/THIS NEWS RELEASE AND THE INFORMATION CONTAINED HEREIN ARE NOT FOR DISTRIBUTION IN THE UNITED STATES/
VANCOUVER, June 29 /CNW/ - EurOmax Resources Ltd. (EOX: TSX-V) and Silk Road Resources Ltd. (SIL: TSX-V) are pleased to announce that the previously announced business combination by way of plan of arrangement (the "Arrangement") was completed effective as of June 29, 2009. Silk Road's shares will be delisted effective as of June 30, 2009. The Arrangement was approved by 99.7% of the votes cast by shareholders of EurOmax and 100% of the votes cast by shareholders of Silk Road at their shareholder meetings held on June 25, 2009 and approved by the Supreme Court of British Columbia on June 26, 2009.
Combined Company Highlights
EurOmax Resources, now that it has completed the business combination with
Silk Road, has the following attributes:
- The benefits of EurOmax's exploration projects which it anticipates
advancing with the proceeds of the sale of Silk Road's Bulagou
property when they are received.
- A broader share trading market with the potential for greater
liquidity.
- Greater financing and acquisition opportunities in the mining
industry.
- Removal of duplication of public company costs.
- An experienced management team with complementary skills in
exploration, business and project development.
Transaction Summary
EurOmax acquired all of the issued and outstanding shares of Silk Road in the Arrangement. Pursuant to the terms of the Arrangement, holders of Silk Road shares are now entitled to receive 2.2535 EurOmax shares for every Silk Road share held. The outstanding options and warrants of Silk Road are deemed to be exchanged for EurOmax options and warrants, adjusted on the basis of the aforementioned exchange ratio, on the same terms and conditions as the original options and warrants. Also, by the terms of the Arrangement, Silk Road and 7167911 Canada Ltd., a wholly-owned subsidiary of EurOmax, have been amalgamated under the name "7167911 Canada Ltd." and the amalgamated company is a wholly-owned subsidiary of EurOmax. Additional information on the business combination is available in the information circulars of EurOmax and Silk Road, each dated May 26, 2009, available on SEDAR at www.sedar.com.
Exchange of Silk Road Shares for EurOmax Shares
Silk Road's shares will be delisted from the TSX Venture Exchange effective as of June 30, 2009. To receive their EurOmax shares pursuant to the Arrangement, Silk Road shareholders should surrender their Silk Road share certificates to the depositary, together with a properly completed letter of transmittal, to receive their EurOmax shares pursuant to the Arrangement. A copy of the letter of transmittal was sent to Silk shareholders and is also available at www.sedar.com.
Board and Management of EurOmax
As a result of the closing of the Arrangement, EurOmax now owns 100% of Silk Road's shares and assets. The board of directors of EurOmax now consists of six directors: John Menzies, Christopher Serin, Michael Mason, Anthony Patriarco, David Bell and Robert Power. John Menzies and Christopher Serin will remain the CEO and CFO, respectively, of EurOmax. Robert Power will serve as the Chairman of the Board of EurOmax.
Update on Sale of Bulagou Property
On June 25, 2009, 96.63% of the votes cast by shareholders of Silk Road at its shareholder meeting approved the sale of its 90% interest in the Bulagou property in the Gansu province of China to Chenzhou Ming Group Company Limited ("Chenzhou") pursuant to a previously announced agreement between Chenzhou and Power Fortune Resources Limited, a wholly owned subsidiary of Silk Road. The gross proceeds of the sale are expected to be approximately 111.8 million RMB (subject to withholding taxes, brokerage fees and various operating expenses). The sale of the Bulagou property has been conditionally approved by the TSX Venture Exchange subject to receipt of the above described shareholder approval and delivery of certain materials requested by the TSX Venture Exchange by July 10, 2009. The sale is expected to be completed in the third quarter of 2009 when the final transfer of the 90% interest in the Bulagou property is registered in the name of Chenzhou and the foreign joint venture company, Jiaxin Minerals Company Limited, is converted into a domestic Chinese company.
Future Activities of EurOmax
After, and subject to, the receipt of the proceeds from the sale of the Bulagou property, EurOmax intends to (i) commence drilling programs on its Ilovitza and Kazandol projects in Macedonia; (ii) commence a geophysical and drilling program on its Ceovishte project in Serbia; and (iii) complete the minimum drilling program required by its option agreements with Freeport McMoRan Exploration Company.
At Ilovitza, EurOmax anticipates the first phase of the 2009 program will involve drilling two 750 metre diamond drill holes to test the potential core of the porphyry copper gold system. A NI 43-101 compliant inferred mineral resource of 303 million tonnes grading 0.51% copper equivalent has been identified immediately adjacent to this potential core of the porphyry copper gold system.
At Kazandol, the drilling program will consist of 5,000 metres of reverse circulation drilling, 4,000 metres of trenching and metallurgical testing. This program is designed to identify a potential mineral resource on the northern portion of the Kazandol licence and complete reconnaissance for potential expansion in the southern portion of the licence.
At Ceovishte, the geophysical survey is designed to identify drill targets in the 1.4 kilometre by 1 kilometre silica breccia zone on the southern end of a 4 kilometre long zone. A 2,000 metre drilling program is planned for the identified drill targets.
CAUTIONARY NOTE REGARDING FORWARD LOOKING-STATEMENTS
This news release contains "forward-looking information" within the meaning of applicable Canadian securities legislation. Forward-looking statements include, but are not limited to, statements with respect to the operations and financial condition of EurOmax and the completion of the sale of the Bulagou property. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved". Assumptions upon which such forward looking statements are based include that EurOmax will receive the proceeds from the sale of the Bulagou property. Many of these assumptions are based on factors and events that are not within the control of EurOmax and there is no assurance they will prove to be correct. Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of EurOmax to be materially different from those expressed or implied by such forward-looking statements, including but not limited to: risks related to the integration of acquisitions, risks related to international operations, actual results of current exploration activities, conclusions of economic evaluations, changes in project parameters as plans continue to be refined and although EurOmax has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. EurOmax does not undertake to update any forward-looking statements that are incorporated by reference herein, except in accordance with applicable securities laws.
For further information regarding the resource estimate on the Ilovitza project, please refer to EurOmax's technical report entitled "Technical Report with Copper Gold Resources on the Ilovitza Project, Macedonia, on behalf of EurOmax Resources Limited, dated August 7, 2008 by G.S. Carter, P. Eng. and Broad Oak Associates" which is available under EurOmax's profile at www.sedar.com.
The scientific and technical information contained in this news release has been prepared by, or under the supervison of, John C. Menzies, a "qualified person" for the purposes of NI 43-101.
The TSX-V has in no way passed upon the merits of the transaction discussed above and has not reviewed and does not accept responsibility for the adequacy or accuracy of the contents of this press release. On Behalf of the Boards of Directors "John C. Menzies" Chief Executive Officer EurOmax Resources Ltd. ----------------------------------------------------------------------- EurOmax Resources Limited is listed on TSX Venture Exchange Symbol: EOX -----------------------------------------------------------------------