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Smith Chief Defended

March 23, 1986

I was disappointed in your March 2 article on Smith International, which appeared to be a personal vendetta against Jerry Neely, Smith's chairman and chief executive. One could only describe as a cheap shot the observation that Neely held this position because of family ties.

The board of directors (five out of seven members are outside directors) were free to oust Neely at any time during the past 10 years, but obviously felt it in the company's best interest to keep him as chairman. Certainly he had earned the confidence of the stockholders and the board as he managed the company's profitable growth to $1.2 billion during his first five years as chairman.

Clearly, Neely deserves a lot of credit for having the commitment and the intestinal fortitude to manage the company in the down times as well as the good. There is often a significant difference between bad decisions and bad outcomes. Your article failed to discriminate between the two.

RICHARD B. FONTAINE

Tustin

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