Jeez....this must have been written by John Nash.
C
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
Chesapeake shareholder Sun Valley increases holdings
2007-03-14 21:34 ET - News Release
Mr. Peter Palmedo of Sun Valley reports
SUN VALLEY GOLD LLC: HOLDINGS OF SECURITIES OF CHESAPEAKE GOLD CORP.
As a result of the completion of a plan of arrangement involving American Gold Capital Corp. and its shareholders and Chesapeake Gold Corp. and a wholly owned subsidiary of Chesapeake, Peter Palmedo and Sun Valley Gold Company, a company which Mr. Palmedo controls, acquired beneficial ownership of, and an affiliate of Mr. Palmedo, Sun Valley Gold LLC, acquired control or direction over, a total of: 1,474,649 common shares of Chesapeake, representing approximately 5.11 per cent of the issued and outstanding Chesapeake common shares; 737,325 common share purchase warrants of Chesapeake to purchase 737,324 Chesapeake common shares, which have underlying shares representing approximately 2.49 per cent of the issued and outstanding Chesapeake common shares after giving effect to the exercise of such warrants; and 147,464 Class A, Series 1, restricted voting shares of Chesapeake, which provide rights of conversion into Chesapeake common shares on certain conditions, representing approximately 16.35 per cent of the issued and outstanding Chesapeake Series 1, Class A shares.
Under applicable Canadian securities laws, Mr. Palmedo is deemed to beneficially own securities which are held by Sun Valley Gold Company, a corporation controlled by him. On Jan. 15, 2007, Sun Valley Gold Company acquired common shares of American Gold which were exchanged for shares of Chesapeake, pursuant to the plan of arrangement, from Sun Valley Gold LLC, a limited liability company of which Sun Valley Gold Company is the managing member.
Following completion of the plan of arrangement, Mr. Palmedo and Sun Valley Gold Company beneficially own, and Sun Valley Gold LLC exercises control or direction over, in total, the Chesapeake securities described above. Each Chesapeake warrant entitles the holder to purchase one Chesapeake common share at an exercise price of $8.00 for a term of five years expiring on Feb. 23, 2012. Each Chesapeake Series 1, Class A share will be automatically convertible, under certain conditions as more fully described in the early warning report being filed concurrently with this press release, into Chesapeake common shares.
Given various factors that will have to be taken into consideration in determining whether the Chesapeake Series 1, Class A shares will be converted into Chesapeake common shares and the basis for such conversion, at this time it cannot be determined if any Chesapeake common shares will be issued on conversion of Chesapeake Series, 1 Class A shares beneficially owned, or over which control or direction is exercised, by Mr. Palmedo, Sun Valley Gold Company and Sun Valley Gold LLC and, if so, how many Chesapeake common shares. The Chesapeake common shares which Mr. Palmedo and Sun Valley Gold Company may be entitled to acquire, and over which Sun Valley Gold LLC may be entitled to exercise control or direction, on conversion of the Chesapeake Series 1, Class A shares, and the Chesapeake common shares which Mr. Palmedo and Sun Valley Gold are entitled to acquire, and over which Sun Valley Gold LLC would exercise control or direction, on exercise of the Chesapeake warrants, together with Chesapeake common shares beneficially owned, or over which control or direction is exercised by them, may be more than 10 per cent of the outstanding Chesapeake common shares, after giving effect to the conversion and exercise of only the Chesapeake securities beneficially owned by Mr. Palmedo and Sun Valley Gold Company, and over which Sun Valley Gold LLC exercises control or direction.
The Chesapeake securities were acquired from treasury pursuant to the plan of arrangement reported in Stockwatch news Feb. 23, 2007. Mr. Palmedo, Sun Valley Gold Company and Sun Valley Gold LLC may increase or decrease direct or indirect beneficial ownership of, or control or direction over, securities of Chesapeake depending upon future market conditions. |
