Life Clips Inc (OTCBB:LCLP) Heading Lower

We warned our readers and subscribers back in May that Life Clips Inc (OTCBB:LCLP) was looking for bagholders. Back then, shares had just hit their 52 week high of $.76 per share. Now shares are down about 30% from our initial warning and look set to go lower if they break current support levels.This is what happens on the OTC Markets with promoted tickers like LCLP, the pumps never last long because the goal of the pump is to unload stock into the promo. The Life Clips promo was launched back in May by MIDAM Ventures LLC and their TechStockInsider. Originally, the landing page said that they were being compensated $75,000 for their efforts. Now the landing page says that:

MIDAM VENTURES, LLC owner and operator of TechStockInsider.com was paid an advertising fee of $225,000 cash & ZERO Restricted Common shares by Life Clips, Inc. (LCLP) for visual sponsorship of TechStockInsider.com and for visual placement Life Clips, Inc. (LCLP) within written materials. FOR A DURATION OF 90 DAYS Beginning 5/4/2016. & ending 8/1/2016

We're actually surprised that they got their contract extended as they don't seem to have done a great job promoting LCLP. They certainly have not done as good of a job as the promoters behind Valmie Resources Inc (OTCBB:VMRI). Valmie paid Small Cap Sentinel and Emerging Growth $135,000 for dedicated emails on VMRI. Valmie has been a consistent volume leader and price mover on the OTC Markets whereas LCLP has not.Life Clips could have been a great promo if the promoters had done their job. LCLP actually has a good story behind it. Life Clips has signed a definitive agreement for the complete acquisition of Batterfly Energy Ltd, which will include 100% of their assets including but not limited to Mobeego. The Mobeego brand launched in November 2015. Mobeego is available within 14 different countries and has sold north of 450,000 units. Mobeego’s anticipated revenue before the end of Q3 of this year is $1,000,000. The Mobeego product is an affordable one time use disposable battery that plugs directly into one’s mobile device, iPad, or action camera.Life Clips also has a new HD 360° action camera coming out next month. Life Clip's HD 360° action camera is 16MP, includes a free 32GB, MicroUSB, HD out interface, contains a Lithium-ion 1200mAh battery, comes in the following resolutions, 2k @ 30fps, 1140 @ 60/30 fps, 1072 @ 60/30 fps & includes a free waterproof case. Life Clip's HD 360° action camera is expected to retail for $269.00USD which is roughly 32% cheaper than the "360 Fly." Life Clips CEO Bob Gruber said:

"360 degree cameras capture everything around you. When you get to the summit of that mountain, when you finish that marathon or how about that celebration with all your family and friends, sometimes a regular snapshot doesn't do the moment justice. How about a 360° virtual-reality selfie? Life Clips is all about sharing life's moments in the best ways possible while keeping your devices charged up and ready. Our new 360° HD camera enhances our product line by offering cutting edge technology that will define the future of photography and more importantly the way we capture and share life's moments."

The biggest overhang on shares of Life Clips is dilution on the back of convertible notes. To finance the Mobeego transaction, LCLP issued a convertible note for $700k. According to the filing, “The Convertible Note has a maturity date of May 13, 2017 and bears interest at 10% per annum. In addition to the terms and conditions described above, the Convertible Note provides that the Company will pay the full amount of the unpaid and unconverted principal and all accrued interest on the maturity date, unless accelerated to an earlier date. The Purchaser has the right at any time to convert all or a portion of the outstanding and unpaid principal amount of the Convertible Note and any accrued and unpaid interest into shares of common stock of the Company. The conversion price is the amount equal to 50% of the lowest intraday trading price of the Company’s common stock during the 20-trading-day period prior the conversion date. The number of shares of common stock issuable is determined by dividing the amount to be converted by the conversion price.”Currently trading with a market cap of $27 million, LCLP is plagued by not only toxic debt but also weak financials. In the quarter ending March 2016, LCLP reported just $1000 in revenues, a $195,000 loss, $18,000 in cash, $159,000 in total assets, and $5,740,000 in total liabilities. All we can say, is buyer beware! We will be updating Insider Financial as soon as we know more. For continuing coverage on LCLP, sign up for our free newsletter and get our next hot stock pick as well as a free ebook!Disclosure: We have no position in LCLP and have not been compensated for this article.