Red Oak Partners, LLC Announces Resignation of Red Oak's Designees from the
Board of Directors of RF Industries, Ltd.
NEW YORK, March 25, 2013
NEW YORK, March 25, 2013 /PRNewswire/ --Red Oak Partners, LLC ("Red Oak"),
today announced that its two designees entitled to serve as Directors on the
Board of RF Industries Ltd ("RF") (NASDAQ: RFIL), David Sandberg and J.
Randall Waterfield, have resigned effective immediately and in accordance with
the terms of the agreement reached between RF and Red Oak on August 29, 2011.
Under that agreement, upon Red Oak's ownership falling below a threshold level
as defined in the agreement, its designees shall no longer be entitled to
serve on RF's Board of Directors. After significant appreciation in RF's
share price in recent months and largely via sales effected under a 10b5-1
plan, Red Oak's current ownership level is now below the required threshold as
defined in the agreement. Although Red Oak has no influence over whether its
second designee, Mr. Waterfield, will resign or not, Mr. Waterfield has agreed
to honor the agreement and resign effective immediately as well.
Stated David Sandberg, Red Oak's Founder and Managing Member, "RF has been a
successful investment for Red Oak, more than doubling over a sub two and
one-half year investment time-frame with such return excluding additional
capital returned to shareholders via dividends (and we recently proposed to
the Board and achieved a sharp increase in the regular quarterly dividend).
Red Oak and RF initially established ownership terms in its 2011 agreement to
ensure Directors had sufficient skin in the game. Given Mr. Waterfield and I
no longer have the levels of share ownership which we believe Directors of
public companies should have in order to be aligned with shareholder's best
interests, we are resigning effective immediately. Despite my resignation, I
have offered to assist RF, if requested, to evaluate new Directors, to improve
its governance policies towards making RF more shareholder friendly, and to
assist with certain strategic and other transition issues over the next few
months, all at no compensation. Mr. Waterfield has indicated that he too is
willing to assist the company on such matters upon request and at no
compensation as well."
Continued Mr. Sandberg, "The timing of our resignations allows RF to add other
independent Directors before the upcoming annual meeting. To optimize
shareholder value going forward, I strongly suggest that RF's Board also:
oadd more independent Directors (noting that two independent Directors
worked at Teledyne with RF's CEO), and that such Director nominees be
referred by RF's large shareholders to ensure true independence;
oadopt Board rotation policies to ensure that fresh perspective exists and
that current Directors represent current shareholders;
oensure that current Directors retain sufficient share ownership in
correlation to their years of tenure (ie., the longer you serve the more
you should own) so as to be aligned with shareholders, and retain at least
the ownership levels defined in the August 29, 2011 agreement;
opursue formal and professional processes, including regarding the
evaluation of several candidates with requisite past CFO experience for
the vacant CFO position;
oand consider retaining a credible banker to oversee a strategic
alternatives process, which is something I believe all business should do
periodically to ensure that shareholder value is optimized.
"We believe RF has a strong niche and should continue to generate positive
cash flows going forward. Red Oak wishes RF the best of luck going forward.
It's been a pleasure to serve as a Director and to witness the dramatic recent
growth and share appreciation."
Red Oak Partners, LLC
SOURCE Red Oak Partners, LLC
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