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GOLDEN QUEEN MINING CO. LTD.
6411 IMPERIAL AVENUE
WEST VANCOUVER, BC V7W 2J5
NOTICE OF ANNUALPROXY STATEMENT AND INFORMATION CIRCULAR
SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD AT 2:00 P.M. ON MAY 31, 2006
The 2006 Annual General Meeting of Shareholders of Golden Queen Mining Co. Ltd. (the “Company”) will be held at 2:00 p.m. Pacific Daylight Time on Wednesday, May 31, 2006, at the offices of Morton & Company, 1200 - 750 West Pender Street, Vancouver, British Columbia, V6C 2T8, for the following purposes:
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The board of directors has fixed April 19, 2006, as the record date for determining shareholders entitled to receive notice of, and to vote at, the Meeting or any adjournment or postponement thereof. Only shareholders of record at the close of business on that date will be entitled to notice of and to vote at the Meeting.
All shareholders are invited to attend the Annual General Meeting in person, but even if you expect to be present at the meeting, you are requested to mark, sign, date and return the enclosed proxy card as promptly as possible in the envelope provided to ensure your representation.All proxies must be received by our transfer agent not less than forty-eight (48) hours, excluding Saturdays, Sundays, and holidays,prior to the time of the meeting in order to be counted. The address of our transfer agent is as follows: Computershare Trust Company of Canada, Proxy Dept., 100 University Ave., 9th Floor, Toronto, ON, M5J 2Y1, fax number, within North America, 1-866-249-7775 and outside North America, (416) 263-9524. Shareholders of record attending the Annual General Meeting may vote in person even if they have previously voted by proxy.
Dated at Vancouver, British Columbia, thisu day ofu, 2006.
BY ORDER OF THE BOARD OF DIRECTORS
____________________________________________H. Lutz KlingmannPresident and Director
GOLDEN QUEEN MINING CO. LTD.
PROXY STATEMENT AND INFORMATION CIRCULAR
ANNUAL GENERAL MEETING OF SHAREHOLDERSTO BE HELD MAY 31, 2006SEPTEMBER 1, 2010
In this Proxy Statement and Information Circular, all references to “$” are references to United States dollars and
all references to “C$” are references to Canadian dollars. As at April 19, 2006,July 28, 2010, one Canadian dollar was equal to
approximately $0.87396$<> in U.S. Currency.
GENERAL
The enclosed proxy is solicited by the board of directors of Golden Queen Mining Co. Ltd., a British Columbia corporation (the "Company"“Company” or “Golden Queen”), for use at the Annual GeneralSpecial Meeting of Shareholders (the “Meeting”) of Golden Queen to be held at 2:10:00 p.m. Pacific Daylight Timea.m. (Pacific Standard Time) on Wednesday, May 31, 2006,September 1, 2010, at the offices of Morton & Company, Suite 1200 - 750 West Pender Street, Vancouver, British Columbia, V6C 2T8, and at any adjournment or postponement thereof. References to “shares” in this document will mean common shares of the Company unless otherwise noted.
Our administrative offices are located at 6411 Imperial Avenue, West Vancouver, British Columbia, V7W 2J5. This Proxy Statement and the accompanying proxy card are being mailed to our shareholders on or about May 10, 2006.August 4, 2010.
The cost of solicitation will be borne by the Company. The solicitation will be made primarily by mail. Proxies may also be solicited personally or by telephone by certain of the Company’s directors, officers and regular employees, who will not receive additional compensation therefore. In addition, the Company will reimburse brokerage firms, custodians, nominees and fiduciaries for their expenses in forwarding solicitation materials to beneficial owners.shareholders. The total cost of proxy solicitation, including legal fees and expenses incurred in connection with the preparation of this Proxy Statement and Information Circular, is estimated to be $12,000.
APPOINTMENT OF PROXYHOLDER
The persons named as proxyholder in the accompanying form of proxy were designated by the management of the Company ("(“Management Proxyholder"Proxyholder”).A shareholder desiring to appoint some other person ("(“Alternate Proxyholder"Proxyholder”) to represent him at the Meeting may do so by inserting such other person's name in the space indicated or by completing another proper form of proxy.A person appointed as proxyholder need not be a shareholder of the Company. All completed proxy forms must be deposited with Computershare Investor Services Inc. not less than forty-eight (48) hours, excluding Saturdays, Sundays, and holidays, before the time of the Meeting or any adjournment of it unless the chairman of the Meeting elects to exercise his discretion to accept proxies received subsequently.
EXERCISE OF DISCRETION BY PROXYHOLDER
The proxyholder will vote for or against or withhold from voting the shares, as directed by a shareholder on the proxy, on any ballot that may be called for.In the absence of any such direction, the Management Proxyholder will vote in favour of matters described in the proxy. In the absence of any direction as to how to vote the shares, an Alternate Proxyholder has discretion to vote them as he or she chooses.
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The enclosed form of proxy confers discretionary authority upon theproxyholder with respect to amendments or variations tomatters identified in the attached Notice of Meeting and other matters which may properlycome before the Meeting.At present, Management of the Company knows of no such amendments, variations or other matters.
PROXY VOTING
Registered Shareholders
If you are a registered shareholder, you may wish to vote by proxy whether or not you attend the Meeting in person. If youRegistered shareholders electing to submit a proxy you must complete, datemay do so by completing the enclosed form of proxy (the “Proxy”) and sign the Proxy, and then returnreturning it to the Company'sCompany’s transfer agent, Computershare, Investor Services Inc. by fax within North Americain accordance with the instructions on the Proxy. In all cases you should ensure that the Proxy is received at 1-866-249-7775, outside North
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America at (416) 263-9524, or by mail or by hand delivery at 100 University Avenue, 9th Floor, Toronto, Ontario, M5J 2Y1 not less thanleast 48 hours (excluding Saturdays, Sundays and holidays) before the Meeting or the adjournment thereof at which the Proxy is to be used.
Beneficial Shareholders
The following information is of significant importance to shareholders who do not hold Sharesshares in their own name.name (referred to as “Beneficial Shareholders”). Beneficial Shareholders should note that the only proxies that can be recognized and acted upon at the Meeting are those deposited by registered shareholders (those whose names appear on the records of the Company as the registered holders of Shares)shares).
