Presentation by Et Snell
to Santa Margarita Water District
Board of Directors
May 25, 2012

    My name is Et Snell and I am an activist who lives out in the Mojave Desert of San Bernardino County.  I have spent much of my time in the last several years pointing out to my fellow citizens how we are being poorly served by our politicians and civic leaders.

    This matter before us today in which the San Bernardino County board of supervisors has surrendered to an entity that exists more than 200 miles away the authority to do an environmental certification of a massive water extraction project in the desert is typical of the poor leadership we suffer under in San Bernardino County.

    My focus today will not be on the environmental and ecological outrage of this project.  Nor am I going to upbraid you for your arrogance and greed in stealing the Mojave Desert's water.  I will allow others to address those issues.

    Instead, I want to see if I can get you to focus on something you probably have not considered, which is that if you vote to approve this arrangement with Cadiz, Inc., you are going to involve your agency and yourselves personally in the criminal conspiracy involving Cadiz, Incorporated now being investigated by the FBI and the Securities and Exchange Commission.

    You may not have known that such an investigation was ongoing.  I do not think it likely Cadiz, Incorporated's officials informed you of it.

    What the Securities and Exchange Commission is focusing on is misrepresentations made by Cadiz, Incorporated to its investors and stockholders.  Cadiz, Inc. longtime lender, L.C. Capital Master Fund, Ltd, has pumped at least $387 million into the company as it has purchased or secured options on 45,000 acres in the East Mojave Desert.

    At the same time, it has operated a relatively modest organic citrus, grape, melon, asparagus, pepper and squash growing farm there that never covered more than 500 acres and which has never utilized more than 5,000 acre-feet of water per year.

    Yet Cadiz, Inc. has been representing to its investors that it is securing the rights to 150,000 acre-feet of water. That is an outright fabrication and a violated of Securities and Exchange statutes.

    About three years ago, investors with L.C. Capital Master Fund became aware of this misrepresentation and fraud when the company's operating capital had dwindled to $4.3 million.  It was at that time that Cadiz, Incorporated first registered on the Securities and Exchange Commission's radar.

    After L.C. Capital abandoned Cadiz, Inc., they began seeking an infusion of funds from other sources, including Altima Partners, a privately held hedge fund company in England, and another outfit called Water Asset Management.

    Cadiz, Incorporated has made similar fraudulent misrepresentations to those firms and their investors, claiming they have water rights to 150,000 acre-feet when in reality their actual water rights stand at 5,000 acre feet.

    In July 2011, a significant number of Cadiz, Incorporated's investors retained the San Diego-based law firm of Robbins Umeda, which specializes in shareholder rights litigation, to commenced an investigation into possible breaches of fiduciary duty and other violations of the law by certain officers and directors at Cadiz, Inc.

    My advice to the board was before they enter into a arrangement with Cadiz, Incorporated, they send someone over to the Securities and Exchange Commission and the law firm of Robbins Umeda - they are located in San Diego, to trade notes.

Et Snell