HashFast announces specs for new ASIC: 400GH/s

[Minor Miner]

The current terms call for the formation of a new company (sometimes called “NewCo” in the documents).  We are not taking over Hashfast, or its estate or anything else; we are forming an new company and it is buying some assets from Hashfast’s estate.

Once this new company (“NewCo”) is formed, Liquidbits/its investors will transfer $10 million to the new company in cash.  This cash will then be used by NewCo to pay $2 million to the Hashfast estate for administrative/priority expenses and to satisfy executory contracts (who by law would be paid ahead of you or us anyway), and $8 million to pay to convert the chips and wafers into usable mining rigs and get them hosted (which is how the money to pay everyone back will be generated).

I think from your question you may have been thinking we were going to do something like give $10 million to the estate, then take over the estate and immediately get our money back.  As you can see from the above explanation, this is simply not the case.

If that is the truth,  it does not correspond with what you filed with the court.  You have not filed with the court that you will fund the company with 10 million dollars of equity.  Your document does not say that.  It says 2 million.   You have obligated yourselves to nothing more in the court filed document.  So why are you on here stating 10 million will be put in newco immediately?
You also need to provide the math behind your claim that under liquidation we will only get 25 cents on the dollar since treat math does not add up to the sworn testimony that there are more than 8 million in inventory to be sold.   Then you have the IP that can be sold.  Those two alone get everyone over 80 cents on the dollar.    
Why don't you list the inventory that you claim is only worth 25 cents?

You did not answer my question about why your claims here do NOT match your court filed document.   
You also do not provide a list of the inventory that you are getting and your valuation of it to support your assertion to creditors that they will only get 25 cents on the dollar in liquidation and your deal of 0 cents to a maximum of 100 cents over two years is superior to that (both points are debatable).
Thought you wanted to clear things up?

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[digitalbrass]

How about you take 2 million dollars Pay us all back in full, then do whatever it is you want. How about that. That sounds good to me. Surely out of that 10 million youll have enough to pay us back. or at least partial payment back then rest of it after you are up and running.

I dont want to hear about how this company is giving you money or more wafer and chip talk. Talk refunds. Give us our money back before you go about buying more wafers or else you will be in the same boat as simon barber. Believe that.

[aasl]

How about you take 2 million dollars Pay us all back in full, then do whatever it is you want. How about that. That sounds good to me. Surely out of that 10 million youll have enough to pay us back. or at least partial payment back then rest of it after you are up and running.

I dont want to hear about how this company is giving you money or more wafer and chip talk. Talk refunds. Give us our money back before you go about buying more wafers or else you will be in the same boat as simon barber. Believe that.

I agree that refund should be hashfast's top priority.

[stan258]

Everything should go out to the highest bidder. Everybody thought the Fed auctioned btc was going to be under market value. Lb can bid on it just like everybody else. Everything from desks, chairs and the damn chips to the shades on the windows. I want every penny on principle now.

[cedivad]

How about you take 2 million dollars Pay us all back in full, then do whatever it is you want. How about that. That sounds good to me. Surely out of that 10 million youll have enough to pay us back. or at least partial payment back then rest of it after you are up and running.

I dont want to hear about how this company is giving you money or more wafer and chip talk. Talk refunds. Give us our money back before you go about buying more wafers or else you will be in the same boat as simon barber. Believe that.

I agree that refund should be hashfast's top priority.

What have you guys smoked? I mean, its a bankruptcy, right? Maybe Wikipedia could help?

[stan258]

How about you take 2 million dollars Pay us all back in full, then do whatever it is you want. How about that. That sounds good to me. Surely out of that 10 million youll have enough to pay us back. or at least partial payment back then rest of it after you are up and running.

I dont want to hear about how this company is giving you money or more wafer and chip talk. Talk refunds. Give us our money back before you go about buying more wafers or else you will be in the same boat as simon barber. Believe that.

I agree that refund should be hashfast's top priority.

What have you guys smoked? I mean, its a bankruptcy, right? Maybe Wikipedia could help?

I want the microwave from the employee break room. I should file an emergency motion for it.  10 bucks with 100 bucks credit to the estate in 90 days.

[kikaha]

Isn't it as simple as Liquid Bits is the only offer on the table other than chapter 7 liquidation, where you would probably get pennies on the dollar.  The lb proposal has the potential to get back a double digit percentage of your cash outlay.  Seems like a reasonable risk to a terrible alternative.  My bigger concern is that the longer this takes to get to conclusion the less that HF chips will be worth.