If Sharesshares are listed in an account statement provided to a shareholder by a broker, then in almost all cases those Sharesshares will not be registered in the shareholder's name on the records of the Company. Such Sharesshares will more likely be registered under the names of the shareholder's broker or an agent of that broker. In the United States, the vast majority of such Sharesshares are registered under the name of Cede & Co. as nominee for The Depository Trust Company (which acts as depositary for many U.S. brokerage firms and custodian banks), and in Canada, under the name of CDS & Co. (the registration name for The Canadian Depository for Securities Limited, which acts as nominee for many Canadian brokerage firms).
Intermediaries are required to seek voting instructions from Beneficial Shareholders in advance of shareholders' meetings. Every intermediary has its own mailing procedures and provides its own return instructions to clients.
If you are a Beneficial Shareholder:
You should carefully follow the instructions of your broker or intermediary in order to ensure that your shares are voted at the Meeting.
The form of proxy supplied to you by your broker will be similar to the Proxy provided to registered shareholders by the Company. However, its purpose is limited to instructing the intermediary on how to vote on your behalf. Most brokers now delegate responsibility for obtaining instructions from clients to ADPBroadridge Investor Communication Services ("ADP"(“Broadridge”) in the United States and in Canada. ADPBroadridge mails a voting instruction form in lieu of a Proxy provided by the Company. The voting instruction form will name the same persons as the Company's Proxy to represent you at the Meeting. You have the right to appoint a person (who need not be a Beneficial Shareholder of the Company), other than the persons designated in the voting instruction form, to represent you at the Meeting. To exercise this right, you should insert the name of the desired representative in the blank space provided in the voting instruction form. The completed voting instruction form must then be returned to ADPBroadridge by mail or facsimile or given to ADPBroadridge by phone or over the internet, in accordance with ADP'sBroadridge's instructions. ADPBroadridge then tabulates the results of all instructions received and provides appropriate instructions respecting the voting of Sharesshares to be represented at the Meeting.If you receive a voting instruction form from ADP,Broadridge, you cannot use it to vote Sharesshares directly at the Meeting - the voting instruction form must be completed and returned to ADP,Broadridge, in accordance with its instructions, well in advance of the Meeting in order to have the Sharesshares voted.
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Although as a Beneficial Shareholder you may not be recognized directly at the Meeting for the purposes of voting Sharesshares registered in the name of your broker, you, or a person designated by you, may attend at the Meeting as proxyholder for your broker and vote your Sharesshares in that capacity. If you wish to attend at the Meeting and indirectly vote your Sharesshares as proxyholder for your broker, or have a person designated by you do so, you should enter your own name, or the name of the person you wish to designate, in the blank space on the voting instruction form provided to you and return the same to your broker in accordance with the instructions provided by such broker, well in advance of the Meeting.
Alternatively, you can request in writing that your broker send you a legal proxy which would enable you, or a person designated by you, to attend at the Meeting and vote your Shares.shares.
REVOCATION OF PROXIES
In addition to revocation in any other manner permitted by law, a registered shareholder who has given a proxy may revoke it by:
| (a) | Executing a proxy bearing a later date or by executing a valid notice of revocation, either of the foregoing to be executed by the registered shareholder or the registered shareholder’s authorized attorney in writing, |
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or, if the shareholder is a corporation, under its corporate seal by an officer or attorney duly authorized, and by delivering the proxy bearing a later date to Computershare Investor Services Inc. at any time up to and including the last business day that precedes the day of the Meeting or, if the Meeting is adjourned, the last business day that precedes any reconvening thereof, or to the chairman of the Meeting on the day of the Meeting or any reconvening thereof, or in any other manner provided by law, or | ||
| (b) | Personally attending the meeting and voting the registered shareholders’ shares. |
A revocation of a proxy will not affect a matter on which a vote is taken before the revocation.
Only registered shareholders have the right to revoke a Proxy. Non-Registered Holders who wish to change their vote must, at least seven days before the Meeting, arrange for their respective Intermediaries to revoke the Proxy on their behalf.
VOTING PROCEDURE
A quorum for the transaction of business at the Meeting is at least two persons present in person being shareholders entitled to vote at the Meeting or duly appointed proxies or representatives for absent shareholders so entitled. Broker non-votes occur when a person holding shares through a bank or brokerage account does not provide instructions as to how his or her shares should be voted and the broker does not exercise discretion to vote those shares on a particular matter. Abstentions and broker nonvotes will be included in determining the presence of a quorum at the Meeting. However, an abstention or broker non-vote will not have any effect on the outcome for the election of directors.
Shares for which proxy cards are properly executed and returned will be voted at the Meeting in accordance with the directions noted thereon or, in the absence of directions, will be voted "FOR"“FOR” the fixingapproval, by special resolution, of the numberremoval of directors at four,Pre-existing Company Provisions (as defined in theBusiness Corporations Act (British Columbia), “FOR” the election of eachapproval, by special resolution, of the nominees to the boardadoption of directors named on the following page, "FOR" the resolution to ratify the appointment of BDO Dunwoody LLP as independent auditorsnew Articles of the Company, for the financial year ended December 31, 2006 and “FOR” disinterested shareholderthe approval, by special resolution, of the issuance of common sharesincrease in the authorized capital of the Company from 100,000,000 to Landon T. Clay, an insider of the Company, upon the exercise of warrants previously issued pursuant to a private placement.150,000,000 common shares, all without par value. It is not expected that any matters other than those referred to in this Proxy Statement will be brought before the Meeting. If, however, other matters are properly presented, the persons named as proxies will vote in accordance with their discretion with respect to such matters.
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VOTING SECURITIES AND PRINCIPAL HOLDERS OF VOTING SECURITIES
On April 19, 2006July 28, 2010 (the “Record Date”) there were 69,368,70694,078,380 shares of our common stock (the "Common Stock"“Common Stock”), issued and outstanding, each share carrying the right to one vote. Only shareholders of record at the close of business on the Record Date will be entitled to vote in person or by proxy at the Meeting or any adjournment thereof.
