agm.....another view

While being on “holiday” I have been watching the postings on HC relating to the AGM held last Tuesday, which I attended.

In the main I am left asking myself was I at the same meeting that some posters who were present and who have taken time out to write in to HC. Some commented with a sense of balance while holding strong views, especially about key personnel's remuneration , but puzzlingly, the plethora of the non attendees and the usual pundits launched into non stop rabid comments, mainly instigated by the jaundiced view of one attendee. Everyone can have an opinion at meetings like these, that’s good, but they must be correct in their summation, what has been in the main propagated on HC is not a real picture of the meeting

Let me say the actual meeting opened with a short statement read out by the chairman, Gus Simpson, just a very broad statement of affairs, nothing earth shattering in what he said

Next each of the proposals being put to the floor were read out individually, this was done by the chairman excepting the one concerning the issue of price stipulated option achievements that the chairman was the recipient, and this one proposal was handled by fellow director Mal James.

It should be clearly understood by all readers that the proposals had been decided before those present at the AGM had voted, (presumably when PALA voted in favour) but all votes were taken from the floor and the results announced. without going into individual detail, the directors standing for re election gained about 92% of the vote and the issue of options potentially to come into play at a strike price/time, to the various directors and key personnel about 62%. Anybody who wants to discuss the results feel free, and I would have personally preferred that the issue was timed to be enacted when certain “physical” on/in the ground achievements had been attained, but the reality is the proposals have been passed and my only response is..... get over it.

Regarding these matters, I especially have no time for the posturing of self declared “non holders”, (who pontificate/denigrate/ the management and the company) neither, I am sure, have the board

Let me also be quite clear, at no time did Gus or Mal James become flustered in the face of questions from the floor about remuneration as has been suggested. I have been to numerous company meetings and it is always hard work for proposed recipients of increased salaries or holdings to appease shareholders in difficult times.

I wish they all worked “buckshee”, but they don’t. A right decision by these people can make us millions, (as you will ascertain later in this post), I heard no derisory laughter as has been said, the people around me who disagreed with proposed company action, (and there were quite a few), seemed decent and would not have shown such bad manners and stooped so low, one person with an agenda sneered a little, it said more about him than those he was attacking on the stand.

The same applied to other directorships held by Simpson and the Company Secretary, these guys don’t punch the clock in when they come to work

This particular contrarian shareholder, at every point in time when each proposal was enunciated, bounced in and started asking what he thought were pressing questions, he must have taken up 75% of “question time”, and that is his right. The chair answered and explained the company’s policy/attitude/direction/decisions to him. To say he asked and commented on the same matters and tried to continually assert his point of view repeatedly is an understatement. Simpson listened to him for the formal and then the informal periods and finally cut him short late in the meeting (when he launched into another diatribe) to take other questions. This character got the message and didn’t participate any further, but spoke face to face with Gus at the close of proceedings. He then rushed into HC print, giving what I regard as his pre determined view to HC readers, as I said a jaundiced view, skewering a great deal of the posts that non attendees have commented and debated since, and perhaps frightening some investors, in my opinion unnecessarily, but I certainly hope unintentionally

Some of his questions went broadly like this;

1/ “What did the individual directors and various managers do ?”........... Gus Simpson and Mal James answered to the best of their ability (despite audible mocking from this perpetual questioner) explaining that the management and staff were working long and hard utilising their best endeavours to achieve their stated outcomes for PEN. The guy could have looked up the internet to see what they all did, I don’t know if he was an expert in company management construction, if not, to explain what he sounded like was one of those characters who we have all come across who preach to a captive audience at a parent and teachers night, they seem to love taking long winded cheap shots from the safety of the floor

2/ “Did the directors think that they and the named employees were worth what they were being paid now or at the increased rates proposed ?” ............ Wether the question had any merit or not he would hardly expect the recipients of the question to answer in the negative. Simpson made the point, as he had privately to me a long time ago, that he wished to assemble the best group of employees working for PEN, and rewarding effort and diligence with options is how he goes about it, (remember what happened in the main when he and Warwick Grigor underwrote the PENOC option float), I personally have no objection to this way of doing things. As regards salaries, I was chatting to a chap some days ago, and he told me that top train drivers up in the NW iron ore sites receive about $200,000 per annum. What did this perpetual questioner think would be a fair salary for people PEN take on, we assume they are world class experts in the particular fields PEN require in
finance/geology/engineering/negotiating/ etc., and I say this in no way disparaging the hard working train drivers !


