I have reached out to an Aubrey supporter and he wanted me to explain why I thought the news yesterday was bad...I am answering him here without naming him because I think everyone has to realize what this news yesterday did to us as shareholders.
The #1 challenge for this company is financing. This quote that Mona put out yesterday is the same reaction I got from my broker after reading that news:
With Zen news out today it is important to note that they have made themselves toxic regarding the capital markets and funds. No one will want to touch this play with this type of patronage and cronyism going on within this company. Why would they when they can all clearly see that the priority regarding cash is to pay off first the executives of the company and then the Board. Funds and capital markets don’t finance life styles with no accountability... a message from a market guy!
The company is in development, will need multiple rounds of financing. It will need to bring in real talent to move it forward. That talent is expensive but worthwhile. That news yesterday saddled the company with an expense of $375k per year for the next 3 years. If the company decides it can no longer afford Aubrey and decides to let Aubrey go, we save $225k per year but have to pay another $450k. If we win the vote and do a forensic audit and find cause to let him go, we still have to pay him. In my world, this does not make sense. In my world, you cannot change roles in a company, maintain the same salary but yet collect severance.
The problem is, in my world is also the financial industry who is interested in funding the project but not interested in funding the lifestyle of entrenched, entitled management.
As a bonus, we now get to pay Keith Morrison as executive chair and a new CEO when he comes on board. Now, who wants to put in the first million dollars of funding?
Respectfully,
Francis Dubé |
