Waterford: First Calgary Should Stand Firm In Face Of Delaying Tactics
Waterford Finance & Investment Limited advised its fellow shareholders of First Calgary Petroleums Ltd. (FCP) that yesterday's court decision delaying the company's Annual and Special Meeting until April 18 does not alter the need to replace President and CEO Richard Anderson and his Board of Directors.
Shareholders who voted their YELLOW proxies -- who represented a majority of the votes cast by the April 4th deadline -- do not need to take any action to ensure their votes result in the removal of Richard Anderson and the election of a new, independent Board.
"We are disappointed but not deterred by the court's decision," said Michael Kroupeev, Director of Waterford. "The court has only delayed the implementation of the shareholders' vote. Essentially, it has allowed Richard Anderson and his board to continue to spend shareholders' money in an effort to entrench themselves, but it has not changed any of the reasons why change is needed at FCP."The reasons listed follow: The value of your shares fell from $22.74 to $2.05 in less than three years; FCP has failed to implement any strategy that could create meaningful shareholder value; FCP has failed to establish long-term financing for the Company and has instead overseen the repeated dilution of shareholders; FCP failed to manage the sale process of FCP in 2005 and the Company's shares have never recovered; FCP failed to link Richard Anderson's compensation to shareholder value; his compensation has more than doubled while shareholder value has been destroyed.
Waterford estimates that FCP has spent approximately $650,000 on advertising and public relation costs to defend Richard Anderson and the current Board, in addition to its highly unusual engagement of two investment banks in connection with the meeting at a minimum cost of $600,000.
On Sunday, April 6, a full two days after the proxy voting deadline, FCP released the contents of a letter it claimed to have received that day from the Algerian Minister of Energy and Mines. This letter appeared only after FCP would have become aware that more than 50% of FCP's outstanding shares were voted in favour of the Board proposed by Waterford.
In Waterford's view, this letter from the Algerian Minister does not change the fundamental problems at FCP. In fact, Waterford is concerned that the broad reproduction of this letter in the form of a press release and the actions taken by FCP to extend the meeting date may serve to damage the Company's relationship with Sonatrach and the Algerian authorities. These issues need to be addressed with the Minister of Energy and Mines of Algeria directly, but in a private manner more befitting of his important role and FCP's need to foster a strong relationship with the Minister. Waterford's nominees to the Board are fully committed to working with the management team, Sonatrach, and the Algerian authorities to advance the development of the Company's Algerian project to the benefit of FCP shareholders and all parties.
As part of its order, the Court of Queen's Bench of Alberta has ordered FCP to instruct its transfer agent to disseminate YELLOW voting instruction cards to FCP's shareholders in the United Kingdom. This rectifies FCP's previous failure to mail such cards and Waterford is pleased that British shareholders will now be enfranchised in the voting process and able to show their support for the Waterford nominees.
Vote the YELLOW Proxy
Shareholders wishing to revoke their management proxy and vote the YELLOW proxy should ensure that the YELLOW proxy can be received by Kingsdale Shareholder Services no later than 5:00 p.m. (Calgary time) on Tuesday, April 15, 2008. Detailed instructions are included in the proxy circular that was distributed to all FCP shareholders. Further information about voting the YELLOW proxy is available from Kingsdale Shareholder Services at 1-866-851-2638.
- Eni Closes Acquisition of First Calgary (Nov 21)
- First Calgary Receives Approvals for Eni's Takeover Transaction (Oct 30)
- Oil Majors Set to Gain As Smaller Rivals Struggle (Oct 23)