Karnalyte Resources Inc T.KRN

News! 9th Press Release posted Sedar Oct 6th - Resignations

[GGSzabo]

Concerned Shareholders Call for Resignations of Interim CEO and Board of Directors

Time to Stop the Oppression of Karnalyte Shareholders by Gujarat State Fertilizers & Chemicals Limited and the Interim CEO

 

• Concerned Shareholders call for the immediate resignation of the Interim CEO and the members of the board of directors (the “Board”) in order to stop the oppression of Karnalyte shareholders
• Interim CEO and the Board, controlled by Gujarat State Fertilizers & Chemicals Limited’s (“GSFC”) nominees (“GSFC Nominees”) on the Board, continue to demonstrate a blatant disregard for basic corporate governance principles, Canadian securities law, TSX rules and regulations, contractual provisions and the avoidance of conflicts of interest and self-dealing
• Concerned Shareholders believe it is time to stop the Interim CEO’s, the Board’s, GSFC’s, and the GSFC Nominees’ oppression of Karnalyte shareholders by appointing a qualified, experienced and independent board of directors

 
Saskatoon, SK, October 5, 2020 — On July 7, 2020, a group of Karnalyte Resources Inc. (TSX: KRN) (“Karnalyte” or the "Company") shareholders (the “Concerned Shareholders”), owning not less than 5% of the issued and outstanding shares of the Company, requisitioned (the “Requisition”) the board of directors (the “Board”) to call and hold a special meeting (the "Special Meeting") of shareholders for the purpose of replacing the Board with a new independent board capable of pursuing opportunities in the Saskatchewan agricultural and fertilizer industry available to the Company that have the potential to create value for all shareholders.
The Concerned Shareholders requested that the Board be constituted with six (6) members, four (4) of whom are highly qualified nominees to be proposed by the Concerned Shareholders, and two (2) of whom will be nominees (the “GSFC Nominees”) of Gujarat State Fertilizers & Chemicals Limited (“GSFC”), in accordance with GSFC’s contractual rights to appoint nominees to the Board.
On July 27 2020, Karnalyte called the Special Meeting to be held on December 15, 2020, almost five months from the date of the notice of meeting.
 
Time to Resign
The Concerned Shareholders believe that the time has come for the Interim CEO and the Board to resign.
The Concerned Shareholders believe that the facts clearly demonstrate that the Interim CEO, the Board, which is controlled by the GSFC Nominees, have abjectly failed to discharge their legal and fiduciary duties to shareholders, as evidenced by:

• their failure to comply with the most basic governance requirements to have an independent Board
• their failure to take any action to rectify the many breaches of contractual agreements, Canadian securities laws, and TSX rules and regulations
• the GSFC Nominees controlling the Board for 20 months, and counting, with no legal or other basis to do so
• delaying the Special Meeting requisitioned by the Concerned Shareholders for 5 months in order to extend their entrenchment as management and the Board
• their inability and failure to develop a corporate strategy for Karnalyte, compounded by outsourcing the development of strategy to an accounting and tax firm

Peter Matson, one of the Concerned Shareholders and amongst the five largest shareholders of Karnalyte, noted that “The Concerned Shareholders believe that the facts we have provided evidence multiple breaches of Karnalyte’s Code of Conduct and justify our call for the immediate resignation of the Interim CEO and the Board.”  Mr. Matson continued: “We believe the breaches of the Code of Conduct we have outlined are material and serious and clearly require such resignations.”
 

Contacts

Peter Matson, on behalf of the Concerned Shareholders and the Nominees, welcomes the opportunity to engage with fellow shareholders. Mr. Matson can be reached at [e-mail].
 

Additional Information

The information contained in this press release does not and is not meant to constitute a solicitation of a proxy within the meaning of applicable securities laws. Although a record and meeting date for the Special Meeting was established by Karnalyte on July 27, 2020, shareholders are not being asked at this time to execute a proxy in favor of the Nominees. In connection with the Special Meeting, the Concerned Shareholders may file a dissident information circular in due course in compliance with applicable securities laws.
The Concerned Shareholders are not soliciting proxies in connection with the Special Meeting at this time. The Concerned Shareholders may engage the services of one or more agents and authorize other persons to assist in soliciting proxies on behalf of the Concerned Shareholders. Any proxies solicited by or on behalf of the Concerned Shareholders, or by any other agent, may be solicited pursuant to a dissident information circular or by way of public broadcast, including through press releases, speeches or publications and by any other manner permitted under Canadian corporate and securities laws. Any such proxies may be revoked by instrument in writing executed by a shareholder or by his or her attorney authorized in writing or, if the shareholder is a body corporate, by an officer or attorney thereof duly authorized or by any other manner permitted by law.
 
The registered address of Karnalyte is located at 2100 Livingston Place, 222 3 Ave SW Calgary, AB T2P 0B4. A copy of this press release may be obtained on the Company’s SEDAR profile at www.sedar.com.