Sack Lunch productions has huge upside. Events are extremely popular. Spreading to Asian markets presents massive growth. Increased revenue year over year. However, I can’t get over the fact of how terrible this company is being run by Surber and the board. When you dig into the financials there are numerous instances that are preventing growth. Now I’m not trying to be like elkonig and undermine the company for no reason. I just want to point out some serious faults and you can tell me what you think.
The most obvious is that this company isn’t turning a profit. With the increased ticket sales and events, he needs to find a way to eliminate unnecessary costs.
Note 3 of the Quarterly Report: “As of March 31, 2016, SAKL had negative working capital of $4,264,662 and an accumulated deficit through March 31, 2016 of $37,408,482. Primarily, revenues have not been sufficient to cover SAKL’s operating costs.
On January 5, 2016 the Board of Directors of SAKL approved the execution of employment agreements with Richard Surber, John Malfatto, David Wulf and Taylor Gourley. The terms of the agreements begin on January 1, 2016 and expire on December 31, 2020. Base annual salary for each of the named persons is $250,000. No profits; yet, four people within the company are getting paid a total of 1 million. These people are out for themselves to make money. They pay themselves first rather than the company.
The board of directors comes off as extremely shady. Check out Note 9 and 10 in the financials. These Preferred shares are a detriment and almost come off scam by Surber and the board. The board of directors will issue preferred shares to Surber or another member of the board for “repayment of debt.” They then will convert a small amount of preferred shares into millions of common stock. These people are literally milking the company dry. I want to believe that this company will be successful, but there is so much incompetence and shady dealings that don’t give me any hope.