(TSX: TVI)
CALGARY, April 22 /CNW/ - TVI Pacific Inc. ("TVI" or the "Company") announced today that it has entered into an agreement to settle all claims associated with class-action proceedings commenced in Ontario by Joe Marcantonio and in Quebec by Florent Audette. The Settlement Agreement, which is subject to court approval, has also been signed on behalf of the other defendants in those actions, being the directors and a former officer of the Company.
On March 3, 2008, a statement of claim was issued (under the Class Proceedings Act, 1992) in the Ontario Superior Court of Justice against TVI, its directors and a former senior officer of the Company by Florent Audette, who was described in the claim as a shareholder of TVI. On April 10, 2008, a different plaintiff, Joe Marcantonio, was substituted as the representative plaintiff in the Ontario action. A further proposed class proceeding was commenced in the Superior Court of Quebec by Florent Audette on July 25, 2008, which was virtually identical to the Ontario claim. In both claims, the plaintiffs alleged that TVI made misrepresentations in financial statements that were restated in 2007. The plaintiffs also alleged impropriety in relation to the Company's historical share option granting practices. In their action, the plaintiffs sought, among other things, damages in the amount of $16 million (consisting of general and special damages of $15 million and punitive damages in the amount of $1 million). A Special Committee of the Board of Directors of the Company conducted an investigation into the option allegations made by the plaintiffs, with the assistance of legal counsel. That investigation, which involved personal interviews and automated data analysis, revealed no intentional misconduct in relation to prior grants of options by the Company; nonetheless, the Company has agreed to implement a number of internal administrative measures designed to strengthen internal controls in relation to option matters.
The Settlement Agreement contemplates a total payment of $2.1 million (inclusive of the plaintiffs' legal costs and all administrative expenses that may be incurred in implementing the settlement) to members of the proposed class, in settlement of all claims that were asserted against TVI, including claims relating to the restatement of certain historical financial statements by the Company in 2007. A cash payment equal to the settlement amount was made on March 31, 2009, by TVI's insurers, who are also paying the Company's legal costs in this matter, subject to a $75,000 deductible, which the Company paid early in 2008.
In entering into the Settlement Agreement, neither TVI nor any of the other defendants has made any admission of liability in relation to the claims.
The Company has been advised by its legal counsel that applications to the Ontario and Quebec Superior Courts for approval of the Settlement Agreement are expected to be made in June 2009.
About TVI Pacific Inc. (TSX: TVI)
TVI Pacific Inc. is a publicly traded Canadian mining company focused on exploring for, developing and producing precious and base metals within district scale systems in the Philippines. The Company's interest in the Canatuan Mine and its other Philippine assets are held through its affiliate, TVI Resource Development (Phils.) Inc.
The Toronto Stock Exchange has neither approved nor disapproved of the information contained herein.