SVR - Savor Ltd (Formerly MOA)

[Balance]

Amazing how the directors and management write their results report like the loss and the disastrous performance against prospectus forecast is like the faults of everybody else's?

Reminds me of their mate, Brent King, and his blame of everyone else for the problems with Viking's investments.

The previous New Zealand distributor arrangement ceased 1 October 2013 and Moa assumed
responsibility for its own sales initiatives for the New Zealand market. The October performance was
particularly strong for New Zealand and a good order book into November supports the revised sales
volume projection.
As signalled, gross margin performance was particularly low at $0.2 million, resulting from too much
emphasis on lower margin products, unrealised economies of scale and the effects of distribution
transition.

[Balance]

Tried to look through the AR for some light and came across this gem of high alert for investors :

Loans to Directors
As contemplated in its Investment
Statement dated 11 October 2012,
Moa Brewing Company Limited has
provided limited recourse loans to the
independent directors and Geoff Ross,
as Chief Executive Officer, to enable
them to subscribe for redeemable
shares at the Offer Price of $1.25 per
share. The independent directors each
subscribed for redeemable shares
having an aggregate issue price of
$200,000, and Geoff Ross, through the
Business Bakery LP, subscribed for
shares having an aggregate issue price
of $1,140,000. The loans do not bear
interest, and are repayable after three
years or earlier at the discretion of the
director. The loans are non-recourse
against the borrowing directors, but
will be secured against the relevant
redeemable shares held by or on
behalf of the directors and which were
acquired with the loan proceeds.
The redeemable shares and related
non-recourse loans in respect of the
above incentive package were issued
on 11 March 2013.
As at 31 March 2013, no cash has
been exchanged in relation to
this transaction.

[J R Ewing]

What a strange way to issue $1.25 options. What say the shares are worth $1 after 3 years? Do the directors then have the option to repay only 80% of the loan and keep the shares? And if they don't pay back any of the loan then does the company write off the loans, take back the shares and cancel them? And what about any dividends in the meantime? It could look very messy to say the least. Why not just issue options, that seems to be the standard way to have directors motivated and their interests aligned with those of shareholders - without the need for them to put any capital at risk of course!

[Balance]

What a strange way to issue $1.25 options. What say the shares are worth $1 after 3 years? Do the directors then have the option to repay only 80% of the loan and keep the shares? And if they don't pay back any of the loan then does the company write off the loans, take back the shares and cancel them? And what about any dividends in the meantime? It could look very messy to say the least. Why not just issue options, that seems to be the standard way to have directors motivated and their interests aligned with those of shareholders - without the need for them to put any capital at risk of course!

Allows the directors to say they have 'skin in the game'?

But not real skin in the game as the loans are interest free and non-recourse - heads they win, tails the company and other shareholders lose.

Excerpt from AGM : "I’d also like to reiterate the personal commitment of Geoff and myself to the
business. As you may be aware, our investment vehicle, The Business Bakery has
a large holding in Moa and we have invested more than $2.6m of our own funds,
so we are not like many company managers or officers who don’t have skin in
the game."

[Harvey Specter]

Tried to look through the AR for some light and came across this gem of high alert for investors :

I think this has been pointed out earlier. Given the redeemable shares are out of the money so to speak, dont expect the loans to be paid back in full unless the company redeems the shares in full (lucky for some isn't it). There is no recourse against the holders of the loans other than security over the shares.

[Balance]

one rule for us, another for the plebs? seems an even sweeter deal than MAD directors were given regarding loans and share purchases. look how much that did for the SP!

Does it not remind you of Snakk?

Save Snakk is a backdoor job - so even worse!

[Harvey Specter]

Does it not remind you of Snakk?

Save Snakk is a backdoor job - so even worse!

Is a backdoor job really worse when the promoters distract potential investors with magazine style ads in the prospectus and use terms like limited recourse loans which M&D investors (if they really exist) don't really understand but use to make the situation look better than it actually is (ie. thinking the promoters had put cold hard cash on the line).

At least Snakk is on the NZAX, so acknowledged to be riskier, and everyone who did their DD knew that shares were issued cheaply in the past.

[Balance]

All time low of 62 cents today but ..

Promotors, directors and 'key' personnel who provided consultancy and management services to Moa paid themselves $1.39m in fees and benefits in the last 18 months!

They will be breathing in the vapors of the $65 scented candles from Ecoya as they think of the disappointed shareholders?

[bull....]

yes the 42 below success doesnt seem to be rubbing of on either of the current businesses, still time I guess to show improvement, but current prices suggest market doesnt hold much hope on either

[blackcap]

All time low of 62 cents today but ..

Promotors, directors and 'key' personnel who provided consultancy and management services to Moa paid themselves $1.39m in fees and benefits in the last 18 months!

They will be breathing in the vapors of the $65 scented candles from Ecoya as they think of the disappointed shareholders?

Thats a lot for a company with a market cap of $18.6 million. That is close to 7.5% of the market cap in fees and benefits. Wow!, they certainly are doing well :P