Why don't we just ask questions here so everyone can read them?   I have a lot of questions but so it is not confusing I will ask them one by one.  I will be upfront and tell you that I think your offer is terrible and puts the creditors at more risk than they have now for recovery.  
You have provided me details of your company's capitalization, yet you expect us all to invest in it.  The deal means creditors could get zero.   Just from hf's sworn testimony it looks like I will get minimum 50 to 75 percent back before the IP is even sold. 
First question,  please detail out how you feel lb is putting 10 million in cash in this business.   If you plan to take over the business and it's assets and from that 10 million will be realized you really are not providing the money, the estate is.  If you really plan to put real cash in this new business then why did you file with the court,  the words Up to 8 million?   That means you could put zero in after the two million (in claims not necessarily the amount you need to pay)  is resolved. If you are sincere,  please answer this first.

We still intend to host the telephone meeting because some things are just more quickly and effectively answered in an interactive setting. That said however, we are happy to answer your questions here as well as many of these questions seem to indicate large misunderstandings about what the 363 sale terms document says/means.

The current terms call for the formation of a new company (sometimes called “NewCo” in the documents).  We are not taking over Hashfast, or its estate or anything else; we are forming an new company and it is buying some assets from Hashfast’s estate.

Once this new company (“NewCo”) is formed, Liquidbits/its investors will transfer $10 million to the new company in cash.  This cash will then be used by NewCo to pay $2 million to the Hashfast estate for administrative/priority expenses and to satisfy executory contracts (who by law would be paid ahead of you or us anyway), and $8 million to pay to convert the chips and wafers into usable mining rigs and get them hosted (which is how the money to pay everyone back will be generated).

I think from your question you may have been thinking we were going to do something like give $10 million to the estate, then take over the estate and immediately get our money back.  As you can see from the above explanation, this is simply not the case.

[digitalbrass]

if they have so many chips and no money ill settle for 5 boards w/ chips, ill supply my own psu and water cooler. I am owed one babyjet but will settle for 5 boards.

[kikaha]

I am pretty sure that "no money" means that they can't build boards.

if they have so many chips and no money ill settle for 5 boards w/ chips, ill supply my own psu and water cooler. I am owed one babyjet but will settle for 5 boards.

[kikaha]

Listening on the call happening now.  Amazed that only one person is asking questions.

“July 22 at 10AM PST/1PM EST, so that you can ask any questions or register any complaints directly with the Chief Executive Officer and Chief Strategy Officer of Liquidbits.
(Conference #: (712) 432-1500, Participant Access Code: 700281#).”

Isn't it as simple as Liquid Bits is the only offer on the table other than chapter 7 liquidation, where you would probably get pennies on the dollar.  The lb proposal has the potential to get back a double digit percentage of your cash outlay.  Seems like a reasonable risk to a terrible alternative.  My bigger concern is that the longer this takes to get to conclusion the less that HF chips will be worth.

Why don't we just ask questions here so everyone can read them?   I have a lot of questions but so it is not confusing I will ask them one by one.  I will be upfront and tell you that I think your offer is terrible and puts the creditors at more risk than they have now for recovery.  
You have provided me details of your company's capitalization, yet you expect us all to invest in it.  The deal means creditors could get zero.   Just from hf's sworn testimony it looks like I will get minimum 50 to 75 percent back before the IP is even sold. 
First question,  please detail out how you feel lb is putting 10 million in cash in this business.   If you plan to take over the business and it's assets and from that 10 million will be realized you really are not providing the money, the estate is.  If you really plan to put real cash in this new business then why did you file with the court,  the words Up to 8 million?   That means you could put zero in after the two million (in claims not necessarily the amount you need to pay)  is resolved. If you are sincere,  please answer this first.

We still intend to host the telephone meeting because some things are just more quickly and effectively answered in an interactive setting. That said however, we are happy to answer your questions here as well as many of these questions seem to indicate large misunderstandings about what the 363 sale terms document says/means.

The current terms call for the formation of a new company (sometimes called “NewCo” in the documents).  We are not taking over Hashfast, or its estate or anything else; we are forming an new company and it is buying some assets from Hashfast’s estate.

