Shareholders stakeholders driving policy - not shareholders
I think the move to the NYSE from the NYSE-A is a prelude to another offering. Shareholders need to know what they are getting themselves into by purchasing HEXO stock (or any other LP for that matter) and need to understand the difference between the concept of shareholder value and stakeholder value. A good reference apeared in the globeandmail yesterday. See https://www.theglobeandmail.com/opinion/stakeholders-trump-shareholders/article734943/. At the moment, company policy is being determined by stakeholder value and not shareholder value.
Sebastien talks a good line about working in the interest of the shareholder, but the current plan speaks to the opposite. Do you think it is right that employees should receive 110% of Gross margin (cash in the door) as a bonus? Not only is there nothing left to pay overhead and operating expenses, the company has to borrow or issue new shares to make up the shortfall - both of which further degrade shareholder value. The harsh reality is that such a plan is ultimately unsustainable if the company is to survive over the long-term .
There is a significant first mover advantage for adopting such a plan. If HEXO announced tomorrow that it would shift to a merit based bonus incentive plan - one that is driven by measurable performance metrics that focus on earnings per share, how do you think shareholders in the industry would react? I think it would have an immediate positive effect on share price as it would distinguish HEXO as being the only LP to align employee interests with those of shareholder. I suspect other LP's would quickly adopt a similar plan.