Press release as of March 10, 1996
Ballad To Acquire 35 Property Areas Comprising 31,100 Hectares Throughout Peru From TVX Gold Inc. For 300,000 Shares At A Deemed Price Of Us$7.00 Per Share
Ballad Enterprises Ltd. ("Ballad") is pleased to announce that it has entered into a preliminary agreement with TVX Gold Inc. ("TVX") which provides for Ballad's acquisition of all of TVX's resource property assets and operations in Peru through the acquisition of TVX Minera del Peru S.A. ("TVX Peru"), TVX's Peruvian subsidiary. TVX's shares are listed and called for trading on the Montreal, Toronto and New York stock exchanges.
TVX Peru is the holder of 100% interests in 35 property areas of various sizes totalling 31,100 hectares. These property areas are located throughout Peru in known gold producing areas. TVX has expended approximately US$4.8 million exploring and developing TVX Peru's assets.
Under the terms of the preliminary agreement by which Ballad will acquire all of the issued and outstanding shares of TVX Peru, Ballad will be required to issue 300,000 common shares from treasury to TVX at a deemed price calculated as the greater of US$7.00 per share or the market price of Ballad's shares on the day of closing. These Ballad shares will not be freely tradeable for one year from issuance. Ballad also holds certain rights of first refusal to purchase the shares upon TVX's sale of the shares.
Ballad is also required to expend US$300,000 on exploration of TVX Peru's properties in the 9 months following Vancouver Stock Exchange acceptance of the acquisition for filing ("VSE Acceptance") and pay $30,000.
Within the three year period following VSE Acceptance, TVX may purchase a 50% interest in any of TVX Peru's existing property areas by paying an amount equal to Ballad's expenditures on the date of TVX's exercise of the buy-back right.
On closing TVX Peru will be debt free and 100% owned by Ballad.
Under the terms of the agreement Ballad took possession of all of TVX Peru's assets, operations and facilities in Peru on March 7, 1997. From this point onward Ballad will be responsible for all exploration and operational expenditures incurred while exploring and developing TVX Peru's resource properties. Funding for these operations will initially be from Ballad's cash on hand.
Ballad intends to aggressively explore and develop TVX Peru's properties immediately. In conducting its due diligence review of the properties Ballad was particularly impressed with the experience, dedication, talent and expertise displayed by TVX Peru's management and exploration teams. It is anticipated that by April 1, 1997, approximately 26 former TVX employees will be added to Ballad's existing Peruvian workforce conducting exploration on the properties.
Work to date on the TVX properties has identified exploration targets of large tonnage low grade gold deposits often hosted within sedimentary/volcanic sequences.
All of the Property areas which comprise the TVX properties were filed for or acquired by TVX as a result of its preliminary geological evaluation and are generally located in areas which are known to host economic gold deposits. Many of the properties display old and new workings by informal miners. Several reportedly contain high grade gold veins, gold bearing breccia zones and evidence of disseminated gold in quantities and in areas that have the potential to become economically viable deposits. Exploration work to date on the property areas by TVX range from preliminary exploration to drilling.
Immediate plans for the exploration of the property areas will focus on properties in the area of the Pierina deposit. Further particulars of the planned exploration program will be revealed later in March.
Upon receipt of VSE Acceptance, Ballad will change the name of TVX Peru to "Ballad Minera del Peru S.A."
The acquisition of TVX Peru is subject to acceptance for filing by the VSE.
A finder's fee is payable in cash on the acquisition.
The agreement between TVX and Ballad does not affect or grant to TVX an interest in any of Ballad's other properties in Peru or Brazil. Ballad has commenced its Spring, 1997 exploration program on the Arequipa Gold Project located west of the city of Arequipa in Peru under the direction of Dr. Alfonso Aguilar. Forces are also being mobilized to begin the Spring, 1997 work program on the Anaua Properties in Northern Brazil.
Negotiations are underway with several corporations for joint venture funding of exploration programs on several of Ballad's properties.
BALLAD ENTERPRISES LTD.
Anthony J. Beruschi,
President |
