Sierra Geothermal Power Corp. (TSX VENTURE: SRA) has sent a letter
to the dissident shareholder to demand a correction of errors,
deficiencies and misrepresentations in the dissident's proxy
circular and accompanying materials.
Sierra shareholders should not allow themselves to be
manipulated by the dissident's materials and claims. Sierra urged
shareholders to vote the GREEN Proxy in support of Sierra's board
and management, as recommended last week by the independent proxy
advisor RiskMetrics Group.
"The dissident's materials are rife with errors, deficiencies
and misrepresentations," said Gary Thompson, Sierra's president and
Chief Executive Officer. "We believe the dissident has an
obligation to set the record straight, correct its circular and
disseminate new materials to shareholders."
The problems with the dissident's circular
Sierra believes the dissident's circular and accompanying
materials have significant errors, deficiencies and
misrepresentations including the following:
- The circular misrepresents Sierra's position regarding a takeover.
- The circular misrepresents Sierra's financings.
- The circular omits required disclosure about the background of three
of the nominees put forward by the dissident for election to the board.
- The dissident's proxy does not conform with securities regulations.
If the dissident does not correct these significant errors and
deficiencies, Sierra believes it has legal remedies available and
reserves the right to exercise them.
Misrepresenting Sierra's position on a takeover
The dissident's circular incorrectly states that Sierra "refused
to consider" the discount price takeover proposal last July from
Ram Power, Corp. In fact, Sierra did not refuse to consider the
proposal. Rather, Sierra's board acted in the best interests of the
company and all shareholders by questioning the discount valuation.
Instead of explaining the valuation, Ram Power withdrew the
proposal.
The dissident, which styles itself as a "concerned shareholder"
makes this further comment: "The Management Information Circular
incorrectly implies that the Concerned Shareholder wishes to buy
Sierra at a discount." Sierra believes that the dissident is taking
out of context a sub-heading from the Management Information
Circular. In context, the Management Information Circular as a
whole, and all other Sierra communications, clearly state that the
dissident wishes to orchestrate a sale of Sierra.
The dissident's errors regarding Sierra's financings
The dissident fails to provide the proper context in describing
Sierra's August 2009 financing. In its circular, the dissident
claims the financing "was completed at a net price to Sierra of
$0.179 per share, a DISCOUNT from the apparent $0.186 valuation
implicit in the Ram Power, Corp. proposal." The dissident should
have supplied the price per share of the financing, which was
$0.20. Further, the dissident should have provided appropriate
context, which is that the price per share of a financing would be
expected to be less than the price to be paid for all shares of a
company in a takeover or merger.
The dissident also misrepresents Sierra's 2009 financings as "an
inappropriate and defensive response to a perceived threat of
shareholder action." In fact, the financings were to fund the
legitimate and necessary business expenses of Sierra and were
required after the dissident's principal, or those associated with
him, withdrew an offer of financing.
The dissident's omissions regarding nominees and proxy form
Sierra believes the dissident's circular omitted material facts
regarding the background of three dissident nominees and the
dissident's proxy form has numerous deficiencies. Sierra's letter
to the dissident provides particulars with regard to these
omissions and deficiencies.
Among the omissions, the dissident's circular failed to disclose
that Skyberry Holdings Ltd. is a principal holder of Sierra's
shares. More importantly, the dissident's circular failed to
disclose the relationship between Skyberry and the dissident
nominee Antony Mitchell.
Among the proxy deficiencies, the form does not provide a manner
for shareholders to specify for whom among the nominees he/she
would like to vote. This omission, which is important for those
shareholders who might support some but not all of the dissident
nominees, is contrary to BC securities regulations.
"We urge our shareholders to look beyond the dissident's
rhetoric and question the real motive for initiating a proxy
fight," said Mr. Thompson. "We believe the errors in the
dissident's circular may help to conceal the ultimate plan of
facilitating a sale of Sierra at a discount. To prevent this from
happening Sierra shareholders must vote their GREEN proxies as soon
as possible."
