Bresea announces name change and interim order granted
VANCOUVER, July 26 /CNW/ - Bresea Resources Ltd. ("Bresea" or the
"Company") is pleased to announce that it has called a shareholder's meeting
for August 23, 2001 at which it will, among other things, seek shareholder
approval to change the name of the Company to "Sasamat Capital Corporation".
The name change is intended to reflect Bresea's new business directions
following the election of the board of directors in February, 2001.
The Company also announces that on July 24, 2001, the Court of Queen's
Bench in Alberta granted an interim order authorizing and directing Bresea to
call, hold and conduct a special meeting of its shareholders (the
"Shareholders") and certain persons who have alleged or may allege claims
against Bresea (the "Affected Creditors"). At the meetings, to be held on
August 23, 2001, Shareholders and Affected Creditors will be asked to approve
the settlement agreement, as amended (the "Amended Settlement Agreement"),
previously entered into and announced by PricewaterhouseCoopers as Interim
Receiver and Manager of Bresea (the "Interim Receiver") and a Plan of
Arrangement (the "Plan of Arrangement").
The Company further announces that it has decided to proceed with its
application for the discharge of the Interim Receiver and Manager. The Company
anticipates its application will be heard in October. The Interim Receiver was
first appointed by the court in November, 1997.
A summary of the terms of the Amended Settlement Agreement is as follows:
1. $6,000,000 is to be paid by Bresea to Deloitte & Touche (the "Bre-X
Trustee") on behalf of Bre-X Minerals Ltd. ("Bre-X") upon approval of
the Amended Settlement Agreement and the completion of the Plan of
Arrangement;
2. Bresea is to transfer to the Bre-X Trustee 49,000,000 common shares of
Bre-X currently held by Bresea;
3. All alleged claims and actions against Bresea by Bre-X and by past and
present shareholders of Bre-X are to be dismissed or compromised;
4. Bresea is to receive a general release from Bre-X and the Bre-X
Trustee for all claims;
5. Bresea is to provide Bre-X and the Bre-X Trustee a general release for
all claims and give releases of claims against certain individuals;
6. Bresea is to receive an assignment of the $90,000 claim of Bre-X
against Bro-X Minerals Ltd.; and
7. Bre-X is to propose the Plan of Arrangement to all Affected Creditors
who will principally be shareholders and former shareholders who
allegedly suffered damages as a result of a decline in Bresea's share
price.
The Plan of Arrangement provides for the creation of a pool of common
shares of Bresea equal to approximately 10% of Bresea's issued and outstanding
share capital to be distributed to satisfy in full the claims of all persons
alleging a claim against Bresea, by way of a pro rata distribution of the pool
of common shares to Affected Creditors. The pool of common shares is to be
created by the issuance from treasury of new common shares of Bresea.
Bresea is a defendant in a number of active proceedings asserting in
aggregate in excess of $3,000,000,000 worth of claims against Bresea and other
parties. The claims are principally made by past and present shareholders of
Bresea and Bre-X who had allegedly suffered losses as a result of a decline in
Bresea's and Bre-X's share price. Bresea denies any wrongdoing and has been
vigorously defending these alleged claims. The Amended Settlement Agreement
and the Plan of Arrangement would effectively settle all of the claims against
the Company.
Some of the parties to the Amended Settlement Agreement have taken the
position that the amendment to the agreement, dated January 22, 2001, was
conditional and never came into effect and that the original settlement
agreement has expired. The Company is in the process of seeking a declaration
from the Court of Queen's Bench in Alberta confirming that the Amendment and
the Amended Settlement Agreement are currently in effect.
The Board has reviewed the alleged claims against Bresea and the Amended
Settlement Agreement. The Board is recommending that Shareholders accept and
approve the Amended Settlement Agreement and related Plan of Arrangement as it
believes that completing the Amended Settlement Agreement is preferable to the
cost and risk of continuing to defend the litigation against Bresea.
The transactions comprising the Amended Settlement Agreement may be
considered to be a related party transaction within the meaning of Policy Q-27
of the Commission des valeurs mobilieres du Quebec ("Policy Q-27") due to the
ownership of over 10% of the Company's shares by the Bre-X Trustee, a party to
the settlement agreement. However, the transactions contemplated by the
Amended Settlement Agreement are exempt from formal valuation requirements and
minority approval requirements under section 5.6(6) of Policy Q-27. 32565
Yukon Inc., which owns approximately 19.6% of the issued and outstanding
common shares of Bresea, is not a party to the Amended Settlement Agreement,
deals at arm's length with the Bre-X Trustee, fully supports the transactions
contemplated by the Amended Settlement Agreement and will be treated
identically to all other holders in Canada of common shares of Bresea and will
not receive, directly or indirectly, as a consequence of the Amended
Settlement Agreement a benefit that is not also received on a pro rata basis
by all other holders of common shares.
Michael Smith, President of Bresea, commented "We are pleased to announce
the shareholder's meeting of August 23. Since being elected in February, the
Board has worked diligently to fulfill its goals of i) obtaining a listing of
Bresea's common shares, ii) terminating the receivership as soon as
practicable, iii) settling all claims against Bresea on a basis fair to all
shareholders, and iv) implementing a new business plan. The shareholder
meeting, the Amended Settlement Agreement and Plan of Arrangement and the
application to terminate the Interim Receiver are all key elements in
fulfilling this plan."
For further information: Roy Zanatta or Rene Randall, (604) 408-8538
newswire.ca |
