Perlite Canada Inc.
TSX VENTURE : PCI

Perlite Canada Inc.

December 06, 2006 13:38 ET

Perlite Canada Inc. Adopts a Shareholder Rights Plan

MONTREAL, QUEBEC--(CCNMatthews - Dec. 6, 2006) - Perlite Canada inc. ("Perlite") (TSX VENTURE:PCI) announces that it has adopted a shareholder rights plan.

"By implementing the rights plan at this time, the Board of Directors have taken pro-active steps to ensure that the Shareholders of the Company can avail themselves of it should an unsolicited offer be made for the Company. The purpose of the plan is to provide the Company and its Directors and Shareholders with sufficient time to properly consider any offers to acquire control of Perlite," said Richard Barabe, President and Chief Executive Officer of the Company.

Under existing securities legislation a take-over bid need only to remain open for 35 days; a period of time which the Directors believe could be insufficient to fully evaluate an offer, make an informed recommendation to the Shareholders of Perlite and if considered appropriate pursue alternatives which could maximize value for Perlite and its Shareholders. Under the terms of Perlite's Rights Plan, a "permitted bid" must be made by means of a take-over bid circular sent to all Shareholders of Perlite, remain open for acceptance for at least 60 days and require acceptance by at least 50% of the voting shares held by Shareholders not affiliated or associated with the Offeror.

The Rights Plan takes effect immediately but Shareholders of Perlite will be asked to approve the Rights Plan at a meeting of the Shareholders of Perlite to be held prior to June 6, 2007. If approved at this meeting, the initial term of the rights plan will expire at the close of the annual meeting of the Shareholders of Perlite in 2009.

In the context of the plan, a flip-in event occurs when a person, acting alone or jointly in concert with another, acquires or offers to acquire more than 20% of the outstanding voting shares, other than by way of a permitted bid, a competing permitted bid or in certain other limited circumstances.

If the potential offerors do not comply with these conditions, each right (other than those held by the acquiring person) will permit the purchase of shares with a market value of $200 on payment of the exercise price of $100 per right on the date of the flip-in event which is deemed to be effective at the close of business on the 10th trading day following the announcement of the offer.

Until the occurrence of a flip-in event, the rights will trade together with the shares and will be represented by the share certificates. Upon the occurrence of a flip-in event, the rights will be evidenced by rights certificates and will trade separately from the shares. The rights do not carry any other rights attaching to the shares such as voting or distribution rights.

Perlite is not adopting the Rights Plan in response to any specific proposal to acquire control of Perlite. The rights plan is similar to plans adopted by other Canadian companies and income funds and approved by their respective Shareholders and Unitholders.

About Perlite

Perlite Canada Inc. specializes in the processing, distribution and sale of perlite and vermiculite, two minerals used in industry and horticulture. The common shares of Perlite Canada inc. are listed for trading on the TSX Venture Exchange.

Forward-looking Information

Forward-looking statements contained herein, are based on current expectations and are subject to a number of uncertainties and risks, and actual results may differ materially. These uncertainties and risks include, but are not limited to the dependence on certain key suppliers, competitive pressures and changes in market activity, risks associated with international operations and foreign exchange, legal proceedings, environmental, health and safety and other regulatory requirements. Further information can be found in the disclosure documents filed by Perlite Canada Inc. with the securities regulatory authorities, available at www.sedar.com.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

Contact Information

  • Perlite Canada inc.
    Richard Barabe
    514-336-6665 / 514-984-9798
    514-336-6651 (FAX)