Sasco Partners Sends Follow-up Letter to Shareholders
22 Dezember 2011 - 7:40PM
PR Newswire (Canada)
HOUSTON, Dec. 22, 2011 /CNW/ - Sasco Partners, LP (together with
its affiliates, "Sasco"), the largest shareholder of Samex Mining
Corp. ("Samex" or the "Company") (OTC.BB: SMXMF), today announced
that it has delivered a follow-up letter to Samex shareholders
responding to numerous false and misleading statements from
yesterday's public statement issued by the Company. The full text
of the letter follows: December 22, 2011 Dear Fellow Samex
Shareholders, We have reviewed the statement released yesterday by
Samex Mining Corp. ("Samex" or the "Company"). Sadly,
management and the Board of Samex have decided to conveniently omit
numerous facts and misdirect shareholders yet again. This is
precisely what happens when a group with a track record of numerous
failures is confronted with reality. The fact is that Sasco
has openly expressed to management its repeated disappointments
with their recent performance via emails, conference calls and
through in-person visits. Recently, upon receiving our list
of demands aimed at advancing shareholder interests and enhancing
shareholder value, the Board decided to form an "independent
committee" consisting of four current Samex directors.
According to Samex's most recently filed information circular, two
of these individuals are non-independent directors and thus, this
so-called "independent committee" is not even composed of a
majority of independent directors. This is yet another
example of the corporate governance issues plaguing the Board and
Samex. We do not have trust that this committee is capable of
independent reflection and judgment on the serious concerns and
demands we have raised. Unfortunately,
present management is growing ever more desperate to maintain the
status quo and consequently appears willing to stoop to new lows at
the expense of shareholders. Without further ado, we will
examine the six main points raised by the Company in its "Samex
Answers Sasco" press release dated December 21, 2011 and show
you why the current Board is not to be trusted: 1) The Company
would have you believe that Sasco "may" have breached a
confidentiality agreement. This disingenuous attempt by
management to imply that I have somehow violated a recent
confidentiality agreement is extremely dishonest. This
standard agreement that management is alluding to was signed before
my visit to Chile in November. As management knows well, upon
Samex's recent press release detailing all exploration activities,
all material information learned during my trip became publicly
disclosed. Therefore the Board's unfair allegation that I
"may now be in breach" of this agreement was a deliberately
deceitful use of words to misdirect the public, while not taking
responsibility for a false accusation. Then, in yet a further
display of legal ineptitude, the Board claimed my letter's
assertion of a non-independent board was both "utterly false and
completely slanderous". Unfortunately, the term slander
applies to spoken words, while libel is the correct term for
written words. Clearly, our Board is unaware of even the most
basic legal considerations, much less the definition of the word
"independent," as noted above. 2) The Company criticizes Sasco for
not agreeing to enter into highly uncustomary and restrictive
lock-up agreements that would have insulated and entrenched the
Board and management. We find it laughable that the Company is
actually criticizing Sasco for not agreeing to guarantee Jeffrey
Dahl's job security for the next 5 years. On an equally misguided
note, the Board has also decided to raise the issue of their
so-called voting agreement. As my private placement was being
completed, Jeffrey Dahl's main concern was whether or not his job
would remain safe and secure in the future. He brazenly asked
for a written guarantee that this would in fact be the case.
I informed him that while I did not anticipate removing management
or the Board, I would need to see them perform for some time before
even considering signing any document of the sort. We then
exchanged a few ideas in drafts, but nothing was ever
executed. Ask yourself why Mr. Dahl did not make signing such
a highly restrictive and uncustomary document a prerequisite for
the private placement if it had already been agreed
upon. Clearly, Jeffrey Dahl and the Board were trying to avoid
accountability for their failures. Unfortunately as 2011
progressed, I realized that management was not keeping their word
on even the most basic of considerations. As a result, I
eventually decided it would not be in the best interests of
shareholders to sign such a document guaranteeing management and
the Board's job security regardless of actual performance. In
fact, I even made this very comment to Jeffrey Dahl in person
during my September visit. If he had any issues with my
position on this matter, then why was I allowed to return to the
property again in November? 3) The Company's
statement that Sasco thinks it "can run our drill programs better
than our professional geological team" does not make any sense. How
would this allegation make any sense when I have had nothing but
praise for Rob Kell and his team in Chile? Our primary issue
has been with management not allocating the adequate and
appropriate resources in a timely manner to assist our geological
team in the field. This is so critical because we are
strongly of the opinion that once enough drilling is completed at
Los Zorros, a legendary discovery can be made. The Company
also states that Sasco has "no experience or qualifications in
geology," thereby somehow implying that we are not welcome to voice
our concerns with the direction of Samex. How ironic is this
statement considering the Company's entrenched CEO is a former
stockbroker and fruit farmer without a college degree? Our
position has always been that Samex needs a qualified industry
veteran to manage its affairs. My firm has been working
diligently via industry contacts to find accomplished executives
and Board candidates with proven track records of success. In
this respect, we are presently evaluating several strong candidates
who have had long tenure with major mining companies and started
