Howard Penney, noted restaurant security analyst and Managing Partner at Hedgeye Risk Management, recently wrote in his report entitled Cosi-Destruction in Deerfield, "I have been analyzing the restaurant industry for twenty years now and I have witnessed only a few other companies that have destroyed more shareholder value than Cosi."
The company is now in free fall with an interim CEO and Chairman without restaurant experience and/or restaurant turnaround experience.
Cosi has never made a profit with this Board of Directors in office. Instead, the company has accumulated a staggering loss of $57.8 million in the past five years, in excess of 140% of its current market capitalization, driving the stock price from $11.21 in March 2006 to a low of $0.56 on September 12, 2011.
Jonathon Heller of The Street recently wrote, “Indeed, I’ve had my doubts that the company can survive longer-term,” after discussing present operations at Cosi. He also expressed optimism about the innovative proposal from BLUM Growth Fund in his recent article entitled Might Be Cosi’s Last Chance.BLUM Growth Fund has been clear with the Cosi Board of Directors. It has explained that there are three options. Option #1, the Board of Directors immediately adopts the latest BLUM Growth Fund proposal dated October 12, 2011, that was filed with the SEC. Part of the proposal, which contains several compromises and concessions, would retain three of the current Board Directors as official members of the Board, and the others would form an advisory group to the Board. Four new official Directors recommended by BLUM Growth Fund would join the new and refreshed Cosi Board of Directors. Each Board member would work for $1 in the first year. Brad Blum would serve as the chairman & CEO of Cosi, and he too would work for $1 salary.