GrowthWorks Commercialization Fund Ltd. Provides Update on Proposed Winding-Up and Legal Proceedings with its Former Manager

TORONTO, Sept. 12, 2017 /CNW/ - GrowthWorks Commercialization Fund Ltd. (the "Fund") today announced that, at the Fund's annual and special meeting of shareholders held earlier today, holders of the Fund's outstanding Class A shares and the holder of the Fund's outstanding Class B shares, each voting separately as a class, passed a special resolution (the "Dissolution Resolution") approving the voluntary winding-up and dissolution of the Fund pursuant to the Canada Business Corporations Act and other applicable legislation, and the distribution by the Fund to its shareholders of all or substantially all of its assets and property, after the payment of, and providing for, all debts, obligations and liabilities (the "Proposed Dissolution").  However, GrowthWorks WV Management Ltd. (the "Former Manager"), the sole holder of the outstanding Class C shares of the Fund and the former manager of the Fund, voted against the Dissolution Resolution.

In order for the Fund to proceed with the Proposed Dissolution, it was necessary for the Dissolution Resolution to have been passed separately by each class of the Fund's outstanding shares.  As a result of the Former Manager's decision to vote against the Dissolution Resolution, the Proposed Dissolution was not approved at the Meeting.  The Fund believes that the Former Manager's actions were taken as part of its ongoing efforts to be paid, in advance of the actual dissolution of the Fund,  amounts which are currently only payable on the Class C shares upon a dissolution of the Fund.

The Board of Directors continues to believe that an orderly liquidation and winding-up of the Fund is in the best interests of the Fund and its shareholders.   Accordingly, the Fund intends to make an application to the Ontario Superior Court of Justice for an order that the liquidation of the Fund be continued under the supervision of the Court.

It is expected that, as a result of the Former Manager's refusal to approve the Proposed Dissolution, the net asset value of the Fund and the funds available for distribution will continue to decline as the Fund will continue to incur expenses over a longer period of time. Moreover, the costs for the Fund to seek such court approval are expected to increase the total costs associated with the Proposed Dissolution. It is expected that distributions to shareholders of the Fund following the appointment of a court-appointed liquidation may be significantly less than the estimated dissolution distribution if the Dissolution Resolution had been approved.

The Fund also announced that legal counsel for the Former Manager has advised the Fund that the Former Manager intends to appeal the ruling of the Ontario Superior Court of Justice (the "Court") announced by the Fund on August 24, 2017.  In its ruling, the Court declared that the payment by the Former Manager to itself of $1.45 million in January 2017 was unauthorized and illegitimate and ordered the Former Manager to repay that amount to the Fund forthwith.  A successful appeal of that ruling and, or, the failure by the Former Manager to comply with the Court's order for payment should the appeal not succeed would have a material adverse effect on the Fund's liquidity.  The outcome of any such appeal cannot be predicted with any certainty.

Forward Looking Statements

This press release contains forward looking statements, including statements with respect to the proposed winding-up and dissolution of the Fund. These forward-looking statements reflect the Fund's current views and are based on certain assumptions, including, but not limited to, assumptions as to future liquidity, capital resources, operating conditions, courses of action, general economic and market 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, but not limited to, the risk that there may not be a market for the Fund's venture assets and the Fund may not be able to dispose of these assets on favourable terms, in a timely manner or at all; the risk that the proceeds that the Fund receives upon a disposition of its venture assets may vary materially and adversely from the historical values assigned by the Fund's former manager, or the Fund's investment advisor; the risk that dispositions of the Fund's venture assets will not yield proceeds sufficient to fund any cash distribution to the Fund's shareholders in connection with the proposed voluntary winding-up and dissolution of the Fund or that the amounts of such distributions will be less than those currently anticipated by the Fund; the risk that tax liabilities or other liabilities or costs could materially reduce the amount of cash available for distribution to the Fund's shareholders in connection with the proposed voluntary winding-up and dissolution of the Fund; the risk that the Fund does not obtain the court, regulatory, tax or third party rulings and approvals required to complete the proposed winding-up and dissolution of the Fund; and the risk that the Former Manager is successful in its appeal of the Court's ruling and, or, the Fund is otherwise unable to collect the amounts claimed from the Former Manager in the Fund's legal proceedings against the Former Manager. 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. There can be no assurance that the proposed voluntary winding-up and dissolution of the Fund or any other transaction will be completed. 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 Commercialization Fund Ltd.

C. Ian Ross, Chairman of the Board of Directors, [phone]