Coalcorp receives notice of an application to the Ontario Securities
Commission
As announced in a
The Application by the Former Management Group alleges that the Proposed Transaction is a "related party transaction" (as defined in MI 61-101) with the Company's Executive Vice Chairman, Joseph Belan, and its most significant shareholder, Pala Investments Holdings Limited. Accordingly, it is alleged that the votes attached to the securities held by
Coalcorp disputes the validity of the Application. The Company's position is that the Proposed Transaction is not a "related party transaction" and, therefore intends to oppose the Application aggressively at the OSC in the interests of all the Company's shareholders.
Coalcorp believes the Former Management Group's OSC Application and the threat of injunction proceedings to block the Proposed Transaction by Blue Pacific Assets Corp. (a corporation that has been disclosed to be controlled by members of former management) as announced by Coalcorp on
If the Proposed Transaction is not completed, Coalcorp may be required to seek creditor protection or commence insolvency proceedings. If this occurs, the Statement of Claim may not proceed and the Company will not recover any damages for what it alleges were improper transactions that were harmful to Coalcorp and its shareholders. Conversely, if the Proposed Transaction is completed, the Company intends to use a portion of the proceeds to vigorously pursue the Statement of Claim.
Based on the unanimous recommendation of a Special Committee of independent directors and the unanimous endorsement of the entire Board of Directors, Coalcorp continues to believe that the Proposed Transaction is in the best interest of the Company, its shareholders and other stakeholders. While litigation continues, Coalcorp does not intend to comment further on these matters unless a material development occurs which requires disclosure.
About Coalcorp --------------
Coalcorp is a coal mining, exploration and development company with interests in the La Francia coal mine and related infrastructure projects and a number of coal exploration properties, all located in
Forward Looking Statements Disclaimer -------------------------------------
Statements made in this news release may be forward-looking and therefore subject to various risks and uncertainties. Certain material factors or assumptions are applied in making forward-looking statements and actual results may differ materially from those expressed or implied in such statements. Coalcorp does not undertake to update any forward-looking statements; such statements speak only as of the date made.
For further information: Juan Carlos Gomez, Interim Chief Executive Officer, +57 - 1 - 658 - 5050 Ext: 9990
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