Why the endless hand wringing and speculation? Ecolab CEO Baker stated from the start that the chemical accounts priced at street pricing was the their reason for buying Swisher. Makes perfect sense, and additionally, at this point, what difference does it make anyway?
Find another job, I guarantee you it will be better than working for Swisher has been. Get on with your life. NEVER look back.
Yes, love, but you'd also own the outstanding lawsuits, the insufficient revenue and every other trouble. That's why Eco bought "Swisher International", not Swisher Hygiene. It's kinda like having a car with a good engine and tranny, but everything else is shot, the repo man is stalking your block, and the DMV fees are 17 years past due. (Think of the stock as the pink slip and all the stockholders as the names on the slip).
Eco bought the engine and tranny. They don't want and would not buy any of the rest, and most especially they do NOT want the pink slip with its back fees. They don't want Swisher Hygiene.
And thank *you* for the calm and compassionate background history of debts and stocks. Knowing all facts may or may not change emotions, but they are truths and I am glad you spoke them. In fairness, I am sure no-one actually wanted Swisher to fail. The hopes were high, and had it succeeded it could have "lifted all boats", as they say. But if- oh, never mind. There's no point in harping now.
I am truly sorry for your and many others losses. Again, thank you.
So I guess the only hope to hold out for is a repeat of the CoolBrands merger. But Coolbrands had cash, and barring a sudden influx from someone wealthy Swisher won't. Or at least not much, and the proxy makes it sound as though they'd like to have to stop reporting ASAP. I assume the slow winddown keeps the door open for someone to talk to someone who knows someone who might make a deal. It's possible. What do you think?
I noticed the numbers used for calculating the $1.38 a share assumed a close November 2nd (page 116), not December 1st or 31st.
If I had $25M, I'd offer $1.38/shr for SWSH now to acquire the company. All the shareholders would tender their shares since the best they can hope for is $1.38 over four years. Then, I'd sell it to ECL for $40M and keep $5M to $7M, because I could shut it down for $8M to $10M instead of the $15M proposed by the current management.
Thank You for your kind words. I didn't mean to imply that Wayne H and Steve B bought their at the time 50 million shares. Most of them were their "cut" when the then privately owned Swisher merged with the shell corporation Coolbrands. Coolbrands had two things that Swisher wanted. Around 80 million in cash and a public listing albeit on the Toronto Stock Exchange. My point although maybe not articulate was that at one point those shares worth north of 500 million and now are worth about 1% of that. They are out a bundle. One point though that wasn't at the time commonly known about those shares Wayne and Steve obtained. According to the S1 filled when the merger was announced both Wayne and Steve had lent out of their own pockets monies to run the down in the dumps Swisher. When that deal with CB closed they could have retired the debts by just dipping into CB's cash. They didn't. Instead they exchanged their debt for Swisher equity in the new company. That said to me that just maybe there was hope this new entity would have legs since they really were putting their own funds up on the table. Unfortunately as we now know their whole business plan of building a national market by buying up willy nilly dozens and dozens of mom and pop outfits with one big one tossed in for good measure(Choice) wasn't viable and the whole thing collapsed in a heap. They never could get it to work and never could get their own internal accounting of all of this to work either. Thus the why of where we are now.
By the way everyone here should read that clawback provision. This really is a gun at all of our heads. Very unusual as well in this kind of deal. You usually see this sort of thing a Bernie Madoff type situations. The only way to avoid it is to get out of the common altogether before they move to delist at which point you are stuck.
I found the "background timeline" the most interesting. Skipping all the bits about " Party A" (Pat Swisher??) and company ABC whatever (hereinafter referred to as "Co. No Thanks") it states directly that they *tried* to get EcoLab to buy at the parent level, even after Eco had repeatedly expressed concerns regarding not just the lawsuit/s but the USAO and the SEC. Eco immediately refused. They are not touching any of the legal entanglements with a 40 hp power washer, and I think the board knows this is the best deal they are going to get and that they are lucky to get it. A small group of already overpaid people will get to milk another 3 years out of it for "winding down" a company with no assets, operations or employees save lawyers.
