VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 04/23/12 -- Pitchstone Exploration Ltd. ("Pitchstone" or "the Company") (TSX VENTURE:PXP) announces that it has entered into an Arrangement Agreement ("the Agreement"), whereby all of the issued and outstanding shares of Pitchstone will be acquired by Fission Energy Corp. ("Fission") (TSX VENTURE:FIS) by means of a Plan of Arrangement ("the Arrangement").
Acquisition Terms
Fission has agreed to issue 0.2145 common shares of Fission ("Common Shares") for each common share of Pitchstone. Based on 45,208,185 Pitchstone shares outstanding, Fission will issue 9,697,155 Common Shares to complete the transaction, representing approximately 8.4% of Fission's issued and outstanding Common Shares as of the date hereof. Pitchstone has further agreed to a C$250,000 termination fee that is payable upon the occurrence of certain events, including the acceptance by Pitchstone of a superior proposal.
Upon completion of the Arrangement, all Pitchstone common shares not owned by Fission at such time will be automatically exchanged on the basis of 0.2145 of a Fission common share for each Pitchstone common share. The consideration to be received by Pitchstone shareholders pursuant to the Arrangement represents a 26% premium over Pitchstone's 20-day volume-weighted average trading price on the TSX Venture Exchange and a 35% premium over Pitchstone's closing price as at April 20, 2012. Upon completion of the transaction, Fission will have approximately 124.5 million common shares issued and outstanding. Pitchstone options and warrants will be converted to Fission options and warrants on the same basis as the common shares.
Pitchstone's board of directors has unanimously approved the Plan of Arrangement and will recommend approval to the Pitchstone shareholders and optionholders in a forthcoming special securityholder meeting scheduled to be held on or about July 16, 2012. The Plan of Arrangement requires approval of 66 2/3% of the votes cast by shareholders and optionholders of Pitchstone, voting as a single class. Fission has entered into Lock-up Agreements with all of the directors and officers of Pitchstone who have agreed, subject to certain exceptions, to vote their shares in favour of the Arrangement