Economist Carl Schramm has resigned from the board of directors of MoviePass parent company Helios and Matheson Analytics, claiming that management withheld financial information and made important decisions without the board’s knowledge.
The board member said his concerns have grown substantially over the last eight weeks, as the company’s management made corporate decisions and executed “significant transactions” without the board’s knowledge or approval, offered last-minute notice of meetings and withheld material information for months.
“These and other actions have interfered with my ability to execute my responsibilities as a board member,” Schramm wrote in a letter dated Aug. 25. “Taken together, they confirm that, despite my best efforts, my ability to effectively discharge my duties as a director have been compromised beyond repair.”
MoviePass Files For Bankruptcy In Last Shoe To Drop
Schramm resigned effective immediately.
The company filed documents with the SEC, disclosing Schramm’s exit from the board. The company said it was unaware of any unanswered requests for information and denied keeping the board in the dark.
“The board and committees of which Mr. Schramm was a member have met at least 25 times at duly convened meetings thus far in 2018,” MoviePass said the filing. “And the company firmly believes that it has kept the board fully informed and has provided all information needed for board members to exercise their responsibilities.”
Here’s the full text of Schramm’s resignation letter to CEO Theodore Farnsworth:
As you know, for several months now, I have raised questions and expressed concerns about the corporate governance of Helios and Matheson Analytics, Inc. (the “Company”). I have sought, often unsuccessfully, information about the Company’s financial status and operations, and explanations of Company strategy. I have objected to the manner in which a number of business decisions have been presented to the Board of Directors by management, without sufficient time for the Board to examine complex documents, to review significant transactions, or to discuss how the proposed actions fit into the Company’s strategic plan.
These concerns have increased substantially over the past eight weeks as management apparently has made a number of important corporate decisions and executed significant transactions either without Board knowledge or approval, or in Board meetings initiated with only a few hours of advance notice by email (at least one of which I did not even know had been called until the meeting had concluded). Just last week, I learned that management withheld material information from the Board for several months.
These and other actions have interfered with my ability to exercise my responsibilities as a board member. Taken together, they confirm that, despite my best efforts, my ability to effectively discharge my duties as a director has been compromised beyond repair.
Accordingly, effective immediately, I hereby resign from the Board of Directors of Helios and Matheson Analytics, Inc., and from any and all committees of which I am a member.
In accordance with Section 11(b)(1) of the Securities Act, from this date forward, I disclaim any and all responsibility for any part of any registration statement filed with the United States Securities and Exchange Commission by or on behalf of Helios and Matheson Analytics, Inc., or any of its affiliates, including but not limited to the Form S-3 filed on January 25, 2018, the Form S-3 filed on July 2, 2018, and any other corporate filings.
/s/ Carl J. Schramm
MoviePass has fallen on hard times this summer. Their parent company’s stock dropped below $1 (again) after a 250-to-1 reverse stock split, and the service crashed on numerous occasions including the Thursday night before Mission: Impossible – Fallout‘s opening. At that time, it looked like MoviePass ran out of money, and they took out a $6M-plus loan which they reportedly paid back. Since then MoviePass has refrained from providing access to major studio new releases and has made various changes to their monthly plan in an effort to stop bleeding cash, striving from the $9.99 a month/one ticket a day program they relaunched their brand on a year ago.
Subscribe to Deadline Breaking News Alerts and keep your inbox happy.