After the Financial institutions refused to support, the announcement from the company on 28-10-08 stated that they have taken steps to reduce the expenses and conserve cash and accordingly reduced the additional financing requirement projections from A$20 million to A$10 million.
Based on the above and further announcements to the market showed that the fixed expenses will be reduced below A$40 million per year that the company spent as fixed expenses in the financial year 2007-08.
However the administrator stated to our representative in their meeting on 27-03-09, that the monthly expenses (as of now assuming no manufacturing of new pumps and no sales and expenses consist only fixed expenses) are around A$3.5 million to A$5 million.
Works out to be A$ 42 million or A$60 million fixed expenses per year. Infact administrator stated to a shareholder that the annual expenses are coming around A$50 million.
This is heavily contradicting the announcement on 28-10-09 and subsequent statements. The question that begs to be asked is who is correct.
If the administrator is correct then the present board had deliberately misled the market by their announcements to the investors. That is a breach of the Corporations Act 2001. That has criminal implications including jail sentences for the board.
On the other hand if the board is correct then the administrator is either misleading the shareholders and is providing false information or incompetent and in capable of administering the company and the creditors should remove them immediately by convening a creditors meeting immediately.
Incidentally employees – six of them made redundant on 01-04-09 and were frog marched out of the building premises as stated to us by one of the employees made redundant – are the biggest creditors and were mostly the creditors at the meeting held on 31-03-09.
A shareholder who discussed the actions of administrator was told that shareholders who contacted them were informed of the creditors meeting on 31-03-09 and were informed that they were welcome to attend that meeting but none turned up.
Those who received the so called welcome invitation for that creditors meeting would notice that the invitation stated “I have no objection if you or indeed any other shareholder wishes to attend the meeting as an observer."
In effect the invitation stated that the shareholders can be the flies on the wall observing the proceedings but are not allowed to participate. Why would any shareholder spend money and time to go to a meeting that did not allow them to participate. Obviously that is in line with the administrators deliberate distortion of facts just as they are citing the old failed SPP attempted by now thoroughly discredited board for not attempting to initiate a new SPP.
VCR
ventracor limited
