Contact/Donnycreek -- summary under Non-Triangular Amalgamations

Overview

Under an Alberta Plan of Arrangement, Donnycreek and Contact will amalgamate on the basis of exchange ratios which will reflect a 56% premium for the Donnycreek shares and with Amalco's management comprised of current Contact management. Donnycreek and Contact shareholders initially will hold 56.4% and 43.6% of Amalco, respectively. Dissenters may receive deemed dividend treatment.

Donnycreek

A TSV-listed oil and gas Alberta company.

Contact

A TSV-listed oil and gas Alberta company.

Plan of Arrangement and Amalgamation

Under the Plan of Arrangement, the shares and options of Donnycreek and Contact held by dissenters shall be deemed to be transferred to Donnycreek or Contact, as the case may be, for their fair value. Under an amalgamation of Donnycreek and Contact (also occurring under the Plan of Arrangement) each Donnycreek and Contact share (other than those held by Contact or Donnycreek) will be exchanged for 0.6 and 0.075 of an Amalco share, respectively, and with options on Donnycreek and Contact being exchanged for options on Amalco shares on a basis reflecting these exchange ratios. The stated capital of the Amalco shares will be equal to aggregate paid-up capital of the Donnycreek and Contact shares immediately before the amalgamation minus those of the shares of Donnycreek and Contact held by each other.

Canadian tax consequences

The amalgamation exchange will occur to shareholders on a rollover basis. Resident holders exercising dissent right may be deemed to have realized a dividend to the extent that the proceeds of disposition exceed the paid-up capital of their shares.