I believe that FC were trying to help no got hoodwinked into crappy financing they didnt understand.
FC trying to help? Got hoodwinked?
Listen, this is the real financial world and in that world the road to hell is paved with good intentions.
You forget
RM was CFO of ADO and was on both boards!
Lenders like this makes all sorts of promises but actually just sell the shares on market to replace the funds they have lent
Well the promises must be in writing to be binding, very difficult to enforce verbal assurances made before signing, usually they're unenforceble.
Most compent lawyers understand this (contract law 101), and surely this is widely understood by CFOs. Surely we could have done better than that for ADO, or is it that RM didn't care so much?
If as CFO if he didn't understand the financing and the
risk to ADO, and understood how to protect us by making verbal assurances binding and in writing, he should have got expert legal and financial advice so that he did. Nothing could be clearer. I'm talking about accountability here.
But again you're ignoring the
elephant in the room (that some think it's spamming to mention):
* The desperate situation that ADO was in at the time exposed us to these adverse loan terms. *
I know you hate it, but I keep coming back to the fact that the poor range of financial options available to ADO reflects the fact that the
much-vaunted deals kept on not coming. Spending was apparently prolific however, and the capital raising failed because shareholders were tapped out from too many CRs earlier. All of this the CFO and CEO were front and centre of.
Surely it's not spamming to mention these
repeatedly ignored realities again. But they are key.
Very poor decision making was involved from early on. I can't believe anyone is arguing otherwise. GC doesn't ever want to 'go back that far' if you try to say these are relevant to our ability to borrow and negotiate, ending with the low SP, the deal with Diasource etc.
I also believe that JH was trying to to his best but strayed well outside his area of expertise and most like introduced Ferghana, Equity First (the supposed lender) and maybe even the original Canadian lender that started the problems although that may have just been by association with Ferghana.
The only thing you can be sure of where JH was involved is the Ferghana Partners association in the first instance. I don't think any reasonable person can can hold JH responsible if FP then introduced ADO to other financiers. He would have been well out of things by then.
Anyone can make suggestions, or introduce people BUT he wasn't the decision maker. He wasn't the CEO! Not the CFO!
This is the key point. Anyone with financial nous or knowledge of Director's duties would know that.
At least you get the point about unfair guilt by association, but you don't really explore it thoroughly.
Either way MB has paid a price, GC has paid a price, RM has paid a price, SA has paid a price, AS has paid a price and now it seems JH & RS are also going to.
Wait a sec.
MB was in a position to oversee ADO raising a loan.
The best that could be said is that MB never had any involvement at all in that debacle, or it seems, ADO's persistently deteriorating financial situation. CRs were raised and shares issued like confetti.
You don't sign off on something you don't understand nor be indifferent to what was happening with a deteriorating financial position. Not when you have financial expertise and are in the business of lending yourself. He was pretty obviously hands-off and perhaps along for the ride in case his options came good.
MB is wealthy he should have provided a loan? False reasoning and NO.
But it does mean
as a successful financier and Chairman he should have been front and centre of sorting this out. It's his area of expertise, not Hurrel's.
People forget areas of expertise and responsibility. Clear reasoning must apply.
GC has paid a price.
Exactly how is this unfair in terms of responsibility? Amazingly he is still on the Board yet he failed to negotiate a deal that would protect ADO from Diasource being able to distance themselves, and cries unfair and conspiracy?
This is his own mess* we're talking about (see above).
As CEO he was responsible. Surely you get this. Anyone with a clue about Director's responsibilities would.
It's entirely reasonable that Diasource did not want to be led by someone who cannot do deals. The deals were not forthcoming. They didn't want to be run by him from a distance when we weren't even getting convincing leadership over our own base.
GC expected them to pay for the takeover. They indulged ADO to a point and finally pulled the trigger when we showed no sign of bringing in deals that would fund the takeover. At some point GC must take some responsibility. Diasource is not a charitable institution. It's a business and it was well run. From what I can see, they aimed to keep it that way.
(Why do you think it is spamming to repeat these
ignored realities. They're commercial realities not dreamland.)
SA paid a price.
The duty to make sure all players on ADO side were aware of the legal and commercial risks to anything signed, is the responsibility of the risk management and legal team. If something is outside of their level of expertise, it's incumbent on them to seek external or financial advice. No doubt about that. This is accountability.
Lawyers will tell you: look this is the deal and these are the risks. Don't rely on verbal assurances especially if they aren't repeated in the written contract. If SA didn't do that, it's natural she would have to go. Maybe she did but was ignored. We don't know what she did but it doesn't look good, does it?
What made the loan deals happen the way they did was probably commercial reality* (see above). You've said those lending terms are common but you don't explain in which circumstances.
Lenders of last resort or close to it? I've seen it all before. With a company in a similar situation to ADO, which borrowed from LaJolla venture capitalists. Similar terms, same result. Too many shares on issue. A consolidation followed.
AS paid a price.
Very unfairly, wouldn't you say? AS was not there at that time of the deal making and the expenditure C/R circus, he is a very competent person involved in a salvage operation and it is a perverse result to get rid of him. (Or was he finding things in the course of his work that didn't add up and made some uncomfortable?)
We must be intelligent about it. Nobody has made a case for getting rid of him that says he's not competent. He was seen as a proxy for attacking the Chairman. Also unfair.
Now it seems JH and & RS are also going to (sic).
Not if there is any fairness or sanity involved.
So far, we have several people notably GC and RM who apparently don't want to take any responsibility for their own bad decision making. In all the conversations I've had with GC, it's always someone else's fault.
You were against removal of MB and now you regard the current round of removals as inevitable?
I tell you who will
pay the price....ADO shareholders who have been unwittingly backing the antics going on and being fed a questionable narrative (eg. Diasource trying to steal ADO's IP. It's paranoid rubbish as far as I can tell, but it seems MS has swallowed it along with his mates rather than take a critical look at RM and GC. Mateship is dangerous in business because it can interfere with your critical faculties).
What JH asked for was
stability. This is essential in order to have credibility to raise finance and sign deals. We've been on the verge of doing just this and this happens?
As you would be fully aware, generally companies will minimise damage and move on due to the need to protect their shareholders and the SP from bloodletting and dirty linen exposure.
We need a full audit into the financial dealings that went on during the reign of GC and RM
(who had an apparent conflict of interest in the FC deal, apparently nobody checked on the implications? It's only "FC" which didn't understand the deal they later made, not RM who was obliged to protect ADO's interests with protecting future dealings with the shares in writing in the contract...AND this is all OK? )
... including expenditures before anyone can make a fully informed and rational decision.
The fallout from this is only starting and this is going to get very ugly indeed. I only hope the company can survive it.
