SCOTTSDALE, AZ, Aug. 6, 2014 /CNW Telbec/ - Chaparral Gold Corp.
("Chaparral" or the "Company") (TSX: CHL) announced today that the
board of directors (the "Board") has adopted a Shareholder Rights Plan
(the "Plan") to ensure that all of the Company's shareholders are
treated fairly in any transaction involving a possible change of
control of Chaparral.
The Plan does not prevent a take-over of Chaparral. The Plan discourages
discriminatory, coercive or unfair take-overs of Chaparral and gives
the Board time, if the Board determines it is appropriate to take such
time, to pursue alternatives to maximize shareholder value in the event
an unsolicited take-over bid is made for all or a portion of the
outstanding Chaparral Shares. The Plan will help prevent a creeping
take-over bid, in which a potential acquirer acquires a "blocking
position" of shares in private transactions or market purchases
sufficient to block any competitive take-over offers, thereby
preventing a competitive take-over auction process.
Nick Appleyard, CEO of Chaparral, stated "This shareholder rights plan
is designed to ensure a fair and transparent process for any potential
future transactions. The Plan does not in any way hinder an acceptable
bidder for Chaparral and at the Board's discretion the Plan can be
waived. We will now continue our negotiations with the U.S.
Environmental Protection Agency, as we see this as the first step in
the process of unlocking value in the Company."
Pursuant to the Plan, the Board has authorized the distribution of one
share purchase right (a "Right") for each outstanding common share of
the Company, effective at the close of business on August 5, 2014. Each
Right is initially attached to and will trade with the Chaparral share
in respect of which it was issued. The issuance of the Rights will not
change the manner in which shareholders currently trade their Chaparral
The Rights will separate from the Chaparral shares to which they are
attached and become exercisable at the "Separation Time", which occurs
following the date a person or a group acting in concert (an
"Acquiror") makes or announces an intention to make a take-over bid, or
otherwise acquires 20% or more of the outstanding common shares of the
Company, other than as an acquisition structured as a Permitted Bid (as
such term is defined in the Plan). The Plan provides that the
Separation Time may be deferred by the Board.
In the event of an acquisition of 20% or more of the outstanding common
shares of the Company by a an Acquiror, other than by way of a
Permitted Bid, each Right will entitle the holder thereof, other than
the Acquiror, to acquire common shares of the Company at a 50% discount
to the then-current market price.
In order for a take-over bid to qualify as a Permitted Bid under the
Plan, the bid must provide that no shares will be taken up under the
bid for a period of at least 60 days after the bid is commenced. A
Permitted Bid must also satisfy certain other conditions, including
that more than 50% of the outstanding common shares held by persons
unrelated to the bidder must be deposited pursuant to the bid and not
withdrawn before any common shares may be taken up under the bid and
paid for, and that, in the event that such number of shares are
deposited, the bidder will make a public announcement of that fact and
the bid will remain open for deposits of common shares for not less
than ten business day following the date of such public announcement.
The Company intends to submit the Plan for approval by the Company's
shareholders within six months. The Plan also remains subject to
regulatory approval, including the approval of the Toronto Stock
Exchange. The foregoing summary of certain terms of the Plan is
qualified in its entirety by reference to the text of the Plan, which
will be available on SEDAR, at www.sedar.com.
About Chaparral Gold
Chaparral is a Nevada-focused precious metals company actively
permitting the 100%-owned Gemfield deposit at the Goldfield property,
in central Nevada. In addition, Chaparral holds a 100% interest in the
advanced-stage Converse property, also located in Nevada.
Some of the statements contained in this release are "forward-looking
statements" within the meaning of Canadian securities law requirements,
including statements relating to regulatory and shareholder approval of
the Plan and negotiations with the Environmental Protection Agency.
Such forward-looking statements involve known and unknown risks,
uncertainties and other factors that may cause our actual results,
performance or achievements to differ materially from the anticipated
results, performance or achievements expressed or implied by such
forward-looking statements. Factors that could cause actual results to
differ materially from anticipated results include risks and
uncertainties relating to obtaining receipt of shareholder approval of
the Plan. Except as required pursuant to applicable securities laws,
the Company disclaims any intention or obligation to update or revise
any forward-looking statements, whether as a result of new information,
future events or otherwise.
SOURCE: Chaparral Gold Corp
For further information:
In North America:
Tel: 1 480 483 9932
Renmark Financial Communications
Tel: 1 514 939 3989
Tel: +41 44 853 00 47
Or email the Company at: email@example.com
Web Site: www.chaparralgold.com