Morning Star Resources Ltd.

November 07, 2013 23:16 ET

Boss's Independent Director Reaffirms Support for Concerned Shareholder's Nominees

Vote your BLUE proxy today

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Nov. 7, 2013) - Morning Star Resources Ltd. (the "Concerned Shareholder") announced today that it was providing the following excerpts from the statutory declaration of the independent director of Boss so that shareholders can read and learn for themselves the independent director's exact comments on the current matter:

  • "Since at least December, 2012 I have been urgently demanding that Ron Netolitzky and possibly even John Bowles meet with Mr. Beruschi to settle matters so that the B claims can be delivered to the Province to get the Settlement closed. From about March of this year I have been very strongly demanding it. I believe this is the way to get the issues over the B claims resolved so that the Settlement can close."
  • "As a current director of Boss I do not recommend that shareholders vote for Boss's nominees. I recommend Boss shareholders vote for Morning Star Resources' nominees in order to get the Settlement closed."
  • "I believe each of these [the Concerned Shareholder's] nominees, but especially Ray [Roland] and Kirk [Shaw], whom I know well and trust, notwithstanding anything else, would make excellent directors."
  • "…as Mr. Beruschi has indicated that once they [the Concerned Shareholder's nominees] are on Boss's board he will forthwith make a deal to allow delivery of the B claims and the closing of the Settlement, because of this alone, I believe they are the best nominees for directors of Boss. There is a very real and important benefit to Boss and its shareholders in their being appointed to Boss's board. It may be the most important thing Boss can do to get the Settlement completed."
  • "As a director I received Boss's recent information circular in draft… I stated I thought it was defamatory… When I finally read the mailed out version I was shocked and did not agree with its contents."
  • "I believe the comments in Boss's information circular about Mr. Beruschi not creating or destroying shareholder value are false, improper, misleading and defamatory."
  • "In November, 2011 I was present when [then CEO of Boss] Mr. Rogers mis-informed Mr. Beruschi when he told him that he did not know why the Province wanted his B claims before paying the $30 million. I was misinformed as well. I was present on numerous occasions where Mr. Beruschi demanded Boss make proper disclosures of the Settlement and B claim situation, including receiving emails from him. I was told by management and legal counsel that Boss was disclosing matters properly. I now believe that to be not true."
  • "I am very disappointed to discover that Don Siemens, who was initially negotiating for Boss, in the end advised Mr. Beruschi that Ron Netolitzky and John Bowles had abandoned settlement discussions on behalf of Boss and were going to leave it to the Province's court application to determine if the Settlement would close, that Don Siemens was now working for Anthem, and that in order to get a settlement Mr. Beruschi had to consent to Anthem receiving $1.5 million for a royalty interest that I understand Anthem did not earn. I believe this was improper, jeopardized the Settlement, and put Anthem in a position to try and get something for its royalty."
  • "I believe that Mr. Beruschi was not aware that the B claims were included in the Settlement until December 14, 2011. From speaking at the time with Mr. Beruschi and his e-mails he certainly was not aware in October 2011 and neither was I."
  • "I am aware that Ultra Resources Corp. had agreed to buy the B claims from Mr. Beruschi for approximately a total of $4.1 million in April 2008."
  • "I completely and adamantly disagree with the statements on page 12 of Boss's management information circular regarding Mr. Beruschi's trust agreements with Boss. I was the person who executed those documents for Boss… Boss's competent lawyers… created the trust documents and acted for Boss on them. Mr. Beruschi did not act on behalf of Boss on those documents… I think it is a defamatory statement about Mr. Beruschi. It is untrue to say Mr. Beruschi acted for Boss on the trust agreements and there was no benefit to Boss."
  • "I know Boss recently applied for an injunction from the Arbitrator to stop Mr. Beruschi from voting his 2 million shares held in trust. I believe this was improper and I do not agree with it. He should be able to vote all his shares. I believe the whole arbitration was without good reason by Boss, that the 2 million escrow shares should be released to Mr. Beruschi, and that Mr. Beruschi should be paid his costs of the arbitration by Boss… I am adamant that the Arbitration should be immediately ended in favor of Mr. Beruschi and the shares released to him."
  • "I further believe that the arbitration was a mistake. In particular, I believe and agree that the escrow agreement provided that the date for Mr. Beruschi to deliver the excluded… claims, and for determining value, was moved to June, 2010 under the amendment agreement and escrow agreements, as intended by the parties and clearly set out in the agreements. I was the president of Boss when these documents were created and executed and understood that the date for Mr. Beruschi to deliver the excluded claims was moved to June, 2010 to put the agreement in good standing so… [Boss's acquisition of the B uranium properties] could close. Specifically, if the excluded claims were not delivered by June, 2010 then the parties would look at June, 2010 as the valuation date. This date was in accord with my understanding in 2007 that the Province could impose a moratorium or ban that would make the excluded claims worthless by then, and that the escrow shares should then be released if the excluded claims were worthless in 2010. As that is exactly what happened the escrowed shares should be released to Mr. Beruschi."
  • "The Provincial Government's ban on uranium made the excluded claims referred to in the escrow agreement and the amendment agreement essentially worthless as of April, 2008. As a result… I believe that all of the escrow shares should have been released to Mr. Beruschi in 2010. I further believe that Boss brought about and prosecuted the arbitration in order to secure greater control over the board and shareholding for the sole benefit of Boss's largest shareholder, Anthem Resources through attempting to cancel those shares. I believe this is improper and I would not have agreed to the arbitration if given proper, independent and non-conflicted advice."

The above lets shareholders read for themselves the independent director's comments in a clear and transparent way, void of any commentary. The independent director has made it clear that without Mr. Beruschi's consent to transfer the B claims, Mr. Netolitzky's nominees do not have the ability to close the $30 million settlement. Don't let Boss's $30 million settlement be lost. Shareholders should vote their BLUE proxy or VIF by 11:00 A.M. (PACIFIC TIME) FRIDAY, NOVEMBER 8, 2013. A vote for your BLUE proxy or VIF is a vote to save the $30 million settlement and return funds to shareholders.

YOU MAY VOTE TO SUPPORT THE CONCERNED SHAREHOLDER'S NOMINEES EVEN IF YOU HAVE PREVIOUSLY DEPOSITED A PROXY IN SUPPORT OF MANAGEMENT. SUBMITTING A BLUE PROXY WILL AUTOMATICALLY REVOKE ANY PRIOR PROXY OR VOTING INSTRUCTION.

For assistance voting your BLUE proxy or VIF, shareholders should contact Valiant Trust Company toll-free at 1-877-699-4880 or 1-866-313-1872, or by email at inquiries@valianttrust.com. Our proxy circular and letter to shareholders has been mailed to shareholders and is also available on SEDAR at www.sedar.com. To keep current with further developments and for information about how to vote your shares, we have set up a website at www.bosspowerconcernedshareholder.com, which we encourage shareholders to visit regularly.

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