On July 24, 2022, the Board of Directors (the “Board”) of Vinco
Ventures, Inc. (Nasdaq: BBIG) (“Vinco Ventures,” “Vinco,” or the
“Company”), a digital media and content technologies holding
company, among other things, terminated Theodore Farnsworth, the
former CEO of Helios and Matheson Analytics and Chairman of
MoviePass, as the Company’s Co-CEO less than 72 hours after he was
appointed, Lisa King as the President of ZVV Media Partners, LLC
and former CEO of the Company, Erik Noble as the Company’s Chief
Security Officer and any other role, and any and all arrangements
between the Company and Roderick Vanderbilt, including as business
development director and Chairman of the Board (Mr. Farnsworth, Ms.
King, Mr. Noble and Mr. Vanderbilt referred to collectively as the
“Farnsworth Group”). Ms. King and Mr. Vanderbilt still remain
members of the Board despite having their roles with the Company
terminated.
On July 14, 2022, Ms. King authorized the filing of a Current
Report on Form 8-K that incorrectly stated Mr. Farnsworth had been
appointed as the Company’s Co-CEO despite being advised that the
information contained in the Form 8-K was incorrect and based on an
invalid Board meeting (the “First Incorrect 8-K”). The Company
attempted to file a Current Report on Form 8-K by the end of the
day on July 14, 2022 to correct the First Incorrect 8-K, but this
attempted Securities and Exchange Commission (“SEC”) filing was
blocked by certain members of the Farnsworth Group, even though Mr.
Farnsworth was not legally appointed as the Company’s Co-CEO at the
time.
On July 17, 2022, the Board convened a duly noticed meeting,
where the Board determined, on the recommendation of the Board’s
independent committees, to terminate Ms. King as the Company’s CEO
and as a Vinco Manager of ZVV Media Partners, LLC (“ZVV”), and
appointed John Colucci, who has over 20 years of marketing and
advertising experience, as the Company’s Interim CEO. In the days
that followed, the Company and the Farnsworth Group held multiple
meetings to try and come to a resolution on the Company’s
management and path forward.
On July 21, 2022, the Board convened another meeting where,
after all directors waived notice required by the Company’s bylaws,
the Board (i) rescinded Ms. King’s termination and appointed her as
the President of ZVV, (ii) appointed Mr. Colucci as Interim Co-CEO
with operational and financial responsibilities and Mr. Farnsworth
as Co-CEO with investor relations and certain business unit
responsibilities. At this meeting, the Board also directly
instructed the Co-CEOs to file a corrective Current Report on Form
8-K by 5:30 PM on July 21, 2022 in order to meet the deadline
imposed as a result of Mr. Colucci’s appointment as Interim CEO on
July 17, 2022. Once again, certain members of the Farnsworth Group
blocked the Company’s attempt to make a Current Report on Form 8-K
filing and the deadline was missed.
On July 22, 2022, without informing anyone at the Company or the
Board, the Company believes that certain members Farnsworth Group
authorized the filing of a Current Report on Form 8-K signed by Mr.
Farnsworth that, once again, materially misrepresented the facts
and chain of events (the “Second Incorrect Form 8-K”). The Company
believes the filings of the First Incorrect Form 8-K and the Second
Incorrect Form 8-K were done unilaterally.
On July 24, 2022, the Board of Directors held another duly
noticed meeting where the Board, among other things, (i) terminated
each member of the Farnsworth Group, effective immediately, (ii)
removed Roderick Vanderbilt as the Chairman of the Board, and (iii)
ratified and confirmed the Board’s July 17, 2022 appointment of
John Colucci as Interim CEO. The Company’s SEC codes
and SEC filings by the Company have been blocked by the Farnsworth
Group, so the Company anticipates filing a Form 8-K when those
issues have been finally resolved.
On July 22, 2022, the Company was, potentially due to the action
or inaction of certain members of the Farnsworth Group, required to
make the $33,000,000 cash payment under the Company’s previously
disclosed Senior Secured Promissory Note dated as of July 22, 2021
(the “Secured Note Payment”). After the Secured Note Payment was
made, the Company had approximately $20,000,000 of cash and cash
equivalents at its disposal. We also have $80,000,000 of cash that
is subject to certain conditions pursuant to a deposit account
control agreement, meaning this cash is not readily available for
Company use. The Company is currently in the process of
implementing a cost reduction plan.
John Colucci, a member of the Board of Directors of the Company
who, at the request of the independent directors, agreed to step in
as Interim CEO, stated “I was willing to step in as the Company
enters into a new phase to stabilize the Company and implement
immediate cost-savings plans and aggressively pursue revenue
generating programs with strategic partners. The Company believes
it thwarted a hostile takeover attempt for no consideration by the
Farnsworth Group, and we are in the process of stabilizing the
Company to move forward and continue to achieve its goals that are
in the best interest of the shareholders.”
About Vinco Ventures
Vinco Ventures (Nasdaq: BBIG) is focused on the
development of digital media and content technologies. Vinco
Ventures’ consolidated subsidiary, ZVV Media Partners, LLC, a joint
venture of Vinco Ventures and ZASH Global Media and Entertainment
Corporation, has an 80% ownership interest in Lomotif Private
Limited. For more information, please visit
investors.vincoventures.com.
Forward-Looking Statements and Disclaimers
This press release contains “forward-looking
statements” as defined in the safe harbor provisions of the U.S.
Private Securities Litigation Reform Act of 1995, which are based
upon beliefs of, and information currently available to, Vinco
Ventures’ management as well as estimates and assumptions made by
Vinco Ventures’ management. These statements can be identified by
the fact that they do not relate strictly to historic or current
facts. When used in this presentation the words “estimate,”
“expect,” “intend,” “believe,” “plan,” “anticipate,” “projected,”
and other words or the negative of these terms and similar
expressions as they relate to the applicable company or its
management identify forward-looking statements. Such statements
reflect the current view of Vinco Ventures with respect to future
events and are subject to risks, uncertainties, assumptions and
other factors relating to Vinco Ventures and its subsidiaries and
consolidated variable interest entities including Lomotif, their
industry, financial condition, operations and results of
operations. Such factors include, but are not limited to, the
expected benefits from Vinco Ventures’ investments in Lomotif and
related growth initiatives and strategies such as the blended
media, cross-platform distribution strategy, the expected benefits
of Lomotif’s participation in and sponsorship of live entertainment
events, the expected benefits from acquisition of AdRizer and
planned integration of the AdRizer technology with Lomotif and
Honey Badger and synergies between AdRizer, Lomotif and Honey
Badger and such other risks and uncertainties described more fully
in documents filed by Vinco Ventures with or furnished to the
Securities and Exchange Commission, including the risk factors
discussed in Vinco Ventures’ Annual Report on Form 10-K for the
period ended December 31, 2021 filed on April 15, 2022, which are
available at www.sec.gov. Should one or more of these risks or
uncertainties materialize, or the underlying assumptions prove
incorrect, actual results may differ significantly from those
anticipated, believed, estimated, expected, intended, or planned.
Although we believe that the expectations reflected in the
forward-looking statements are reasonable, we cannot guarantee
future results, performance, or achievements. Except as required by
applicable law, including the securities laws of the United States,
we do not intend to update any of the forward-looking statements to
conform these statements to actual results.
# # #
For further information, please contact
the Company at: investors@vincoventures.com
Vinco Ventures (NASDAQ:BBIG)
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