Shareholder RIghts-copy of newsErin Ventures adopts shareholder protection rights plan
Erin Ventures Inc EV
Shares issued 23,105,095 Nov 28 close $0.43
Thu 29 Nov 2001 News Release
Mr. Tim Daniels reports
Erin Ventures' board of directors has agreed to implement a shareholder
protection rights plan.
The intended issuance of a rights plan is not in response to management's
anticipation of any specific, current acquisition or transaction, nor is it
intended to prevent a takeover of the corporation, nor to secure
continuance in office of management or the directors. The objective of the
proposed rights plan is to give adequate time for the shareholders of the
corporation to properly assess the merits of a takeover bid without undue
pressure, and to allow competing bids to emerge. The rights plan is further
designed to give the board of directors time to consider alternatives,
thereby allowing shareholders the opportunity to receive full and fair
value for their common shares. The rights plan may increase the price to be
paid by a potential offeror to obtain control of the corporation, and may
discourage certain transactions. Adoption of the rights plan will not
detract in any way from or lessen the duties of the board of directors to
act honestly and in good faith with a view to the best interests of the
corporation and its shareholders, and to act in accordance with such
standards when considering a bid made for the common shares of the
corporation.
The rights, to be issued under the plan once all regulatory and compliance
requirements have been met, become exercisable only if a party acquires 20
per cent or more of the corporation's common shares without complying with
the rights plan or without the approval of the board of directors of the
corporation. The rights plan will seek to ensure that all shareholders are
treated fairly and have an equal opportunity to participate in the benefits
of a takeover bid. Under the proposed terms of the rights plan, those bids
that meet certain requirements intended to protect the interests of
shareholders are considered to be permitted bids. A permitted bid must be
made by way of a takeover bid circular prepared in compliance with
applicable securities laws, remain open for 60 days and satisfy certain
other conditions. Under the rights plan, the corporation plans to issue one
right in respect of each common share of the corporation's holders of
record at 5 p.m. (Pacific Standard Time) on Dec. 14, 2001. In the event a
takeover bid is made that does not meet the permitted bid requirements,
those rights will entitle shareholders, other than any shareholder or group
of shareholders making the takeover bid, to purchase additional common
shares of the corporation at a substantial discount to the market value of
such common shares at the time. The corporation is not aware of any pending
or threatened takeover bids.
The rights plan will be operative for a three-year period, once adopted.
The plan will be submitted for ratification by common shareholders at
Erin's next annual shareholders' meeting, to be held on Jan. 31, 2002. To
remain effective, the plan must be approved by more than 50 per cent of the
votes cast at that meeting by independent (non-management) shareholders.
The rights plan is also subject to the approval of the Canadian Venture
Exchange.