CALGARY, Oct. 11, 2016 /CNW/ - Paramount Resources Ltd. ("Paramount" or the "Company") (TSX:POU) announces that its board has approved Paramount implementing a normal course issuer bid ("NCIB") and a Notice of Intention to make a Normal Course Issuer Bid has been filed with and accepted by the Toronto Stock Exchange (the "TSX").
Paramount is implementing the NCIB as the Company's directors and management believe that from time to time the market price of Paramount's Class A Common Shares ("Common Shares") does not reflect the underlying value of the Common Shares and that the purchase of Common Shares for cancellation at such times is a prudent corporate measure that will both increase the proportionate interest in the Company of, and be advantageous to, all of the Company's remaining shareholders.
The NCIB will commence on October 13, 2016 and will terminate on the earlier of: (i) October 12, 2017; and (ii) the date on which the maximum number of Common Shares that can be acquired pursuant to the NCIB are purchased. Purchases of Common Shares under the NCIB will be effected through the facilities of the TSX or alternative Canadian trading systems at the market price at the time of purchase.
Paramount may purchase up to 5,441,602 Common Shares under the NCIB, which represents 10% of the public float for the outstanding Common Shares as at October 3, 2016. Pursuant to the rules of the TSX, the maximum number of Common Shares that the Company may purchase under the NCIB in any one day is 188,705 Common Shares, which is 25% of the average daily trading volume of the Common Shares on the TSX for the six months ended September 30, 2016 of 754,821 Common Shares. Paramount may also make one block purchase per calendar week which exceeds such daily purchase restriction, subject to the rules of the TSX. Any Common Shares purchased pursuant to the NCIB will be cancelled by the Company.
Paramount's last normal course issuer bid was implemented in 2010 and Paramount did not acquire any Common Shares under such bid.
Paramount may establish an automatic share purchase plan under which the designated NCIB broker could purchase Common Shares pursuant to the NCIB based on parameters established by the Company. Any such plan would be subject to the prior approval of the TSX.
Paramount is an independent, publicly traded, Canadian corporation that explores for and develops conventional petroleum and natural gas prospects, pursues longer-term non-conventional exploration and pre-development projects and holds investments in other entities. The Company's principal properties are primarily located in Alberta and British Columbia. Paramount's Class A Common Shares are listed on the Toronto Stock Exchange under the symbol "POU".
SOURCE Paramount Resources Ltd.