From: Joe Cocalis [cocalis@worldnet.att.net] Sent: Sunday, June 08, 2003 12:31 PM To: rule-comments@sec.gov Subject: File No. S7-10-03. (Proxy Reform) Jonathan G. Katz, Secretary Securities and Exchange Commission 450 Fifth Street, NW Washington, DC 20549-0609. Dear Mr. Katz: We applaud the Securities and Exchange Commission (SEC) for championing the cause of corporate election reform. Some well-established laws and regulations are just plain wrong. With the current system of "multiple ballots" and "challenger pays election costs", the Chief Executive Officer (CEO) selection of directors, not the stockholder franchise is the real basis from which management draws its power over stockholder assets. The time is right for change. The Goldfield Corporation is a good example of franchise abuse and its effect on stockholders. We have a significant proportion of our life savings invested in the stock of The Goldfield Corporation, symbol GV, a construction company. Goldfield appears to be run to benefit the CEO and Board of Directors (BOD) and not the stockholders. We have decided to sell some or all of our 500,000 shares of Goldfield, in part, because of SEC Rules that prevent stockholders from participation in a meaningful electoral process to effectuate change. Goldfield is a micro-capitalization company with 89 employees, seven directors, 27,000,000 shares, a price under $1.00 and the overhead of the much larger company it was in the past. The stock is the oldest listed company trading on the American exchange. In 2001, a group of Goldfield stockholders attempted to vote for a qualified candidate who had filed with the SEC for the position of director. Management spent $450,000, or 3.25% of capitalization, on multiple express mailings of ballots and telephone solicitations. Many stockholders viewed this unnecessary expense as outrageous (our family's prorated proxy cost was about $8,300 and the ballots did not provide us with the opportunity to vote for all candidates). The exorbitant cost of proxy solicitation for qualified challengers, estimated to be in excess of $50,000 for an alternate ballot or proxy, de facto prevented us from exercising our fundamental shareholder right to vote all our shares for the candidate of our choice. Only when the company provides equal ballot access to qualified challengers, will "the floor of opportunity" be raised to levels where stockholders are free to meaningfully participate in electoral competition. No challenges have been initiated in the 2002 or 2003 proxy campaign out of fear that management is willing to spend another 3.25% of our assets on multiple solicitations. The lesson learned was that management will adopt a scorched earth policy with our money if we attempt to elect a watchdog director. So in lieu of running a candidate, we adopted the tact of making our wishes known to management through stockholder proposals. The proposals that got past SEC review were ineffective and have made a mockery of the electoral process. For example, in 2002, Goldfield shareholders passed a stockholder resolution that called for performance-based compensation. In a year when revenues were flat ($22 million), earnings decreased by over 50% (to $682,000), and stock price decreased by 10%, the directors awarded the CEO a $97,000 bonus and the directors saw to it that they received a hefty increase in directors fees from $15,000 to $18,000 per year (and from $500 to $1,000 additional for each meeting attended). This is outrageous overhead for a company with 89 employees. The directors have debased the shareholder proposal and shareholders deserve the opportunity to vote them out of office. A viable alternative exists. Sell the company to a much larger company that is able to absorb the overhead. Although this alternative is lucrative to stockholders, we believe it to be unlikely because it would kill the cash cow for both the CEO and the directors. In summary, stockholders like us feel helpless to do anything about these and other abuses. We believe that the excessive overhead will eventually suck the lifeblood out of The Goldfield Corporation when a downturn in construction occurs. We urge you to implement franchise reform in time for the 2004 election cycle. Single ballot access to qualified challengers is the only viable way to implement the change that is necessary to ensure the long-term viability of stockholder assets. Joseph and Donna Cocalis 119 Wright Street Point Marion, PA 15474