Morning Star Resources Ltd.

October 10, 2013 09:30 ET

Boss Board Continues to Deflect Responsibility

Board must take responsibility for damage caused by its breach of trust

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Oct. 10, 2013) - Boss Power Corp.'s ongoing efforts to avoid responsibility for damages caused by the board's breach of trust are unacceptable. The current risk to the $30 million settlement is entirely the result of the board's breaches of trust in wrongfully including the B claims in the settlement without the consent or knowledge of the B claims owner Mr. Beruschi, the President of Morning Star Resources Ltd. (the "Concerned Shareholder").

The board must take the necessary actions to rectify its mistake before the $30 million settlement is lost. The board is reminded of its FIDUCIARY DUTIES TO ACT IN THE BEST INTERESTS OF BOSS AND ITS SHAREHOLDERS. The board's suggestion that the Concerned Shareholder should fix the board's mistakes shows the board's incompetence in not only being unable to close the settlement, but running a public company.

The board's previous "offer", which continued to entrench the existing directors, has been patently rejected by the Concerned Shareholder. The obvious question for the board, which it has attempted to divert attention away from, is: WHAT IS THE BOARD'S CURRENT PLAN TO SAVE THE $30 MILLION SETTLEMENT? The Concerned Shareholder challenges the board to answer this question. The Province's application to set aside the settlement is imminently approaching.

The board has, by wrongfully including the B claims in the settlement, put the $30 million settlement funds in jeopardy, squandered Boss's cash and generally flouted securities laws, yet the board still places the blame for Boss's inability to close the settlement on the Concerned Shareholder. "The ongoing and concerted efforts by the members of the board to keep their positions have only exacerbated the problem which they originally created some two years ago," said Mr. Beruschi. "It is time for the board to accept responsibility for their actions and to do what is best for all of Boss's shareholders - resign as proposed."

When the board demands Mr. Beruschi, a shareholder, "do the right thing for all of Boss's shareholders," the board is passing its fiduciary duties to protect the $30 million settlement to Mr. Beruschi. That is absurd. SHAREHOLDERS EXPECT THE BOARD TO "DO THE RIGHT THING" FOR BOSS SHAREHOLDERS, NOT A SHAREHOLDER WHOSE PROPERTY THE BOARD HAS UNLAWFULLY AGREED TO TRANSFER. The existing board's insistence that they continue in power is not more important than putting the $30 million settlement out of risk for the benefit of all shareholders.

In an effort to protect themselves, the directors have seen fit to waste two years and a significant amount of Boss's cash to hire multiple law firms and advisors to defend the board (and certain of its advisors) against liability brought about by their wrongful acts. It is not in the best interests of Boss's shareholders for the existing directors and their advisors to be absolved of potential personal liability for their misconduct. If the incumbent board cannot do the right thing and accept the proposal to immediately resign on their own, then Boss's shareholders must make the decision for them at the upcoming annual general meeting of shareholders scheduled to be held on November 14, 2013.

Information on the names and backgrounds of the Concerned Shareholder's proposed director nominees, as well as detailed reasons to support the Concerned Shareholder's position, will be more fully described in a detailed information circular to be mailed to shareholders and filed on SEDAR in due course in advance of the November 14, 2013 shareholders' meeting.

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