TORONTO, April 18, 2018 /CNW/ - Labrador Iron Ore
Royalty Corporation ("LIORC") (TSX: LIF) announces that its
Board of Directors (the "Board") has adopted a shareholder
rights plan (the "Rights Plan"). The Rights Plan is similar
to shareholder rights plans adopted by other Canadian public
companies and LIORC believes it is consistent with certain
published institutional investor guidelines. The Rights Plan was
not adopted in response to or in contemplation of any known
take-over bid or other similar transaction. Neither management of
LIORC nor the Board is aware of any pending, threatened or proposed
acquisition or take-over bid for LIORC. The Rights Plan is not
intended to prevent take-over bids.
To qualify as a "Permitted Bid" under the Rights Plan, a
take-over bid must be made by a bidder by way of a take-over bid
circular pursuant to and in compliance with National Instrument
62-104 – Take-Over Bids and Issuer Bids and the take-over
bid must be made to all holders of common shares, other than the
bidder.
Under the Rights Plan, LIORC will issue (a) one right (a
"Right") for no consideration in respect of each outstanding
common share of LIORC to all holders of record at the close of
business on April 18, 2018 (the
"Effective Date") and (b) one Right (which will be
represented by the common share certificates until the Rights
become exercisable) in respect of each additional common share
issued after the Effective Date during the term of the Rights Plan.
Subject to the terms of the Rights Plan and to certain exceptions
provided therein, the Rights will become exercisable (other than by
an acquiring person or its joint actors) to acquire common shares
at a substantial discount to market value in the event any person,
together with joint actors, acquires or announces its intention to
acquire 20% or more of LIORC's outstanding common shares without
complying with the "Permitted Bid" provisions of the Rights
Plan or without the Rights Plan being waived in accordance with its
terms.
The Rights Plan has been accepted for filing by the Toronto
Stock Exchange, subject to shareholder ratification. LIORC is
seeking shareholder approval and ratification of the Rights Plan
(and approval of an amendment to LIORC's articles to permit the
issuance of common shares upon the exercise of Rights) at its
upcoming annual and special meeting of shareholders to be held on
May 16, 2018. The foregoing
description of the Rights Plan is qualified in its entirety by the
full text of the Rights Plan, a copy of which is available under
LIORC's profile on SEDAR at www.sedar.com and on LIORC's website at
www.labradorironore.com.
SOURCE Labrador Iron Ore Royalty Corporation