VANCOUVER, Sept. 18, 2018 /CNW/ - Concerned shareholders, Kulwant Malhi and BullRun Capital Inc. (the "Concerned Shareholders") of GrowMax Resources Corp. (the "Corporation" or "GrowMax") (GRO:TSX.V) today announced the intention of their board nominees (the "Concerned Shareholder Nominees") to declare, if elected, a cash dividend in the amount of $0.075 per share as part of their plan to steer the Corporation in a direction that focuses on the interests of shareholders of GrowMax ("Shareholders").
As Kulwant Malhi observed "the Concerned Shareholder Nominees have experience building shareholder value by creating world class publicly-traded companies. Recent successes include the FOUNDING and development of Cannabix Technologies Inc. (BLO:CSE), Patriot One Technologies Inc. (PAT.V:TSX.V) and most recently Micron Waste Technologies Inc. (MWM:CSE)".
Under the Concerned Shareholders' plan, all holders of GrowMax Common Shares will receive a dividend payment estimated at $0.075 per share (the "Dividend"), subject to the availability of funds. The Dividend would, subject to shareholder approval, be structured in a tax efficient manner as a return of capital and reflects the approximate current trading value of GrowMax common shares on the TSX Venture Exchange.
The Concerned Shareholders believe that given the Corporation's strong cash position, the Dividend provides an efficient means to distribute a significant amount of cash on hand to Shareholders while preserving sufficient financial resources and working capital to pursue new business opportunities.
After the Dividend, shareholders will continue to own their GrowMax shares and the Concerned Shareholders believe GrowMax will have approximately $16 million in cash. The Concerned Shareholders are committed to utilizing this strong cash position to seek out investments and transactions that are investor friendly and will actually maximize shareholder value, instead of committing to the acquisition of PrimaSea Holdings and its wholly-owned subsidiary Fertimar (the "PrimaSea Acquisition") which will result in the ultimate depletion of GrowMax's cash treasury. The amount of the Dividend will ultimately be subject to the amount of available cash in Growmax after the changeover of the Board at the shareholder meeting on September 25, 2018.
Unlike the PrimaSea Acquisition, the Dividend will not result in the handover of 50% of your company to PrimaSea's shareholders or entrench control of the Corporation in GrowMax directors and officers. Instead, the Dividend will allow Shareholders to continue to meaningfully participate as shareholders in the Company with a management team whose interests are aligned with ALL shareholders.
Reminder to Vote
The Concerned Shareholders remind all Shareholders that the proxy voting deadline is this Friday, September 21, 2018. The deadline is fast approaching and Shareholders are encouraged to vote today. More information is available at www.laurelhill.ca/abetter-growmax. By voting only the YELLOW proxy, shareholders will be voting:
- AGAINST a highly-dilutive transaction that will result in the handover of nearly 60% of your company to GrowMax directors and officers;
- AGAINST the re-election of a board of directors that has destroyed shareholder value in favour of their own self-interest;
- AGAINST the adoption of a new equity incentive plan that will further increase the shareholdings of directors and officers and further dilute your interest in the Corporation;
- AGAINST the adoption of an advance notice by-law that gives the board of directors the sole discretion to dismiss your shareholder nominees;
- FOR the new Concerned Shareholder nominees who will rejuvenate the GrowMax board of directors and take the Corporation in a new direction that will eliminate wasteful spending and maximize shareholder value; and
- FOR the issuance of a dividend payment which will result in a cash being paid directly to YOU instead of being used to fund a money-losing operation.
Do not vote the blue proxy. Shareholders should discard any blue proxy they may receive and should vote only their YELLOW proxy well in advance of the proxy voting deadline of September 21, 2018 at 8:00 a.m. Calgary time.
Due to the essence of time, Shareholders are asked to vote online or by telephone by following the instructions found on the YELLOW proxy to ensure votes are received in a timely manner. IF YOU HAVE ALREADY VOTED USING MANAGEMENT'S BLUE PROXY, YOU CAN STILL SUPPORT THE CONCERNED SHAREHOLDERS BY USING THE YELLOW PROXY. THE LATER DATED PROXY WILL SUPERSEDE.
Remember every vote counts to protect your investment. Regardless of the number of shares you own, please vote your YELLOW proxy today.
Questions and requests for assistance may be directed to the Concerned Shareholders' Proxy Solicitor:
Laurel Hill Advisory Group
North America Toll Free: 1-877-452-7184
Outside North America: 1-416-304-0211 (collect)
Email: [email protected]
SOURCE BullRun Capital Inc.
For further information: BullRun Capital Inc., #915 - 700 West Pender Street, Vancouver British Columbia V6C 1H2, Attention: Kulwant Malhi, [email protected], Tel +1 604 805 4602