GrowthWorks Canadian Fund Ltd.'s Former Manager Contests Termination of the Management Agreement
TORONTO, Dec. 2, 2013 /CNW/ - GrowthWorks Canadian Fund Ltd. (the "Fund") today announced that the Fund has received a letter from legal counsel to GrowthWorks WV Management Ltd. (the "Former Manager"), the former manager of the Fund, relating to the termination of the management agreement (the "Management Agreement") between the Fund and the Former Manager. The Fund previously announced that, on September 30, 2013, the Fund had terminated Management Agreement in accordance with its terms. In the letter, the Former Manager asserts that the Management Agreement was terminated without cause, and, as a result, it is entitled to damages from the Fund in the amount of approximately $16.750 million. The Fund believes that the claim by the Former Manager is without merit and will vigorously defend the claim.
As previously announced, on October 1, 2013 the Fund commenced proceedings under the Companies' Creditors Arrangement Act (the "CCAA") and, on November 20, 2013 the Fund obtained an order (the "Order") of the Ontario Superior Court of Justice authorizing the Fund to initiate a Sale and Investor Solicitation Process (the "SISP"). CCC Investment Banking, the Fund's financial advisor, has commenced contacting prospective strategic and financial partners interested in participating in the SISP.
FTI Consulting Canada Ltd., the Court appointed monitor in the CCAA proceedings, will supervise the SISP in accordance with the terms of the Order.
For further information, please refer to the monitor's website at http://cfcanada.fticonsulting.com/gcfl.
This press release contains forward looking statements, including statements with respect to the CCAA proceedings. These forward-looking statements reflect the Fund's current views and are based on certain assumptions, including assumptions as to future operating conditions and courses of action, sale or refinancing alternatives, economic conditions and other factors the Fund believes are appropriate. Such forward looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those contained in these statements, including the risk that disposition of the Fund's portfolio investments or refinancing or other strategic alternatives may not be available on terms acceptable to the Fund, or at all, or that any such disposition or other strategic alternative would yield proceeds sufficient to satisfy in full the Fund's payment obligations to Roseway Capital S.a.r.l., the Fund's other creditors or any distribution to the Fund's shareholders; the risk that litigation or defence proceedings involving claims by the Former Manager or other third parties against the Fund may involve substantial expense and, if successful, could require the Fund to pay substantial damages; and those risks and uncertainties disclosed in the Fund's most recently filed prospectus and other regulatory filings posted on SEDAR at www.sedar.com. These risks and uncertainties may cause actual results, events or developments to be materially different from those expressed or implied by such forward-looking statements. Unless required by law, the Fund does not assume any obligation to update any forward-looking statements, whether as a result of new information, future events or results or other factors.
SOURCE GrowthWorks Canadian Fund Ltd.