Anglo Swiss Resources Inc -
Anglo's Catamayo project update; placement
Anglo Swiss Resources Inc ASW
Shares issued 38,237,606 2000-03-22 close $0.27
Thursday Mar 23 2000
Mr. Len Danard reports
Anglo Swiss Resources has signed two letter of intents to enter into formal joint participation agreements with Hampton Court Resources Inc. to earn up to a 60-per-cent interest in Anglo's Catamayo River gold project in southern Ecuador and up to a 60 per cent in Anglo's Blu Starr gemstone property in Southern British Columbia.
Hampton Court has also committed to a private placement of $500,000 for Anglo Swiss. Two directors of Hampton Court have agreed to join the board of directors of Anglo Swiss effective immediately. A third non-related party has committed to a private placement of $100,000. The aforementioned agreements, private placement and board appointees are subject to regulatory approvals.
Catamayo River gold property.
An independent geological report conservatively estimated that the Catamayo River property, located in southern Ecuador, contains 9.24 million cubic metres of gravel with 332,820 ounce resource of unrefined placer gold. Further gold-bearing gravels have been discovered since the initial report was completed in early 1997. With current gold values in the $300 (U.S.) range, the estimated grade of this deposit is approximately $10 (U.S.) per cubic metre, based on testing performed by company personnel.
Hampton Court has completed its due diligence on the Catamayo River and has agreed to proceed immediately upon execution of a formal joint participation agreement with the installation of a portable wash plant mining operation on the Catamayo property and shall have a period of 120 days to establish commercial production. The facilities shall consist of a portable wash plant with a minimum design capacity of 150 cubic yards per hour. HCR shall also supply adequate support equipment and personnel to run the plant at its designed capacity.
HCR facilities shall be capable of averaging 90,000 cubic yards per quarter.
Upon the satisfactory completion of the agreed-to work program by HCR, evidenced by a 90-day period which meets the 90,000-yard production target, the parties shall hold the following interests in the Catamayo property and associated facilities -- HCR 50 per cent and Anglo 50 per cent. All revenues received from the sale of production from the property shall be shared as to 50 per cent HCR and 50 per cent Anglo. All expenses from the date of completion of the agreed-to work program including but not limited to such things as future capital costs, operating costs and applicable administration costs shall be shared as to each proportionate share.
HCR may earn an extra, pro-rated 10-per-cent share, by increasing production past the 90,000 yards per quarter by doubling production to 300 yards per hour (180,000 yards per quarter), such as HCR averages 200 yards per hour (120,000 yards per quarter) it will earn an extra 3.3 per cent of the net or 53.3 per cent. If production increases to 180,000 yards or more per quarter, HCR earns 60 per cent and Anglo will retain 40 per cent.
HCR shall be the agreed to operator of the Catamayo property.
British Columbia Blu Starr gemstone property
Anglo Swiss Resources is developing Canada's first gemstone property located in Southern B.C.; since acquiring the property in 1995. The property consists of over 15,000 acres of mineral tenure rights and 1,853 acres of placer mineral rights.
Anglo's gemstones of B.C. have been published in many United States jewellery and gem/gemology trade magazines including the National Jeweler, the GIA's Gems & Gemology, JCK Jewelers' Circular Keystone and most recently the Professional Jeweler.
Gemstones discovered to date include numerous showings containing star sapphire, iolite, garnet, aquamarine, titanite, moonstone and several varieties of quartz crystals plus a recent discovery of a large mineralized area containing showings of crystalined graphite.
HCR commits to the following work commitments on the Blue Starr property:
Phase 1: A minimum of $250,000 is to be spent on an agreed-to evaluation program. Funds are to be spent within a one-year period from the date of a formal joint participation agreement. HCR shall be responsible for the payment of all fees and costs to maintain the leases in good standing during the phase 1 earning period. These costs shall be credited to the work program. Any revenues generated from the sale of production from the Blue Starr property shall be shared based on the phase 1 earning shown below.
Phase 2: Prior to the expiry of phase 1, HCR must elect to proceed with a phase 2 commitment or terminate its participation in further earning. The phase 2 commitment shall be a minimum of $250,000, which is to be spent on an agreed-to work program. Funds are to be spent within a one-year period from the date of the election. HCR shall be responsible for the payment of all fees and costs to maintain the leases in good standing during the phase 2 earning period. These costs shall be credited to the work program. Any revenues generated from the sale of production from the Blue Starr property shall be shared based on the phase 2 earning shown below.