To the knowledge of the Directors and executive officers of the Company, the beneficial owners or persons exercising control over Company shares carrying more than 5% of the outstanding voting rights are:
| Name and Address | Number of Shares(1)(2) | Approximate % of Total Issued |
| Landon T. Clay | 14,619,572 | 21.08% |
| Sprott Asset Management Inc. | 14,400,000 | 20.08% |
| RAB Special Situations (Master) Fund Limited | 4,040,000 | 5.82% |
| Name and Address | Number of Shares(1) | Nature of Ownership | Approximate % of Total Issued |
| Landon T. Clay Providence, RI | 726,077 | Sole voting and investment control | 0.77% |
| 21,956,063(2)(4) | Shared voting and investment control | 23.34% | |
| Thomas M. Clay Providence, RI | 1,168,522(3) | Sole voting and investment control | 1.24% |
| 17,158,969(2) | Shared voting and investment control | 18.24% | |
| Harris Clay Augusta, GA | 4,797,094(4) | Shared voting and investment control | 5.10% |
| Soledad Mountain LLC Delaware | 7,258,330(5) | Sole voting and investment control | 7.72% |
| Sprott Asset Management Inc. Toronto, ON | 11,860,300(6) | Sole voting and investment control | 12.61% |
| Gammon Gold Inc. Toronto, ON | 7,500,000(7) | Sole voting and investment control | 7.97% |
| (1) | The | |
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| (3) | Includes 300,000 shares issuable upon exercise of options. | |
| (4) | Landon Clay and Harris Clay have shared voting and investment control of 4,797,094 shares. | |
| (5) | Jonathon Clay is the managing member and has voting and investment control on the shares. | |
| (6) | Sprott Asset Management LP holds the shares as portfolio manager. | |
| (7) | Includes 2,500,000 shares issuable upon exercise of share purchase warrants. |
INTEREST OF CERTAIN PERSONS IN MATTERS TO BE ACTED UPON
Except as disclosed herein, no Person has any material interest, direct or indirect, by way of beneficial ownership of securities or otherwise, in matters to be acted upon at the Meeting other than the election of directors and the appointment of auditors and as set out herein. For the purpose of this paragraph, “Person” shall include each person:
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(a) who has been a director, senior officer or insider of the Company at any time since the commencement of the Company’s last fiscal year; (b) who is a proposed nominee for election as a director of the Company; or (c) who is an associate or affiliate of a person included in subparagraphs (a) or (b).
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PROPOSAL 1NUMBER
REMOVAL OF DIRECTORSPRE-EXISTING COMPANY PROVISIONS
The board of directors proposesEffective March 29, 2004, theBusiness Corporations Act (British Columbia) (the “Corporations Act”) replaced the previousCompany Act (British Columbia) (the “Old Act”). As a consequence, all British Columbia companies are now governed under the Corporations Act. Every British Columbia company must have transitioned to fix the number of DirectorsCorporations Act within two years from the coming into force of the Corporations Act. The Company at four. Under British Columbia corporate legislation, a public company is required to have a minimum of three directors. In addition, a public company is required to have an audit committee that must be composed of at least three members. Each audit committee member must be an independent director of the Company and financially literate. Accordingly, the Company has determined that fixing the number of directors at four is required to meet these requirements. Our articles permit the number of directors to be set by ordinary resolution of shareholders.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" SETTING THE NUMBER OF DIRECTORS AT FOUR.
PROPOSAL 2ELECTION OF DIRECTORS
The board of directors proposes that the following four nominees be elected as directors at the Meeting, each of whom will hold office until the expiration of their term or until his or her successor shall have been duly appointed or elected and qualified: H. Lutz Klingmann, Edward G. Thompson, Gordon C. Gutrath, Chester Shynkaryk.
Unless otherwise instructed, it is the intention of the persons named as proxies on the accompanying proxy card to vote shares represented by properly executed proxies for the election of such nominees. Although the board of directors anticipates that the four nominees will be available to serve as directors of Golden Queen, if any of them should be unwilling or unable to serve, it is intended that the proxies will be voted for the election of such substitute nominee or nominees as may be designated by the board of directors.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" EACH NOMINEE.
The following table sets out the names of the nominees; their positions and offices in the Company; principal occupations; the period of time that they have been directors of the Company; and the number of shares of the Company which each beneficially owns or over which control or direction is exercised.
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SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth certain information regarding the beneficial ownership of the Company’s Common Stock as of April 19, 2006 by:
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Except as noted below, Golden Queen believes that the beneficial owners of the Common Stock listed below, based on information furnished by such owners, have sole voting and investment power with respect to such shares.
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SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires Golden Queen's directors, executive officers and persons who own more than 10% of a registered class of Golden Queen’s securities to file with the SEC initial reports of ownership and reports of changes in ownership of Common Stock and other equity securities of Sense. Directors, executive officers and greater than 10% shareholders are required by SEC regulation to furnish Golden Queen with copies of all Section 16(a) reports they file.
To Golden Queen’s knowledge, based solely on a review of Forms 3 and 4, as amended, furnished to it during its most recent fiscal year, and Form 5, as amended, furnished to it with respect to such year, Golden Queen believes that during the year ended December 31, 2005, its directors, executive officers and greater than 10% shareholders complied with all Section 16(a) filing requirements of the Securities Exchange Act of 1934.
DIRECTORS AND EXECUTIVE OFFICERS
The following table contains information regarding the members and nominees of the board of directors and the Executive of Golden Queen as of the Record Date:
All of the officers identified above serve at the discretion of the board of directors and have consented to act as directors of the Company.
RELATIONSHIPS AMONG DIRECTORS OR EXECUTIVE OFFICERS
There are no family relationships among any of the existing directors or executive officers of Golden Queen.
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BOARD OF DIRECTORS MEETINGS AND COMMITTEES
During the fiscal year ended December 31, 2005, the board of directors held one directors’ meeting. All other matters which required board approval were consented to in writing by all of the Company’s directors.
The board of directors has established an Audit Committee and a Compensation Committee. The board of directors has no standing nominating committee. Each of the Audit and Compensation Committees is responsibletransitioned to the full board of directors. The functions performed by these committees are summarized below:Corporations Act in 2005.
Audit Committee. The Audit Committee considersUnder the selection and retention of independent auditors and reviews the scope and results of the audit. In addition, it reviews the adequacy of internal accounting, financial and operating controls and reviews Golden Queen’s financial reporting compliance procedures. The members of the Audit Committee are Chester Shynkaryk, Edward G. Thompson and Gordon C. Gutrath.
