NEW YORK, NY / ACCESSWIRE / June 11, 2024 / The OLB Group, Inc., (NASDAQ:OLB) , a diversified Fintech eCommerce merchant services provider and cryptocurrency mining enterprise, issued an open Letter to Shareholders from Chairman and CEO of OLB Group, Ronny Yakov, providing a review of a challenging 2023 and anticipated milestones for 2024.
Dear Shareholders,
Starting on a positive note, our revenues going forward will reflect business from the recent acquisition of the bodegas/convenience store network portal, Black011.com, and the mobile brands Blackwireless.com and Mangomobile.com. OLB recently acquired the remaining 19.9% equity interest of Cuentas SDI, LLC and now owns 100% of Black011.com, which will be restructured and rebranded with additional OLB products and services. Currently we service 1,800 bodegas currently and expanding month to month. Starting by the end of the Third Quarter, we will be offering a variety of new products and services, pre-paid phone cards and credit cards to the owners of bodegas and convenience stores to their underbanked and unbanked customers. Additionally, we are launching the Affordable Connectivity Program (ACP) program that offers subsidies to low-income customers. We also expect to launch additional services for point of banking and bill payments in early 2025.
Merchant payment services continues to be our core business and the primary business related to our custom-developed applications, which remains our strongest competitive advantage. For example, we have begun incorporating point-of-sale systems and merchant boarding components into the black011.com portal.
We are expanding our network of sport ticketing systems to minor leagues baseball teams and stadiums. Currently, OLB has partnered with eight (8) teams with a number of additional customers to be announced upon signing of contracts.
ShopFast? - Our Omni Commerce platform for services online, in-store and on-mobile services is fully integrated with the latest technologies to provide mobile commerce armed with up-to-date fraud prevention and 3D Secure technology.
OLBPay?, our billing and invoicing platform, will have AI components related to support invoice prediction and fraud preventions and is projected to launch by Fourth Quarter, 2024.
SecurePay ?, our payment gateway, is now fully integrated and certified with Total Systems (TSYS), Elavon for Visa, MasterCard and Amex, and Jack Henry for ACH Payments. Secure Pay is also providing Stored Credit Cards and a wallet technology for recuring billings and contactless payments.
Status Update on DMint Spinoff On April 19, 2024, we confidentially filed an updated registration statement and a response to SEC comments on prior versions of the registration statement relating to the spin-off DMint, Inc., our Bitcoin mining subsidiary. We anticipate a clearer picture of the pending record date and spin-off date in the coming weeks, at which point, the Company will be announcing a Shareholder of Record date for the DMint stock dividend to OLB shareholders. In anticipation of the spin-off of DMint, we will be reporting in our quarterly financial statements for the six months ended June 30, 2024, DMint's underlying business as a Divested Asset, and the Liabilities of DMint on the balance sheet of OLB will be written off when we distribute shares of DMint to OLB shareholders. We are resubmitting the S-1 this week to address the remaining questions to the SEC.
Despite the revenues loss resulting from the termination of merchant services of the acquired portfolio, which we have fully written off, the company projects a revenue run rate of at least $15 million for fiscal 2024.
Ongoing Litigation Against FFS Data and Clear Fork Bank We have taken a conservative approach to the merchant portfolio acquired from FFS Data in 2021 (the "FFS Portfolio"). In light of the ongoing fraud claims against FFS Data, we have made the decision to write off the FFS Portfolio and anticipate the recovery of our entire investment upon conclusion of the litigation. We are suing to reverse the transaction and seek the return of the Company's $16 million investment, all legal fees, loss of business opportunity and reputational damages.
The Company is engaged in ongoing litigation with FFS Data relating to a breach of contract in connection with the portfolio of merchants acquired in 2021 (the "Acquired Merchant Portfolio"), whereby the Company is making a claim to recover the purchase price it paid for the Acquired Merchant Portfolio and FFS is claiming that it should be paid the remaining portion of the purchase price of the Acquired Merchant Portfolio which was not paid because of the breaches of representations made by FFS about the underwriting of the merchants in the Acquired Merchant Portfolio. In addition, in connection with the litigation with FFS, OLB has also made a claim against Clear Fork Bank https://www.clearfork.bank/ , the payment processing bank for the Acquired Merchant Portfolio, for damages the Company suffered as a result of it having to cease processing transactions for the merchants underlying the Acquired Merchant Portfolio. The Bank has filed a counterclaim for fees incurred by it in connection with the transactions processed since the acquisition of the Acquired Merchant Portfolio by the Company. However, the damages claimed have been materially reduced over time due to account balancing which was not completed at the time of the counterclaim.
The management at OLB Group is fully engaged in the success of the company, continues to periodically buy shares at the open market and financially support the company. Today the company has no long-term liability.
In conclusion, we believe that after the spinoff of DMint, OLB Group will attract analyst research coverage for both entities as separate, pure play companies engaged in Bitcoin mining and merchant services respectively.
Regards,
Ronny Yakov, CEO OLB Group, Inc.
About OLB Group, Inc. The OLB Group, Inc. is a diversified Fintech eCommerce merchant services provider and Bitcoin mining enterprise. The Company's eCommerce platform delivers cloud-based merchant services for a comprehensive digital commerce solution to merchants in all 50 states. In addition, through its ownership of the Black 011 platform, OLB Group can provide its services to an additional network of 31,600 convenient stores and bodegas in the United States. DMint, a wholly owned subsidiary of OLB Group, is engaged in the mining of Bitcoin in a facility in Tennessee utilizing sustainable hydroelectric and solar power.
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Safe Harbor Statement All statements from The OLB Group, Inc. in this news release that are not based on historical fact are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and the provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements include, but are not limited to, statements concerning the impact of COVID-19 on our operations and financial condition, our ability to implement our proprietary merchant boarding and CRM system and to roll out our Omni Commerce and SecurePay applications, including payment methods, to our current merchants and the integration of our secure payment gateway with our crowdfunding platform, our ability to successfully launch a cryptocurrency mining operation and our ability to earn revenue from the new operations. While the Company's management has based any forward-looking statements contained herein on its current expectations, the information on which such expectations were based may change. These forward-looking statements rely on a number of assumptions concerning future events and are subject to a number of risks, uncertainties, and other factors, many of which are outside of our control, that could cause actual results to materially differ from such statements. Such risks, uncertainties, and other factors include statements regarding the expected revenue and income for operations to be generated by The OLB Group, Inc. For other factors that may cause our actual results to differ from those that are expected, see the information under the caption "Risk Factors" in the Company's most recent Form 10-K and 10-Q filings, and amendments thereto, as well as other public filings with the SEC since such date. The Company operates in a rapidly changing and competitive environment, and new risks may arise. Accordingly, investors should not place any reliance on forward-looking statements as a prediction of actual results. The Company disclaims any intention to, and undertakes no obligation to, update or revise any forward-looking statement.
Contacts OLB Group Investor Relations Rick Lutz [email protected] (212) 278-0900 Ext. 333
