It seems to me that Labrat can solve all issues with one simple business change.

Define all hardware as hardware belonging to investors. And LRM's function is only to act as a hosting service.
Investors are actually customers. And LR can charge a 5% hosting & service fee.

Customers (formerly known as LRM investors) receive 85-90% of all minded coins and can then make the decision to send LR more of those bitcoins to purchase & install more hardware.

Simple.

After all, if I recall correctly, Labrat used the term "group purchase" to describe this business better than anything else.

If Vince was right about the hardware, why hasn't LR said anything about it arriving yet? Why would it be a secret? Unless LR was thinking there is a chance it might not be legally necessary to report it to investors... of course, this presumes Vince was correct.

There was a comment made by LR early in all this where he compared it to a group purchase more than a bond or share. Sad thing it that we are even discussing this now - many disillusioned investors - but the ambiguity might end up working in favor of investors if it comes down to a legal case.

I was thinking earlier today that there is probably a case to legally force disclosure of certain values. LR even claimed he wanted to be transparent before, but his fee's & purchases are still invisible. This is why it would be a good idea for him to eliminate his fee's from the 25% and instead create new bonds for himself so that he is bound to dividends as compensation along with the other investors. His lawyer, as he said, already made the point that he should not mix in his hardware with company hardware for reasons of conflict of interest. Seems to me that keeping his fee hidden (mixed in with hardware purchases & operational costs) would be in the same category as a conflict of interest.

If he isn't careful to do right to investors that funded the company, someone could use the legal system and turn it into a train wreck. LRM might then cease to exist and LR could end up broke. Hopefully, he does what's right. A good start would be to disclose receipt of new hardware. And to proportionately multiply bonds or increase hashrate per bond/contract as has been the case.

Yeah. But LR needs to very soon take that 3:1 to something closer to 23+:1 with the new hardware coming online.

Found a way for what?

Where do u see that?

Bittymitty,

For what it's worth. I already noted that point in mind several days ago, but I didn't bring it up yet because I found the same comment posted by Endlessa. When you combine that with all that LR has said publicly, he is obligated to grow the hashrate/bond in proportion with the hardware. The comment Endlessa linked may seem to have a little bit of ambiguity and thus leave a little legal wiggle room, but that doesn't appear to be the case since LR (LRM's official spokesperson) has repeatedly communicated that the bonds hashrates will continually grow with hardware. So, that clears out any ambiguity in the linked comment. Basically, LR must grow bond hashrates proportionately with hardware increases. And I don't think he intends to change that. However, he might try to change the ratio for re-investment. But that will likely increase the threat of legal action of some form. Personally, I think he can leave re-investment at 25%, BUT he needs to eliminate his fee's from the 25% and instead create maybe 4000-5000 new bonds that can compensate him. He would then be rewarded for performance, and not by a mystery fee. Also, he can offer new bonds that people may be more willing to purchase. As it stands, the reputation is tarnished enough that he won't be able to sell new bonds again until protecting investors is priority #1...and terms translate into a solid long term investment. As LR has stated many times, it's a marathon. One can reasonably interpret a marathon investment to mean one that isn't a short or medium term decaying investment.

It would be nice if Dave shipped that hardware soon.

LOL!

Today I was grilling vegetables and a big chicken sausage. To speed up the cooking, I split the sausage down the middle and flattened it out..and thought about how closely it might resemble a rat being grilled. And fantasized about a rat pelt....but didn't see much use for one... anyway *head shake*gotta snap out of those ideas... indeed, pitchfork is on hold...but within reach.

If LR's intention is to grow investments, which I think he communicated... then how could it not grow proportionately? The only way I see that would happen is if he started taking minded coins and keeping them for himself instead of re-investing. But that would be highly disingenuous and would fuel a firestorm. At worse, I think he restructures the re-investment ratio.

