A director and the founder of a finance company recently resigned due to internal disagreements within the board. The company has faced significant challenges this year, including non-compliance with state and federal laws. As a result, several key executives were terminated, and it was discovered that the company had overstated its cash balance. This led to concerns about the company’s ability to continue operating and pay its employees. In an effort to secure funding, the company has announced a loan from Woodford Eurasia, a subsidiary of investment firm United International Holdings Netherlands BV. As part of this agreement, Woodford Eurasia demanded the resignation of four board members and appointed two new members. However, some board members expressed frustration with the company’s approach to vetting Woodford as an investor. They raised concerns about the lack of transparency and disregard for due diligence. The resignation of these board members further highlighted the dysfunctional nature of the board. Overall, the company is facing significant challenges and uncertainties in its future.
The recent resignations of key executives and board members have raised concerns about the finance company’s stability. Following non-compliance issues and the discovery of a cash balance discrepancy, the company has struggled to pay its employees and continue operations. In an attempt to address these challenges, the company secured a loan from Woodford Eurasia, a subsidiary of United International Holdings Netherlands BV. However, the terms of the loan required the resignation of four board members. Some departing board members expressed dissatisfaction with the company’s handling of investor vetting and lack of transparency. Their resignation letters outlined concerns about inappropriate activities and obstacles to conducting thorough due diligence. Another board member resigned after a meeting related to the funding deal was held without the presence of two directors, potentially violating corporate bylaws. These resignations highlight the dysfunction within the company’s board and raise doubts about its ability to serve the interests of shareholders.
Summary of events:
- A director and the founder of a finance company resigned due to internal disagreements within the board.
- The company faced non-compliance issues with state and federal laws, leading to terminations of key executives.
- An overstatement of the company’s cash balance by $30m was discovered.
- The company faced difficulties paying employee wages and expressed concerns about its ability to continue as a going concern.
- The company secured a loan of $2.5m from Woodford Eurasia, with the possibility for an additional $50m.
- Woodford Eurasia demanded the resignation of four board members as part of the loan agreement.
- Some resigning board members criticized the company’s handling of investor vetting and lack of transparency.
- Another board member resigned after a meeting related to the funding deal was held without proper attendance.
- The resignations highlighted dysfunction within the company’s board and raised concerns about serving shareholder interests.
- The founder’s resignation fulfilled a condition required for the loan.