Speaking of: a chunk of the payment will go towards buying insurance so that Wayne and Steve and everyone else will get out of having to bear any consequences. We live in an oligarchy, folks. And, as iyel referenced, if we *don't* vote for everything like sheep, they are actually threatening us with personal liability. Classy.
iyel, you are very kind! but unless I am wrong, WayneSteve received SWSH stock as a byproduct of the IPO, not by actual purchase. You know better than I do there. They spent to get the thing going, but as little as they could and insofar as was possible the companies they bought were purchased with stock. And I don't feel like going through all the filings back to 2010 and adding it all up, but their pockets did not suffer during their tenures as board members. In a nutshell: these are not nice men, and they have histories of gathering up small companies in "roll-ups", draining them dry and tossing them and the people involved aside like garbage.
And I think the stock hasn't moved yet because this proxy is so bulky and was not announced. People may hone in on that $1.38, however illusory it may turn out to be.
We don't need Berrard to lead anything. Just his vote in the event a better deal arises. Why not Ecolab? Ecolab is paying $40 million for the assets, but they could buy the stock of the company for $1.50/share and get the asset for $25M. Sure, they would bear expenses to wind down the company and have to fight the final lawsuit, but that could be accomplished for a lot less than $15 million. I'd vote for that if for no other reason than to see this management team get the boot with no severance.
Clawback? As if what has happened isn't enough? BTW Left-I doubt Steve Berrard will launch a proxy fight here. There just isn't enough on the table to make it worth it to him. The more I read through the proxy the more disheartening it becomes. The shareholders really are being told to expect nothing.
Just came upon this nugget from the proxy.
Our stockholders may be liable to our creditors for part or all of the amount received from us in our liquidating distributions if reserves are inadequate.
If the Dissolution becomes effective, we may establish a contingency reserve designed to satisfy any additional claims and obligations that may arise. Any contingency reserve may not be adequate to cover all of our claims and obligations. Under the DGCL, if we fail to create an adequate contingency reserve for payment of our claims and obligations during the three-year period after we file the Certificate of Dissolution with the Delaware Secretary of State, each stockholder could be held liable for payment to our creditors of the lesser of (i) such stockholder's pro rata share of amounts owed to creditors in excess of the contingency reserve and (ii) the amounts previously received by such stockholder in dissolution from us and from any liquidating trust or trusts. Accordingly, in such event, a stockholder could be required to return part or all of the distributions previously made to such stockholder, and a stockholder could receive nothing from us under the Plan of Dissolution. Moreover, if a stockholder has paid taxes on amounts previously received, a repayment of all or a portion of such amount could result in a situation in which a stockholder may incur a net tax cost if the repayment of the amount previously distributed does not cause a commensurate reduction in taxes payable in an amount equal to the amount of the taxes paid on amounts previously distributed.
Any guess what Berrard's stance is? He is not listed among the 15.2% management committed to the ECL buyout (steal). Only Wayne H is.
Not that easy however to buy 50% plus one left. Two individuals own 30% between them. Add to that what is held by current board members and assorted hangers on and you are mighty close to that 50%
What I find surprising is the common. Its held up nicely even after release of the proxy. I wonder if the consequences have sunk in. There isn't a whole lot in there that says the common is even worth what it is trading at now. They do everything they can to tell us not to get our hopes up on any kind of distribution.
See Annex C: PLAN OF COMPLETE LIQUIDATION AND DISSOLUTION
16. Authorization. The Board is hereby authorized, without further action by the stockholders, to do and perform or cause the officers of the Company, subject to approval of the Board, to do and perform, any and all acts, and to make, execute, deliver or adopt any and all agreements, resolutions, conveyances, certificates and other documents of every kind that are deemed necessary, appropriate or desirable, in the absolute discretion of the Board, to implement this Plan and the transactions contemplated hereby, including, without limiting the foregoing, all filings or acts required by any state or federal law or regulation to wind up its affairs.
