On Review of Both Proxies, A Retraction Is In OrdeHey Mates,
Let me premise my remarks by saying that the following is the opinion of 4 private investors in Rockwell, so please accept it on face value.
I finally received my proxy circulars this morning, fromboth Pala Investment Holdings and that of the three Rockwell executivedirectors. It is now almost 2 AM London time.Over the past 6 hours I have studied both proxies and just finished ateleconference with my colleagues here in London, and in Vancouver.
To summarize our discussions, we have decided to vote withthe three current Rockwell executive directors, and against the proposal byPala. I am not retracting some of thecomments I’ve made over the past week or so about current Rockwell management,in that I feel they:
1] have shown poor leadership at times by failing to ensureshareholder value was maintained, instead allowing the share price to declineby more than 95%
2] are being compensated far too much during a period whenall mining concerns are reducing compensation, reducing expenses, and protecting workingcapital. The burn rate, in our opinionhas been excessive, and must be addressed.
That having been said, they have agreed, in their proxy, to:
1] maintain the shareholder rights plan (poison pill), whichPala has indicated would be terminated, either through our proxy, or afterwards, should their slate be voted in. We feel the shareholder rights plan is absolutely essential.
2] undertake a “Fair Rights Offering”, allowing existingshareholders the opportunity to purchase additional shares, but limiting anyresulting individual share position to not more than 25% of the current sharecapitalization. We feel this is also an important concept, as it will go a longway towards ensuring that the company is not broken up, and existing shareholders are afforded the opportunity of avoiding any dilution, while helping Rockwell through the current market downturn.
In fairness to Pala, what concerned us about the their proxy offer was the mention, onseveral occasions about company restructuring.Any of us familiar with the VSE know exactly what that means … shareconsolidation, at the very least, or a potential asset sale that could leavethe average shareholder with little or nothing.We don’t feel this is the avenue to go down.
One final point. We all are concerned with the silence of the four existing Rockwell directors, who Palahave indicated they support as part of the new Board they propose. We as shareholders have not heard from them.Where do they stand, and why?
In any event, I retract my previousposition and, somewhat reluctantly, we will vote the Green Proxy. However we hope the existing Rockwell executivedirectors asking for our support will, if successful, listen to the concerns of existingshareholders.
I shouldalso mention that one colleague who had already voted the Blue, has indicated sheintends to revoke her proxy and vote with us.
Brit