On June 6, Crestview plans to mail to every shareholder FY2021 financial statements that clearly do not comply with state law. For the legally-required annual report reviewed by the CPA firm and containing all necessary adjustments and disclosures, shareholders are referred to a website, where that report does not exist—at least not yet. That this attempt to misrepresent the true financial condition to shareholders is intentional is revealed in the last paragraph of the draft president’s letter to shareholders, available here.
Also, the letter contains inconsistencies as to whether the Well #7 project is more likely than not to be successful. In the Executive Summary, it says, “efforts to find an alternative site have not been successful but are ongoing.” In the section about Well #7, it says—
Crestview Staff continues to work with State, Regional and County regulators to address the concerns that were raised during the Public Hearing process. Due to the issues that were raised, and the lack of clarity from regulatory agencies in response to those issues, no other locations within the district are being evaluated at this time. We have suspended our search for other locations.
So which is it? Looking for a new site, or definitely not looking for a new site? The fact that the board has suspended a search for a new location—if it has—certainly does not mean it has a viable plan for 191 Alviso. No reasonable person believes it is more likely than not that Well #7 can be permitted, drilled, and brought online at 191 Alviso. The board has no plan to achieve that—other than repeating what has failed three times already, “working with” public agencies at great expense and with zero positive results after seven years.
The internally-prepared draft has none of the explanations and disclosures required by law. One of the disclosures likely to be in the CPA-reviewed report is the multi-million dollar risk that Crestview has undertaken in the Calleguas contract for Well #8.
Would the board, staff, and consultants be twisting themselves into such a pretzel about issuing financial statements if it were not for the simple fact that our president, Sol Chooljian, refuses to admit that important blunders have occurred on his watch? He wants to keep spending more shareholder money to conceal these failings. We need the other four directors to exercise their independent judgments and put a stop to this nonsense.
The indications are they have not given up on Well #7. This is to the
benefit of 98% of the shareholders. I suspect there are technical modifications to the original plan that would adequately mitigate concerns at that location plus make it very acceptable to all.