HDG hires adviser, swallows poison pillHigh Desert hires adviser, swallows poison pill
2008-10-29 19:21 ET - News Release
Mr. Paul Haber reports
HIGH DESERT GOLD CORPORATION ANNOUNCES ENGAGEMENT OF FINANCIAL ADVISOR AND ADOPTION OF SHAREHOLDER RIGHTS PLAN
High Desert Gold Corp. has engaged Wellington West Capital Markets Inc. as financial adviser to assist the special committee of the board of directors of the company in considering the unsolicited takeover bid by Northern Financial Corporation and to advise on alternative proposals for maximizing shareholder value.
The company also announced that its board of directors has approved the adoption of a shareholder rights plan, effective Oct. 29, 2008. The board adopted the rights plan to ensure the fair and equal treatment of all shareholders in connection with any takeover bid for the company, including the unsolicited takeover bid by Northern, and to ensure that the board has adequate time to assess and respond to Northern's unsolicited takeover bid and any alternative proposals. The rights plan is subject to acceptance by the Toronto Stock Exchange.
The rights plan is not intended to prevent takeover bids. Those bids that meet certain requirements intended to protect the interests of shareholders of the company are considered under the rights plan to be permitted bids. A permitted bid is a takeover bid made by way of a circular for all outstanding common shares to all shareholders, which remains open for at least 60 days and satisfies certain other conditions.
The rights issued under the rights plan will become exercisable only if a person, together with its affiliates and associates, acquires or announces its intention to acquire beneficial ownership of common shares of the company, which, when totalled with its current holdings, total 20 per cent or more of the outstanding common shares other than by a permitted bid. Following such an acquisition, each right held by a holder (other than the acquiring person and its affiliates and associates) would, upon exercise, entitle the holder to purchase common shares at half the market price at the time the rights become exercisable. A copy of the rights plan is being filed on SEDAR under HDG's profile.
The rights were issued to holders of record at 12:01 a.m. (Toronto time) on Oct. 29, 2008. A separate rights certificate will not be issued until such time as the rights become exercisable. The rights plan and all outstanding rights will terminate on April 28, 2009.