successful junior mining ventures. 4) The Board would have
you believe that it adequately represents the best interests of
shareholders. The Samex Board's track record speaks for
itself. Do you know of any other junior mining company that
still has the same board intact after 16 years of failed execution,
extensive share dilution, and not even a single proven ounce of
resources to speak of? How can management be proud of this
legacy of failure? What's even more confusing is their
declaration to be ethical because option grants have never reached
10% of outstanding shares. The issue here is not one of
quantity but of quality. For example, why should the
Abbotsford management have been awarded even a single option in
2009 after nearly driving Samex into bankruptcy the year
before? Jeffrey Dahl, his father Peter Dahl, Larry McLean,
his wife Brenda McLean, and Allen Leschert were awarded
approximately 2,100,000 options in September 2009. Such
action appears not only highly unethical to us, but also appears to
be in direct disregard of their respective fiduciary duties to
shareholders. In fact, Samex presently has less than just 1%
of its outstanding shares available to issue as options for new
employees. This handicap will almost certainly leave Samex at
a disadvantaged position if the Company needs to further expand its
operations. Shareholders need an independent and
re-constituted Board that is not composed of management and their
personal friends, or the unabashed abuses of power will continue
unabated. 5) Management claims that Sasco's comments on hiring new
geologists and drill rigs are misleading. Apparently, Jeffrey Dahl
and his colleagues are bewildered when I quote their very own press
releases. Perhaps that is because their projections have a
checkered history and are utterly unreliable. The simple fact
is that anyone can look up both their December 17, 2010 as well as
July 8, 2011 press releases, which are two separate issues.
They did not drill Nora when promised, but also by their own
admission, they did not even have a single rig on Los Zorros for
many months in 2011. There is nothing "confusing" about these
facts as management tries to claim. Additionally,
management's claim that they had been "actively recruiting
geologists throughout 2011" does not reflect reality. From
January 2011 until September 2011, Samex only hired 1 new
geologist. Then after a visit in September 2011, when I
strongly urged management to put a serious effort into recruitment
with new strategies, Samex managed to hire two more geologists
within just two months. One would hardly call this a
mere coincidence. 6) The Board defends the practice of
allowing its highest-paid executives to live most of the year in
Abbotsford, Canada. It remains tremendously disappointing
that the Company is still trying to justify its hands-off
approach. The simple fact is that Samex does not need to
allocate the lion's share of its salary expenditures to individuals
living in a small Canadian town. Our Company is perfectly
capable of having just a few administrative employees remain in
Canada full-time to handle regulatory related matters. The
plain fact is that our CEO and VP of Operations choose to remain in
Abbotsford because it allows for a more convenient lifestyle than
does living away from their families in Chile. Next time you
are lucky enough to have management actually return your phone
call, please be sure to ask them exactly how many salaried
employees work in the Abbotsford office, as well as how much each
one is earning annually.
Lastly, as far as our website is concerned, Mr. Dahl
once again does not have his facts straight. His stated
belief that I was content with the site is reference to a joke I
made upon one of my visits. Sadly, even Mr. Dahl admitted
that the website was a "source of embarrassment" for many
years. It is truly inconceivable that anyone could have been
satisfied with the stale and confusing nature of our prior site,
and unfortunately our "new website" is merely a simple design
modification. Visitors cannot even see detailed maps of our
projects or clear visuals of our drill results. These are
essential facets of any exploration company's website, and any
management with the slightest bit of industry experience would
certainly understand this. In conclusion, both
the Board and management of Samex have wasted valuable time, have
misallocated Company resources, and have further expanded upon
their own legacy of poor performance. They will do everything
in their power to continue distracting the public from their
abysmal track record. You don't even have to take our word
for it - their 16 year track record is out in plain view for
everyone to see, and it's hardly anything to celebrate. The
reality is that Jeffrey Dahl, along with his father and friends,
have run Samex as if it were their private company for the better
part of two decades. This management clearly needs to change,
and the time for change is now.Moving forward, Sasco will continue
working hard to find our Company the proper management and Board
team that is desperately required to unlock shareholder value and
the full potential of Samex. If incumbent management wishes
to remain "suspicious" of our motives, they are welcome to do
so. We are the largest shareholder of Samex and do not
receive salary or options of any kind from the Company. Our
interests are directly aligned with yours as shareholders.
Like all other shareholders, we only benefit if our Company
succeeds in its exploration activities.
We would like to thank you for taking the time to hear our
viewpoints and encourage you to make your own and informed
decisions about what is truly best for Samex. Many
shareholders continue to contact us and provide their valuable
input during this important time. We want to assure everyone
that we are only concerned with promoting all shareholder interests
and enhancing shareholder value. Warmest Regards, Sasan Sadeghpour
Chief Investment Officer Sasco Investments, Manager of Sasco
Partners Contact: Sasco Partners, LP Sasan Sadeghpour, (713)
956-5200 (ext. 102) SOURCE Sasco Partners, LP Sasco Partners, LP
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