Coloured Ties files dissident circular at Labrador Gold

Executive Summary

• Coloured Ties Capital Inc., along with shareholders Kal Malhi and Rauni Malhi (controlling over 8% of Labrador Gold Corp.), have filed a dissident circular to solicit proxies for the annual and special shareholders meeting on Feb. 24, 2026.
• The dissident group aims to reconstitute the board of directors and reject the company's proposed change of business to an investment issuer, citing "massive shareholder value destruction" and a lack of business acumen by the current board.
• The release outlines specific criticisms of the board's past performance, including negative Total Shareholder Returns (TSR) for key directors, alleged squandering of cash reserves, and poor strategic decisions such as selling Kingsway and New Found shares at a loss.

Key Details

• Proxy Solicitation: Coloured Ties and concerned shareholders are soliciting proxies for the Feb. 24, 2026, meeting to vote against the current board and for their nominees: Kulwant Malhi, Ronald Wortel, Jean Lafleur, and Tara Asfour.
• Shareholding: The concerned shareholders own or control over 8% of Labrador Gold Corp.'s outstanding common shares.
• Proposed Changes: The dissidents seek to:
  • Reject the proposed change of business to an investment issuer.
  • Reject the name change.
  • Pass a director removal resolution.
  • Fix the number of directors at five.
  • Elect their nominees to the board.
• Financial Criticisms:
  • Labrador had ~$18 million in cash as of Nov 2025; the board allegedly squandered $2 million in two months on professional fees and proxy solicitation.
  • Directors James Borland, Leonidas Karabelas, and Roger Moss have generated negative TSRs at all companies they have been involved with.
  • The board sold Kingsway during a gold rally and sold New Found shares at an $8 million loss (or ~$13 million opportunity cost).
• Strategic Dispute:
  • The board proposes becoming an investment issuer, focusing on greenfield/early-stage assets. The dissidents argue this is risky, ill-advised, and trades at a discount to net asset value.
  • The board’s flagship investment under the new strategy, Northern Shield Resources (NRN), was acquired at a 33% premium to market (vs. typical 15-25% discount), and NRN has written down property values 10 times since 2014, writing off ~$11 million.
  • The board spent 18 months reviewing 51 projects without finding a qualifying investment.
• Dissident Alternative Strategy:
  • Coloured Ties claims to be in confidentiality agreements and data rooms with major producing miners regarding advanced brownfield assets.
  • They cite LaFleur Minerals (acquired from Monarch Mining bankruptcy) as a success story, which raised $7.8 million, reached a $35 million market cap, and is relaunching production.
  • The dissidents commit to not diverting cash to LaFleur Minerals or engaging in related-party transactions if elected.
• Specific Rebuttals:
  • The release denies claims that nominee Ronald Wortel holds 150,000 LaFleur options, stating he holds none.
  • The dissidents criticize the board for failing to implement strategic goals over 18 months and for being silent on the Borden Lake property and recent exploration on Hopedale.

Notable Quotes

• "The concerned shareholders own or control over 8 per cent of the company's outstanding common shares, and cannot stand by and allow the board to destroy shareholder value as they have done at Labrador and elsewhere."
• "The board has overseen massive shareholder value destruction and underperformed every relevant comparator."
• "There is no economic justification for a junior, minority interest, investment issuer. All such investment issuers trade at a discount to net asset value."
• "Absent an economically sound strategy and devoid of any credibility to execute on an investment issuer strategy the board is resorting to desperate scare tactics..."
• "We have a better plan... Coloured Ties is under confidentiality agreements and in data rooms with several highly respected major producing miners regarding well advanced, brownfield assets."