CALGARY, Aug. 25 /CNW/ - Subject to regulatory approval, Flag Resources
(1985) Limited ("Flag") has agreed to accept ten million (10,000,000) shares
of Golden Briar Mines Limited ("Golden Briar") shares, valued at $0.10 per
share (50 above current market price), as settlement of indebtedness of
$1,157,192 (as of December 31,2002) owed to Flag by Golden Briar. Completion
of the proposed transaction would give Flag a 35% controlling interest in
Golden Briar, The indebtedness was incurred by the payment by Flag on Golden
Briar's behalf of trade invoices and exploration expenses over a number of
years.
In a second proposed shares for debt transaction, also subject to
regulatory approval, Flag will issue 2,000,000 common shares, valued at
$0.12 per share, to Golden Briar in settlement of cash advances of
$240,000 made to Flag.
The majority of the Board of Directors of each of Flag and Golden Briar
are comprised of the same individuals. As the proposed issue of 10,000,000
Golden Briar shares to Flag will involve a change of control in Golden Briar,
a shareholders' meeting will be called to seek shareholder approval of the
transaction by a majority of the minority or disinterested shareholders. The
shares for debt transactions are intended to strengthen each corporation's
balance sheet.
In addition to the foregoing shares for debt transactions, Flag and
Golden Briar have entered into an agreement whereby Flag will transfer to
Golden Briar, for nominal consideration, a 50% working interest in Flag's
Exploratory License of Occupation in the western Rathbun Township, Sudbury
Ontario, subject to the approval of the Ontario Ministry of Northern
Development and Mines. The 1,750 acre Exploratory License is in the Rathbun
and Aylmer Townships, 20 miles north of Sudbury, near the northeast flank of
the Sudbury Structure, It is six miles due west across Lake Wanapitei from
Flag's 70,000 acre holdings in the Wanapitei Anomaly. The parties have agreed
to this transfer of the working interest in order to share the costs of the
requisite work commitments. |
