VANCOUVER, July 25, 2014 /CNW/ - Gold Reach Resources
Ltd. ("Gold Reach" or the "Company") (GRV: TSX-V) announces the
approval and adoption of a Shareholder Rights Plan Agreement (the
"Rights Plan").
Shareholder Rights Plan
The Rights Plan was not adopted by the Board of Directors in
response to, or in anticipation of, any offer or take-over bid and
is not intended to prevent a take-over bid.
The fundamental objectives of the Rights Plan are to provide
adequate time for the Board of Directors and shareholders to assess
an unsolicited take-over bid for the Company, to provide the Board
of Directors with sufficient time to explore and develop
alternatives for maximizing shareholder value if a take-over bid is
made, and to provide shareholders with an equal opportunity to
participate in a take-over bid.
To implement the Rights Plan, the Board of Directors authorized
the issue of one right to purchase a common share (a "Right") in
respect of each common share of the Company outstanding to holders
of record. One Right will also
be issued in conjunction with each common share of the Company
issued while the Rights Plan is in effect. The Rights will be
evidenced by certificates for common shares and will not be
transferable separately from the common shares.
The Rights Plan encourages a potential acquiror who makes a
take-over bid to proceed either by way of a "Permitted Bid" or with
the concurrence of the Board. A Permitted Bid is a bid made
by way of a take-over bid circular to all holders of the Company's
common shares which is open for acceptance for not less than 60
days. If at end of 60 days at least 50% of the outstanding
shares, other than those owned by the offeror and certain related
parties, have been tendered, the offeror may take up and pay for
the shares but must extend the bid for a further 10 days to allow
other shareholders to tender. If a take-over bid fails to
meet these minimum standards of the Rights Plan and is not waived
by the Board of Directors, each Right would, upon exercise, entitle
a Rights holder, other than the acquiror and certain related
parties of the acquiror, to purchase additional common shares at a
significant discount to market, thus exposing the acquiror to a
substantial dilution of its holding.
The Rights Plan remains subject to the approval of the TSX
Venture Exchange and to the execution of definitive agreements with
the Company's transfer agent. The Rights Plan also remains
subject to ratification of the shareholders of the Company at the
next annual general meeting of the Company scheduled to be held
September 5, 2014. If the
Rights Plan is not ratified by the shareholders, the Rights Plan
and any Rights will terminate and cease to be effective at that
time. If the Rights Plan is ratified, it will continue in
effect until the third annual meeting of the shareholders
thereafter.
A copy of the Rights Plan will be available on SEDAR at
www.sedar.com.
On behalf of the Board of Directors
"Conrad Swanson"
Conrad Swanson
Chairman, Chief Executive Officer and Director
Neither the TSX Venture Exchange nor its Regulation Service
Provider (as the term is defined in the policies of the TSX Venture
Exchange) accepts responsibility for the adequacy of accuracy of
this news release.
SOURCE Gold Reach Resources Ltd.