Capstone Companies Inc (QB) (CAPC) News

Employees: 2 as of 09/30/2024

Wallach and Wolf? Or, Wallach and Perez?

Getting close to Shell status. Just need to discharge about $4 M in Liabilities

HENCE SUB-PENNY

Another Q filed, another 3 months gone.

The mirrors were liquidated for which the company netted about 80K. Remember that they raised over $3 million, ostensibly to produce 3000+ mirrors. I figure they might have made 1500ish mirrors. They sold/gave away maybe 100-150ish. The rest of them have apparently gone to Woot for a net 80K.

Debacle. The last hope is the Connected Chef. Supposed to be coming soon in June 2022, then June 2023, then Holiday season 2023. They have no purchase commitments as of August 2024. They've manufactured no inventory (no money).

Debacle. They have no other product to sell, and no money to create new products.

All debt extended to October 2024 and November 1, 2024. Kicking the can down the road. They have no way to pay this debt.

They dumped a bunch of the wardrobe mirrors on Woot this month.

https://tools.woot.com/offers/capstone-touch-screen-smart-mirror-22-5in-x-60-in

$189. At least one buyer wasn't too happy with the 'deal':

https://forums.woot.com/t/capstone-touch-screen-smart-mirror-22-5in-x-60-in/1720850/24

cole7007
5d
We just received our mirror and I gave it to my daughter as a birthday present. Upon opening the box everything appeared to be in good shape. The problems occurred once we tried to install ANY apps. The OS is very buggy and kept ‘thinking’ the mirror was disconnected from the internet. When this happens the mirror can basically only be used to replicate the iphone’s screen.

After several hours of going through resets, moving the mirror to a location where the wifi was ‘excellent’ we were finally able to get the mirror to download google, youtube, spotify, and a few other apps. Success!..not so fast. Even though the apps downloaded they would error out on install. The only app we were able to get to work was Spotify. All the Google apps either failed to install or failed to load. We received an error stating we needed to install Google Play Services, which we downloaded and installed, but the app kept crashing, rendering the mirror’s screen useless because ‘app crashed’ windows kept popping up.

In summary, this is a great idea but the execution is not acceptable for using the tablet…at all. The sheet that provides the instructions (QR code) takes you to a non-existent site and the phone number takes you to a medical device company, making me believe that there likely will be NO online support and no one to talk with if you have issues. Even at $200 for a supposed $1000 smart mirror, it isn’t worth the hassle in my opinion (unless you’re just purchasing it for the phone screen-mirroring).

I don't think capstoneconnected.com is coming back...



They probably should delete links to it from their corporate web page, capstonecompaniesinc.com. And delete the link from their twitter page too.

connected-chef.com still works, but there have been zero updates for a whole year. If they have no ability or intent to produce the product, they should take that website offline too.

capstoneconnected.com replaced with generic Coming Soon page

On February 5, 2023, the Company entered into a new Employment Agreement with Stewart Wallach, whereby Mr. Wallach will be paid $301,521 per annum. The initial term of this new agreement began February 5, 2023 and ends February 5, 2025. The parties may extend the employment period of this agreement by mutual consent with approval of the Company’s Board of Directors, but the extension may not exceed two years in length.

Nice pay structure for a -0- company

A frustrated investor. here.

10Q on 5/15 is next.

That's more money out of Wallach's Wallet to get filed. At some point, he has to give up being the bank.

Capstone has debts they can not pay. Capstone has no product to sell, and no capital to create new products.

Capstone has 2 employees, Wallach and Wolf. Both in their 70s.

What's next?

https://www.otcmarkets.com/otcapi/company/financial-report/400233/content

They've filed a OTCQB Certification!

https://www.otcmarkets.com/stock/CAPC/disclosure

Haven't filed their OTCQB Certification yet. It's due within 45 days of the 10K due date. The form probably takes 15 minutes to fill out, after you've filed the 10K. They typically file it in April.

While we wait for Capstone to say something, anything, we can watch for the OTCQB Certification. If their plan is for Chapter 11 or 7, the Certification is moot - it kicks them off OTCQB.

Or Mikey bought them for his kids.

Quite possibly they've sold the mirrors to a liquidator.

https://dealstream.com/financial/public-shells

Several hundreds of thousands, maybe, for a good, clean shell?

question>If are are preformed what is the value of a symbol?

