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  "documentTitle": "Axon Enterprise (formerly TASER) (AAXN)",
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  "presentationDate": "2019-06-19 00:00:00",
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      "kind": "callout",
      "text": "Axon has not explained why the total cost (land lease purchase + prepaid rent) increased 25%. Also, recall it said total capex of $12 - $15m in 2019. Does this mean its total capex budget will be just to purchase land, and its operating business requires no growth or maintenance capex?",
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      "text": "Excerpts from legal documents regarding purchase price and prepaid rent.",
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      "text": "Beyond the small $17.6m acquisition of VIEVU (requiring just $5m of cash), the only notable investment Axon has announced is its intention to construct a new headquarters in Scottsdale, AZ. Axon claims it needs a new 325,000 square foot space for manufacturing and production, a 3.2x increase in size from its current 100,000 square foot facility.(1) The need for such an aggressive expansion in light of stagnate Taser product sales and unit production appears outlandish. Furthermore, Axon’s repeated delays and 25% increased costs (without explanation) shows further evidence of poor capital planning and disclosure practices by management. We also question why is it pre-paying rent for an 84 year leasehold interest? Is Axon attempting to inflate future cash flow by incurring the cost upfront?",
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      "kind": "quote",
      "text": "On December 13, 2018, we entered into a Purchase and Sale Agreement (\"PSA\") to purchase a leasehold interest to a parcel of land located in Maricopa County, Arizona for a period of 84 years, on which we intend to construct our new headquarters. The purchase price of the land lease was $13.1 million. It is also contemplated that we will prepay the rent under the lease in the amount of $10.9 million. — 10-Q filed May 10, 2019",
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      "text": "Source: Original agreement - filed Nov 11, 2018 / Source: 10-Q - filed May 10, 2019",
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      "kind": "source-note",
      "text": "1. Axon says it has other warehouse facilities, and that its new HQ will consolidate locations. We are unable to determine the size of these other facilities.",
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      "kind": "title",
      "text": "Axon Has Spent Money On Nothing, Other Than Preparing A Plush New HQ",
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      "evidence": "The report details the struggles facing Axon Enterprises, including poor accounting practices, dependence on China, and allegations of police briberies",
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