TORONTO, June 19,
2024 /CNW/ - Mithaq Capital SPC ("Mithaq"),
the largest shareholder of Aimia Inc. (TSX: AIM) ("Aimia" or
the "Company"), today responded to certain misleading claims
made by Aimia representatives in a video interview posted to
Aimia's website regarding Aimia's strategic direction and its
relationship with Mithaq. While the board of directors of Aimia
(the "Board") continues to demonstrate an unwillingness to
engage productively with its most significant shareholder, Mithaq
feels compelled to respond to these misleading claims in the
interest of ensuring that shareholders can make an informed
decision at the upcoming contested annual meeting of Aimia
shareholders to be held on June 26,
2024 (the "Meeting").
As previously disclosed, Mithaq has nominated six individuals
(the "Mithaq Nominees") for election to the Board at the
Meeting pursuant to Aimia's advance notice by-law (by-law no.
2013-1). Aimia shareholders willing to express their support for
the Mithaq Nominees should vote using the GOLD form of
proxy or GOLD voting instruction form accompanying the
Mithaq circular prior to 5:00 p.m.
(Toronto time) on Friday, June 21, 2024. Shareholders who have
questions or require assistance may contact Mithaq's proxy
solicitor, Carson Proxy, for more information by North American
toll-free phone at 1-800-530-5189, local phone or text at
416-751-2066 or by email at info@carsonproxy.com
Mithaq has ownership of, or control or direction over, a total
of 26,893,588 common shares of Aimia, representing approximately
26.98% of the issued and outstanding common shares.
A Board Without Significant
Equity Ownership
When asked why he became involved with Aimia, the current
Executive Chairman responded that "first and foremost, I'm an
investor, and I've bought more shares recently in the Company".
Mithaq finds the emphasis on equity ownership as justification for
his current role perplexing given that he and the current Board
have campaigned to prevent Mithaq, the Company's largest
shareholder, from obtaining any representation at the Board level.
The Executive Chairman was appointed concurrently with the dilutive
private placement undertaken by Aimia in October 2023. Together with others associated
with Aimia's financial advisor, he acquired shares at a deeply
discounted price of $3.10 for both a
share and purchase warrant in an effort to thwart Mithaq's
outstanding takeover bid for $3.66
per share. According to public filings, the Executive Chairman owns
a mere 0.3% of the issued and outstanding shares and all seven
management nominees own only 0.8% of the issued and outstanding
shares. Five of the seven management nominees, including the
Executive Chairman, have never been elected to the Board by
shareholders and they have demonstrated a willingness to waste
significant Company resources to prevent a shareholder that has a
26.98% interest in the Company from having any say in its
governance and strategic direction.
Sweetheart Related Party Deal
with Paladin
The Executive Chairman stated that the arrangements with Paladin
Private Equity, LLC ("Paladin") were bad for Aimia. Mithaq
agrees, but the consideration paid, and the Board's decision to
issue five million shares to a related party immediately before the
record date for the Meeting, is an indefensible derogation of its
fiduciary duties. Cashing out Paladin's carried interest one year
into the investment, before any measurable performance has been
achieved, demonstrates a concerning lack of business judgment. To
make matters worse, Aimia had cash to pay Paladin, as demonstrated
by its subsequent announcements of the PLM earn-out payment and a
$20 million normal course issuer bid,
instead of issuing additional shares at the expense of pre-existing
shareholders, a dilutive and defensive tactic that the Board seems
content to repeat. If the Board truly believed this was a good deal
for Aimia, and not just another dilutive share issuance to a
friendly party to consolidate power, it would disclose to
shareholders the details of the special committee process and
valuation work done in connection with this transaction. Mithaq has
requested on more than one occasion that Aimia make such disclosure
in accordance with corporate governance best practices and
applicable securities laws, but the Company has refused to provide
any information.
Mithaq's Plans for
Aimia
The current Board has not been able to resolve its dispute with
Mithaq because it refuses to productively engage with its most
significant shareholder and continues to waste significant Company
resources to maintain control. If the Board and management have
changed, as Aimia asserts, then why do they continue to adopt the
same aggressive defensive tactics one year after Mithaq first made
its concerns public? The current Board speaks of strategic review
and unlocking shareholder value, but all this Board has done is
take credit for the limited successes of prior Board members and
further dilute Aimia shareholders. The current Board is using the
same playbook and making the same empty promises as prior Board
members.
Mithaq has articulated a clear 10-step plan to get Aimia on
track, which is set out in detail in Mithaq's letter to
shareholders dated June 3, 2024
available on Aimia's profile on SEDAR+ at www.sedarplus.com. That
plan has nothing to do with "running Aimia as a hedge fund", as
alleged by the current Executive Chairman. Mithaq is
not a hedge fund and does not invest in hedge funds. Mithaq will
not take an executive leadership role and intends to focus on
bringing valid shareholder perspectives to a Board charged with
overseeing a competent management team and acting as responsible
stewards of shareholder capital.
