Court Order Blocks Snow Lake From Issuing Shares
Toronto, Sep 30, 2022 AEST (ABN Newswire) - On Thursday, September 29, 2022, at the request of a group of concerned shareholders (the "Concerned Shareholders") of Snow Lake Resources Ltd. (
NASDAQ:LITM), the King's Bench of Manitoba (the "Court") issued an order that stops Snow Lake from issuing any new shares prior to the record date, being October 27, 2022 (the "Record Date"), for the Company's annual shareholders' meeting (the "Meeting") scheduled to be held on December 15, 2022.
The Concerned Shareholders sought the Court order on an urgent basis after learning that Snow Lake was rushing to approve and complete a financing prior to the Record Date - the date on which the shareholders entitled to vote at the Meeting shall be determined. The proposed financing included the public issuance of a large number of shares by way of a registration statement filed with the US SEC and posted on EDGAR at www.sec.gov. The financing would have resulted in a very significant number of shares being placed directly into the hands of parties determined by Philip Gross and his supporters.
The Concerned Shareholders argued that allowing the financing, as proposed, was simply not in the best interests of Snow Lake and its shareholders. They explained to the Court that the issuance of 10,000,000 shares, being equal to approximately 56% of the current shares outstanding, would be highly material for Snow Lake and its shareholders both in nature and value and nothing about the process of the approval, motivation for and execution of the proposed financing was normal or appropriate. The approval by the board of directors was without full disclosure of all relevant information, and Mr. Gross' intention was to complete this financing immediately. There was no reason for this rushed process other than to issue shares before the Record Date for the upcoming meeting.
The financing represented improper, self-serving defensive tactics by Mr. Gross and the directors who support him and the Concerned Shareholders are relieved that the Court put a stop to this misconduct.
This dramatic intervention was necessary in light of the continuing improper actions of Mr. Gross and the directors who continue to support his actions. In an effort to prevent further actions detrimental to Snow Lake and its shareholders, on September 20, 2022, the Concerned Shareholders commenced an application against Snow Lake, and the motion which led to the September 29, 2022 Court order was brought within this broader action. The Concerned Shareholders became aware of further improper actions of Mr. Gross when reviewing the registration statement filed with the SEC, including changes to Mr. Gross' compensation package, which was improperly amended two months ago, without proper board approval, and without any notice to shareholders, to add a "golden parachute" by increasing his payout on a change in control to three years of fees, and to be paid out in advance of the Meeting. Furthermore, the Company's news release dated September 23, 2022, regarding the Nasdaq Notification of Noncompliance fails to explain that Mr. Gross orchestrated the removal of Mr. Nachum Labkowski from the audit committee, which triggered the notification from Nasdaq, due to Mr. Labkowski's unwillingness to support Mr. Gross in his attempts to entrench himself at the Meeting.
On December 15, 2022, shareholders will have the opportunity to save Snow Lake and their investment in its shares. The Concerned Shareholders encourage shareholders to stay informed and exercise their rights at the Meeting. Shareholders have a right to determine the future of our company and these outrageous efforts by Mr. Gross and other directors to frustrate that only reinforces the urgent need for change.
Contact
Sources: The Concerned Shareholders of Snow Lake
For additional information, please contact:
SaveSnowLake@gmail.com
Or visit www.saveSnowLake.com
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