Some years ago, Bill Lloyd was struggling to make Lenox operate as if it were an organization for generating wealth rather than a sociopath's device for fleecing investors. The number of shares fully diluted was something like 12 million, up from 6 million months before. Bill's intent was to reduce that number to under 10 million, perhaps to as little as 8 million. Both Ken and Bill indicated that the darkness of crazy dilution was over and that the firm was going to sell product, not stock.
News flash! The number of shares fully diluted is nearly 30 million.
Ken's romance with selling stock is a kind of dementia or is at best a perceptual problem. Some people find it hard to give up living off their parents. But some people -- middle-class, middle-aged people -- find it hard to give up living off their peers!
And not only living off the shareholders. It is said that even when Lenox had a lot of money, people who provided investor-relations services had to wait for months before receiving what was rightfully theirs. It is said that executives were treated in the same way. It is said that people had to withhold material being prepared for Lenox until payment was made.
Now that Lenox is having some success, consider the possibility that another firm is thinking of a buy-out. Would Lenox sell at a higher price if Ken made a full transition in the months before a serious offer? Yes, if only because the pre-offer stock price would reflect the change. Would current owners prosper even more if Lenox were not sold? Yes, the technology would be commercialized under new management.
Ken, you should bow out in a gracious and useful way. You should say, "I gave you a company. I made mistakes, and although I can do a better job now, I realize that the company's valuation will always be a lot lower no matter what I do, so long as I remain the CEO. You are burdened by my history and by the market's perception, a perception based on fact. I take responsibility by relieving you of that burden."
If you intend to resign, please say so in the coming announcements and specify a date.
Oh, you intend no such thing, though it be in our interest? What a surprise.
"Though you grind a fool in a mortar, grinding him like grain with a pestle, you will not remove his folly from him." -- Proverbs 27:22 |
