10:26:20 EDT Thu 28 Mar 2024
Enter Symbol
or Name
USA
CA



Diversified Royalty Corp
Symbol DIV
Shares Issued 54,155,173
Close 2014-10-31 C$ 2.75
Market Cap C$ 148,926,726
Recent Sedar Documents

Diversified Royalty ex Bennett's court appeal dismissed

2014-10-31 19:25 ET - News Release

Mr. Sean Morrison reports

DIVERSIFIED ROYALTY CORP. ANNOUNCES FILING OF FINAL PROSPECTUS AND UPDATE ON LITIGATION INVOLVING JOHN BENNETT

Diversified Royalty Corp. has filed and obtained a receipt for a final short-form prospectus in respect of its previously announced bought-deal public offering of common shares of the corporation. The prospectus was filed in each of the provinces of Canada, except Quebec. A copy of the prospectus is available on SEDAR.

As previously announced, the corporation has entered into an agreement with a syndicate of investment dealers co-led by Cormark Securities Inc. and GMP Securities LP, pursuant to which the underwriters have agreed to purchase an aggregate of 12.5 million common shares at a price of $2.40 per share for gross proceeds of $30-million. In addition, the corporation has granted the underwriters an option to purchase up to an additional 1,875,000 shares from the treasury at a price of $2.40 per share exercisable at any time up to 30 days following closing of the offering, for market stabilization purposes and to cover overallotments, if any. The Toronto Stock Exchange has conditionally approved the listing of up to an additional 14,375,000 common shares of the corporation to be issued pursuant to the offering and overallotment option. Listing is subject to the corporation fulfilling all the requirements of the TSX on or before Jan. 16, 2015. The closing of the offering is expected to occur on or about Nov. 12, 2014, and is subject to regulatory approval including that of the TSX.

Update on litigation involving John Bennett

On Oct. 30, 2014, the Supreme Court of Canada dismissed Mr. Bennett's application for leave to appeal an order of the B.C. Court of Appeal ordering his extradition to the United States to stand trial for conspiracy to defraud and major fraud against the United States. The corporation expects Mr. Bennett, currently under detention in Vancouver, to be transported in the very near future to Newark, N.J., where he is to be tried before a jury in Federal District Court.

In October, 2013, the corporation brought a motion to the Ontario Superior Court (commercial list) to set aside or suspend a Dec. 29, 2010, interim order, which required the reimbursement of Mr. Bennett's criminal defence expenses by the corporation, pending a final determination of his entitlement to indemnification. In March, 2014, Mr. Bennett served a cross-motion to strike the corporation's motion and to require the corporation to continue to reimburse his legal defence costs pending trial. In September, 2014, both the motion and the cross-motion were scheduled for a hearing on Dec. 19, 2014. On Oct. 30, 2014, after Mr. Bennett lost his application for leave to appeal to the Supreme Court of Canada, his counsel requested the corporation pay a $2.5-million (U.S.) retainer to cover the criminal defence costs of his trial in New Jersey. Mr. Bennett's counsel further advised that it intended to amend its cross-motion currently scheduled for hearing on Dec. 19, 2014, to seek this relief. It also advised that it would seek to expedite the hearing of the amended cross-motion.

While the corporation intends to strenuously resist this motion, there is some possibility that the corporation may be ordered to finance up to $2.5-million (U.S.) to cover Mr. Bennett's criminal lawyer's retainer and that the advance of this retainer may not be financed by the corporation's insurance. As of the date hereof, the corporation has sufficient funds on hand (and, if needed, available under its line of credit) for such purposes.

We seek Safe Harbor.

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