In the course of its oversight of our financial reporting process, the directors have: (1) reviewed and discussed with management our audited financial statements for the year ended December 31, 2005; (2) received a report from BDO Dunwoody LLP our independent auditors, on the matters requiredCorporations Act certain Pre-Existing Company Provisions (the “PCPs”) continue to be discussed by Statement on Auditing Standards No. 61, “Communications with Audit Committees”; (3) received the written disclosures and the letter from the auditors required by Independence Standards Board Statement No. 1, “Independence Discussions with Audit Committee”; and (4) considered whether the provision of non-audit services by the auditors is compatible with maintaining their independence and has concluded that it is compatible at this time.
Based on the foregoing review and discussions, the board has concluded that the audited financial statements should be included in our Annual Report on Form 10-KSB for the year ended December 31, 2005 filed with the SEC.
Compensation Committee. The Compensation Committee reviews and approves the compensation of Golden Queen’s officers, reviews and administers Golden Queen’s stock option plans for employees and makes recommendations to the board of directors regarding such matters. The members of the Compensation Committee are H. Lutz Klingmann, Edward G. Thompson and Chester Shynkaryk.
Nominating Committee. No Nominating Committee has been appointed. Nominations of directors are made by the board of directors. The Directors are of the view that the present management structure does not warrant the appointment of a Nominating Committee.
DIRECTORS COMPENSATION
Commencing in the year ended December 31, 2005, directors’ fees will be paid to each director in the amount of CAD$1,500 for the year ended December 31, 2005 and CAD$2,000 per year thereafter. The fees in respect of each year will be paid on December 1 of that year.
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table sets forth all compensation paid or earned for services renderedapply to the Company in all capacities during the fiscal years ended December 31, 2003, 2004 and 2005unless such provisions are removed by Golden Queen’s president and chief executive officer (“CEO”) and each executive officer who earned over $100,000 in total salary and bonus during the three most recently completed financial years, for services rendered to the Company.
| Name and Principal Position | Annual Compensation | Long Term Compensation | ||||||
Year | Salary ($) | Bonus ($) | Other Annual Compens- ation ($) | Awards | Payouts | All other compens- ation ($) | ||
| Restricted stock award(s) ($) | Securities underlying options/ SARs (#) | LTIP Payouts ($) | ||||||
| H. Lutz | 2005 | USD$107,308(1) | Nil | Nil | 350,000(2) | Nil | Nil | Nil |
| Klingmann | 2004 | USD$76,466(1) | Nil | Nil | Nil | Nil | Nil | Nil |
| President | 2003 | USD$45,495(1) | Nil | Nil | 225,000 | Nil | Nil | Nil |
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OPTION/SAR GRANTS DURING THE MOST RECENTLY COMPLETED FINANCIAL YEAR
The boardway of directors has approved the issuance of stock options to our employees, directors, officers and consultants. Unless otherwise provided by the board of directors, all vested options are exercisable for a term of five years from the date of grant. On February 1, 2005, there were options granted to acquire 1,200,000 sharesspecial resolution of the authorized common stock.
During the fiscal year ended December 31, 2005, Golden Queen granted the following stock options to the Company’s CEO and president:
| Name | Number of securities underlying options/ SARs granted (#) | Percent of total options/ SARs granted to employees in fiscal year | Exercise or base price ($/Sh) | Expiration Date |
| H. Lutz Klingmann President | 350,000 | 29.17% | USD$0.30 (CAD$0.35) | February 1, 2010 |
AGGREGATED OPTION/SAR EXERCISES DURING THE MOST RECENTLY COMPLETEDFINANCIAL YEAR AND FINANCIAL YEAR-END OPTION/SAR VALUES
No stock options were exercised by the Named Executive Officer during the Company’s fiscal year ended December 31, 2005.
OPTION AND SAR REPRICINGS
There was no repricing of options or SAR’s held by Named Executive Officers during the Company’s fiscal year ended December 31, 2005.
TERMINATION OF EMPLOYMENT, CHANGE IN RESPONSIBILITIES AND EMPLOYMENT CONTRACTS
There are currently no employment contracts in place with the directors and officers of Golden Queen other than the following: On March 11, 2004, we entered into a management agreement with Lutz Klingmann. Pursuant to the termsshareholders. Removal of the agreement, Mr. Klingmann acts as chief operating officer and has overall management responsibility for our operations. Mr. Klingmann receives CAD$60 per hour as compensation for his work and also receives CAD$5 per hour for use of his office, equipment and out-of-pocket expenses. The management agreement also provides for the issuance of up to 300,000 common shares of Golden Queen to Mr. Klingmann on attaining of certain milestones.
COMPENSATION COMMITTEE
Composition of the Compensation Committee
The members of the Compensation Committee during the year ended December 31, 2005 were Edward G. Thompson, Chester Shynkaryk and Gordon Gutrath. Mr. Shynkaryk was president of the Company until December 1, 1995 and has served as the Secretary of the Company since such time. Mr. Thompson served as president until November 29, 2002.
Report on Executive Compensation
The Compensation Committee of the board of directors is responsible for reviewing and approving the remuneration of the senior management of the Company, including the President and chief executive officer. The guiding philosophy of the Compensation Committee in the determination of executive compensation is ensuring that the Company is able to attract the best possible candidates for management positions, given the high level of
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competition for competent management in the mining industry, and to align the interests of management with those of the Company’s shareholders.
The Company’s executive compensation policies are designed to recognize and reward individual contribution, performance and level of responsibility and ensure that the compensation levels remain competitive with other precious metals development and mining companies. The key components of total compensation are base salary and incentives.
The Compensation Committee uses industry compensation data as a basis for determining appropriate base salary ranges. Within these ranges, the base salaries are established to reflect the individual executive's proven and expected contribution and responsibility.
Stock options are granted to executive officers to align the financial interests of management with the interests of shareholders of the Company and to encourage executive officers to focus on strategies and results that enhance shareholder value in the longer term. The number of options to purchase Common Shares granted to each individual will depend largely on his level of responsibility and contribution to the Company’s performance.
The Compensation Committee considers, on an ongoing basis, the appropriateness and effectiveness of the Company’s executive compensation policies, given prevailing circumstances.
