ANSWERS TO YOUR EMAILS
Questions / answers are complied from the questions submitted to BRAVADA International on our "Contact Us" page. Question / answers are not posted if it is very similar to another one already answered or asks for information that has not been disclosed.
Has BRAVADA sent the information that OTC Markets needs in order to attain Current Status? It appeared the Nov 16th filings were all in order but perhaps this is not the case as OTC has not granted Current status yet. It would be much appreciated if I could have some understanding of what is needed in order for OTC Markets to move forward on this issue or a time frame of when you think this will be done.
Unfortunately, it took the OTC Markets 8 business days to review the Company's filings. On the afternoon of November 25, 2020, the Company was informed that it had to correct one date in the Q1, Q2 and Q3 filings in addition to an update in the Attorney Letter. This was completed and filed as requested by the OTC Markets. BRAVADA does not have any control over the time it takes OTC Markets to review and approve the filings. We can only make the changes as per their request and make the assumption that the filings are complete as required by the OTC Markets, however, there is no certainty until the filing(s) are approved and the Company is on the 'Current Filer' tier.
Are there any updates on the release of the 2019 financials and removing the stop sign on OTCMarkets?
BRAVADA has provided information on this matter on 3 press releases:
- April 9, 2020 the company disclosed:
"The Company expects to become a current filer sometime in 2020. Additional information shall be provided to shareholders via a conference call or press releases in the near future."
- August 20, 2020, the company increased its full year 2020 revenue guidance and reiterated:
"The Company previously announced that it is working to return the company to current filer status sometime during fiscal year 2020. Additional information shall be provided to shareholders via a conference call or press releases in the near future."
- September 2, 2020 the company disclosed;
Bravada.com was launched, a website specifically designed for shareholders and provides an enormous amount of corporate information and disclosure to shareholders.
Is the company planning a share buy back program? Since the stock seems to be very undervalued, trading at 60% of 2020 revenue. Are you planning to have a CC this year?
A couple things with regards to any share repurchase. A company must be a current filer to be able to make open market purchases of its stock. This is because all shareholders must be in possession of all material facts that the Board of Directors / insiders have so that shareholders may make the same determination as to the over or under evaluation of the company's shares. If the company is in possession of any potentially material facts that have not been disclosed to the public, the company must then disclose the material information or, if the disclosure cannot be made at that time, engage in any approved open market share repurchases at a time when the material information is disclosed. All market participants must make the same informed decision as to whether they would like to buy or sell the company's stock. If any share repurchase is going to occur, the company must make an announcement with regards to it and that it has authorized "X" amount for a particular time frame (1 year or a specific quarter).
The next issue is determining the ROI on any share repurchase relative to ROI of reinvestment into the company's expansion investments in such things as WorldofPets.com. Launching a website such as WorldofPets.com can be capital intensive with regards to seeding initial inventory. A determination must be made with regards to ROI on invested capital, whether it is better in a share repurchase or a new website launch. If there is not enough capital for seed inventory then the company must halt its expansion if funds are going to be funneled to a share repurchase. I cannot provide any insight into what our internal evaluations / expectations are or could be with regards to any of these matters but once we are a current filer then we can determine these things internally. One could conclude that the share price may be materially different from where it is now once everything is disclosed .... or it may not be, we shall see.
As for the CC, I have made mention of this possibility a couple of times in press releases. I leave the possibility of this open once we have all information disclosed. This new question / answer mechanism on the new Bravada.com has been working quite well as people seem quite eager to ask questions to dispel potential inaccuracies or gain clarification.
Why did BRAVADA not have an attorney letter with their previous financial releases?
An attorney letter is only required once a year, submitted after the annual return is filed OR for the most recent quarterly disclosure statement to return to current filer status. In BRAV's case it is the later. The attorney letter will be filed for our most recent quarterly release to return the company to current filer status.
Did BRAVADA issue any stock during the time it was not filing?
A Pink Sheet company cannot issue stock or release from restriction any stock during the time it is not a current filer. Hence, investors can be assured that the last disclosure statement filed in 2016 is accurate regarding the corporate share structure. An OTC Pink company must be a current filer to affect corporate stock changes or additions.
When will BRAVADA become a current filer again?
BRAVADA has stated in public press releases that it expects to be a current filer sometime in 2020.
Why did BRAVADA Stop Reporting its Financials from 2016 - 2019?
