Open Letter from Hesham “Sham” Gad to Paragon Technologies Stockholders
For the past several months, you, the esteemed Paragon Technologies stockholders, have been inundated with seemingly inaccurate and misleading information that I, Hesham “Sham” Gad, believe has been deliberately orchestrated to divert your attention from the entrenchment activities taking place at the Company under Sam Weiser’s oversight. These actions, which I firmly believe potentially violate Delaware law, have been costing the Company and its stockholders significant resources.
The Board’s Anti-Stockholder Culture
Under the guise of an investigation into my beneficial ownership of approximately 28.4% of Paragon’s outstanding common stock, the Audit Committee, chaired by Mr. Weiser, has fostered an anti-stockholder culture at the Company. This culture has been manifested through various entrenchment tactics aimed at maintaining the status quo and thwarting shareholder efforts to bring about positive change.
Entrenchment Tactics and Their Consequences
One such tactic involves the use of poison pills and other defensive measures designed to prevent hostile takeovers. While these measures may provide some short-term benefits to the Board, they ultimately come at the expense of stockholders, who bear the cost of these defenses through diluted stock value and other financial burdens.
Another tactic is the manipulation of corporate governance structures to maintain control, such as the recent appointment of new directors with close ties to the Board and the Company’s management. These actions not only disregard the importance of transparency and accountability but also hinder the ability of stockholders to effect change through the democratic process.
Update on the Pending Lawsuit
In response to these entrenchment activities, I filed a lawsuit in the Court of Chancery of the State of Delaware challenging the Company’s actions. The lawsuit seeks to enjoin the Company from further violations of Delaware law and to recover damages incurred by stockholders as a result of the Board’s actions.
Despite the ongoing litigation, the Board has continued its entrenchment efforts, further solidifying my belief that change is necessary to protect the interests of Paragon’s stockholders. I urge all of you to focus on the facts and to consider the long-term consequences of the Board’s actions.
Implications for Paragon Stockholders and the World
For Paragon stockholders, the Board’s actions have resulted in a diminished stock value, increased financial burdens, and a lack of transparency and accountability. These consequences can be detrimental to your investment and may hinder the Company’s potential for growth and success.
Beyond Paragon, the Board’s actions serve as a cautionary tale for investors in companies with similar governance structures. The use of entrenchment tactics can have far-reaching implications, not only for the targeted company but also for the investment community as a whole, as it may discourage investment and hinder the efficient allocation of resources.
Conclusion
In conclusion, I call on all Paragon stockholders to demand transparency and accountability from the Board and to reject the entrenchment tactics that have been employed. By focusing on the facts and the long-term implications of the Board’s actions, we can work together to protect our investment and ensure the Company’s future success.
- Hesham “Sham” Gad, beneficial owner of approximately 28.4% of Paragon Technologies’ common stock, issues open letter to stockholders
- Letter responds to Audit Committee’s investigation and provides update on ongoing lawsuit challenging entrenchment actions
- Board’s actions include poison pills, manipulation of corporate governance structures, and disregard for transparency and accountability
- Consequences for Paragon stockholders include diminished stock value, increased financial burdens, and lack of transparency
- Implications for the investment community include discouragement of investment and hindered resource allocation
I encourage all Paragon stockholders to stay informed and to engage in open and transparent dialogue with the Company’s management and Board. Together, we can work towards a brighter future for Paragon Technologies and the investment community as a whole.