Submitted by the Compensation Committee.EDWARD G. THOMPSON (Chairman)GORDON GUTRATHCHESTER SHYNKARYK
PERFORMANCE GRAPH
The following graph tracks the percentage change in the Company’s share price compared to the percentage change in the CBOE Gold Index.
| December 31, 2001 | December 31, 2002 | December 31, 2003 | December 31, 2004 | December 31, 2005 | |
| Company | 100 | 692 | 415 | 308 | 253 |
| S&P/TSX Gold Index | 100 | 150 | 217 | 210 | 285 |
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COMPENSATION OF DIRECTORS
The Company does not pay director’s fees. It is currently the policy ofPCPs would permit the Company to grant options to purchase Common Shares to its directorsadopt updated corporate articles that reflect current business practice under the Company’s 1996 Stock Option Plan (the “Plan”). Generally, each director is granted as may be appropriate in particular circumstances given other responsibilities assumed by the director in the Company’s affairs and contributions made by such director to the Company.
The Plan provides for the issuance of options to purchase Common Shares to the directors, officers and employees of the Company and its subsidiaries. The Plan is administered by the Compensation Committee of the board of directors of the Company. The Plan provides that a maximum of 3,300,000 Common Shares will be reserved, set aside and made available for issuance pursuant to options granted from time to time under the Plan, provided that, under the terms of the Plan, no person is entitled to be granted options to purchase Common Shares constituting more than 5% of the number of outstanding Common Shares.
The Plan provides that the exercise price of each option granted shall not be less than the market price of the Common Shares on the TSX on the trading day prior to the day on which the option is granted. The Plan provides that all options granted under such plan will expire not later than five years after the date of grant and, unless otherwise specifically determined at the time of the grant of any option, all options granted under the Plan expire 39 months after the date on which they are granted.
Options granted to employees of the Company and its subsidiaries under the Plan will vest, as to one-third of the number of Common Shares issuable upon the exercise of the options granted, on the date of grant and, as to an additional one-third of such number of Common Shares, on each of the next two anniversaries of such date. Options granted under the Plan to other persons vest immediately on the date of grant.
Options granted under the Plan are not transferable, other than by will or other testamentary instrument or the laws of succession. The Plan provides that where an optionee is dismissed, removed or otherwise ceases to be a director, officer or employee of the Company or its subsidiaries (other than for cause or as a result of his or her retirement or death), all unexercised options held by such person terminate on the earlier of 60 days after the optionee ceases to be a director, officer or employee of the Company or its subsidiaries or the normal expiry date of such unexercised options. Under the Plan, an optionee who retires at or after the age of 60 or after 20 years of employment by the Company or any of its subsidiaries may exercise vested options held by him or her at the date of retirement in accordance with the terms of such options as though the optionee had not retired. Options held by an optionee under the Plan at the time of his or her death will terminate on the earlier of one year after the date of death of the optionee or the normal expiry date of such options. In the event that an optionee is dismissed as a director, officer or employee of the Company or one of its subsidiaries for cause, all unexercised options held by such person immediately terminate.
A total of 1,200,000 options to purchase Common Shares were granted to the directors of the Company for the Company’s financial year ended December 31, 2005.
There are no other arrangements under which directors of the Company were compensated by the Company during the year ended December 31, 2005 for their services in their capacity as directors and, without limiting the generality of the foregoing, no additional amounts are payable under any standard arrangements for committee participation or special assignments, except that the Articles of the Company provide that the directors are entitled to be paid reasonable traveling, hotel and other expenses incurred by them in the performance of their duties as directors. The Company’s Articles also provide that if a director is called upon to perform any professional or other services for the Company that, in the opinion of the directors, is outside of the ordinary duties of a director, such director may be paid a remuneration to be fixed by the directors and such remuneration may be either in addition to or in substitution for any other remuneration that such director may be entitled to receive.
The aggregate direct remuneration paid or payable by the Company and its subsidiary (the financial statements of which are consolidated with those of the Company) to the directors and senior officers of the Company during the financial year ended December 31, 2005 was C$132,570, C$125,070 of which was paid to Mr. Klingmann for his services as president of the Company and C$7,500 of which was paid to Chester Shynkaryk as director’s fees and related services. No other compensation was paid or given during the year for services rendered by the directors in such capacity, and no additional amounts were payable at year-end under any standard arrangements for committee participation or special assignments.
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For the 2005 fiscal year, 1,200,000 options to purchase Common Shares were granted to the directors of the Company as a group.
REPORT OF CORPORATE GOVERNANCE
The TSX has adopted certain guidelines (the “Guidelines”) for listed companies regarding recommended corporate governance policies and practices. These Guidelines deal with the principal areas of responsibility of the board of directors and its committees and the composition of the board and these committees. This report reviews the Company’s corporate governance procedures and practices in comparison to the Guidelines.
Mandate and Responsibility of the BoardCorporations Act.
The board of directors of the Company is responsible for supervising management in carrying onproposes to remove the business and affairsPCPs. The removal of the Company. DuringPCPs requires the year ended December 31, 2005, the board held one meeting and consented other approval by way of consent resolutions. Directors are required to exercise their powers with reasonable prudence in the best interests of the Company. As recommended by the Guidelines, the board has expressly confirmed its commitment to the principles set out in the Guidelines and has accepted and confirmed its responsibility for overseeing management’s performance in the following particular areas as set out in the Guidelines:
the strategic planning process of the Company;identification and management of the principal risks associated with the business of the Company;planning for succession of management;the Company’s policies regarding communications with its shareholders and others;the establishment by the Company of, and compliance with, appropriate environmental policies; andthe integrity of the internal controls and management information system of the Company.
In carrying out its mandate, the board relies primarily on management to provide it with regular detailed reports on the operations of the Company and its financial position. The board reviews and assesses these reports and other information provided to it at meetings of the full board and its committees. The Company’s former president and chief executive officer, Edward G. Thompson, was a member of the board, and the Company’s present president, H. Lutz Klingmann, is a member of the board, giving the board direct access to information on his areas of responsibility. Other management personnel attend board meetings on request to provide information and answer questions.
The reports and information provided to the board on a regular basis discuss the Company’s operations with respect to the exploration and development of the Soledad Mountain Project and include such matters as the permitting process, property acquisitions, staff additions and changes, financing and investor relations activities, expenditures and results of operations and the procedures followed to monitor and manage the risks associated with the Company’s operations. At least semi-annually, management reports to the board on its strategic and business plan, performance relative to that plan and any changes in the plan. From time to time, members of the board may be involved with management in developing recommendations to the full board on particular issues such as acquisitions or financings. Certain areas of the board’s responsibility are delegated to regular or special committees of the board which report back to the full board on their considerations.
