06:03 AM EDT, 07/25/2024 (MT Newswires) -- Bitfarms ( BITF ) , a Bitcoin data center company, overnight Wednesday issued a statement in response to a decision by the Capital Markets Tribunal of the Ontario Securities Commission to cease trade the company's shareholder rights plan.

The tribunal announced its decision following hearings on July 22 and July 23.

The company also said its board, following a unanimous recommendation of its independent Special Committee, unanimously approved the adoption of a new shareholder rights plan pursuant to a shareholder rights plan agreement entered into with TSX Trust Company, as rights agent, dated July 24, 2024.

"The Tribunal has decided to cease trade Bitfarms' ( BITF ) Rights Plan, which effectively terminates the Rights Plan. The Rights Plan was put in place to preserve the integrity of the independent Special Committee's strategic alternatives review process in light of attempts by Riot to opportunistically acquire the company," said Brian Howlett, Lead Director of the Bitfarms Board, in a statement. "In light of this decision, the Bitfarms Board has adopted the New Rights Plan to ensure the interests of all shareholders are protected. The Board and the Special Committee remain committed to maximizing value and seeking to achieve the best outcome for the company and its shareholders."

According to the Bitfarms ( BITF ) statement, the New Rights Plan has been adopted to ensure, to the extent possible, that all shareholders of the company are treated fairly and equally in connection with any unsolicited take-over bid or other acquisition of control of the company, including the protection against "creeping bids", which involve the accumulation of 20% or more of the company's common shares through purchases exempt from applicable Canadian take-over bid rules.

It added the New Rights Plan is not being adopted in response to any specific proposal to acquire control of the company, and the Board is not aware of any pending or threatened take-over bid for the company. However, the Board is aware that Nasdaq-listed Riot Platforms, Inc. (RIOT) is seeking to replace three directors on the Bitfarms Board at the company's hybrid special meeting of shareholders on October 29, 2024. The New Rights Plan allows Riot to proceed with its nominations and solicit proxies in respect of the Meeting.

Riot for its part announced that it was "successful" in its application to the Ontario Capital Markets Tribunal to cease trade the June 10, 2024 shareholder rights plan implemented by the Board of Bitfarms ( BITF ). It noted the cease trade order terminates Bitfarms' ( BITF ) 'Poison Pill' -- which contemplated a 15% trigger -- effective immediately.