TSX: SXI
Your vote is extremely important.
Make an Informed Choice and Vote the WHITE
Proxy to Protect your Investment.
VANCOUER, Oct. 24, 2017 /CNW/ -
The Special Committee of Synex International Inc. (TSX:SXI) (the
"Company" or "Synex") wishes to announce today that a
leading independent governance and proxy advisory firm, Glass Lewis
& Co. ("Glass Lewis"), has recommended that Synex
shareholders vote the WHITE proxy FOR the management nominees at
the upcoming Annual General Meeting of Synex's shareholders
scheduled for 10:00 a.m.
(Vancouver time) on Friday, November 3, 2017 at the offices of Clark
Wilson LLP, 900 – 885 West Georgia Street, Vancouver, British Columbia.
Glass Lewis made its proxy vote recommendation after carefully
reviewing the facts and arguments made by both the Special
Committee of Synex and Daniel
Russell (the "Dissident" or "Russell"). The
independent recommendation is intended to assist shareholders in
making choices regarding proxy voting decisions. Glass Lewis made
the following points in recommending that its clients vote the
WHITE proxy FOR the management nominees:
RUSSELL'S ARGUMENTS – "LIGHT ON DETAIL, LACKING IN
CONTEXT"
"…we consider the overall case presented by Mr. Russell is light
on detail, lacking in context and nearly bereft of circumspection
in terms of the significant degree of influence he has personally
wielded over Synex. Perhaps just as problematic, we consider he has
paired these arguments with a very broadly framed plan that seems
to double down on his effort to skirt his historical service in the
Synex board room."
RUSSELL'S PLAN – "UNQUANTIFIABLE PROMISES"
"…Russell is not only the Company's largest investor but also a
long-serving director. With a seat in the board room over the last
13 years, we believe unaffiliated investors should expect
considerably more granularity than an unquantifiable promise to
"deal with the very real issues" facing Synex or "analyze
operations" and "fully extract value" from assets that Mr. Russell
has presumably been in a position to intimately observe and discuss
since 2004. Indeed, the only concrete plan appears to relate to
cutting overhead expenses, including salaries, though we would
caution even that line item lacks a measurable objective or
benchmark of any substance…"
RUSSELL'S STRATEGY – "LOOSELY FRAMED ARGUMENTS"
"…Russell offers loosely framed arguments around strategy,
expenses, profitability and return on assets. We consider these
positions are offered somewhat colloquially and are placed in
decidedly limited context with suitable peers or industry
benchmarks which might [not] (sic) reasonably reflect challenging
conditions in the energy sector as a whole. We thus do not believe
they serve as informative or compelling points here, particularly
given Mr. Russell's historical and significant ability to actively
engage with the remainder of the board on these issues through both
his directorship and his position as Synex's largest
shareholder."
RUSSELL'S NOMINEES – NOT "A CLEAR AND FAVOURABLE
ALTERNATIVE"
With respect to Cecilia Tam:
"does not appear to have any relevant executive or public board
experience"
With respect to David
Schincariol:
"it is not clear he has substantive experience with independent
energy production firms and it does not appear he has any executive
or public board experience"
With respect to Richard
McGivern:
"we do not believe [his] disclosed background clearly
establishes relevant executive experience and does not indicate he
has any public board experience"
With respect to the hand-picked slate collectively:
"While we would not suggest the foregoing candidates lack
appropriate expertise within the scope of their current employment,
we question how this framework -- i.e. a collection of independent
nominees with limited industry background and no apparent public
board service -- reflects, in Mr. Russell's words, "world-class
experience and expertise" with respect to the challenges and
opportunities presently facing Synex."
RUSSELL'S SHARE PRICE ARGUMENT – FAILED TO SUPPORT HIS
CASE
"… we believe the Dissident has failed to provide sufficiently
contextualized figures to support the case that Synex's performance
has deviated significantly from industry trends or even that the
Company's share price performance -- already hampered by volatility
stemming a low free float and limited trading liquidity -- has
materially underperformed suitable benchmarks."
RUSSELL – "NEAR-UNILATERAL AUTHORITY"
"… in the event the Dissident is successful… the board will be
comprised of five members, two of which will be Mr. Russell and his
spouse. Combined with a large equity stake and independent nominees
bringing a relatively neophyte degree of experience to the public
board room, we are concerned Mr. Russell will be positioned to
exercise near-unilateral authority regarding Synex's strategic and
financial direction. We hold this perspective even before giving
effect to the fact that Mr. Russell has indicated his prospective
intention to take on a senior management role, "as an interim or
transitional measure. In short, we do not believe support for the
Dissident's agenda and candidates represents a clear and favorable
alternative…"
RUSSELL'S CRITIQUE – "A RATHER ODD STONE TO THROW"
"We would further suggest Mr. Russell's [total shareholder
return] critique is a rather odd stone to throw, given his lengthy
service on Synex's board. Instead of addressing what seems to be a
self-inflicted attack on his own legacy, we note Mr. Russell's
primary materials fail to meaningfully acknowledge his directorship
with Synex and instead attempt -- rather unconvincingly, in our
view -- to frame his agenda from the perspective of a board room
outsider."