Once this new company (“NewCo”) is formed, Liquidbits/its investors will transfer $10 million to the new company in cash.  This cash will then be used by NewCo to pay $2 million to the Hashfast estate for administrative/priority expenses and to satisfy executory contracts (who by law would be paid ahead of you or us anyway), and $8 million to pay to convert the chips and wafers into usable mining rigs and get them hosted (which is how the money to pay everyone back will be generated).

I think from your question you may have been thinking we were going to do something like give $10 million to the estate, then take over the estate and immediately get our money back.  As you can see from the above explanation, this is simply not the case.

[cedivad]

I missed the call, but I think that the questions left unanswered above still deserve some written reply.
Also, historically, selling hardware has been more profitable than mining with it. So why isn't LB proposal build hardware to resell it and host it in the unsold part?

[Kipsy89]

I missed the call, but I think that the questions left unanswered above still deserve some written reply.
Also, historically, selling hardware has been more profitable than mining with it. So why isn't LB proposal build hardware to resell it and host it in the unsold part?

Tell that to all the people currently invested in ASICMiner's 3rd generation!

[Minor Miner]

Listening on the call happening now.  Amazed that only one person is asking questions.

“July 22 at 10AM PST/1PM EST, so that you can ask any questions or register any complaints directly with the Chief Executive Officer and Chief Strategy Officer of Liquidbits.
(Conference #: (712) 432-1500, Participant Access Code: 700281#).”

Isn't it as simple as Liquid Bits is the only offer on the table other than chapter 7 liquidation, where you would probably get pennies on the dollar.  The lb proposal has the potential to get back a double digit percentage of your cash outlay.  Seems like a reasonable risk to a terrible alternative.  My bigger concern is that the longer this takes to get to conclusion the less that HF chips will be worth.

Had previously scheduled meetings and LB's did not answer even my simplest question here.   I guess because it is true their post here is deceptive and does not match what they filed in court.
Interesting, you have a brand new account and think it is a GREAT deal and that in liquidation we could only get "pennies on the dollar".   Why don't you share the math behind that statement.   LB refused to detail out their valuation of the the inventory, so where are you getting this BS from?
There are 29,000 chips plus A LOT MORE ASSETS.
There is likely $10,000,000 owed to creditors (many claims are likely overstated) and the $2,000,000 is already IN THE CREDITORS' CLAIMS. 
Just selling the inventory to bidders will net $7 to 9 Million.    That is 60 to 80 cents on the dollar (because lawyers etc. need to be paid).
Then every shareholder likely owes all the money they took from the company BACK to the estate.   This is substantially more than $2,000,000 which gets you to all of us being repaid fully.
This is before we sell the IP etc.

That sounds a LOT better, than maybe, perhaps, possibly getting somewhere between 0 cents and 100 cents from a company that is unknown to you and still lists their primary place of business as a residential condo worth $275,000 in a building that does not allow you to run a business out of it.

[cedivad]

Possibly the most incredible thing of my day is that LB's strategy confused myself as well. They acted like they were trying to fix the self defined confusion, but they simply used the fog machine to their own interests. Lacking to reply to the last legitimate questions they left a cloud of confusion into undecided minds like mine. Now what should you believe? The terms and lb promises of spending $10M or the terms and a probable upcoming selfish interest from lb, where they try not to spend a dollar more than what they have to?

I've emailed him, just in case he is not reading the thread. Let's see his exhaustive answer.

[Entropy-uc]

Possibly the most incredible thing of my day is that LB's strategy confused myself as well. They acted like they were trying to fix the self defined confusion, but they simply used the fog machine to their own interests. Lacking to reply to the last legitimate questions they left a cloud of confusion into undecided minds like mine. Now what should you believe? The terms and lb promises of spending $10M or the terms and a probable upcoming selfish interest from lb, where they try not to spend a dollar more than what they have to?

I've emailed him, just in case he is not reading the thread. Let's see his exhaustive answer.

It really doesn't matter if they are investing $10M or $100M.  The most the creditors every see is $6M, in 2 years.  In exchange we give them $9M of inventory and IP rights.

There really isn't any justification for the creditors to finance LB for the next 2 years for less than we could recover selling everything today.

[cedivad]

It really doesn't matter if they are investing $10M or $100M.  The most the creditors every see is $6M, in 2 years.  In exchange we give them $9M of inventory and IP rights.

