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Ciscom Concerned Shareholders respond to Incumbent board’s disingenuous commentary regarding the AGM and SGM

More self love and justifications for self dealing coming from the Incumbent board



Toronto, ON, February 15, 2024 - Hummingbird Capital Inc., alongside Chen Xi Liao and Andrew Darbyson, leading a movement representing almost 40% of Ciscom Corp.’s : (CSE: CISC), (OTCQB: CISCF): shareholders, has swiftly addressed the incumbent board's, misleading statements regarding the recent Annual General Meeting (AGM) and Special General Meeting (SGM) held on Feb. 8, 2024.


Seven days after the Meetings, the Incumbent Board released on Feb 14, 2024 a press statement and an email letter to shareholders, attempting to explain the delay and the rejection of approximately 10% of votes from concerned shareholders. However, these communications were riddled with further disingenuous statements and inaccuracies.


The Incumbent Board falsely claimed that concerned shareholders only presented 31% proxy votes, downplaying the significance of a vote of no confidence. Not only did the board fail to engage in a dialogue with concerned shareholders, (on multiple attempts made by the shareholders), but they also rejected an additional nearly 10% of proxy votes, dismissing the clear expression of dissatisfaction from a substantial portion of shareholders seeking change.


The Incumbent Board falsely claimed it was TMX Group as Scrutineer that rejected the proxy votes.  In fact it was Michel Pepin CISC’s President, CFO, Chairman Paul Gaynor and directors that were rejecting almost all of the concerned shareholders votes,   Thankfully TMX Group  helped mediate attempting to make Michel Pepin and the board act more reasonable in light of the overwhelming documentation proving the validity of the votes.  If TMX Group did not step in to assist the concerned shareholders our 31% of accepted votes would have been even far less.  In the end, the board was the final decision and they chose to reject votes that were accompanied by notarized and Medallion Signature guaranteed bank statements with votes from participating Canadian Financial institutions.  These votes would have added another almost 10% votes of no confidence and supported our slate of directors.


Despite claims of shareholder inclusivity during the AGM, the board selectively restricted participation via Zoom, and Hummingbird Capital's CEO faced intentional ignorance when attempting to ask questions. Only after the Scrutineer's intervention did the Chairman acknowledge and permit some participation.


Mr. Trahan's pertinent questions regarding the board's decision to expand, despite financial constraints, and the apparent self-dealing in the stock option plan were brushed aside by the board. This lack of transparency further highlights the incumbent board's evasion of accountability.


Specifically, Mr. Trahan asked very poignantly why such a small company would be seeking to add more members to the board of directors, correctly pointing out that the additional cost could not be afforded by a company with already runaway expenses, an extremely high debt burden at a time with a tightening credit market. In response, Mr. Gaynor and the rest of the board had no answer to this.


In Mr. Trahan's second comment and question, he inquired about the stock option plan granted to the board, suggesting a potential issue of self-dealing. Mr. Trahan highlighted that the President, CFO, and director explicitly stated in a video interview on Stockhouse that CISC was severely undervalued. Michel explained that shareholders should consider the enterprise value of Ciscom for the true valuation. As Trahan elaborated, this would imply a share price ranging between approximately $1.27 and $2.54. However, in a bold and seemingly self-serving move, the board priced their stock option plan in the market at just $0.17 per share, approaching the historical all-time low trading price  only a couple of days later.


Despite this question and comment being posed in relation to the motion to pass the stock option plan again the board stated Mr. Trahan’s question and comment  is unrelated and moved on.


Despite all the votes rejected by the incumbent board it is worth noting that when you consider disinterested shares only (i.e. the shares belonging to the general body of shareholders other than the incumbent directors themselves), the Meeting in fact evidenced an overwhelming show of support for the slate of directors proposed by the Concerned Shareholders (more than 3/4 of such shares were voted in favour of the Concerned Shareholders, as opposed to less than 1/4 of such shares in favour of the Incumbent Board).


In an appalling act of insincerity, the board states in the PR and letter to shareholders that they are always open for discussion and to direct communication to the Chairman.  However as the concerned shareholders have stated previously, we have been attempting to have dialogue with the board since November 2023 and still have yet to have them respond to any and all of our requests made to them directly and through their legal counsel.


Our concerns are grave. The current board lacks the necessary experience, prioritizes self-interest over shareholder welfare, and engages in disingenuous communications.    Moreover the President & CFO continues to promote publicly “normalised EBITDA” a practice that is not accepted as Generally Accepted Accounting Principals GAAP and is never used in public capital markets.  We strongly feel this disingenuous presentation is misleading to attempt to lessen the true appearance of the losses the company continues to report.   We feel these reckless actions risk the credit facilities afforded to them by the banks.


Furthermore, with the growing litigations Ciscom is embroiled in and the lack of foresight to attempt to settle any of them makes acquisitions and capital raises near impossible.  On this path  we feel this board is on a collision course that could end in insolvency.


Our support for change and a new slate of directors intensifies each day. Shareholders wishing to voice concerns and support the movement to salvage Ciscom are encouraged to reach out directly.



Information in Support of Public Broadcast Solicitation


Proxies. Proxies may be solicited by the Concerned Shareholders pursuant to an information circular sent to shareholders after which solicitations may be made by or on behalf of the Concerned Shareholders, by mail, telephone, fax, e-mail or other electronic means as well as by newspaper or other media advertising, and in person by directors, officers and employees of the Concerned Shareholders, who will not be specifically remunerated therefor. The Concerned Shareholders may also solicit proxies in reliance upon applicable exemptions to the solicitation requirements under Canadian corporate and securities laws, which may include by way of public broadcast, including through press releases, speeches or publications and by any other manner permitted under applicable Canadian laws. The Concerned Shareholders may engage the services of one or more agents and authorize other persons to assist in soliciting proxies on their behalf.


Cautionary Statement Regarding Forward-Looking Information


This press release contains forward-looking statements. All statements contained in this filing that are not clearly historical in nature or that necessarily depend on future events are forward-looking, and the words “anticipate,” “believe,” “expect,” “estimate,” “plan,” and similar expressions are generally intended to identify forward-looking statements. These statements are based on current expectations of the Concerned Shareholders and currently available information. They are not guarantees of future performance, involve certain risks and uncertainties that are difficult to predict, and are based upon assumptions as to future events that may not prove to be accurate. The Concerned Shareholders do not assume any obligation to update any forward-looking statements contained in this press release, except as required by applicable law.



Hummingbird Capital Inc.


For further information, please contact:


HummingBird Capital Inc.

Gilles Trahan

President & CEO

Phone: 416-247-2808

Chen Xi (Tony) Liao

Phone : 647-874-8088





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