AGM Results and New Director

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Ken Morgan
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The Company is pleased to announce the election of Michael Katz to its board of directors at its Annual General Meeting held September 19, 2006, and the re-election of Ken Morgan and Mark Brown. Mr. Katz, a Montreal native, received a BA degree from McGill University and an MBA degree from Concordia University. A career in finance, variously with Toronto Dominion Bank, Richardson Greenshields, and CIBC Wood Gundy culminated in a posting to London, UK in 1991, where he has remained since. In his current capacity, Mr. Katz has been a private investor and businessman since 1996.

The Company’s directors and officers are now as follows:

Kenneth W. Morgan – President, CEO and Director
Mark T. Brown – Director
Michael Katz – Director
Winnie Wong – CFO

Mr. Katz replaces Lindsay Bottomer, who has served as a member of the Company’s board since 2003. The Company thanks Mr. Bottomer for his valuable service over the years.

The Company also received shareholder approval to pay a dividend to all shareholders of cash and/or marketable securities which the Company holds, and approval for either a consolidation or subdivision of the Company’s common shares. As the Company has traded at a significant discount to its Net Asset Value (“NAV”) for several years, directors and management have been exploring ways for shareholders to realize a greater percentage of this value. One such strategy would be to dividend cash and/or marketable securities to the shareholders directly. Management and directors are of the opinion that this could both enhance trading liquidity and reduce the discount. The directors now have discretionary approval from shareholders to determine the amount, composition, and timing of any such distribution. If a dividend is to be distributed, the Company will provide adequate notice to its shareholders.

The subdivision of common shares is also a strategy to improve the liquidity of the Company’s shares and therefore potentially narrow the gap between the market price and the NAV. The consolidation of the Company’s shares is unlikely to be undertaken in the near term and would only be considered, if at all, after the Company had distributed a portion of its assets via the dividend. The directors have the discretion to determine whether a subdivision or consolidation will be implemented and, again, the Company intends to provide adequate notice to its shareholders in advance of any action.

The Company also reports that all of the items presented for voting at the AGM were passed. The following is a list of the other items voted and approved at the meeting:

  1. Set the number of directors at three (3)
  2. Election of Messrs. Morgan, Brown and Katz
  3. Appointment of Auditor
  4. Fix Auditors’ Remuneration
  5. Stock Option Plan
  6. Approve Directors’ Fees

About Strategem Capital

Strategem Capital Corporation is a publicly-traded merchant bank focused on the development of emerging companies with growth potential. The Company invests in debt and/or equity positions in these companies.

This release and prior releases are available on the Company’s Internet web site located at


“Kenneth W. Morgan”
Kenneth W. Morgan, CA, CPA
President, CEO and Director

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this news release.