Before they can 'sell' the ticker, they have to shell-ify Capstone

They're close on the Assets side: they wrote off the remaining value of the smart mirrors. They'll have to book a one time gain when they sell the inventory to a liquidator; watch eBay if you want a mirror.

The $43K they spent on molds for the smart cutting board will have to be written off; they still carry that on the books as of 12/31/2023.

The remaining asset would be the Goodwill, an intangible.

On the liabilities side, they have over $3 million as of 12/31/2023. They'll need to use bankruptcy to settle this debt.

Is the value now just the symbol/ticker itself?

It cost major $$$'s to get a listing?

The Beat Goes On



The Company does not have an alternative product line to the Connected Surfaces Connected Chef product line and would be unable to develop an alternative in 2024 due to a lack of adequate working capital. The financial condition of the Company has caused the Company to seek to effect an extraordinary corporate transaction to protect shareholder value and sustain the Company as an operating company. This effort is being pursued in conjunction with efforts to secure pre-production orders for the Connected Chef. An extraordinary corporate transaction could include a merger or sale of the Company or reorganization of the Company under bankruptcy protection or otherwise or could result in the liquidation of the current business and efforts to fund a new business line in 2024 if adequate, affordable funding is available. The Company may be unable to effect, if necessary, an extraordinary corporate transaction or obtain significant funding for a new product line in 2024 to sustain the Company as an operating company. Reorganization under the protection of the bankruptcy code is one possible extraordinary corporate transaction if the Connected Chef product lines does not become a viable revenue source and other extraordinary corporate transactions are not possible. While the Company is continuing efforts to establish the Connected Chef product line as a viable revenue source, the Company is exploring possible alternative new business lines, which alternative business lines could be internally developed with sufficient funding or acquired in a merger or asset acquisition. If the Company receives a pre-production bulk order for the Connected Chef, the Company would have to raise working capital to fund production and the Company may be unable to raise that funding on affordable terms or at all.

https://www.sec.gov/ix?doc=/Archives/edgar/data/814926/000190359624000189/capc_10k.htm

As of the date of the filing of this Form 10-K report, the Company does not have a current product that is being actively produced or is in production. The Company’s former product line, LED consumer lighting products, matured in 2022 and is no longer in production. The Company’s efforts to develop Connected Surface consumer products, specifically a Smart Mirror for residential use, as a new product line did not succeed in attracting sufficient revenues to be a sustainable product line. The inability of the Smart Mirrors to become a viable revenue source was due, in part, to delays in production and launch due to COVID 19 pandemic, changes in consumer preferences in the smart mirror market in the U.S., unwillingness of brick-and-mortar retailers that purchased the LED products in bulk to purchase the Smart Mirrors, and established competition in the smart mirror market from companies with greater brand recognition and marketing resources than the Company. The e-commerce initiatives of the Company did not spur significant sales of the Smart Mirror products and all inventory was written off as expensed as of December 31, 2023.

The Connected Chef was ready for formal introduction in quarter four of 2023, and Management is actively marketing the Connected Chef tablet to appliance manufacturers and distributors, but the product has no purchase commitments from retailers as of the date of this Form 10-K report. Further, the Company will have to raise funding to fund production costs, which funding may not be available to the Company.

Capstone Florida SOS moves...



Bye, Capstone Lighting Technologies, we barely knew ye. The lighting products brought in $37 million in 2017, before Capstone turned their attention to the smart home products.

Don't fret too much, they filed annual reports for Capstone Companies (the one that represents CAPC stock) and Capstone Industries (the company that CHDT/CHDO acquired that brought Stewart to CAPC).

There are only 2 guys (Stewart and George) left, so they really didn't need 3 corporations. Is Jonathan Caparco still with the company? What would he still be doing? There haven't been *any* company announcements since last June. Is CAPC really paying the guy to do nothing?

3 weeks until the 10K.

1 through 5 not pretty.
The count down has begun?

Two months later, and nothing has changed.

The Transfer Agent still hasn't been informed about the share structure change, voted on last May, and filed with the SOS at Sunbiz.com in June. Why? I think because it longer serves the purpose of generating new capital, and satisfying old debt.

I believe they intended to satisfy the ~$3 million in debt with preferred shares at a dollar per share (liquidation preference of a dollar a share, plus conversion to common at 66.66 common shares per share). The collapse of the share price under a penny makes the deal less appealing to debt holders. The limited wash trading we saw in January really hasn't changed things. I think we're headed back under a penny without real positive news.