How to cast your vote
A special meeting of Sierra shareholders has been scheduled for
January 26, 2010. The Management Circular and related proxy
materials, including the GREEN proxy, have been mailed to persons
who were shareholders of record as of the close of business on
December 15, 2009. Investors and security holders may obtain a free
copy of these documents on our website at
www.sierrageopower.com/proxy, or the Canadian securities
regulator's web site www.sedar.com, or by mail.
You can request the materials by contacting Anthony Srdanovic,
Sierra Geothermal Power Corp., Suite 500 - 666 Burrard Street,
Vancouver, B.C., Canada, V6C 3P6, or by telephone: 604-642-6179, or
by email asrdanovic@sierrageopower.com or follow the web link
http://www.sierrageopower.com/index.php/proxy.
Sierra and its directors, executive officers and other members
of its management and employees may be deemed to be participants in
the solicitation of proxies from Sierra shareholders in connection
with the proposed acquisition. Information concerning the interests
of Sierra's management who are participating in the solicitation is
set forth in the Management Circular.
If you have any questions or need assistance in completing your
GREEN proxy, please call Laurel Hill Advisory Group at toll free
1-888-534-1149 or by email at assistance@laurelhillag.com and they
will be happy to help.
About Sierra Geothermal Power Corp.
Sierra Geothermal Power Corp. is a renewable energy company
focused on the exploration and development of clean, sustainable
geothermal power. It is based in Vancouver, British Columbia and
listed on the TSX Venture Exchange under the symbol SRA. Its
portfolio of geothermal projects located in Nevada and California
exceeds 365 square kilometres (90,000 acres) and has a combined
total estimated capacity of greater than 500 MW. Sierra intends to
finance development by utilizing a combination of corporate equity,
joint venture partnerships and project debt, with the support of US
government grants and loan guarantees. To find out more about
Sierra Geothermal Power Corp. (TSX VENTURE: SRA) visit our website
at www.sierrageopower.com.
On behalf of the Board of Directors
Gary Thompson, P.Geo, President, Chief Executive Officer and
Director
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION
This news release may contain forward-looking statements. All
statements, other than statements of historical fact, included or
incorporated by reference in this news release are forward-looking
statements, including, without limitation, statements regarding
activities, events or developments that Sierra expects or
anticipates may occur in the future. Forward-looking statements can
be identified by the use of forward-looking words such as "may",
"would", "could", "expect", "intend", "plan", "estimate",
"anticipate", "believe" or "continue" or similar words or the
negative thereof. Forward-looking statements in this news release
include statements that Sierra's project portfolio has combined
total estimated capacity of greater than 500 MW and that Sierra
intends to finance development by utilizing a combination of
corporate equity, joint venture partnerships and project debt, with
the support of US government grants and loan guarantees.
There can be no assurance that the plans, intentions or
expectations upon which these forward-looking statements are based
will occur. Readers are cautioned not to place undue reliance on
these forward-looking statements, which are not a guarantee of
performance and are subject to a number of uncertainties and other
factors that could cause actual results to differ materially from
those expressed or implied by such forward-looking statements.
These factors include general economic and market conditions,
changes in the law, actions of competitors, drill results and other
changes in circumstance, and Sierra's ability to implement business
strategies and pursue its business plan. In addition, all
forward-looking statements involve risks and uncertainties,
including the risks and uncertainties detailed in Sierra's filings
with the applicable Canadian securities commissions, copies of
which are available at www.sedar.com. We urge you to carefully
consider these factors.
All of the forward-looking statements contained in this news
release are expressly qualified in their entirety by this
cautionary statement. The forward-looking statements included in
this news release are made as of the date of this news release and
Sierra undertakes no obligation to publicly update such
forward-looking statements to reflect new information, subsequent
events or otherwise, except as required by law.
Neither the TSX Venture Exchange nor its Regulation Services
Provider accepts responsibility for the adequacy or accuracy of
this release.
Contacts: Sierra Geothermal Power Corp. Gary Thompson President
& CEO (604) 642-6158 / 1-800-563-5631 info@sierrageopower.com
Sierra Geothermal Power Corp. Anthony Srdanovic Investor Relations
(604) 642-6179 asrdanovic@sierrageopower.com
www.sierrageopower.com
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