Melrose Ventures Group Calls for Accountability from Hank Management Amid Ongoing Shareholder Concerns

Rhea-AI Summary

Melrose Ventures Group has expressed serious concerns about Hank's management's recent decisions and lack of transparency. The key issues include a controversial proposed acquisition that would give away 49% ownership for assuming $1M in debt, potential shareholder dilution of approximately 80% through convertible debt modifications, and management's refusal to engage in dialogue with shareholders. Melrose's tender offer stands at 9 cents per share, offering an 80% premium over management's proposed 5 cents per share pricing. The company has experienced a 95% stock decline since going public in October 2021, with stagnant customer base and revenue growth.

Positive

• Melrose's tender offer provides 80% premium at 9 cents per share compared to management's 5 cents proposal
• Existing customer base of 42,000 remains stable

Negative

• 95% stock price decline since October 2021 IPO
• Proposed acquisition would give away 49% ownership for just $1M debt assumption
• Planned convertible debt modifications could dilute shareholders by 80%
• No meaningful revenue growth since 2018
• Management's proposed 50% decrease in convertible debt conversion price would add 50M new shares
• New convertible securities at 5 cents conversion price threaten further dilution

NAPLES, FL / ACCESSWIRE / November 6, 2024 / Melrose Ventures Group expresses deep concern regarding the recent press release from Hank's management, which stated they would not respond further to inquiries from Melrose. This decision reflects a troubling pattern of evasiveness and lack of transparency that has persisted over the past seven years.

Despite numerous attempts to engage with management, including a recent request for a shareholder meeting on October 21, 2024, Hank's leadership has consistently failed to acknowledge calls for dialogue. This includes attempts to block shareholders from attending meetings and addressing critical issues that could significantly impact the company's future.

Key Issues Raised by Melrose Ventures Group:

1. Proposed Acquisition: The management's plan to acquire a company with no revenue and unproven technology raises serious concerns. In exchange for assuming $1 million of the target's debt, Hank would relinquish 49% ownership, jeopardizing shareholder value without a clear path to profitability.

2. Convertible Debt Concerns: The proposed 50% decrease in the existing convertible debt conversion price would increase shares outstanding by 50 million, diluting current shareholders at a time when the existing debt is manageable.

3. Issuance of New Converts: The introduction of new convertible securities at a conversion price of 5 cents is viewed as irresponsible and highly dilutive, further threatening shareholder equity.

4. Management Accountability: There is a pressing need to replace the current management team with individuals who have a proven track record of building and growing the company. The original founders, who successfully established a customer base of 42,000, are better positioned to lead Hank towards profitability.

5. Shareholder Dilution: Current management's actions could dilute existing shareholders by approximately 80%, with no foreseeable benefits.

6. Tender Offer: The Melrose Group takeover Tender Offer is for 9 cents per share, offering existing shareholders an 80% premium and an attractive alternative to the proposed acquisition pricing at 5 cents per share causing approximately 80% dilution to current shareholders at all time stock price lows, which Hank Payment Corp's management is trying to force existing shareholders to accept without shareholder approval.

Historical Context of Management Performance:

Since taking over in 2018, Hank's management has overseen a 95% decline in stock price since the company went public in October 2021. The company has failed to achieve profitability, maintaining the same customer base without meaningful revenue growth. This underperformance raises serious questions about the current leadership's ability to navigate the company towards a successful future.

Melrose Ventures Group urges Hank's management to reconsider their approach and engage constructively with shareholders. Transparency and accountability are essential for restoring confidence and ensuring the long-term success of the company.

For further information, please contact:

For any questions, please contact Michael Trimarco, Principal of Melrose Ventures & Intelligent Payment Processing, at 516-848-3388.

SOURCE: Melrose Ventures

View the original press release on accesswire.com

FAQ

What is Melrose Ventures' tender offer price for Hank (HNKPF) shares?

Melrose Ventures is offering 9 cents per share, representing an 80% premium over management's proposed 5 cents per share pricing.

How much has Hank's (HNKPF) stock declined since its IPO?

The stock has declined 95% since going public in October 2021.

What is the potential shareholder dilution in Hank (HNKPF) under current management's proposal?

Current management's actions could dilute existing shareholders by approximately 80% through convertible debt modifications and new securities issuance.

How many customers does Hank (HNKPF) currently have?

Hank has a customer base of 42,000, which has remained unchanged since 2018.