So what now? I see 5 possibilities:

1) Status Quo. Wallach continues to pay the minimal accounts payable as they come due, increasing his debt holding, while external debt holders (Khoury and Fleisig) hold off on demanding payment. I figure this could go on through the end of March, when they file the 2023 10K.
2) Reverse split. Maybe another 10 or 15 to one. That gets the share price up temporarily, making the convertible preferred more attractive (assuming the 66.66 to 1 conversion rate still holds after the Reverse split).
3) Chapter 11 reorganization with a DIP lender (probably Wallach) getting the bulk of the new equity.
4) Chapter 7 liquidation. Not really likely, as no one gets paid (really quite scant tangible assets left to liquidate - debt holders will not get full repayment, and common shares wiped out).
5) Sold to another company? I doubt this. There's nothing really to buy, but a warehouse full of mirrors no one wants, and some plastic molds for the cutting board that will never be built (my opinion, but backed by consumer action).

So, what's it going to be? Maybe we'll know in another 2 months.

Looks like the web site error has been fixed.

Carry on!

capstoneconnected.com

Fatal Error
I wonder who is maintaining the CAPC websites these days. Seems to be a ?temporary? glitch on capstoneconnected.com

Gonna be hard to move those mirrors if people can't get to the website.

https://capstoneconnected.com/

What's the Hold-up on changing the share structure.

In May, CAPC voted to increase the A/S to 300M shares. It was filed with Florida SOS as a Corporate Amendment in June. It's now December, and CAPC still hasn't told its Transfer Agent about the change.



They can't move forward without recapitalization. They can't do that until they tell the Transfer Agent about the change. No one will lend them money. At some point Wallach is going to be tapped out on funds. At some point, Fleisig and Khoury are going to want their loans repaid. CAPC can't keep pushing out due dates indefinitely.

Of course, CAPC doesn't really have to file anything until end of March 2024, so, buckle in for a long cold CAPC winter.

End Of Year Sale! Everything Must Go!! Act Before Midnight!!!



Could raise some cash, but this is a liquidation of an asset at below (already written down) costs.

Company Performance updated for 3Q2023

The Connected Chef is not yet in production and has not produced any pre-production sales orders or revenues as of the third quarter of 2023. The launch of the Connected Chef is slated to take place in the first quarter of 2024, subject to available working capital to pay for product production, inventory and marketing.

Well, so much for Holiday Sales of the cutting board. I don't think it will ever be sold to the public.

Yes. It looks like death of the a company.
You have been the very few sceptics who tried to warn investors. Well done.
Where's Mikey?...He likes it. Was that a commercial?

Updated Profile on OTCMarkets

Now they just have to file 3Q10Q, and find a product that someone wants to buy.

Smart cutting board isn't cutting it. Mirrors dead and gone. Deep in debt. My guess is they've pushed out repayment yet again.

We'll find out for sure on 11/14.

OTCQB companies need to verify their Company Profile every 6 months

as a part of being on the OTCQB. CAPC last updated their profile in April. An update was due in October. Capstone hasn't done that, and OTCQB has removed the Verified Company Profile badge for CAPC.

Is Capstone just being lazy, or have they decided being on the OTCQB isn't worth the $15K annual fee?

Lazy, or out of cash, and no new funders can be found?

Oh, god, so you're trying that again?

How many Preferred B-1 shares are going to debt repayment? Each one represents 66.66 common shares that can be sold into the market.

3 Million debt to cover == 200 million common shares that eventually will be sold into retail. I don't think Wallach or Postal would be quick to convert, but you can be darn sure Fleisig and Khoury will want to monetize their debt repayment.

So, what are they owed? Fleisig is owed $340K plus 5% interest over two years. Debt comes due in April 2024. He's also owed $200K plus 5% interest over 18 months due November 1, 2023. Khoury is owed $200K plus 5% interest over 18 months due November 1, 2023. It adds up to about $800K. 800,000 Preferred B-1 shares convert into 53.4M common shares. Yeah, over a doubling of the O/S.

Would Fleisig and Khoury actually want Preferred Shares that convert at 66.66 common shares per dollar (1.5 cents per share)? Only if the price remains above 1.5 cents during the conversion and dumping.

Enter the stock promoters. They have another job to do.

Meanwhile, how does any of this raise the millions they need Today to build stupid smart cutting boards for retail sale by 3rd quarter (already 3 weeks past)?