The problem is that you don't know if the assets are really worth $9M, do you? I have to prefer $6M "guaranteed" (if they spent $10M into the mine they would probably be "guaranteed") rather than 3-9M maybe.

[Entropy-uc]

It really doesn't matter if they are investing $10M or $100M.  The most the creditors every see is $6M, in 2 years.  In exchange we give them $9M of inventory and IP rights.

The problem is that you don't know if the assets are really worth $9M, do you? I have to prefer $6M "guaranteed" (if they spent $10M into the mine they would probably be "guaranteed") rather than 3-9M maybe.

If it was $6M today, I would agree.  But it's a promise of $6M in a couple years, and possibly nothing if something goes wrong in that time frame.

[cedivad]

If they really invest $10M, and if they really can't take value out of the company before paying us, what could go wrong? How could they screw us? Wouldn't they have every interest not to?

[kikaha]

@Minor Miner:
I don't have any magic insight here.  Having worked for a large company, I have experienced bankruptcies of small companies and creditors seem to only get pennies on the dollars after the dust settles.  If you are right about their being a lot of assets that can get liquidated at good prices and distributed to the creditors for a significant percentage of what creditors are owed, then I agree this would be a very simple solution with little risk.  I just don't have faith that that will happen.  There is typically a big difference in the value of inventory versus what the inventory can be sold quickly for.

Listening on the call happening now.  Amazed that only one person is asking questions.

“July 22 at 10AM PST/1PM EST, so that you can ask any questions or register any complaints directly with the Chief Executive Officer and Chief Strategy Officer of Liquidbits.
(Conference #: (712) 432-1500, Participant Access Code: 700281#).”

Isn't it as simple as Liquid Bits is the only offer on the table other than chapter 7 liquidation, where you would probably get pennies on the dollar.  The lb proposal has the potential to get back a double digit percentage of your cash outlay.  Seems like a reasonable risk to a terrible alternative.  My bigger concern is that the longer this takes to get to conclusion the less that HF chips will be worth.

Had previously scheduled meetings and LB's did not answer even my simplest question here.   I guess because it is true their post here is deceptive and does not match what they filed in court.
Interesting, you have a brand new account and think it is a GREAT deal and that in liquidation we could only get "pennies on the dollar".   Why don't you share the math behind that statement.   LB refused to detail out their valuation of the the inventory, so where are you getting this BS from?
There are 29,000 chips plus A LOT MORE ASSETS.
There is likely $10,000,000 owed to creditors (many claims are likely overstated) and the $2,000,000 is already IN THE CREDITORS' CLAIMS. 
Just selling the inventory to bidders will net $7 to 9 Million.    That is 60 to 80 cents on the dollar (because lawyers etc. need to be paid).
Then every shareholder likely owes all the money they took from the company BACK to the estate.   This is substantially more than $2,000,000 which gets you to all of us being repaid fully.
This is before we sell the IP etc.

That sounds a LOT better, than maybe, perhaps, possibly getting somewhere between 0 cents and 100 cents from a company that is unknown to you and still lists their primary place of business as a residential condo worth $275,000 in a building that does not allow you to run a business out of it.

[Shaxz]

[/quote]


There really isn't any justification for the creditors to finance LB for the next 2 years for less than we could recover selling everything today.
[/quote]

But who is willing to purchase the entire inventory of chips TODAY from estate?  LB appears to be the only dog in this fight as HF and LB both claim that the inventory has been shopped around to multiple buyers with no interest.  Debtor in possession financing also appears to be a no go in order for HF to build them out themselves.   Time is of the essence on this matter.

LB is also willing to waive their $5.3 million claim on the estate, so they are essentially trading their equity stake in estate for usable inventory(with additional investment).  By my calculations they are getting these chips for market value of ~ $200 chip ($5.3 million/27k chips +/-).  I agree that a 2yr. time frame for full payback is too extended, but they do make concessions for this contingency including full payment of equity units prior to LB(newco) ever taking a dividend or disbursement and having the promissory note secured against assets of the "newco".  LB can't be expected to take all the upfront risks on this proposal and since they are taking risk capital to build out these miners, they are entitled to un-guaranteed longer term gains.  Time is of the essence on this matter.

What exactly is the sticking point for the creditor's committee on this proposed sale?  it sounds like it is time duration on note/equity units? Please enlighten us...  have not seen any update on committee website either?