THESE DOCUMENTS HAVE TO BE READ FROM BACK TO FRONT. CLEVER MGT AND BOARDS WILL TRY TO BURY THE IMPORTANT INFORMATION LIKE THIS ON BACK PAGES WITH THE HOPE MOST SHAREHOLDERS WON'T READ THE WHOLE DOCUMENT.
They had before the rss 50 million shares between them.
I actually wouldn't mind hearing from Wayne on what he thought went wrong here. Wayne had that track record going back decades and it was his name that lit up the common back in 2010-2011. His reputation was well earned until Swisher came along.
Actually not all that unbelievable left. Whatever you think of Wayne H and Steve B . they have lost a bundle here since 2011. At one point they had 5 million shares between them worth upwards of 500 million. Today? 5 million worth almost 99% less. They will try to grab whatever crumbs are left.
One other thing I neglected to mention from the proxy. They also say that after the deal closes the end of this year but before they vote on a dissolution they may move to have the SEC cancel their registration and delist. That saves money and they will want that obviously. If they do go that route the public shareholders really are in a bind. They wont even be able to sell whatever shares they have and will have to wait for a distribution that may or may not come and could be as far out as 2019 according to the filing.
The board intends to withhold our funds to buy indemnification insurance and hold contingencies for potential legal fees should we sue them. They're doing the same for Ecolab. In other words, they intend to go to war with us shareholders and use our capital to fight us. THIS IS ABSURD.
Unbelievable after all we've been through with this management team and board. The following from the draft proxy, which by the way is six months late. Emphasis mine.
"If the Dissolution is approved by our stockholders and if the Board of Directors determines to proceed with the Dissolution, the Board of Directors will determine, in its SOLE discretion, the timing of, the amount of, the kind of, and the record dates for all distributions, IF ANY, made to stockholders. Our Board of Directors has NOT established a timetable for distributions to stockholders or for the amount of any distributions. However, we
expect the amount of any such distribution, if one is made, to be SIGNIFICANTLY AND MATERIALLY LESS, in the aggregate, than the consideration to be received in the Sale Transaction, if the Sale Transaction is completed. We can provide NO ASSURANCE as to the ultimate amounts, IF ANY, to be distributed or the timing
of any distributions."
This is absurd. A year? Does it take a year of CEO, COO, CFO, CAO, etc., etc. time to wind this POS company down? We're ^&**ing idiots if we agree to this. Why are we expected to standby while they fritter away the paltry amount they're selling the company for?
In glancing at this a bit further they also make clear that none of the anticipated expenses going forward that will come from that 40 million include any possible liabilities and/or penalties from the still ongoing SEC investigation of their business practices as well as law suits still outstanding from various parties with grievances of their own.
They have filed a preliminary proxy at the SEC. Over 100 pages and at the moment I don't have the time to start reading it but a quick perusal tells us the following. They intend at some point(anywhere from 1 to 3 years)to file a certificate of dissolution. As for the distribution they make it clear that this will be at the "sole discretion" of the BOD and will be substantially less than the amount of the original deal with Ecolab. At the most it wont be more than $1.38 and that is in 2019. Given the uncertainties of the business after the deal closes it given the fact they make it clear they and they alone determine the final payout I don't think we should assume we will get much of anything.
BTW-Its still unclear just what liabilities are going to be left by Ecolab for the Swisher shareholders to pickup. The 40 million deal calls for them to buy most of the assets and "current liabilities" but not much of anything else. So if by that the shareholders are being stuck will the short and long term debt and pension liabilities plus the cost of running a shell corporation from 2016 on until they dissolve (including salaries of the officers) we could wind up with nada.
I know :( and agree with *you* 200%. It's a lot easier to just listen to the Chain of Command and nod along than to pay attention & be aware. A lot of people didn't even know there was any cash issue at all. It's not going to be easy, so I wanted to point out that quitting (as compared to being laid off) usually means losing unemployment. Not a happy outcome if you have no reserves. :(
Thank you. GLTA.