I'll say again, the cutting board tablet idea is dumber than the smart mirror idea, and will sell about as well to consumers. Which is to say, hardly at all.

It’s nice knowing company directors are putting up their own money and never sold a single share

Thanks Mike - !!!

The Connected Chef is expected to be ready for formal introduction in quarter three of 2023, but the product has no purchase commitments from retailers as of second fiscal quarter of 2023. Further, the Company will have to raise funding to fund production costs, which funding may not be available to the Company.

https://www.sec.gov/ix?doc=/Archives/edgar/data/814926/000190359623000620/capc_10q.htm

How about this time around, we ignore the stock promoters, and focus on what the company has said and what the company has filed?

We're 3 weeks into the 4th quarter. No new financing has been announced (a material event for a company facing Insolvency). Further, the company owed Wallach $503.5K due Sept. 27, 2023, and $430K to Fleisig and Khoury due Nov. 1, 2023. Instead of having money to build the cutting board, they're deep in debt currently due.

Add to the top of this, the cutting board tablet is a dumber idea than the smart mirror was.

I think the cutting board will be a big hit. The mirror was overpriced, the cutting board is much more affordable and could be in many homes very soon !

Any Particular Reason Mike - ???

The Story so Far ...



In 3 weeks, they'll provide 3Q2023 results, and that can be added to the graph. I figure they're about -$3 million net tangible assets by now.

Wallach himself was due repayment of $500K as of last month. E. Fleisig and M. Khoury are due $400K plus interest as of 11/01/2023.

That money does not exist for repayment. So, who is going to pony up new cash? They need $4 million or so minimum to keep the CAPC story going.

Wallach is old and ready for retirement. Will he risk his retirement on this new Smart Cutting Board, after the complete failure of the Smart Mirror?

I wouldn't.

Have a great feeling here … $CAPC

In longs as casual me right direction hopefully they care more about there bumpiness business well high dollar values as well shareholders holding?

https://www.connected-chef.com/pre-register

Go get in line! Only $279! Act Before Midnight, so you don't forget!

Available for Holiday Season... doesn't specify which holiday, though.

OS + 816,167

As mentioned, the Transfer Agent has a different idea as to the OS for CAPC.

Well lets hope the dint do anything stupids? some EPs will comes in avoiding diction share holders interests outlining neutralization?

Wait for the Transfer Agent update.

CAPC bought back those shares in years past, but never canceled them. Transfer Agent still sees them as Outstanding.

Odd thing is the Transfer Agent hasn't updated OTCmarkets for September yet.

Other odd thing is company has been silent about their New Smart Cutting board, which was going to be on sale in Retail by August. Report of 8/14 says they haven't built any yet, as of 6/30/2023. Gonna be hard to sell what they haven't manufactured yet.

Other Other odd thing is company hasn't said a word about their brick and mortar sales test for the Smart Mirrors. Anyone catch sight of one in their favorite big box store?

What exactly has the company been selling since the dour 6/30/2023 filing? My guess is very little. Waiting on cash infusion.

OS - 816.167

🚨 CAPC

💰 0,0195
📈Outstanding Shares Updated:
🔴Old: 49.643.031 (2022-04-04)
🟢New: 48.826.864 (2023-09-12)
Difference: -1.6441% (-816.167)

AS: 56.666.667

What a joke

If you want one of those mirrors, better act fast.

They're gone from Amazon. Capstoneconnected.com won't allow you to add one to the cart.

Beachcamera.com still seems to allow you to buy one. Your mileage may vary.

Also, that Connected Chef cutting board/tablet was supposed to be for sale by August - Don't see where you can buy one.

Monday's 2Q2023 filing should be interesting.

Amendment to Increase A/S now on Sunbiz.

300,000,000 shares of which 295,000,000 are common and 5,000,000 are preferred. Now we wait to see how they dole those out to cover debt and raise new working capital.

Sunbiz amendment to Increase A/S filed on 6/22/2023



Sunbiz has updated their database for amendments through 6/21/2023 as of today, so it should appear tomorrow, my guess. No real new information, but now Capstone can follow through on re-capitalization. We'll get a better idea on dilution when they finally re-capitalize.

https://www.davincivirtual.com/loc/us/florida/deerfield-beach-virtual-offices/facility-1390

Virtual Office? That's good, right? From 4690 sq. ft. to a Mail box drop?

Given that there are only 3 employees and a couple of hourly contractors left in the company, this is a prudent corporate move.

Remember to thank a penny stock promoter for this one.