Towards the end of the meeting Gus Simpson spent 15/20 minutes running through what had eventuated during 2011 and where they wanted to take PEN in the near and medium future. It was illuminating and left me satisfied as to where PEN is heading. To be in charge of a small cap uranium explorer,with excellent prospects, who on the arrival alongside of a investor of the ilk of PALA, and with a rising uranium price, saw its capitalisation reach around $300 million. (The definitive facts needed as regards reserves in the ground last February was probably different, expanded reserves need to be delineated now, not so then) Why wouldn’t we all think that a bright future was on the horizon ?. Well the scenario changed in a way that Hollywood wouldn’t have envisaged when the tsunami hit Japan, the worlds greens had unlimited free kicks to the groin so Merkel immediately folded like a pack of cards prior to Germany’s state elections, and that paragon of virtue Bellesconi decided to wind down Italy’s nuclear program. (please tell me he didn’t come to that decision during a “bunga bunga”party), the right perspective is only now appearing, and we have been and are facing a world financial crisis of confidence once again, speculative money has dried up. Any of the PEN knockers, (those who hold shares only) and who claim to be across these matters, if they are so concerned, should now contact PEN and submit methods to overcome sentiment and the financial crisis otherwise.................................. let the board get on with their job

Gus exhorted forcefully that uranium shares in general follow the price of uranium. The chart published on HC by Purd at 15.11 hours on 30/11/11 (#7482049) unequivocally show that virtually all uranium explorers, and most of the new near producers (URZ are down about 66% since February 2011, they are building their recovery plant and have outsourced their milling to Cameco) do just that, virtually in parallel with each other....... full stop finish!!!!! PEN may have better prospects than most, and are better cashed up than most

Finally and of great importance, Gus explained, as far as he was legally allowed, what happened regarding the NuCore situation.

NOTO BONO.... Readers should note that those HC members who left early to be first on the HC press to describe the meeting, missed this explanation of an issue that the “nae sayers” postulated upon for weeks when Cornell and his NuCore left our fold, condemning the management, saying they had exposed the company to ridicule and worse still Jim Cornell had seen PENs state secrets, “chicken little “ stuff. In reality, when PEN was financially at the top of its game back earlier this year, Gus and the board attempted to take over a uranium broking company that was showing an annual profit of $160 million per annum, with the free investigative help of PALA, who at no cost to PEN, put in people to do due diligence on the targeted company. As we all can now see, the uranium business went into free fall, PENs capitalisation dropped dramatically and the target company remains unsold to this day, but is still trading. Jim Cornell was going to come on board as he was intimately involved with the target company. As it turned out that projected association could not be consummated and Cornell went elsewhere. If nothing else, this shows what the PALA relationship can bring to PEN, it shows what the innovative PEN leadership has tried to bring to us shareholders............... the perpetual posters who somehow failed to bring up this matter initially ought to be ashamed, it shows they are only interested in negative things about PEN, it shows their true colours

In closing , Gus repeatedly stated PALA were totally beside PEN, and for more than just being the largest shareholder. There may be some who feel this is a company who are waiting in the wings to somehow take the goose that is going to lay the golden egg, I have said before on this site and Gus says the same , why would they want to interfere maliciously when the board and management are going down the right path in historically, the most difficult period the uranium industry has faced since Three Mile Island incident. It is ever more apparent to me that no one can even contemplate a takeover of PEN the way the shareholding is set up, another chestnut put to bed that the early AGM leavers missed, and those posters who deliberately failed to declare it since they went to press after the AGM have, as I said, shown their true colours

As far as I am concerned I left the meeting perfectly assured the company is in good hands, so to those people who are concerned about their investment I can only say this, the story Gus told me 18 months ago when we met, and the story he told last Tuesday has not varied one iota, and this in the face of unprecedented turmoil

There can be no guarantees, but believe who you will

The latin motto at an Army establishment I attended back in the Vietnam war days said, “ NIL BASTARDUM CARBORUNDUM”, translation, “DON’T LET THE BASTARDS GET YOU DOWN”

GO THE PEN

Svengali