0373849 B.C. Ltd.

May 26, 2011 17:02 ET

Procon Acquisitionco Ltd. and 0373849 B.C. Ltd. Agree to Amalgamate

VANCOUVER, BRITISH COLUMBIA--(Marketwire - May 26, 2011) - Procon Acquisitionco Ltd. ("Acquireco"), a wholly-owned subsidiary of Procon Mining and Tunnelling Ltd. ("Procon") of Suite 108 – 4664 Lougheed Highway, Burnaby, British Columbia, V5C 5T5, and 0373849 B.C. Ltd. (the "Company") announce today that they have entered into an amalgamation agreement (the "Amalgamation Agreement") dated May 26, 2011.

Pursuant to the proposed amalgamation between Acquireco and the Company (the "Amalgamation"), each holder of common shares of the Company, other than Acquireco, will receive one redeemable preferred share of the new company resulting from the Amalgamation ("Amalco") for each common share of the Company held immediately prior to the Amalgamation. Each redeemable preferred share of Amalco will then be immediately redeemed for $0.00000311839 in cash, provided that each holder of Amalco redeemable preferred shares will be entitled to receive at least $0.01 in aggregate consideration for all Amalco redeemable preferred shares held. As a result of the Amalgamation and the redemption of the redeemable preferred shares, Amalco will cease to be publicly held and Amalco will be a wholly-owned subsidiary of Procon.

A special committee (the "Special Committee") of the board of directors of the Company (the "Board") reviewed the terms of the proposed Amalgamation Agreement and recommended to the Board that the Company enter into the Amalgamation Agreement and that the Board recommend that shareholders of the Company vote to approve the Amalgamation.

Based, in part, on the recommendation of the Special Committee, the Board has unanimously determined that the Amalgamation is in the best interests of the Company and is fair, from a financial point of view, to shareholders of the Company other than Procon, Acquireco and their affiliates and recommends that shareholders vote their shares in favour of the Amalgamation.

The Amalgamation must be approved by two-thirds of the votes cast by holders of common shares and non-voting shares of the Company, voting together as a single class, at a special meeting of shareholders of the Company (the "Meeting") to be held on June 23, 2011. The Amalgamation must also be approved by two-thirds of the votes cast by holders of common shares of Acquireco.

Acquireco currently owns 656,885,026 common shares and 25,974,841,034,959 non-voting shares in the capital of the Company, representing approximately 91.06% of the issued and outstanding common shares, 100% of the issued and outstanding non-voting shares of the Company and approximately 99.99% of the total equity of the Company. Acquireco intends to vote its shares for the Amalgamation.

The record date for determining shareholders entitled to receive notice of and vote at the Meeting is May 18, 2011. It is anticipated that the Company will mail the formal notice, accompanying management information circular, and other related documents in connection with the Meeting commencing on or about May 30, 2011. A copy of these materials will also be available at www.sedar.com commencing on or about May 30, 2011. Subject to customary closing conditions, closing will take place after shareholders of the Company approve the Amalgamation and is anticipated to take place on or about June 24, 2011.

This news release does not constitute an offer to sell or a solicitation of an offer to sell any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

This release includes certain statements that may be deemed to be "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. All statements in this release, other than statements of historical facts, that address future production, reserve potential, exploration and development activities and events or developments that the Company expects, are forward-looking statements. Although management believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance, and actual results or developments may differ materially from those in the forward-looking statements. Factors that could cause actual results to differ materially from those in forward-looking statements include market prices, exploration and development successes, continued availability of capital and financing, and general economic, market or business conditions. Please see our public filings at www.sedar.com for further information.

Contact Information

  • 0373849 B.C. Ltd.
    Jimmy Mah
    Chief Financial Officer
    (604) 291-8292
    (604) 291-8082 (FAX)