Daylight Energy Ltd.
TSX : DAY
TSX : DAY.DB.C
TSX : DAY.DB.D

Daylight Energy Ltd.

December 05, 2011 13:53 ET

Daylight Shareholders Approve Plan of Arrangement With Sinopec International Petroleum Exploration and Production Corporation; Vote of Series D Debentureholders Adjourned to December 15, 2011

CALGARY, ALBERTA--(Marketwire - Dec. 5, 2011) - Daylight Energy Ltd. ("Daylight" or the "Corporation") (TSX:DAY) is pleased to announce that the holders of common shares of Daylight have approved the proposed acquisition of Daylight by Sinopec International Petroleum Exploration and Production Corporation ("SIPC") pursuant to a plan of arrangement under the Business Corporations Act (Alberta) (the "Arrangement"). Under the Arrangement, Daylight shareholders will receive $10.08 in cash for each common share of Daylight. The Arrangement was approved by approximately 99.6% of the votes cast by Daylight shareholders at the special meeting of securityholders held on December 5, 2011. The closing of the Arrangement remains subject to receipt of required regulatory approvals, the granting of the Final Order by the Court of Queen's Bench of Alberta and the satisfaction or waiver of the other conditions specified in the arrangement agreement among Daylight, SIPC and an indirect wholly-owned subsidiary of SIPC entered into on October 9, 2011.

The vote of the holders of Daylight's 6.25% series "D" convertible debentures (the "Series D Debentures") was adjourned in order to provide such holders with a further opportunity to vote their Series D Debentures in order to allow for the Series D Debentures to participate in the Arrangement and receive a cash payment of $1,110 per $1,000 principal amount of Series D Debentures, plus accrued and unpaid interest to, but excluding, the closing date of the Arrangement. In order to be included in the Arrangement, holders of at least 662/3% of the aggregate principal amount of the Series D Debentures must vote in favour of the Arrangement. Immediately prior to today's securityholders' meeting, holders of approximately 60.6% of the issued and outstanding Series D Debentures had voted in favour of the Arrangement. The $1,110 cash payment per Series D Debenture to be received by the holders of Series D Debentures pursuant to the Arrangement represents the approximate undiscounted amount that would be paid to holders of Series D Debentures if Daylight were to exercise its right to redeem the Series D Debentures on January 1, 2013, being the earliest possible date for the redemption of the Series D Debentures, at 105% of their principal amount, plus the interest that would otherwise be payable to the holders of the Series D Debentures during 2012. Approval of the Arrangement by the holders of the Series D Debentures is not a condition to the completion of the Arrangement.

The adjourned meeting for the vote of the holders of Series D Debentures will be held at 9:00 a.m. (Calgary time) on Thursday, December 15, 2011 at the offices of Blake, Cassels & Graydon LLP, located at 35th Floor, Bankers Hall East Tower, 855 - 2nd Street S.W., Calgary, Alberta. Holders of Series D Debentures as of the November 3, 2011 record date for the securityholder meeting may continue to vote their Series D Debentures in the same manner as described in the information circular and proxy statement of Daylight dated November 1, 2011 (the "Circular"), a copy of which is available on Daylight's SEDAR profile at www.sedar.com. A holder of Series D Debentures that has questions or requires more information with regard to the voting of their Series D Debentures should contact Daylight's proxy solicitation agent, Laurel Hill Advisory Group, at 416-304-0211, or at its North American toll-free number: 1-877-304-0211 or by email at assistance@laurelhill.com.

As a result of the above-described adjournment, the application for the Final Order of the Court of Queen's Bench of Alberta will now be made by Daylight on December 15, 2011. The deadline for an interested party who desires to appear at the hearing for the Final Order to serve Daylight with a notice of intention to appear and related documents and information has been extended to 12:00 noon (Calgary time) on December 13, 2011. Similarly, the deadline by which a registered holder of Series D Debentures may provide a written notice of dissent in respect of the Arrangement has been extended to 5:00 p.m. (Calgary time) on December 13, 2011. The procedures relating to an interested party desiring to appear at the hearing for the Final Order and the exercise of dissent rights for holders of Series D Debentures are otherwise subject to the same requirements as set forth in the Circular.

The requisite approval of the Arrangement from the holders of Daylight's 10% series "C" convertible debentures (the "Series C Debentures") was not obtained. As a result, the Series C Debentures will be excluded from the Arrangement and will remain outstanding following closing of the Arrangement. Approval of the Arrangement by the holders of the Series C Debentures is not a condition to the completion of the Arrangement.

ABOUT DAYLIGHT ENERGY

Daylight is a growing intermediate oil and liquids rich natural gas producing company with a high quality suite of resource play assets in Western Canada. Daylight has approximately 213.5 million common shares currently outstanding which trade on the TSX under the symbol "DAY". Daylight's Series C and Series D Debentures also trade on the TSX under the symbols DAY.DB.C and DAY.DB.D, respectively.

All amounts stated herein are in Canadian dollars.

ADVISORY:

Forward-Looking Information and Statements

This press release contains forward-looking statements and forward-looking information within the meaning of applicable securities laws. The use of any of the words "expect", "anticipate", "continue", "estimate", "objective", "ongoing", "may", "will", "project", "should", "believe", "plans", "intends" and similar expressions are intended to identify forward-looking statements or information. More particularly and without limitation, this press release contains forward-looking statements and information concerning: the adjourned meeting and anticipated receipt of required regulatory approvals and the Final Order for the Arrangement; and the ability of Daylight and SIPC to satisfy the other conditions to, and to complete, the Arrangement.

In respect of the forward-looking statements and information concerning the anticipated completion of the proposed Arrangement, Daylight has provided such in reliance on certain assumptions that it believes are reasonable at this time, including assumptions as to the ability of the parties to receive, in a timely manner, the necessary regulatory and other third party approvals, including but not limited to approvals required to be obtained by SIPC from the Government of The People's Republic of China and Investment Canada Act approval; and the ability of the parties to satisfy, in a timely manner, the other conditions to the closing of the Arrangement. These dates may change for a number of reasons, including the inability to secure necessary regulatory or other third party approvals in the time assumed or the need for additional time to satisfy the other conditions to the completion of the Arrangement. Accordingly, readers should not place undue reliance on the forward-looking statements and information contained in this press release concerning these times.

Risks and uncertainties inherent in the nature of the Arrangement include the failure of Daylight or SIPC to obtain necessary regulatory and other third party approvals, or to otherwise satisfy the conditions to the Arrangement, in a timely manner, or at all. Failure to so obtain such approvals, or the failure of Daylight or SIPC to otherwise satisfy the conditions to the Arrangement, may result in the Arrangement not being completed on the proposed terms, or at all. In addition, the failure of Daylight to comply with the terms of the Arrangement Agreement may result in Daylight being required to pay a non-completion or other fee to SIPC, the result of which could have a material adverse effect on Daylight's financial position and results of operations and its ability to fund growth prospects and current operations.

Readers are cautioned that the foregoing list of factors is not exhaustive. Additional information on other factors that could affect the operations or financial results of Daylight are included in reports on file with applicable securities regulatory authorities, including but not limited to: Daylight's Annual Information Form for the year ended December 31, 2010, Daylight's Notice of Annual General Meeting and Information Circular and Proxy Statement dated April 14, 2011 and Daylight's Notice of Special Meeting and Information Circular and Proxy Statement dated November 1, 2011, each of which may be accessed on Daylight' SEDAR profile at www.sedar.com.

The forward-looking statements and information contained in this press release are made as of the date hereof and Daylight undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

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