Management and the management nominees are qualified to
successfully lead Synex.
MANAGEMENT SLATE STRENGTH
Management and the management nominees have experience which is
directly relevant to the business of a public company operating and
developing independent power projects in British Columbia. Unlike the Dissident
and certain of his nominees, management and the management slate
have:
- Strong local connections, extensive industry experience and
substantial public company governance experience.
- A history of successfully designing, building and operating
medium-sized hydroelectric plants – a complex set of tasks that
require specialized and diverse skill sets.
- Broad-based support from shareholders, unlike the
Dissident's primary support from his spouse and members of his
family.
Management's slate (as found on your WHITE proxy) includes
Tanya DeAngelis, who is the
Dissident's spouse, in recognition of the fact that Russell, as a
large shareholder, should have representation on the Board and the
access and influence available to a director.
The nominees listed in your WHITE proxy represent the best
choice for the Company who will act in the best interests of ALL
shareholders.
CORPORATE GOVERNANCE AND STRATEGIC PLANNING
Glass Lewis has recognized certain corporate governance matters
facing the Company – matters which the Special Committee has
identified previously. In recognition of these items going forward,
the Special Committee will recommend that the board appoint an
empowered Corporate Governance, Nomination and Compensation
Committee comprised of three independent directors. The Special
Committee will also recommend that the board appoint a Strategic
Operations Committee, which will be empowered to be responsible for
considering and making recommendations in regard to the Company's
strategic direction and planning with a view to enhancing corporate
and shareholder value. Positive change is on the side of
management's nominees.
VOTE TO PROTECT YOUR INVESTMENT IN SYNEX
Annual General Meeting
The Annual General Meeting of Synex's shareholders is scheduled
for 10:00 a.m. (Vancouver time) on Friday, November 3, 2017 at the offices of Clark
Wilson LLP, 900 – 885 West Georgia Street, Vancouver, British Columbia.
The Special Committee Recommendations
Your vote is extremely important.
The Special Committee unanimously recommends that Synex
shareholders vote only the WHITE proxy or voting instruction form
FOR the management nominees.
Shareholders who have previously voted the Dissident's proxy or
voting instruction form and wish to support the management
nominees, have the right to change their vote by simply voting the
WHITE proxy or voting instruction form. It is the later dated proxy
which will count. Please disregard any other coloured proxies you
receive.
For more information, Synex shareholders are encouraged to
access the Management Information Circular of Synex on its website
at www.synex.com or under Synex's profile at www.sedar.com.
VOTE TODAY. Time is of the essence and Synex shareholders
are urged to vote online by following the instructions found on the
WHITE proxy or voting instruction form to ensure votes are received
in a timely manner. Vote no later than the deadline of
November 1, 2017 at 10:00 a.m. (Vancouver time).
This press release contains forward-looking information. This
information relates to future events and the Company's future
performance. All information and statements contained herein that
are not clearly historical in nature constitute forward-looking
information, and the words "may", "will", "should", "could",
"expect", "plan", "intend", "anticipate", "believe", "estimate",
"propose", "predict", "potential", "continue", "aim", or the
negative of these terms or other comparable terminology are
generally intended to identify forward-looking information. Such
information represents the Company's internal projections,
estimates, expectations, beliefs, plans, objectives, assumptions,
intentions or statements about future events or performance. This
information involves known or unknown risks, uncertainties and
other factors that may cause actual results or events to differ
materially from those anticipated in such forward-looking
information. In addition, this press release may contain
forward-looking information attributed to third party sources. The
Special Committee believes that the expectations reflected in this
forward-looking information are reasonable; however, undue reliance
should not be placed on this forward-looking information, as there
can be no assurance that the plans, intentions or expectations upon
which they are based will occur.
This press release contains forward-looking information
concerning, among other things, the following: the Special
Committee's assessment that Glass Lewis' recommendations validate
that the future of the Company best lies in the hands of the
management nominees; the conclusions and assessments of Glass Lewis
as set forth herein; and matters with respect to the upcoming
meeting, including the scheduled date and time of the meeting and
the cut off time for proxies. A number of risks and other factors
could cause actual results to differ materially from those
expressed in the forward-looking information contained in this
press release including, but not limited to, the risk that the
Company's and Glass Lewis' assessments, as set forth herein, are
incorrect; the risk that the meeting date and time may be delayed,
adjourned or otherwise. With respect to forward-looking information
contained in this press release, the Special Committee has made
assumptions regarding, among other things: that Glass Lewis'
recommendations will not change; the time and date of the meeting
(and related voting cut-offs) will not change. The Special
Committee has included the above summary of assumptions and risks
related to forward-looking information included in this press
release in order to provide investors with a more complete
perspective on the Company's future operations. Readers are
cautioned that this information may not be appropriate for other
purposes. Readers are cautioned that the foregoing lists of factors
are not exhaustive. The forward-looking information contained in
this press release are expressly qualified by this cautionary
statement. The forward-looking information contained herein is made
as of the date of this press release and the Company disclaims any
intent or obligation to update publicly any such forward-looking
information, whether as a result of new information, future events
or results or otherwise, other than as required by applicable
Canadian securities laws.
SOURCE Synex International Inc.