The one way LRM could be successful with the 25/75 ratio is to operate far more transparently and responsibly to investors. And allow people to continue to buy more bonds with their dividends. That way,the success of the company is driven by satisfied investors, and not by feeding a mindless company. I mean really, what's the point of a company growing if nobody is helped by it's growth? That would be like building a giant sand castle ONLY for the sake of building a giant sand castle - why? to look at and feed only one or two people's pride at the big sand castle? How worthless that would be. But...if it was operated responsibly, and people could choose to re-invest, then - if it grew - it would grow because it helped people that want to re-invest in it. So far, LRM is on the polar opposite end of a company a person would want to re-invest in. And this is largely due to the uncertainty in management. This is one reason I think EVERY decision made should by made while respecting this priority list:

1. investors
2. employees
3. company

I think he will distribute the coins mined by all future new hardware to original bond holders. And I think he left that impression earlier if not mistaken.

Besides, if he were to let investments decay, that would be corporate suicide b/c a lawsuit would be imminent. Why? Because there would be no point in watching investments go to being worthless, when liquidating could return to investors about BTC0.04+ per bond.

Notwithstanding his apparent confidence that LRM would win a lawsuit,  I think LRM would easily lose. And eventually, if threatened with a lawsuit, that would become apparent to LR when the lawyers report back to him that he should settle out of court. So, I think, not paying proportionately on all future hardware would be a bad decision.

maqifrnswa

Great post. I hope it doesn't get overlooked. It's nice seeing people think about solutions. Even though the problems aren't well defined to many of us. But it seems you have some familiarity with what is going on in terms of legality issues - which has an effect of relief because it seems to mean you'd might concur with (or be understanding of) LR's dilemma. Correct me if I'm wrong on that.

301MH fixed?  

Ok, just kidding, don't get any ideas.

By the way, here's a solution to some of the tension. A problem that has been a problem since the beginning. Your fee structure should not be built into the 25%. It causes concern as there is no transparency. And one of your stated goals/intentions in the was to be transparent.

Instead! A fine solution if I must say so myself.

You should eliminate any Labrat fee terminology... and in place of it create 5000 new bonds for yourself, and call the dividends from that as your fee for management.
That way 100% of the 25% goes to electricity and new hardware, and less speculation on what is going on behind the curtain. Your pay would be very fair and dependent upon performance of LRM - along with everyone else. You claimed you wanted to operate more openly/transparent. This is a very fine opportunity to do that and win support in the midst of any legal wrangling. You'd receive about 8% of all dividends - isn't that plenty fair if not very generous? I'm willing to bet this idea receives a lot of welcome b/c it shouldn't affect your pay and it peels back the curtain a bit.

By the way, the video above of Dave's PH farm was scary. LR, are you ready to handle that kind of facility?

No worries.. I was just poking at you for poking at me about reading. I actually had read most of your posts (scanned where it seemed unimportant). But I guess re-reading them helped sort it a bit more - if not for the mere cathartic effect. I will summarize for myself and others to track with me. The blue is my original blue question. The quotes are your responses you gave to other people about either their question or some other topic, but that hit in the vicinity of answering my question - even if wasn't directly answering my question. And these are all of your comments that I gleaned over the past ten pages that seem significantly enough related to my questions. There is a reason I didn't think you answered my questions, and it was because these are only partial answers. So, I'll expound in purple.

1. What is up with the 150TH order?

In one comment you wrote:
"No new hardware is in yet."
I had figured it wasn't in. But wasn't sure. So, that answers that part. But the question is a little deeper. Was the order actually ever placed, and if you were getting any updates.
I was speculating that since Coinseed's orders were so large that it would interfere with LRM orders. Ifso, that would stink.


2. What is the current status of the hardware resources you've been working on? Were any bridges closed or burned?

I found three relevant comments you made to others:
i. "There are certain important connections that are still in place, but there are things changing in the BTC hardware manufacturing community that are not my place to comment on."
Can you at least comment on if buying at prices comparable to what were expected before are at the least still achievable?

ii. "It has been done as an immediate fix, but the business world does not operate on same day basis unfortunately.  I can beg and plead for information today and I'll get answers by the end of the week if I'm lucky."
The second half seemed to be a comment about begging for hardware shipment updates. Is that correct?

iii. "No I can't as they are not my companies and releasing information that is not mine to release would destroy relationships built with manufacturers."
Ok, secret squirrel stuff.