The Guidelines recommend that a board of directors and the chief executive officer should develop position descriptions and that the board of directors should approve or develop the corporate objectives which the chief executive officer is responsible for meeting. The mandate of the board has been established as overseeing the conduct of the business of the Company and supervising management. In connection with the appointment of H. Lutz Klingmann in November 2002 as the president, the board confirmed the corporate objectives which the president is responsible for meeting.
The Guidelines recommend that a board of directors should have in place appropriate structures and procedures to ensure that it can function independently of management. The board considers that Mr. Klingmann’s occupation of the position of president is not of such a nature as would prevent the board from effectively functioning independently of management. The Board is prepared to meet without management present any time it is considered necessary or appropriate.
The Guidelines recommend that a board of directors should implement a system which enables an individual director to engage an outside adviser at the expense of the corporation in appropriate circumstances. While the board has not formalized any such system, the members of the board are aware that they have the right to retain outside
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advisers, at the Company’s expense, when appropriate. The Guidelines recommend that a board of directors should examine its size with a view to its effectiveness. The board is satisfied that its current size is appropriate to effectively perform its duties.
Composition of the Board
The Guidelines recommend that a board of directors should be constituted with a majority of individuals who qualify as “unrelated directors”. An unrelated director is defined as a director who is independent of management and is free from any interest and any business or other relationship which could, or could reasonably be perceived to, materially interfere with the director's ability to act with a view to the best interests of the corporation, other than interests and relationships arising from shareholding. Based on this definition, the board has determined, as recommended by the Guidelines, that the board has a majority of unrelated directors, since three of the Company’s four directors qualify as unrelated directors. Mr. Klingmann is a related director. The Board does not have a “significant shareholder” within the meaning of the Guidelines.
The Chairman of the Board, Edward G. Thompson, was not a member of management of the Company until he acted as President and Chief Executive Officer from of February 29, 2000 to November 29, 2002.
Committees of the Board
The Guidelines recommend that the committees of a board of directors generally should be composed of outside directors, a majority of whom are unrelated directors. The board has had two standing committees: the Audit Committee and the Compensation Committee, each comprised of one related director and two unrelated directors. The Audit Committee held no meetings during the year ended December 31, 2005. The Company does not have an Executive Committee.
The Guidelines recommend that the audit committee of a board of directors should be composed only of outside directors. The Audit Committee reviews and recommends for approval by the board the Company’s annual and six-month interim financial statements and all external financial reporting. It also reviews and follows up on major findings of financial audits to ensure the Company has an effective system of internal controls. The Audit Committee has direct access to the Company’s external auditors to discuss and review specific issues as appropriate.
The Guidelines recommend that a board of directors should review the compensation of directors. The Compensation Committee has responsibility for matters relating to executive and director compensation and planning for the succession of management of the Company.
The Guidelines recommend that a board of directors should appoint a nominating and governance committee of directors composed exclusively of outside directors to propose new nominees to the board of directors and assess directors on an ongoing basis. Although the Company does not have a nominating and governance committee, the board is satisfied that in view of size and composition of the board, it is more efficient and cost effective for the full board to perform the duties of the nominating and governance committee as set out in the Guidelines. The board recruits new directors as needed from time to time. Any appointment of a new director requires board approval and is subject, ultimately, to approval by the shareholders of the Company at the next annual general meeting of shareholders of the Company.
The Guidelines recommend that a board of directors should implement a process for assessing the effectiveness of the board as a whole, the committees of the board and the contribution of individual directors and provide an orientation and education program for new directors. The board as a whole is responsible for the orientation and education of new directors and the evaluation of the effectiveness of the board and its committees and the performance of directors. The board assesses and will make any changes necessary to improve board effectiveness and will consider and, if deemed advisable, establish a formal process of identifying, recruiting, appointing, reappointing and providing ongoing development for directors.
The Guidelines recommend that a board of directors should expressly assume responsibility for developing the corporation’s approach to governance issues. The board as a whole takes responsibility for developing the Company’s approach to corporate governance issues, including, among other things, the Company’s response to the Guidelines.
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Decisions Requiring Approval of the Board
Although the board has delegated responsibility for the day to day management of the Company to the president and chief executive officer, there are certain significant decisions which require the prior approval of the board. These include decisions with respect to major capital expenditures, the appointment of and compensation for officers of the Company, the adoption and amendment of incentive plans, share issues and repurchases, financing arrangements and material acquisitions and divestitures. Significant disclosure documents are also subject to board review and approval.
Shareholder Feedback and Concerns
Under the direction of the president and chief executive officer, the Company’s investor relations program includes discussions with individual shareholders and other stakeholders.
Board’s Expectations of Management
The process of setting the board’s expectations of management begins with the development of a strategic plan for the Company. Once the strategic plan has been approved by the board, it is management’s responsibility to successfully implement the plan. Management reviews periodically with the board its progress to date on the implementation of the strategic plan. On an annual basis, management also prepares an operating and financial plan for the upcoming year against which short term performance is measured. Performance in relation to the annual plan and other short term objectives is reviewed with the board on a regular basis.
In the board’s opinion, the current corporate governance practices of the Company are adequate and appropriate for a company at its stage of development and are consistent with both the spirit and intent of the Guidelines. The board will continue to review, and change where necessary, its approach to corporate governance.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Transactions with management and others
The following is in addition to disclosure contained elsewhere herein respecting transactions involving management.
On July 8, 2003, one shareholder beneficially holding in excess of 10% of the voting shares of the Company purchased a 6.5% convertible promissory note for the amount of $150,000. The promissory note is due on demand on July 9, 2004 and is convertible into units of the Company at a price of $0.23 per unit, each unit consisting of one common share and one non-transferable detachable share purchase warrant, each whole warrant entitling the holder to purchase one additional common share of the Company at an exercise price of $0.32 for a term of two years.
On January 26, 2004, one shareholder beneficially holding in excess of 10% of the voting shares of the Company purchased 3,000,000 units pursuant to a private placement by the Company for an aggregate purchase price of C$1,500,000.
