Tri-River Ventures Inc. - Company Update
VANCOUVER, May 4, 2012 /CNW/ - Concurrent with the posting of the audited financial statements and management discussion and analysis of Tri-River Ventures Inc. (the "Company") (TSX.V Symbol: TVR.V), the Company wishes to provide the following property update.
On March 31, 2011, the Company entered into a Purchase and Sale Agreement with Sino Spirit Capital Investment Holding Limited ("Sino Investment") to acquire Sino Investment's 100% equity interest in Sino Spirit Group Limited ("Sino Group") which owns a 60% equity interest in Qinghai Lenghu Kunhu Potash Company Ltd. ("Lenghu Potash"). Lenghu Potash owns a mining permit in Qinghai Province of the People's Republic of China, covering a contiguous area of 23.8 km2 in the centre of the Kunteyi Salt Lake area, which has a total area of about 200 km2. Lenghu Potash is currently producing potash fertilizer from this property. The agreed purchase consideration consisted of cash payments of $11,583,000 (RMB78,000,000) in three installments and share issuances having an aggregate value of up to $4,455,000 (RMB30 million). The first refundable installment of $4,443,260 (RMB30,000,000) was made on April 4, 2011. The second refundable installment was due on October 4, 2011. By way of an executed amendment ("Amendment") between the parties dated April 20, 2012 which formalized an early verbal variation between the parties, the deadline for payment of the second installment has been extended until (i) the Company has completed its due diligence to its satisfaction, including receipt and review of audited financial statements of Lenghu Potash, (2) the parties have entered into a detailed definitive agreement, and (3) the Company has completed an equity or debt financing sufficient, with working capital, to pay the second installment. Thereafter or concurrently, the parties would expect to close the transaction, subject to TSX Venture Exchange (the "Exchange") acceptance. In the interim, pursuant to the Amendment, and in consideration of having the use of the first installment funds, Sino Investment has agreed to pay annually the Company the greater of (i) 16.67% of the net annual profit of Lenghu Potash starting from its fiscal year ended December 31, 2011, and (ii) RMB3.334 million (approximately $500,000), prior to closing of the transaction.
On March 22, 2011, the Company entered into a Share Exchange Agreement with Strong Rising International Limited ("Strong Rising") to acquire Strong Rising's wholly owned subsidiary, Taiji Resources Ltd. ("Taiji"). Taiji owns three early stage potash exploration properties in Saskatchewan. The Company conditionally agreed to acquire all of the issued and outstanding shares of Taiji in exchange for 11,360,000 Company shares and the indirect assumption of debt of approximately $1.75 million. The closing of the Agreement has been subject to several conditions including obtaining sufficient evidence of value and completion of due diligence satisfactory to Company management. The NI43-101 report has been completed and filed with the Exchange, and management have received audited financial statements of Taiji for the fiscal year ended January 31, 2011, and the two previous fiscal years. However, Company management are not satisfied with the due diligence results and are seeking:
|(i)||a deferral of Taiji's debt, with demand for payment subject to successful exploration of Taiji's properties, and|
|(ii)||completion of a substantial concurrent financing sufficient to fund exploration activities on Taiji's properties. Pursuant to section 10 of the Agreement, the deadline for closing the transaction was December 31, 2011 wherein either party may unilaterally terminate the Agreement. Neither party has done so to date with negotiations ongoing.|
The Company also wish to announce that Michael Woods has resigned as a director of the Company, but will continue to serve as legal counsel of the Company. The Company management expresses sincere thanks to Mr. Woods for his invaluable contribution to the Company's business endeavor.
Tri-River is a Canadian based exploration company focusing on acquisition, exploration and development of mineral resource properties. The Issuer is currently evaluating salt lake potash producing operations in Qinghai, China and potash exploration properties in Saskatchewan, Canada. Tri-River's shares are listed on the TSX Venture Exchange under the symbol TVR.
This press release contains forward-looking statements based on current expectations. Forward-looking statements entail various risks and uncertainties that could cause actual events or results to differ materially from those reflected in forward-looking statements. Risks and uncertainties about Tri-River's business are more fully discussed in Tri-River's disclosure materials under the heading "Risk Factors" and elsewhere in Tri-River's MD&A, Financial Statements and other periodic filings with Canadian securities regulators and on SEDAR. The Issuer does not assume any obligation to update forward-looking statements except as required under applicable law.For further information:
Y.B. Ian He (604) 306-5867
Barry Sheng (604) 601-8366