West Hawk Announces Shareholders' Rights Plan
October 02 2008 - 8:00AM
Marketwired Canada
West Hawk Development Corp. (TSX VENTURE:WHD) ("West Hawk" or the "Company") is
pleased to announce that the board of directors of the Company (the "Board") has
adopted a shareholder rights plan (the "Rights Plan"). The Rights Plan will take
effect today, subject to confirmation by the TSX Venture Exchange (the
"Exchange") and the Company's shareholders at its annual general meeting to be
held on Friday, October 24, 2008 (the "Meeting").
The Rights Plan is based on similar plans that have been adopted by other
Canadian public companies to ensure the fair treatment of shareholders in the
event of an unsolicited take-over offer for the Company's common shares. It is
designed to: (i) encourage persons seeking control of the Company to negotiate
with and obtain approval of the Board; (ii) to discourage abusive or inadequate
takeover bids for the Company; and (iii) to assist the Board in obtaining the
highest price of the Company's shares if the Board determines in good faith that
the Company should be sold. The intention is to protect the interests of the
Company's shareholders and maximize shareholder values by discouraging unfair or
abusive takeover strategies.
The rights (the "Rights") proposed to be issued to shareholders under the Rights
Plan will entitle the shareholders, upon the occurrence of certain triggering
events (including the acquisition of 20% or more of the common shares of the
Company in a transaction not approved by the Board) to acquire additional common
shares of the Company at a 50% discount from the prevailing market price. The
Rights will not, however, be triggered by a "Permitted Bid", which is defined as
a bid made to all of the shareholders for all of their common shares in
accordance with applicable securities legislation, and subject to other
specified conditions, and which is accepted by a majority of independent
shareholders.
The Rights Plan is not intended to deter fair offers for the common shares of
the Company, nor will it have any adverse effects on the Company's ordinary
operations.
The Board considers that the adoption of the Rights Plan is desirable and in the
interests of all of the Company's shareholders. The Board believes the value of
the Company's assets is not reflected in the current market price of the
Company's shares.
The Company has no knowledge of any pending or threatened takeover bids for the
Company, and has no reason to believe that any takeover offer for the Company's
shares is imminent. However, it is considered that the Company's circumstances
are such that it is vulnerable to the kinds of abusive acquisition tactics that
the Rights Plan is designed to prevent. In implementing the Rights Plan, the
Board has authorized the distribution of one share purchase right for each
outstanding common share of the Company to shareholders of record at the close
of business on September 29, 2008. The Rights Plan must be ratified by a
majority vote of the Company's shareholders at the Meeting. The full text of the
Rights Plan will be available on the SEDAR website after the shareholders
approve it at the Meeting. The Rights Plan is also subject to acceptance by the
Exchange.
The Rights will not be exercisable and will not trade separate and apart from
the common shares at any time prior to a person or group acquiring, or
announcing an intention to acquire, 20% or more of the votes attaching to all
securities of the Company. The issuance of the Rights will have no tax
consequences for the Company's shareholders.
On behalf of the Board of Directors,
Wm. Mark Hart, President and Chief Executive Officer