v.CEX swallows poison pill today..CALGARY, Dec. 23, 2010 (Canada NewsWire via COMTEX News Network) --
(TSX-V:CEX)
ContactExploration Inc. ("Contact" or the "Company") (TSX-V: CEX) announcesthat it has adopted a Shareholder Protection Rights Plan (the "RightsPlan"). The Rights Plan is similar to existing shareholder rights plansadopted by other Canadian public companies. The Rights Plan has notbeen adopted in response to, or in anticipation of, any known take-overbid.
The Rights Plan's objectives are to ensure, to the extentpossible, that all shareholders of the Company are treated equally andequitably in connection with any takeover bid for the Company. TheRights Plan discourages discriminatory, coercive or unfair takeovers ofthe Company and gives the Board of Directors (the "Board") time, if,in the circumstances, it is appropriate to take such time, to evaluatethe proposed transaction and to conduct an orderly process to maximizeshareholder value. Such process may include the solicitation ofsuperior proposals, consideration of alternative structures,identification of other potential bidders or the conducting of anorderly auction.
The Rights Plan requires approval by Contact'sshareholders within six months of the Rights Plan's effective date. TheRights Plan will be put to shareholders for their consideration at thenext annual and special meeting of shareholders of the Company, to beheld before June 23, 2011. If the Rights Plan is not confirmed byContact's shareholders, it will terminate and be void and of no furtherforce and effect.
The Board has implemented the Rights Plan byauthorizing the issuance of one right (a "Right") in respect of eachcommon share (the "Common Shares") of the Company outstanding at theclose of business on December 23, 2010 (the "Record Time"). Inaddition, the Board authorized the issuance of one Right in respect ofeach additional Common Share issued from treasury after the RecordTime. The Rights trade with and are represented by Contact's CommonShares. Until such time as the Rights separate from the Common Shares,when they become exercisable, Rights certificates will not bedistributed to shareholders.
If a person, or a group actingjointly or in concert, acquires (other than pursuant to an exemptionavailable under the Rights Plan) beneficial ownership of 20 percent ormore of the Common Shares, Rights (other than those held by suchacquiring person which will become void) will separate from the CommonShares with each Right then permitting the holder thereof to purchasefrom the Company that number of Common Shares having an aggregatemarket price (as determined in accordance with the Rights Plan) on thedate of consummation or occurrence of such acquisition of Common Sharesequal to twice the exercise price of the Rights for an amount in cashequal to the exercise price. The exercise price of the Rights pursuantto the Rights Plan is $100.00 per Right. At any time prior to theRights becoming exercisable, the Board may waive the operation of theRights Plan with respect to certain events before they occur.
Theissuance of the Rights is not dilutive and will not affect reportedearnings or cash flow per share until the Rights separate from theunderlying Common Shares and become exercisable or until the exerciseof the Rights. The issuance of the Rights will not change the manner inwhich shareholders currently trade their Common Shares.
A copy of the Rights Plan will be available under the Company's profile on SEDAR at www.sedar.com.
About Contact Exploration Inc.
ContactExploration Inc. is a public company with a focus on Canadian EastCoast onshore oil and gas production and exploration. Our philosophy isto operate production and exploration in our core area of AtlanticCanada and to participate through overrides and carried interests incertain regional unconventional plays, such as coalbed methane in theCumberland Basin, shale gas in the Windsor area, and exploration on thewest coast of Newfoundland. Contact has onshore interests in NovaScotia, Newfoundland and New Brunswick which includes the Stoney CreekField. In addition to the Atlantic Canadian properties, Contact hasproducing oil assets in south eastern Saskatchewan.
ADVISORY:This press release contains certain forward-looking information andstatements within the meaning of applicable securities laws. The use ofany of the words "expect", "anticipate", "continue", "estimate", "may","will", "project", "should", "believe", "plans", "intends" and similarexpressions are intended to identify forward-looking information orstatements. In particular, but without limiting the forgoing, thispress release contains statements concerning the approval by Contact'sshareholders of the Rights Plan. Although Contact believes that theexpectations reflected in these forward looking statements arereasonable, undue reliance should not be placed on them because Contactcan give no assurance that they will prove to be correct. Sinceforward looking statements address future events and conditions, bytheir very nature they involve inherent risks and uncertainties. Inparticular, no assurances can be given that Contact's shareholders willapprove the Rights Plan. Further, events or circumstances may causeactual results to differ materially from those predicted as a result ofnumerous known and unknown risks, uncertainties, and other factors,many of which are beyond the control of the Company. Additionalinformation regarding some of these risk factors may be found under"Risk Factors" in the Company's Management Discussion and Analysisprepared for the year ended March 31, 2010. The reader is cautioned notto place undue reliance on this forward-looking information. Theforward looking statements contained in this press release are made asof the date hereof and Contact undertakes no obligations to updatepublicly or revise any forward looking statements or information,whether as a result of new information, future events or otherwise,unless so required by applicable securities laws.
Neither TSXVenture Exchange nor its Regulation Services Provider (as that term isdefined in the policies of the TSX Venture Exchange) acceptsresponsibility for the adequacy or accuracy of this release.
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SOURCE: Contact Exploration Inc.