Diversified Royalty Corp. (TSX: DIV and DIV.DB) (the
“Corporation” or “DIV”) today announced certain amendments to the
proposed Articles of DIV to be voted on for adoption at the special
meeting of shareholders of DIV to be held at 9:00 am (Vancouver
time) on October 14, 2020 (the “Meeting”) as part of DIV’s proposal
to have shareholders consider and, if thought advisable, pass a
special resolution to approve the continuance of DIV from the
Canada Business Corporations Act to the Province of British
Columbia under Business Corporations Act (British Columbia) (the
“Continuance”).
Following discussions by DIV with Institutional
Shareholder Services, a leading proxy advisory firm, as part of
DIV’s continued commitment to implementing good corporate
governance practices, the Board of Directors of DIV has agreed to
amend the following provisions of the proposed Articles attached as
Schedule C to DIV’s information circular dated September 14, 2020
(the “Proposed Articles”):
- Quorum. The quorum requirement for future meetings of
shareholders of DIV set forth in the Proposed Articles will be
increased from 10% (which is reflective of the quorum requirement
under DIV’s existing By-laws) to 25%.
- Advance Notice Provisions. The advance notice provisions in the
Proposed Articles will be revised in order to only allow additional
disclosure requests from DIV outside of delineated categories if
required pursuant to applicable securities laws or stock exchange
rules in order to determine the independence of a proposed
nominee.
- Share Sub-Divisions and Consolidations. The Proposed Articles
will be revised to provide that subdivisions or consolidations of
DIV’s shares will require shareholder approval by ordinary
resolution.
The above noted changes to the Proposed Articles
to (i) increase the quorum requirement for shareholder meetings, is
intended to encourage wide-ranging shareholder participation in
future meetings of DIV shareholders, (ii) the advance notice
provisions, is intended to ensure additional disclosure requests by
DIV with respect to proposed nominees for election to the Board of
Directors of DIV are appropriately limited in their scope, and
(iii) require shareholder approval for share sub-divisions and
consolidations, is intended to facilitate shareholder input on such
decisions given shareholders may have unique preferences in regards
thereto, notwithstanding that such capital alterations are
inherently administrative.
DIV initiated the aforementioned changes to the
Proposed Articles in an effort to continually improve DIV’s
corporate governance practices, plans and policies in order to
satisfy the most current criteria of its investors and proxy
advisory firms. DIV is pleased to report that Glass Lewis, another
leading proxy advisory firm, has recommended DIV shareholders vote
“For” the Continuance.
The Continuance and the Proposed Articles, other
than the changes described herein, are more fully described in
DIV’s information circular dated September 14, 2020, a copy of
which is available on SEDAR at www.sedar.com. A copy of the
Proposed Articles, with the amendments described herein, is
available on DIV’s website at www.diversifiedroyaltycorp.com and on
SEDAR at www.sedar.com.
About Diversified Royalty Corp.
DIV is a multi-royalty corporation, engaged in
the business of acquiring top-line royalties from well-managed
multi-location businesses and franchisors in North America. DIV’s
objective is to acquire predictable, growing royalty streams from a
diverse group of multi-location businesses and franchisors.
DIV currently owns the Mr. Lube, AIR MILES®,
Sutton, Mr. Mikes, Nurse Next Door and Oxford Learning Centres
trademarks. Mr. Lube is the leading quick lube service business in
Canada, with locations across Canada. AIR MILES® is Canada’s
largest coalition loyalty program with approximately two-thirds of
Canadian households actively participating in the AIR MILES®
Program. Sutton is among the leading residential real estate
brokerage franchisor businesses in Canada. Mr. Mikes operates
casual steakhouse restaurants primarily in western Canadian
communities. Nurse Next Door is one of North America’s fastest
growing home care providers with locations across Canada and the
United States as well as in Australia. Oxford Learning Centres is
one of Canada’s leading franchised supplemental education services
in Canada and the United States.
DIV intends to increase cash flow per share by
making accretive royalty purchases and through the growth of
purchased royalties. DIV intends to pay a monthly dividend to
shareholders and increase the dividend as cash flow per share
increases allow.
Forward Looking Statements
Certain statements contained in this news
release may constitute “forward-looking information” within the
meaning of applicable securities laws that involve known and
unknown risks, uncertainties and other factors which may cause the
actual results, performance or achievements to be materially
different from any future results, performance or achievements
expressed or implied by such forward-looking information. The use
of any of the words “anticipate”, “continue”, “estimate”, “expect”,
“intend”, “may”, “will”, ”project”, “should”, “believe”,
“confident”, “plan” and “intends” and similar expressions are
intended to identify forward-looking information, although not all
forward-looking information contains these identifying words.
Specifically, forward-looking information in this news release
includes, but is not limited to, statements made in relation to:
the date and other details of the Meeting, the Continuance and the
Proposed Articles; DIV’s intention to pay monthly dividends to
shareholders; and DIV’s corporate objectives. These statements
involve known and unknown risks, uncertainties and other factors
that may cause actual results or events, performance, or
achievements of DIV to differ materially from those anticipated or
implied by such forward-looking information. DIV believes that the
expectations reflected in the forward-looking information included
in this news release are reasonable but no assurance can be given
that these expectations will prove to be correct. In particular
there can be no assurance that: the Continuance and the Proposed
Articles will be approved by shareholders at the Meeting; DIV will
be able to make monthly dividend payments to the holders of its
common shares; or DIV will achieve any of its corporate objectives.
Given these uncertainties, readers are cautioned that
forward-looking information included in this news release are not
guarantees of future performance, and such forward-looking
information should not be unduly relied upon. More information
about the risks and uncertainties affecting DIV’s business and the
businesses of its royalty partners can be found in the “Risk
Factors” section of its Annual Information Form dated March 18,
2020 and in its most recent Management’s Discussion and Analysis,
copies of each of which are available under DIV’s profile on SEDAR
at www.sedar.com.
In formulating the forward-looking information
contained herein, management has assumed that DIV will generate
sufficient cash flows from its royalties to service its debt and
pay dividends to shareholders; lenders will provide any necessary
waivers required in order to allow DIV to continue to pay
dividends; the impacts of COVID-19 on DIV and its royalty partners
will be consistent with DIV’s expectations and the expectations of
management of each of its Royalty Partners, both in extent and
duration; DIV and its royalty partners will be able to reasonably
manage the impacts of the COVID-19 outbreak on their respective
businesses. These assumptions, although considered reasonable by
management at the time of preparation, may prove to be
incorrect.
All of the forward-looking statements made in
this news release are qualified by these cautionary statements and
other cautionary statements or factors contained herein, and there
can be no assurance that the actual results or developments will be
realized or, even if substantially realized, that they will have
the expected consequences to, or effects on, DIV. The
forward-looking information included in this news release is
presented as of the date of this news release and DIV assumes no
obligation to publicly update or revise such information to reflect
new events or circumstances, except as may be required by
applicable law.
THE TORONTO STOCK EXCHANGE HAS NOT
REVIEWED AND DOES NOT ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR THE
ACCURACY OF THIS RELEASE.
Additional Information
Additional information relating to the
Corporation and other public filings, is available on SEDAR at
www.sedar.com.
Contact: Sean Morrison, President and Chief
Executive Officer Diversified Royalty Corp. (604) 235-3146
Greg Gutmanis, Chief Financial Officer and VP
Acquisitions Diversified Royalty Corp. (604) 235-3146
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