On January 24, 2006, we amended the terms of the warrants to extend the expiry date from January 27, 2006, to June 1, 2006 and to decrease the exercise price from $0.75 per share to $0.60 per share.
On March 11, 2004, we entered into a management agreement with Lutz Klingmann. Pursuant to the terms of the agreement, Mr. Klingmann acts as chief operating officer and has overall management responsibility for our operations. Mr. Klingmann receives $60 per hour as compensation for his work and also receives $5.00 per hour for use of his office, equipment and out-of-pocket expenses. The management agreement also provides for the issuance of up to 300,000 common shares of the Golden Queen to Mr. Klingmann on the attaining of certain milestones.
PROPOSAL 3RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
BDO Dunwoody, LLP, served as Golden Queen’s independent auditors for the fiscal year ending December 31, 2005, and has been appointed by the board of directors to continue as Golden Queen’s independent auditor for Golden Queen’s fiscal year ending December 31, 2006, and until the next annual general meeting of shareholders.
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The fees for services provided by BDO Dunwoody LLP to us in each of the fiscal years ended 2004 and 2005 were as follows:
| Fees | 2004 | 2005 |
| Audit fees | 24,873 | 37,156 |
| Audit related fees | Nil | Nil |
| Tax fees | 4,451 | 4,771 |
| All other fees | Nil | Nil |
Although the appointment of BDO Dunwoody, LLP, is not required to be submitted to aaffirmative vote of the shareholders, the board of directors believes it appropriate as a matter of policy to request that the shareholders ratify the appointment of the independent public accountant for the fiscal year ending December 31, 2006. In the event a majoritynot less than 75% of the votes cast at the meeting are not votedMeeting by shareholders of the Company, present in favor of ratification,person or by proxy. Accordingly, the adverse voteCompany’s shareholders will be consideredasked to consider and, if thought advisable, to pass, with or without amendment, a special resolution as follows:
“BE IT RESOLVED, as a direction to the board of directors of Golden Queen to select other auditors for the fiscal year ending December 31, 2006.Special Resolution, THAT:
| (a) | the Pre-Existing Company Provisions set forth in Part 16 of the Regulations to the Business Corporations Act (British Columbia) are hereby removed and no longer apply to the Company; | |
| (b) | any director of the Company is authorized to instruct its agents to file a Notice of Alteration to a Notice of Articles with the British Columbia Registrar of Companies along with all other necessary documents and take such further actions that may be necessary to effect the amendment; and | |
| (c) | the board of directors is hereby authorized, at any time in its absolute discretion, to determine whether or not to proceed with the above resolutions without further approval, ratification or confirmation by the shareholders.” |
THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” RATIFICATIONTHE REMOVAL OF THE APPOINTMENTPRE-EXISTING COMPANY PROVISIONS.
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PROPOSAL 2
ADOPTION OF BDO DUNWOODY, LLP, AS GOLDEN QUEEN'S INDEPENDENT AUDITORS FOR THE FISCAL YEAR ENDING DECEMBER 31, 2006.
PROPOSAL 4REPRICING OF WARRANTS HELD BY AN INSIDERNEW ARTICLES
On January 26, 2004,The Company’s existing Articles (the “Existing Articles”) were implemented on May 30, 1986 pursuant to the Old Act. Since that time, a number of amendments have been made to the Corporations Act and certain corporate practices have evolved which are not reflected in the Existing Articles.
Accordingly, the Directors are recommending that the Company issued 8,000,000 units pursuantadopt a new form of Articles (the “Revised Articles”) to a private placementincorporate the provisions reflected in the amendments to the Act and to facilitate the Company being able to take advantage of certain mechanisms permitted by the Company. Each unit consistslegislation.
Key Provisions of one common share and one share purchase warrant. Each share purchase warrant entitled the holder thereof to purchase one common share atRevised Articles
The following is a pricesummary of C$0.62 per sharecertain key provisions contained in the first year and $0.75 perRevised Articles that represent a change from the Existing Articles:
| 1. | Shareholder Resolutions at Meetings:the requisite majority to pass a special resolution at a meeting of shareholders may be decreased from a three-quarters majority to a two-thirds majority; | |
| 2. | Shareholder Resolutions by Written Consent:shareholders’ may pass a resolution without a meeting by unanimous written consent in the case of a special resolution, or by consent of the shareholders holding two-thirds of the voting shares in the case of an ordinary resolution; | |
| 3. | Location of Shareholder Meeting:general meetings of shareholders of the Company can now, if the location is approved by directors’ resolution, be held outside of British Columbia; | |
| 4. | Time of Shareholder Meeting:general meetings of shareholders of the Company are required to be held each calendar year and not more than fifteen months (rather than thirteen months as was previously the case) after the holding of the last preceding annual general meeting; | |
| 5. | Quorum for Shareholder Meetings:the quorum for a shareholder meeting will change to one person present at the meeting representing in person or by proxy, and not less than 10% of the votes eligible to be cast represented at such meeting; | |
| 6. | Redemption and Repurchase:any offer by the Company to purchase or redeem its own shares, need not be made pro rata to all the shareholders; | |
| 7. | Change of Name:the Company’s name may be changed by ordinary resolution or resolution of the directors; | |
| 8. | Director Indemnification:the Revised Articles reflect the Corporations Act provisions with respect to the indemnification of directors and officers and other eligible persons. These include the removal of court approval of any agreement to indemnify a director or officer in most cases, as well as mandatory indemnification in certain eligible cases; | |
| 9. | Non-certificated shares: the Revised Articles expressly permit the Company to issue shares using a book-based system where shareholders would receive a share statement rather than an actual physical share certificate. Use of a non-certificated share system has the potential to reduce the Company’s share records maintenance costs, facilitate transfers, and reduce the risk of loss of certificates; and | |
| 10. | Remuneration of Auditors: the directors of the Company can determine the remuneration of auditors without the Company obtaining shareholder approval. |
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Shareholders may request a full copy of the Revised Articles by contacting the Company as indicated in the second year. Mr. Landon T. Clay, an insiderheading “Additional Information” below.
The resolution to adopt the Revised Articles must be passed by not less than 75% of the Company, purchased 3,000,000 unitsvotes cast by the shareholders present in the private placement, at a price of C$0.50 per unit.