Potential Misconduct at
Upcoming Meeting
Mithaq reiterates its warning to Aimia shareholders that it is
very concerned about potential misconduct by the current Board at
the Meeting. As previously disclosed, Mithaq formally requested on
June 5, 2024 that Aimia cooperate
with Mithaq in advance of the contested Meeting by setting certain
standard protocols and procedures to avoid the extravagant legal
and other advisor expenses incurred by Aimia unnecessarily
following the 2023 annual meeting. Aimia continues to refuse these
requests, which are customary in the context of a contested
shareholder meeting, other than to confirm that the Meeting will
have an independent chair, who Aimia will not identify.
As a result of Aimia's unwillingness to engage with its largest
shareholder on matters that should be uncontroversial, Mithaq has
been forced to seek assistance from the Ontario Superior Court of
Justice (Commercial List) in an urgent attendance on Thursday, June 20 at 10:00
a.m. (Toronto time). While
Aimia could cooperate with Mithaq to ensure a transparent Meeting,
it appears that Aimia instead plans to incur unnecessary legal
costs at the expense of shareholders to resist Mithaq's
uncontroversial and fair requests. This flagrant disregard for
corporate governance and shareholder democracy should be
unacceptable to shareholders.
ADVISORS
Mithaq has retained Carson Proxy as its proxy solicitor. Torys
LLP is acting as legal counsel.
ABOUT MITHAQ
Mithaq is a segregated portfolio company and affiliate of Mithaq
Holding Company, a decentralized family office
headquartered in Saudi Arabia with investments in public
equities, private equity, real estate and income-producing assets
in local and international markets.
CAUTIONARY STATEMENT REGARDING
FORWARD-LOOKING INFORMATION
This document contains "forward-looking statements" (as
defined under applicable securities laws). These statements relate
to future events or future performance and reflect Mithaq's
expectations, beliefs, plans, estimates, intentions, and similar
statements concerning anticipated future events, results,
circumstances, performance or expectations that are not historical
facts. Forward-looking statements include, but are not limited to,
statements in respect of the conduct of the Board at the Meeting
and the impact of the Mithaq Nominees, if elected, on the financial
condition, results of operations and business strategies of Aimia,
including specifically in connection with Mithaq's plans for Aimia,
and other matters. Such forward-looking statements reflect Mithaq's
current beliefs and are based on information currently available.
In some cases, forward-looking statements can be identified by
terminology such as "may", "will", "should", "expect", "plan",
"anticipate", "believe", "estimate", "predict", "potential",
"continue", "target", "intend", "could" or the negative of these
terms or other comparable terminology.
By their very nature, forward-looking statements involve
inherent risks and uncertainties, both general and specific, and a
number of factors could cause actual events or results to differ
materially from the results discussed in the forward-looking
statements. In evaluating these statements, readers should
specifically consider various factors that may cause actual results
to differ materially from any forward-looking statement. These
factors include, but are not limited to, Aimia's results of
operations and future cash flows; the future performance, business
prospects and opportunities of Aimia; the election of the Mithaq
Nominees; the ability of the Mithaq Nominees, if elected, to effect
positive change at Aimia; the implementation and impact of Mithaq's
plans for Aimia; the response to and outcome of any court
applications that may be made against Mithaq or Aimia; the
implementation and timing of Aimia's business strategy; the current
general and regulatory environment and economic conditions
remaining unchanged; the availability of financing and capital
costs; Aimia's available cash resources; Aimia's ability to
identify, attract and retain skilled staff; currency exchange
rates; required capital investments; market competition; ongoing
relations with employees and other stakeholders; and general
business and economic conditions.
Although the forward-looking information contained in this
document is based upon what Mithaq believes are reasonable
assumptions, there can be no assurance that actual results will be
consistent with these forward-looking statements. The
forward-looking statements contained in this document are made as
of the date of this document and should not be relied upon as
representing views as of any date subsequent to the date of this
document. Except as may be required by applicable law, Mithaq does
not undertake, and specifically disclaims, any obligation to update
or revise any forward-looking information, whether as a result of
new information, further developments or otherwise.
Neither Mithaq nor or any of its subsidiaries, affiliates,
associates, officers, partners, employees, representatives and
advisers make any representation or warranty, express or implied,
as to the fairness, truth, fullness, accuracy or completeness of
the information contained in this document or otherwise made
available, nor as to the reasonableness of any assumption contained
herein, and any liability therefore (including in respect of
direct, indirect, consequential loss or damage) is expressly
disclaimed. Nothing contained herein is, or shall be relied upon
as, a promise or representation, whether as to the past or the
future and no reliance, in whole or in part, should be placed on
the fairness, accuracy, completeness or correctness of the
information contained herein.
SOURCE Mithaq Capital SPC