Trans Hex Group Limited has filed a counterclaim in response to Diamond Fields International’s $19.5-million (U.S.) claim against Trans Hex for its repudiation of the former Diamond Fields International/Trans Hex joint venture agreement. Trans Hex is claiming for payments owing under the joint venture of approximately $200,000 (U.S.) and damages of approximately four million South African rand (approximately $400,000 (U.S.)). Trans Hex has also made an alternative claim for damages of 268 million rand (approximately $26.8-million (U.S.)).
The damages claims are based upon Trans Hex’s allegation that it was induced to enter into the Diamond Fields International/Trans Hex joint venture agreement by material false representations that Trans Hex alleges were made on the company’s behalf by Mark Collins, Diamond Fields International’s former chief operating officer. Mr. Collins is a member of the dissident Boulle Group and is named in the Boulle Group’s dissident proxy circular as one of its nominees for election to the company’s board of directors at the annual general meeting scheduled for Nov. 21, 2002.
The company’s position is that Trans Hex’s allegations are completely without foundation and that its alternative damages claim for 268 million rand is sensational, abusive and far fetched. The company intends to proceed with its own damages claim against Trans Hex and to defend against Trans Hex’s baseless counterclaim.
The company is surprised by the Boulle Group’s revelation in news issued earlier today that, if its nominees are elected to the company’s board of directors, they intend to negotiate a settlement with Trans Hex, a 7-per-cent shareholder of Diamond Fields International. Management is disappointed that, in furtherance of the Boulle Group’s desire to take control of the company in the proxy contest, the Boulle Group would risk undermining the company’s favourable position in this litigation. The Boulle Group’s failure to disclose its intentions in the dissident proxy circular makes this all the more disturbing and deserving of criticism and closer scrutiny.
WARNING: The company relies upon litigation protection for “forward-looking” statements.
