Heres my letter:
Subject: CHRB shareholders meeting
Date: Mon, 30 Dec 1996 00:19:34 -0800
From: Christopher Bommarito <mullinsv@pilot.msu.edu>
Organization: Michigan State University
To: cfo@chrb.com
Dear Mr. Tam Cheuk Ho,
I (along with my wife Verenda) am a shareholder of CHRB and have a few
questions/concerns about the management of the company and the recent
dilution of shares.
There was a Form 10-C filed regarding the issuance of approximately 7
million more common shares of CHRB in exchange for Series B convertable
stock.
My questions are as follows:
1. How many series B shares were exchaged and how many are outstanding?
2. I have not received a proxy form to cast my vote regarding the
reverse split and other matters. I correspond with other shareholders
and they have also not received ballots. Given that the meeting is
tommorow it is inevitable that our votes will not be counted. I am
disturbed by this and feel that although my position is relatively small
(~15,000 shares), that the votes of all shareholders of CHRB should be
counted. To not give us an opportunity to vote, I believe is against
SEC rules.
3. What are the Board of Directors doing to increase the valuation of
the shareholders stock? The stock has continued to decline, primariuly
due to lack of shareholder(current & potential) confidence. CHRB
continues to have excellent fundimentals, however fundimentals mean
little if the market believes that CHRB will continue to dilute
shareholders value by increasing the number of shares.
4. Will the Board of Directors entertain a plan to buy back common
shares of CHRB?
Myself and other shareholders believe that this will have a profound
impact which would go beyond the effect of the actual decrease in the
amount of shares outstanding. A relatively small buy back of shares
would be a strong message to the financial communities that a)The Board
of Directors feels that CHRB is undervalued b)Most importantly, it
would send a signal that the dilution of shares has ended.
5. With the 10:1 reverse split, as proposed, the potential number shares
remains at 200,000,000. I believe that the authorized number of shares
would also be reduced by a factor of ten, from 200,000,000 to
20,000,000. Will any action be taken to accomplish this?
Please respond to my questions via E-Mail.
If possible I would also like the following proposals to be brought to
the floor of the Dec 30 meeting or if this is not possible, I would like
to know how I can go about making a proposal to the Board &
shareholders.
1. Reduce the number of authorized shares of the Company's Common
Stock, which will go from 200,000,000, of which approximately
191,716,659 shares of Common Stock constitutes authorized but unissued
and unreserved shares to 20,000,000, of which approximately 11,716,659
shares of Common Stock constitutes authorized but unissued and
unreserved shares.
2. Initiate a plan to buyback 1,000,000 shares (pre-reverse split) of
common stock. This plan would not only reduce the number of outstanding
shares of common stock without significant adverse impact on the
relatively strong cash position of the Company, but also send a positive
signal to U.S. markets as to the future intentions of the Company in
regards to the dilution of shares.
Thank you for your cooperation.
--
Christopher Bommarito mullinsv@pilot.msu.edu
Verenda Darline Bommarito
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