TORONTO, Dec. 20 /CNW/ - As a result of a claim (the "Oppression Claim")
filed by Challenge Gas Holding AB ("Challenge"), Exclusive Asset Management
Inc. ("Exclusive") and Salvatore Fuda, the Chairman of Echo Energy Canada Inc.
("Echo Energy") (TSX Venture Exchange - EEI.V), (collectively, the
"Plaintiffs") on November 26, 2007, in the Ontario Superior Court of Justice
against Echo Energy, Gary Conn, Michael Hunter, Robert Moore, David Johnstone
and Sal Pacifico (collectively, the "Defendants"), on December 18, 2007, Mr.
Justice Morawetz of the Ontario Superior Court of Justice issued an injunction
(the "Injunction") enjoining the Defendants from proceeding with a proposed $2
million private placement of shares of Echo Energy (the "Private Placement").
Mr. Justice Morawetz also found that:
(a) the Plaintiffs have established a strong prima facie case of
oppression in that it was improper for the Board of Directors of
Echo Energy to have, on November 20, 2007, considered and approved
a resolution authorizing the Private Placement;
(b) the issuance of shares of a company must be for its own benefit and
must not be for the purpose of manipulating and maintaining control
of the company;
(c) there is no evidence that Echo Energy requires additional capital in
the immediate short term; and
(d) Echo Energy is not precluded from approving a private placement of
its shares if the Plaintiff Salvatore Fuda is permitted to acquire
all or not less than 52% of the shares.
Mr. Justice Morawetz also expressed his view that the Plaintiffs and the
Defendants would be better served if the date for the special meeting of
shareholders requisitioned by the Plaintiffs (the "Special Meeting") to
consider the removal of Robert Moore and Salvatore Pacifico as directors of
Echo Energy, and to elect Thomas M. Sheppard and Brian Monrad as directors of
Echo Energy to fill the vacancies created by their removal, was advanced to a
much earlier date than the April 22, 2008 date currently proposed by the Board
of Directors of Echo Energy.
Finally, Mr. Justice Morawetz ordered that the Defendants pay the
Plaintiffs their costs in the proceeding.
In light of Mr. Justice Morawetz' recommendation, the Plaintiff Salvatore
Fuda has today issued a request to the Board of Directors of Echo Energy that
it call the Special Meeting at the earliest practical date, and specifically
by the week ending February 8, 2008.
The Plaintiff Salvatore Fuda has also suggested to the Board of Directors
of Echo Energy that Mr. Justice Morawetz' order is material and is properly
the subject of a news release by Echo Energy.
Finally, the Plaintiff Salvatore Fuda is currently seeking an independent
third party expert to assess Echo Energy's gas reserves, with which
independent assessment Echo Energy has now agreed to cooperate as long as Mr.
Fuda pays for the assessment himself.
No securities commission or regulatory authority has approved or
disapproved the contents of this news release. The TSX Venture Exchange does
not accept responsibility for the adequacy or accuracy of this news release.
For further information:
For further information: Can be obtained from Salvatore Fuda in Toronto
by phone at (416) 360-4032 or by e-mail at firstname.lastname@example.org.