didnt prior to the crash when the company was aggressively buying back. other long term shareholders? obviously not enough as the price has tanked close to 50% now on heavy volume.
as a long term shareholder with more invested in this company that any insider - i hope you continue to buy aggressively and get to my level. you may see things differently and understand that things change dramatically at a certain level.
collectively we are easily the largest shareholder behind the sybrnik brothers. i know several on this board that are just under Ma in the number of shares owned. no other insider is close to Ma's 2.5-3MM shares.
the only thing that really matters as a group is whether or not the Sybrnik brothers are satisfied first and then the BOD are satisfied second. while the BOD has very limited liability despite their fidcuiary responsibility, they can still be held liable for civil damages for breaching that duty. it is expensive and hard to "prove" but in civil court - one only needs to prove 51% - not beyond a reasonable doubt.
every investor should be engaged in this process if they are holding any substantial position. most investors are not sophisticated in their approach and believe their best interests are always being upheld by upper management and the BOD. unfortunately, that is often not the case. there are many conflicts. right now, there is a conflict between compensation and performance. it is further conflicted as the BOD is receiving no cost shares/options and thus have an incentive to not rock the boat. that is in direct conflict with their fiduciary responsibility to protect and increase shareholder value.
that being said, communication should be professional, specific, measurable, and polite.
i would also recommend going straight to Ma and cc the COB on these communications. right now, the message can not be watered down or obfuscated with generalities. if the price tanks again, it will be back in the teens and all of our money that was spent on the buyback will have been for not.
while the company needs to retain cash to grow, the stock price provides significantly more leverage than cash longer term. they can get a much higher return on investment by absorbing supply due to the low price than employing that cash elsewhere right now. especially with their track record of employing cash. more importantly, it is time the insiders buy on the open market. there should be no excuses. either buy or state the insiders are restricted.
That is boilerplate language. in general - that is ideal. when your stock drops 40-50% in two weeks after CEO is discussing the great year and the company buys back 5%+ of the outstanding shares - it is not appropriate. shareholders ONLY get a return in VASO through stock appreciation. there are no dividends and none in the foreseeable future. if the company is not addressing that type of decline, then they are derelict in their fiduciary responsibilities. in this case - and this is my opinion which seems to be shared by several - the decline is a direct result of the CEOs fumbling of the quarter and CC and it is up to him to make it right.
every massive drop like this makes it harder for the stock to appreciate meaningfully in the future. worse, as i have stated prior, there are only so many times long term shareholders will retrench and increase positions.
the stock price/performance needs to be addressed internally at the executive and board levels and then a plan needs to be addressed with shareholders publicly and immediately.
how long did they have to meet the $4MM target? was it 12 months or calendar year 2013? if it was 12 months - than they still have time. i read it as being calendar year 2013. in that case - they would not have as the total revenues were $2.782MM which was primarily Jifu (and what appears to be a couple ten thousands of Mach5).
they have been filing consistently late but with the required NTs being submitted. it is curious why they were able to file the 10K on time especially when accounting for the Jifu acquisition.
i just cant imagine a scenario where it is in the best interest of the company and shareholders to NOT announce positive rollout of the smartwatch/security solution.
is the BOD disappointed with his performance? if so - why the last round of option awards? i think the only way his job becomes an issue is if the Sybrnik brothers disapprove.
i agree on the SG&A. i even mentioned that prior to the quarter/10K being released. the increase hasnt been commensurate with revenues/profits from the increased expenditures. look at SG&A in 2011 compared to the following two years. it doesnt add up. 2013 should have been a break out year and instead it was a dud. even if 1Q14 ends up being the breakout quarter - who is going to notice, care, or believe it is a turning point after the last CC? THAT is the issue. Ma has just not been able to resonate with new investors and now he appears to be turning off long term shareholders.
unless he specifically addresses the 50% drop in stock price that by all means was a direct result of the missed quarter and his follow up to it and instills resolute confidence in the investor base that his plan will lead to a consistently and highly profitable company - then he should be removed. i dont want to deal with a CEO change but this one unfortunately has failed to engage investors and Wall Street to create sustainable appreciation. while he was basically hand picked by the Syrbnik brothers - at a certain point, they will need to cut bait and make the change.
back to the webinar - did you listen to it? did you hear the engagement with Lieberman talking about the opportunities and the company's response to those? he provided real excitement and energy to the conversation. there was no hype. it was again, a complete 180 from the energy that Ma sucked right out of the investor base.
i have been invested in VASO long before Ma due to the potential and increased my position based on the dearth of 3rd party reports/trials, approvals, and to a lesser degree - Ma's comments. i can not simply sell and move on due to the size of my position. if i tried to liquidate quickly - i would probably tank the price well into the teens. it would look similar to what is going on now. who is going to absorb those shares? the long term shareholders are more than likely getting tapped out. worse - after Ma's comments - why should they continue to put risk capital here if it is going to be dead money for the next 2-3 years. even if they do - they would be looking to play the swings and not be invested long term (which most on here are ultimately looking for).
finally - Ma has consistently failed to address the very simple question on why insiders are NOT buying. either they are restricted or they arent. there are no restrictions within SEC guidelines on directly answering that question. WHY ARE THEY NOT BUYING ON THE OPEN MARKET?!?