3. Are you committed to LRM being an actual success?

No answer found.
This may have been answered in some effect, but I don't think it is entirely clear. Let me just ask: Do you have a confident (not necessarily certain) outlook for LRM and current investors for the long run?

4. Are you committed to keeping the spirit of the agreement you communicated and sold to everyone?
That spirit means you intend to continue to send out dividends in proportion to the growth of the whole company hash-rate, and maintain the same continual re-investment plan.

You commented in one place to another comment:
"I'm working on doing so and all I have done is provide an immediate fix that does fit into the original contract promises, with the intent to find a way to benefit early contract purchasers as more hardware comes in."
Is it correct for me to interpret this to mean that you do have the intention to do what you can to grow investors dividends with the company in at least the general spirit of the original agreement? In other words, you intend to diligently seek ways to grow investors investments (sounds obvious, but needs to be asked in light of how things have been perceived).

...

Thanks. I have been tracking. It was actually a total of four questions in blue lettering (or did you not read that?). But I'll go back and re-read your comments to double check.

I know you were responding to someone else. And on what you wrote here, I agree with what you are driving at. Labrat can only do what he can only do within the law.

However, he could at least answer some hardware questions or express his intentions better. Especially, if his intentions are seeking to honor the spirit of the original agreement. It doesn't have to be expressed in the sense that "this is how the end solution will be", but it can be "this is the KIND of end solution I want to find. And I will fight to find if such a solution is possible". .... That is not an end solution, but it is a commitment to fight or work for a kind of end solution (if it's possible). This would resonate well with people, especially if it's seeking to honor the spirit of the agreement. That really wouldn't be hard to ask. In the meantime, however, people have to read in between the lines and observe his very defensive posturing.

I really don't want to be unfair to Labrat's intentions or misrepresent him. If I ever did, then I was wrong. But the importance of investors questions & concerns should not be so easily dismissed. And I find it ironic that he said he was advised to stop answering questions, when he really didn't answer any questions. Correct me if I'm wrong, because I'm willing to be corrected on that.

I'd bet there are many many more folks that would be advising you to answer any of the simple questions.

For that matter. How could they advise you of that if you haven't actually answered any of the most obvious questions that have people all tensed up?

BTW: What is a "pheonixed contract"?

The trend in bitcoin isn't that people are suing for everything, the trend is some people are outright scamming and some are very poorly managing other people's investments.

If you wanted to defuse half of the tension in this thread (if not more)... you could just say this:
"Just like the 3 for 1 issue. I will proportionately add more bonds to accounts as the whole company hashrate grows. And if I figure out a a better way, then that will be implemented. But the spirit of the original agreement will be honored as closely as possible." (or something along those lines - just trying to communicate is respectable, imo)

Your priority should be this Zack.
1. Investors
2. You
3. The company

Not:
1. You
2. The company
3. Investors

Labrat.

Nobody is really trying to dictate how fast your lawyers work. It seems like you are disconnected from what people are reading from you. And in fairness, that could easily be happening the other way around where people are not reading you correctly. But resolving how people read you is more in your control than you seem to know.

You simply need to try to answer critical questions - even if only in your theoretical ideal - and just communicate more. Speak plainly. We are not the enemy!! (unless you view us that way).

But some of what you wrote in the past couple days comes off as raw defensive & legal posturing. And this is a really bad sign - and you may simply not realize it. However, if you were to instead speak as if you were going to do everything to keep the spirit of the agreement going - even if that means liquidating to avoid hurting people - then you will gain much much more respect. People don't sue people they respect.

The forum could be a lot calmer. And you could have more respect from investors. It's your choice.

I agree that Labrat needs a bit more space to clear up his concerns. And a week more should suffice....

By the way, what do you mean that the hardware vendor was causing problems for Labrat? I don't think that was a communicated issue. At least not with Bitfury. LR hasn't said anything about Bitfury - which is one of the communication issues at hand. As far as I've heard, only BFL is known to have an issue - and that seems to be known because BFL communicated it recently.