Within the last three weeks, Conshohocken-based Skinny Nutritional Corp. has seen three of its four board members resign, each submitting a letter critical of how the company is being run.
The only board member left is chairman Michael Salaman, who also happens to be the CEO.
Skinny Nutritional is the maker of Skinny Water, which is marketed as a zero-calorie, zero-sugar bottled water product. A tiny, unprofitable company, Skinny Nutritional's shares trade over the "pink sheets" over-the-counter market at a price that's quite near zero itself.
While the reasons for board departures are generally routine (think: demands of other duties), the skinny on Skinny is far from routine.
First out the door was Michael Zuckerman, who resigned on Jan. 17, "because I do not have confidence that I am being kept informed of facts and events that involve the company," he said in a letter filed with the Securities and Exchange Commission.
One example cited by Zuckerman in the letter was that Skinny Nutritional's directors and officers liability insurance coverage had been allowed to lapse because the premium had not been paid. The board was not told until "well after the fact," he writes.
Eight days later, John J. Hewes and Francis W. Kelly also informed the company they would resign from the board. In Hewes' letter dated Jan. 27, Hewes said the "tipping point" for him came in mid-December when he'd requested a full disclosure of the company's accounts payable be made available to the board. Such information, including bank account records and credit card statements, were not made available, Hewes said.
Kelly also expressed frustration over Skinny Nutritional's willingness to provide detailed financial, production and sales information in a letter received by the company on Jan. 28. "Ultimately, I have had to recognize that, for whatever the reasons, the Company will not correct these serious problems," he writes.
Zuckerman, an executive with the privately held Zuckerman Honickman packaging company; Hewes, a former Sallie Mae executive; and Kelly, an equity trader who worked for Susquehanna International Group, had joined the board of Skinny Nutritional in July 2010.
In a regulatory document filed by the company with the Hewes and Kelly resignation letters, Skinny Nutritional said it "does not concur with the characterizations" described by the directors about "its purported unwillingness" to provide information.