1. Syrbnik brothers could both pass leaving 40% of the outstanding shares up for liquidation as relatives monetize and move on (who knows if any of the heirs have any passion or even knowledge of what EECP is...?)
2. GEHC terminates contract. while Ma was adamant that they got the highest level of reimbursement from GEHC - he did NOT answer the question about 2011 results compared to 2013. why the big rebate/quarter in 4Q11 that gave VASO a $3.7MM net income year and top results in 2013 still gave them a net loss.
3. Larger player makes a Biox clone and/or uses a semi comparable unit and crushes them with superior pricing and distribution.
4. Shorts/hedge funds see a very weak CEO and vulnerable stock and short/manipulate the hell out of it knowing there is a growing suspect shareholder base and have deep enough pockets to shake the trees.
these are all very viable and potential issues that a long term shareholder has to be aware of and concerned about. Ma has NOT protected or enhanced shareholder value in the last 3 years. he is dangerously close to being negative with one or two more days like this when one looks at the dilution stemming from M&A and insider compensation (that have not returned revenues/income).
he is in his third major sales reorg in almost as many years. per the CC - he couldnt even communicate what or why they were reorganizing the Euro salesforce. he kept talking about unfavorable exchange rates and it being very hard.
while i do not question his passion or even necessarily his competence, he clearly is NOT able to communicate his vision and instill confidence in Wall Street that it will come to fruition. protecting and enhancing shareholder value is the paramount concern of any CEO of a publicly traded company and the respective BOD. if that is not being done, or if there is no confidence that the CEO will be able to do it in the future - they should be removed.
most investors here realize Ma is extremely conservative in his comments and guidance. while there is no issue with under promising and over delivering - he is not over delivering. EECP is THE only real driver for this stock long term. Biox, MobiCare, GEHC are perishable. GEHC is nothing but a distribution agreement. Biox and MobiCare could provide solid revenues and assist in profitability - they are still commodity driven products in a market with few barriers to entry. nothing or little proprietary here. risk capital does not wait for the "long term" if there is no end in sight. Ma has been here 6-7 years now.
as bocamp and others have pointed out - Biox to date has been a failure. it was supposed to be accretive upon purchase. there is certainly no indication it has been. Rios hire/deal has for all intents and purpose been a dud - both of these have caused substantial dilution to the stock price. since Ma's tenure - the outstanding shares have gone up 40-45% (if i am remembering correctly), his compensation has tripled to quadrupled since he started, and the long term shareholders are realistically only up 2-3 times after dilution is factored in. while that may seem stellar - it is still not even bringing value back to post PEECH.
he single handedly dropped the stock price on that CC. it wasnt just the missed/over expectations on a profitable year or the lack of EECP sales increasing or having a breakout quarter. he thwarted ALL enthusiasm for EECP in the short and medium term (6 months to 2 years) and thus risk capital quickly exited to more attractive plays. while that might not matter if you have a "3-5 year horizon" - one can not put this company on the same level as an XOM when comparing CEOs and giving them time to execute a plan. while you are patiently waiting - the following can happen and destroy all the value almost instantly for long termers:
PJ - how do you define "long term"...? i am invested in this company due to EECP therapy and the major advances i have seen over the last 10 years and the specific, increased interest in the last two years. further, there is a direct line of sight between widespread adoption of the therapy and high profitability for the company. this profitability is tied to a win-win for consumers (patients), the medical community (absent maybe of cardiac surgeons losing profitable surgeries but i am sure they will continue to have plenty of patients to keep them busy), and potentially most importantly - the tax payers. it has been proven viable, is dramatically cost competitive, and all questions/pushback from the original CMS repsonse post PEECH have been resoundly answered. further, the Europeans have already embraced the therapy.
so - why are sales not increasing with respect to exponentially increasing interest in Europe, India, and even here in the US (did you listen to/participate in the EECP webinar several months back?) why did Ma give a robust, very positive outlook on EECP, sales, CMS response, etc in the CC of 3Q13 and then do a complete 180 in the 4Q13 CC and basically pushed off anything positive with EECP for another several years? EVERY investor here knows CMS acceptance/coverage is the brass ring in the US. EVERY investor here knows VASO has only so much stroke with getting that coverage changed. HOWEVER, what about Europe? India? they have embraced the technology TODAY and those markets should be embraced and blanketed TODAY! there is ZERO reason why Ma should not have been able to speak about real potential and pipeline targets in India and Europe based on the PRs and his exuberance 3Q13. europe was announced back in August. India was beginning of this year. are the sales people sitting in their office waiting for the phone to ring...?