Mr. Chooljian controls the board agenda and has failed to schedule matters necessary to comply with the bylaws and California law. He could have scheduled such matters for the March 31 and April 28 meetings but did not. In order to keep power, he may never schedule them.
We reported the 2021 financial statements were required to be sent to shareholders by March 30. The CPA firm had all the information it needed except for the following decisions only the board can make:
- The size of the company’s matching contribution to the 401(k) plan,
- Whether to write off the “asset” of $884,607 spent on the failed Well #7 project,
- Whether to write down the value of the land purchased for Well #7, and
- The content of the disclosure that should be made about the substantial risk of material losses on the Calleguas contract for Well #8.
Mr. Chooljian is deliberately keeping shareholders from knowing the company’s true financial condition.
We also reported that the bylaws require the annual election of directors to be held no later than May 13. That deadline will be missed—even if the board holds a special meeting to take the necessary actions on the financial statements and to set the meeting date. There must be four days notice for a board meeting. The CPAs will need at least a few days after the meeting to finalize their report, and it must be sent to shareholders at least 15 days before the meeting.
Crestview has failed to deliver copies of the shareholder mailing list—to which we are all entitled—to at least two requesting shareholders. With a shareholder list, we could communicate with each other, collect five percent of shareholder votes to call an election, and run other candidates against Mr. Chooljian and passive directors. According to the bylaws, Mr. Chooljian can continue his misrule until shareholders vote him off the board.
Obsessive Exclusion of Shareholder Participation
In addition to these abuses of shareholders, Mr. Chooljian has imposed a policy of never giving any shareholder any information unless the bylaws specifically require it, and he will not negotiate about timing of required disclosures. Exceeding his authority at the 2020 shareholder meeting, he announced that no director could communicate with shareholders without his consent. Exceeding his authority in October 2021, he began muzzling disagreement by limiting to three minutes shareholders’ comments at board meetings. (Although the bylaws allow the board to impose reasonable limits on shareholder comments, it has never done so.) More about obsessive secrecy here.
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