VenGrowth Asset Management Inc.

VenGrowth Asset Management Inc.

August 20, 2011 15:58 ET

GrowthWorks' Tactics Repeat a Long Series of Attempts to Undermine VenGrowth Shareholder Will

VenGrowth and Georgeson Outline Steps Taken to Confirm Equitable Treatment of Shareholders

TORONTO, ONTARIO--(Marketwire - Aug. 20, 2011) - The VenGrowth Funds and their proxy solicitation agent Georgeson Shareholder Communications Canada Inc. ("Georgeson") have acted in response to allegations made by GrowthWorks of coercive tactics being used by the VenGrowth Funds and Georgeson.

Our investigation uncovered no evidence that supports GrowthWorks' allegations of coercive tactics.

"GrowthWorks' repeated and baseless claims of inappropriate behaviour on the part of the VenGrowth Funds, its board, managers and advisors do a disservice to VenGrowth shareholders and are personally repugnant," said John Crow, Chair of the Board of the VenGrowth Funds. "GrowthWorks continues to rely upon fabrication, exaggeration and manipulation to undermine the undoubted integrity of the VenGrowth Special Committee process that began in January. GrowthWorks has attempted to force its will upon shareholders through outrageous means, including the many misrepresentations and unfounded attacks within the GrowthWorks' information circular, to siphon off the VenGrowth Funds' cash resources that GrowthWorks so desperately needs to stave off its own painfully evident financial crisis."

"Georgeson has never received instructions from the VenGrowth Funds, the Special Committee of the Board, the managers of the VenGrowth Funds, or any of their advisors or related parties to mislead or coerce shareholders with respect to the proposed transaction, and in particular, the early redemption option," said Chris Makuch, Vice President, Sales and Marketing, Georgeson Shareholder Communications Canada Inc.

In the course of Georgeson's investigation it was uncovered that Georgeson had mistakenly given incorrect information to a very limited number of shareholders. Georgeson immediately took corrective action to ensure that this error was not widespread, and would be corrected.

"We take these matters very seriously and instituted immediate steps to review and correct the situation. Our assessment is that there was inaccurate information regarding early redemption options provided to a very limited number of VenGrowth shareholders, including a few GrowthWorks' officers," continued Mr. Makuch.

VenGrowth and Georgeson have taken the following steps to reconfirm with shareholders and advisors that a shareholder's access to improved redemption options under the Covington Offer is not conditional on how that individual shareholder votes:

  • The issuance of a press release to reconfirm the equitable treatment of VenGrowth shareholders under Covington Offer
  • The issuance of the press release content to financial advisors for their review and asking that they forward the material to their clients who are VenGrowth shareholders
  • Georgeson is calling all VenGrowth shareholders contacted by Georgeson to ensure that they are aware of the correct information concerning redemption options

"We are confident that the errors in question were limited, and that there is no question that the integrity of the voting process is sound. This is just another example of GrowthWorks' tactics that are attempting to delay and stifle the ability of shareholders to vote for the Covington Offer and bring about a resolution that shareholders want and deserve," said Mr. Crow.

Important Information for VenGrowth Shareholders

The Covington Offer does not require and never has required an individual shareholder to vote in favour of the Covington Offer or vote at all in order to be eligible for its cash redemption options. These redemption options will be available to all shareholders in VenGrowth I, VenGrowth II and VenGrowth Advanced Life Sciences if the Covington Offer is approved by the necessary majority of shareholders at the shareholder meetings of those funds and the transaction is completed.

Shareholders are reminded that to have their shares redeemed on the closing of the Covington Offer they must submit a properly completed redemption request form as described in the management information circular of the VenGrowth Funds dated July 6, 2011.

Investors who would like more information are invited to contact their financial advisor, visit vengrowth.com or contact Georgeson, our proxy solicitation agent, at 1.866.676.3003.

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