Agrees that Shareholders have sent a Powerful Message --
to the Board
NEW YORK, June 25, 2015 /CNW/ --
Dear Fellow Shareholders,
In an ongoing and much needed effort to promote transparency to
fellow shareholders, Red Oak Partners, LLC ("Red Oak") wishes to clarify yet another
misleading and promotional press release issued by Dynacor Gold
Mines Inc. (TSX: DNG)(OTC: DNGDF) ("Dynacor" or the "Company") on
June 23, 2015. Specifically,
Dynacor's Board has made incorrect claims about the level of
support shown for its Directors at the June
22 election. Dynacor's Board is well aware that only
two voting options exist in Canada
for the election of Directors: FOR or WITHHOLD. There
exists no AGAINST vote concept. Accordingly, WITHHOLD votes
represent votes opposing re-election. Despite knowing this,
Dynacor's Board ignored a significant number of votes specifically
marked as WITHHOLD regarding the re-election of its Chairman as
well as certain other Directors. In yet another instance of
misleading and cherry-picking of facts, Dynacor's Board has taken a
path to skew information in its favor by promoting a fictitious
level of support. We have confirmation that the WITHHOLD
votes regarding the election of the non-independent Chairman,
Rene Branchaud, represented an
amount greater than eighty percent of ALL shares which voted
at the 2014 election and at least seventy times the number
of shares which the eighteen year affiliated Director owns
personally. This is a far cry from the laughable 99.83%
support which Dynacor's Chairman-led Board claimed was voted in
support of its conflicted Chairman Branchaud.
Additionally, because of Red
Oak's concern about a fair election, Red Oak voted on Dynacor's proxy card to ensure
Dynacor could not find ways to exclude such votes. Despite
taking such precautions, Dynacor's Board and representatives
conducted the meeting in the absence of an independent inspector of
elections. Despite the Dynacor insiders speaking English
fluently, they conducted the meeting entirely in French (which was
fine) but did not ask (in English) for Red
Oak's representative (who was present at the meeting) to
propose Red Oak's nominees. A
fairly run election would never have seen such a conflicted and
intentionally unfair process, and only confirms our concerns about
Dynacor's Chairman and Board's alignment with shareholders and vs.
its desperation to entrench itself at literally any cost.
Stated David Sandberg,
Red Oak's founder and managing
member, "Red Oak's goal was to bring
important issues to light. We did not actively solicit
shareholders and I did not make a single outbound call, and we
expect we spent less than 20% vs. the shareholder monies which
Dynacor's Board so readily wasted (Dynacor's Board should publicly
disclose what it spent even if shareholders will be outraged at the
amount). Ultimately we even voted on the Company's proxy
card. Through this managed effort, we were successful in
confirming that the largest shareholders of the Company expect
significant change as a result of this process, we forced Dynacor's
Board to publicly confirm it will address all of the
issues we raised (although it did recant in a recent press release
regarding adopting policies related to Director tenure, but we will
almost assuredly contest next year's election in a significant way
if tenure as well as tenure-based ownership requirements are not
adopted), and we gave a much needed wake up call to the Board and
to shareholders, including those who have fiduciary duties to their
own investors. In the interim, we – along with all
shareholders – anxiously await the Governance Committee's new
policies as well as the next nominating process, one which we
expect will not be led by the non-independent Chairman and in which
shareholder candidates will be strongly considered, if not
favored. Until then, we ask that Dynacor's Board require
Director training for its less experienced Directors who have not
had such training as well as those (such as the CEO and some of the
newer Directors not named Depatie) whose only meaningful experience
has been at Dynacor and who therefore would not have exposure to
public company governance and standard Board processes."
Continued Mr. Sandberg, "We remain excited about the business
and continue to increase our investment, and believe our group is
currently the largest shareholder of the Company. As
long-term holders, we continue to require strong governance and
meaningful alignment and representation by shareholders because
these are necessary to ensure that shareholders see optimal value
and dodge a recurrence of the Malaga bankruptcy (Dynacor's
predecessor) which so many of these same insiders played a key role
in."
Regards,
David Sandberg
Managing Member
Red Oak Partners, LLC
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/red-oak-partners-llc-clarifies-another-misleading-press-release-from-dynacor-300104875.html
SOURCE Red Oak Partners, LLC