There were a number of circumstances that came together and culminated in BRAVADA taking a hiatus from reporting:
- Late in 2015, BRAVADA's Accountant and Bookkeeper, Alice Cherng, had asked CEO Danny Alex about moving the company's books from QuickBooks to Xero. Mr. Alex gave an unequivocal 'no' to Ms Cherng. He wanted the books to be kept in QuickBooks to ensure ongoing continuity.
- In 2016, Ms. Cherng had moved the company's books to Xero despite Mr. Alex denying the request. This placed the books in a distressed situation.
- The first draft of the financials were egregiously incorrect and Mr. Alex knew that Ms Cherng had used Xero to compile the quarter.
- Ms. Cherng gave Mr. Alex several additional versions of the Q2 financials that continued to be egregiously incorrect.
- The company terminated Miss Cherng on May 26, 2016. (Please Review the Alice Cherng Termination Report for details)
- The Company hired Michelle Ang in July of 2016 as Office Manager / Bookkeeper. Ms. Ang, had a familiarity with the company's books and suggested we finish off the quarter and year in Xero since time was now a major issue if the company was going to file on time and complete the 2016 financials.
- Ms. Ang then had a baby in November 2016 and did not return to complete the Company's books despite confirming with the company that she would resume her duties.
- The books were now half in Xero and half in Quick books and a highly qualified person would be needed to clean up what had transpired with QuickBooks and Xero.
- Early in 2017, BRAVADA embarked on its planned business re-orientation which included moving its entire business to the LA Fashion District and implementing a new business model and approach.
- Revenue was in decline in a business environment where hundreds of retailers were filing for bankruptcy, a period CEO Danny Alex calls the Great Retail Dying.
- The costs associated with moving the company's operations, re-orientating, and other expenses of maintaining its listing with OTC Markets resulted in burdensome cost structure that may have compromised the ability of the company to complete its plans.
- The costs of being public were very onerous and it was something that had to be cut so that BRAVADA could move forward into a growth position.
- The company's financials were now divided between Xero and QuickBooks and were 2 quarters behind.
- BRAVADA was looking for and interviewing qualified candidates for bookkeeper and hired Sandra Baughman who seemed overtly qualified.
- CEO Danny Alex had a timeline for Ms. Baughman to complete the financial quarters for the company.
- The deadlines passed without completion and Ms. Baughman was terminated early in 2018 when she did not produce the financials on time as instructed by Mr. Alex.
- BRAVADA then went on a very exhaustive review process for a bookkeeper to correct, resume and bring up to date the company's financials.
- The company hired Peter Talay, a highly qualified bookkeeper with nearly 4 decades of experience with years of experience in the fashion industry with companies such as American Apparel and a number of other mid sized operations in the fashion district. His exactness and competence has allowed the company to repair its books to a very high degree of accuracy.
- BRAVADA is confident that Mr. Talay has brought uncompromised accuracy to the reporting of its financials
- The company also hired Sohail Jerry Javaheri, CPA, MST of California Accountants Group, LLP as its Accountant in November 2017.
- The company's full year 2019 financials as well as Q1 and Q2 2020 will be released in short order.
- The company has stated that it expects to be a "Current Filer" sometime in 2020.
Why did BRAVADA give a projection for 2019 revenues in April and then increase it in August?
In April 2020, the company had provided a range of revenue for full year 2019 that was management prepared and not a final draft. It still had to be reviewed by the company's accountant and taxes filed. The Covid-19 pandemic had forced closure of many offices and our accountants were also affected for sometime even though they were working in a limited capacity from home. The IRS extended tax filings until July 15 during this time. Our accountants had completed our taxes and made some adjusting entries. When we had received our final draft for our 2019 financials, we provided a revised range to investors.
Why didn't BRAVADA give an exact revenue number instead of a revised projection for 2019 revenues in August?
The reason for the August news release was that we were increasing our full year 2020 revenue to a significantly higher range and this is a material change in the business. That was the reason for the PR. However, we also knew our 2019 revenues were slightly higher than previously disclosed so we decided to add that information into the press release as well. We only provide exact numbers on the actual releases of our full financial statements. Until they are disclosed, they will always be a range.
If the full year 2019 financials are finished, why are you not releasing them?
Fiscal year 2019 is our latest full year financial release so it requires the full disclosure statement that includes the 2019 financials. Once the 2019 financials are completed the full breadth of information must be compiled, verified and supplemental management discussion completed. Financials are only a part of the full year disclosure statement and it all takes time.