On January 24, 2006, the Company amended the terms of the warrants to extend the expiry date from January 27, 2006, to June 1, 2006 and to decrease the exercise price from $0.75 per share to $0.60 per share. The purpose of the amendment was to provide those warrantholders with the opportunity to exercise their warrants at an exercise price that reflected market pricesperson or by proxy at the time ofMeeting. Accordingly, the amendment.Company’s shareholders will be asked to consider and, if thought advisable, to pass, with or without amendment, a special resolution as follows:
Pursuant to TSX requirements, the exercise of the amended warrants issued to Mr. Clay requires the prior approval of“BE IT RESOLVED, as a majority of shareholders of the Company, excluding the votes attaching to the shares held beneficially by Mr. Clay and his associates.Special Resolution, THAT:
| (a) | the existing Articles of the Company be cancelled and the new Articles be adopted as the Articles of the Company; and | |
| (b) | the board of directors is hereby authorized, at any time in its absolute discretion, to determine whether or not to proceed with the above resolutions without further approval, ratification or confirmation by the shareholders.” |
THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” APPROVALTHE ADOPTION OF NEW ARTICLES OF THE ISSUANCECOMPANY.
PROPOSAL 3
INCREASE OF AUTHORIZED CAPITAL
The Company proposes to alter its Notice of Articles to increase the Company’s authorized capital from 100,000,000 common shares without par value to 150,000,000 common shares without par value. The Company previously had also authorized 3,000,000 preferred shares without par value, however as no preferred shares are presently outstanding, no preferred shares will be included in the proposed alteration.
The Company currently has no specific proposals or agreements for offers or sales of its common shares. The Company expects that costs associated with developing a mine at its Soledad Mountain project may require additional equity financing. Any mine project financing or series of financings could result in the allotment of additional common shares that would exceed the Company’s current authorized capital. Accordingly, the Company believes that it is prudent to increase the authorized capital at this time.
The rights, privileges, preferences and restrictions applicable to the Company’s common shares will not be affected by the proposed change to the authorized capital. There are currently no provisions in the current or Revised Articles or agreements to which the Company is a party or is aware of, or any other facts or circumstances, that would give the Company a basis to conclude that the increase in authorized capital would have the effect of delaying, deferring or preventing a potential change in control.
The resolution to increase the authorized capital must be passed by not less than 75% of the votes cast by the shareholders present in person or by proxy at the Meeting. Accordingly, the Company’s shareholders will be asked to consider and, if thought advisable, to pass, with or without amendment, a special resolution as follows:
“BE IT RESOLVED, as a Special Resolution, THAT:
| (a) | the authorized capital of the Company be changed to 150,000,000 common shares, without par value, and no preferred shares, and the Company’s Notice of Articles be altered accordingly; | |
| (b) | any director of the Company is instructed to authorize its agents to file a Notice of Alteration to a Notice of Articles with the British Columbia Registrar of Companies along with all other necessary documents and take such further actions that may be necessary to effect the amendment; and | |
| (c) | the board of directors is hereby authorized, at any time in its absolute discretion, to determine whether or not to proceed with the above resolutions without further approval, ratification or confirmation by the shareholders.” |
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THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” INCREASING THE AUTHORIZED CAPITAL OF THE AMENDED PRIVATE PLACEMENT WARRANTSCOMPANY TO MR. LANDON T. CLAY.150,000,000 COMMON SHARES.
OTHER MATTERS
Golden Queen knows of no other matters that are likely to be brought before the Meeting. If, however, other matters not presently known or determined properly come before the Meeting, the persons named as proxies in the enclosed proxy card or their substitutes will vote such proxy in accordance with their discretion with respect to such matters.
PROPOSALS OF SHAREHOLDERS
Meeting Materials sent to Beneficial OwnersShareholders who have not waived the right to receive Meeting Materials are accompanied by a Voting Instruction Form (“VIF”). This form is instead of a proxy. By returning the VIF in accordance with the instructions noted on it, a Non-Registered Holder is able to instruct the Registered Shareholder how to vote on behalf of the Non-Registered Shareholder. VIF’s, whether provided by the Company or by an Intermediary, should be completed and returned in accordance with the specific instructions noted on the VIF.
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In either case, the purpose of this procedure is to permit Non-Registered Holders to direct the voting of the shares which they beneficially own.Non-Registered Holders receiving a VIF cannot use that form to vote common shares directly at the Meeting - Non-Registered Holders should carefully follow the instructions set out in the VIF including those regarding when and where the VIF is to be delivered.Should a Non-Registered Holder who receives a VIF wish to attend the Meeting or have someone else attend on his/her behalf, the Non-Registered holder may request a legal proxy as set forth in the VIF, which will grant the Non-Registered Holder or his/her nominee the right to attend and vote at the Meeting.
Proposals which shareholders wish to be considered for inclusion in the Proxy Statement and proxy card for the 20062011 Meeting of Shareholders must be received by the Secretary of Golden Queen by January 17, 2007,December 1, 2010, and must comply with the requirements of Rule 14a-8 under the Securities Exchange Act of 1934, as amended, and Division 7 of Part 5 of the B.C. Business Corporations Act.
ANNUAL REPORT ON FORM 10-KSB
A COPY OF GOLDEN QUEEN’S COMBINED ANNUAL REPORT TO SHAREHOLDERS AND ANNUAL REPORT ON FORM 10-KSB FOR THE YEAR ENDED DECEMBER 31, 2005 ACCOMPANIES THIS PROXY STATEMENT AND IS IN THE FORM ANNEXED TO THE PROXY STATEMENT AS APPENDIX “B”. AN ADDITIONAL COPY WILL BE FURNISHED WITHOUT CHARGE TO BENEFICIAL SHAREHOLDERS OR SHAREHOLDERS OF RECORD UPON REQUEST TO INVESTOR RELATIONS, GOLDEN QUEEN MINING CO. LTD. AT 6411 IMPERIAL AVENUE, VANCOUVER, BC, V7W 2J5.
Dated at Vancouver, British Columbia, thisu <>day of May, 2006.July, 2010.
| BY ORDER OF THE BOARD OF DIRECTORS | |
| /s/ H. Lutz Klingmann | |
| H. Lutz Klingmann | |
| President |
BY ORDER OF THE BOARD OF DIRECTORS
__________________________H. Lutz KlingmannPresident
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