Amaya and Chartwell enter into a business combination agreement

Chartwell and Amaya will continue to focus on their existing businesses with the greatly expanded products, technologies and expertise resulting from the combination.

Pursuant to the Arrangement Agreement, a wholly owned subsidiary of Amaya, will acquire all of the issued and outstanding common shares of Chartwell by way of a plan of arrangement under the Business Corporations Act in an arm's length transaction valued at approximately us$ 23.4 million.

Under the terms of the Arrangement Agreement, each Chartwell shareholder will receive cash in the amount of $0.875 plus 0.125 common shares of Amaya in exchange for each Chartwell Share. Chartwell Shareholders will also have the right to elect to receive one-half of the total consideration for their Chartwell Shares in the form of Amaya Shares at a deemed value of $3.00 for each Amaya share, subject to a maximum number of Amaya Shares to be issued to Chartwell Shareholders of 3,825,197, which represents approximately 9% of the current issued and outstanding shares of Amaya. 

The Chartwell Shares have a deemed value of $1.25 for the purpose of the Arrangement. The Arrangement represents a 69% premium to the weighted average trading price of the Chartwell Shares for the 30 trading days ended May 11, 2011 and a premium of approximately 56% over the closing price of the Chartwell Shares on May 11, 2011.

The Chartwell Board has unanimously determined that the Arrangement is fair to the Chartwell Shareholders and that the Arrangement is in the best interest of Chartwell and has unanimously approved the Arrangement and resolved to recommend that Chartwell Shareholders vote in favour of the Arrangement. Evans & Evans, Chartwell's financial advisor, has provided the Chartwell Board with its preliminary indication that, as of the date hereof, the consideration to be received by Chartwell Shareholders pursuant to the Arrangement is fair, from a financial point of view to such shareholders.

Members of the Chartwell Board and the Chartwell executive officers, who collectively own approximately 5% of the outstanding Chartwell Shares, have entered into lock-up agreements with Amaya to vote their Common Shares in favour of the Arrangement and the transaction is conditional on holders of at least another 20% of the Chartwell Shares entering into similar lock-up agreements on or before May 27, 2011.

The Arrangement is subject to customary Toronto Stock Exchange, TSX Venture Exchange and other regulatory approvals, securing contractual consents as well as including, but not limited to, the approval of at least 662/3% of the votes cast in person or by proxy at a special meeting of Chartwell's Shareholders and the approval of the court pursuant to theBusiness Corporations Act (Alberta). The Arrangement is also conditional upon Chartwell's Board receiving a final fairness opinion from Evans & Evans.

A meeting of Chartwell Shareholders for the purpose of considering the Arrangement is expected to be held in early July, 2011. An information circular in connection with the Arrangement is expected be mailed to Chartwell Shareholders in mid-June. It is expected that this transaction would be completed in July 2011.

Under the Arrangement Agreement, Chartwell has agreed that it will not solicit or initiate any discussions concerning the pursuit of any other acquisition proposals. Each of Chartwell and Amaya has also agreed to pay a termination fee of $1 million to the other in certain other circumstances.  In addition, Amaya has the right to match any competing superior proposal for Chartwell in the event such a proposal is made.

Following the Arrangement, the Chartwell Shares will be de-listed from the TSX, and Chartwell will continue to be run by its current management team as a wholly-owned subsidiary of Amaya.

All outstanding options to acquire Chartwell Shares will either have been exercised or surrendered for cancellation prior to the closing date of the transaction, and, subject to TSX Venture Exchange approval, Amaya will grant, as of the effective date of this proposed transaction, an aggregate 560,000 options to current officers and employees of Chartwell. The options will be granted at an exercise price based on the market price of Amaya shares at such time and will be subject to the provisions of the Amaya Stock Option Plan.

In commenting on the proposed transaction, Darold H. Parken, President and CEO of Chartwell Technology said, "The combination of Chartwell and Amaya presents a tremendous range of synergies which will benefit both companies and their customers. The resulting company will have a significantly expanded product range, delivery channel capability and market reach. We are very excited about joining forces and working with the team at Amaya to build a highly diversified international gaming company and to better serve our customers."

David Baazov, President and CEO of Amaya Gaming Group commented that: "The proposed transaction represents a significant step for Amaya in our strategy to accelerate growth in the regulated interactive gaming industry. We are delighted that both companies have recognized the strategic, operational and financial benefits of the synergies between the two companies. The combination of Chartwell and Amaya will increase shareholder value and benefit both companies, by leveraging complementary technologies and reinforcing capabilities to further penetrate target markets."