Phase 3: Prior to the expiry of phase 2, HCR must elect to proceed with a phase 3 commitment or terminate its participation in further earning. The phase 3 commitment shall be a minimum of $500,000, which is to be spent on an agreed-to work program. Funds are to be spent within a one-year period from the date of the election. HCR shall be responsible for the payment of all fees and costs to maintain the leases in good standing during the phase 3 earning period. These costs shall be credited to the work program. Any revenues generated from the sale of production from the Blu Starr property shall be shared based on the phase 3 earning shown below.
HCR shall earn the following interests in the Blu Starr property upon the completion of its agreed-to work programs:
phase 1, earned interests HCR 10 per cent, Anglo 90 per cent;
phase 2, earned interests HCR 20 per cent, Anglo 80 per cent; and
phase 3, earned interests HCR 40 per cent, Anglo 60 per cent.
HCR shall have the right for a period of 180 days from the end of the phase 3 earning period to elect to purchase an additional interest in the Blu Starr property under the following terms:
Optional purchase 1: HCR shall have the right to purchase a 10-per-cent interest from Anglo for a price of $1-million.
Optional purchase 2: HCR shall have the right to purchase an additional 10-per-cent interest from Anglo for a price of $1-million.
If HCR elects to purchase these additional interests the Blu Starr interests shall be:
after optional purchase 1, earned interests HCR 50 per cent, Anglo 50 per cent; and
after optional purchase 2, earned interests HCR 60 per cent, Anglo 40 per cent.
During the phase 1, 2 and 3 work commitment periods on the Blu Starr property, Anglo and HCR shall act as joint operators. All proposed work programs will be jointly prepared and agreed to by Anglo. Upon completion of the phase 3 earning, HCR shall be named sole operator of the property.
$600,000 private placement
HCR has committed to a private placement of $500,000 to acquire a total of 3,333,333 common shares of Anglo at a price of 15 cents per share. The total purchase price is $500,000. Each share would have one common share purchase warrant attached which would allow HCR to acquire one additional Anglo share for each warrant held. The warrants would be available for exercise for two years at an exercise price of 20 cents per share during the first year and 25 cents per share during year two.
A third non-related party has acquired a total of 666,666 common shares under the same terms for proceeds of $100,000.
The two private placements are at arm's length with no finder's fee and are subject to regulatory approvals.
Anglo Swiss appointees to the board of directors
Because of the significant share position that HCR will have in Anglo and because of the joint operations that will be conducted on the Anglo properties, Anglo agrees to propose that two Anglo board seats will be made available to HCR effective March 21, 2000.
The nominees from HCR are Dr. Robert McPherson and Conrad Kathol.
Dr. McPherson graduated with a BSc in geological engineering and a PhD in surficial geology from the University of Manitoba and has worked in the resources industries in Western Canada and internationally for the past 35 years.
Dr. McPherson has worked as an oil and gas geologist/engineer in Western Canada, the U.S. and internationally. He also worked as an oil and gas analyst for a major Canadian brokerage firm.
Dr. McPherson has extensive experience in surficial geology, alluvial gold mining, sand and gravel exploration and groundwater geology. Dr. McPherson is president and director of Hampton Court Resources Inc. and a director of several other resource-based public companies.
Mr. Kathol is an engineering graduate of the University of Alberta and has worked in the resource industry in Western Canada and internationally for the past 27 years.
Mr. Kathol has worked as an exploration geologist in Western Canada and the U.S. and has experience in all aspects of the petroleum industry including exploration technology, reservoir engineering and economic evaluation.
Mr. Kathol also has extensive experience in surficial geology, sand and gravel exploration and groundwater geology. Mr. Kathol is a director of Hampton Court Resources Inc. and several other resource-based public companies and is the president of Invader Exploration Inc., a public company listed on the Canadian Venture Exchange.
Anglo Swiss is very pleased to have the addition of the enormous knowledge and experience these two individuals will share as the development of the company's properties is continued through to the production level.
Anglo Swiss has granted Dr. McPherson and Mr. Kathol options allowing each of the them to purchase 500,000 shares of Anglo Swiss at 21 cents for a period of five years. The board of directors has also set 2.25 million options at 21 cents to other members of the board. The proposed options shall be subject to the approval of the applicable regulatory bodies.
Dr. David Hughes has rendered his resignation effective March 21, 2000, to allow the additions to the board of Anglo Swiss Resources Inc.
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