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PACIFIC
IMPERIAL MINES INC.
1605-750
West Pender Street, Vancouver,
BC, V6C 2T8 Canada
Telephone: (604) 669.6332 Facsimile:
(604) 688.9336 Email: ppm-corp@telus.net
December 13, 2004 PPM-TSX Venture
PRESSS
RELEASE
ACQUISITION OF GOLDCHINA HOLDINGS
GROUP LIMITED UPDATE VANCOUVER,
British Columbia – August
31, 2004 – Pacific Imperial
Mines Inc. (“Pacific Imperial”)
is pleased to announce that its
proposed acquisition of Goldchina
Holdings Group Limited (“Goldchina”)
has been approved by shareholders
at the annual an extra-ordinary
general meeting held on July 23,
2004. The acquisition will constitute
a reverse take-over pursuant to
the policies of the TSX Venture
Exchange (the “RTO”).
Since the date of the meeting,
the following developments have
occurred.
1.
The terms of the financing to
be undertaken concurrently with
the RTO have been altered. The
Company will now be raising gross
proceeds of $2,000,000 rather
than $3,000,000. The financing
will consist of a private placement
of 8,000,000 units at a price
of $0.25 per unit, each unit comprised
of one common share of the Company
and one common share purchase
warrant entitling the holder to
purchase one additional common
share for a period of two years
at a price of $0.45 per share.
$1,500,000 of the private placement
will be conducted on a brokered
basis by Dundee Securities Corporation.
IBK Capital Corp. has been replaced
as the Company’s agent for
this purpose and will no longer
be involved with any portion of
the financing. $500,000 of the
private placement will be conducted
on a non-brokered basis. In respect
of the brokered portion of the
private placement, Dundee will
be paid a corporate finance fee
of $5,000, a cash commission equal
to 9% of the amount raised and
will be issued an agent’s
warrants entitling it to purchase
that number of common shares of
the Company equal to 9.5% of the
number of units sold by Dundee,
to a maximum of 560,000 agent’s
warrants.
2. To offset the reduced amount
of the RTO Financing, four creditors
of Goldchina who are related parties
to certain shareholders of Goldchina
have agreed to forgive an aggregate
of 4,400,000 RMB of indebtedness
(or CDN $687,500). In addition,
the Company has deferred raising
funds for the completion of the
proposed Phase 2 work program
on Goldchina’s Tangshang
and Salachong gold exploration
properties (the “Properties”).
The Company proposes to raise
further funds for this purpose
in a new equity financing to be
completing sometime following
the completion of the RTO. In
result, taking into account the
combined working capital of the
Company and Goldchina as at July
31, 2004, the Company will have
the estimated amount of $1,522,500
available to it upon completion
of the RTO and financing which
will be applied as follows:
3.
The Company will, concurrent with
the completion of the RTO, enter
into a cooperative agreement with
Kobex Resources Ltd. (“Kobex”)
pursuant to which Kobex will be
granted a right of first refusal
to acquire a 60% undivided interest
in one resource property available
to the Company (excluding the
Tangshang and Salachong properties).
In order to acquire an interest,
Kobex will be required to fund
$3,000,000 of exploration and
development expenditures on the
property within three years of
the date Kobex identifies a property
of interest to it. The right of
first refusal will expire on the
earlier of Kobex having identified
a property to pursue an interest
in or three years from the date
of the Cooperative Agreement.
The Company and Kobex will form
a joint venture company (the “JVC”)
for the purposes of acquiring
and developing a property that
is identified by Kobex. For the
property selected, Kobex will
also be required to issue to the
Company up to an aggregate of
1,000,000 shares from its treasury
on a staged basis as follows:
(a) 200,000 shares upon the JVC’s
receipt of title to the property;
(b) 200,000 shares upon expenditure
by Kobex of US$1,000,000 on the
property;
(c) 200,000 shares upon expenditure
by Kobex of a cumulative amount
of US$3,000,000 on the property;
and
(d) 400,000 shares upon a production
decision being made by the parties
in respect of the property.
4. In conjunction with entering
into the Cooperative Agreement
with Kobex, the Company will also
appoint Dr. Roman Shklanka to
the Board of Directors. Dr. Shklanka
is the Chairman and a Director
of Kobex. He is also the Chairman
and Director of Canico Resources
Corp; former Chairman of Hasting
Resources Corp; former consultant
to Barrick Gold Corp. and former
director and Chairman of Sutton
Resources Ltd. Dr. Shklanka's
appointment will strengthen the
Company's board and will facilitate
the expansion of the Company's
portfolio of exploration properties
through the implementation of
the Cooperative Agreement with
Kobex.
Conditions
of Completion - Completion of
the proposed transaction, which
constitutes a Reverse Take-Over
under the policies of the TSX
Venture Exchange, is subject to
completion of the financing and
TSX Exchange acceptance. Management
anticipates that these conditions
will be met and that the RTO and
financing will be closed within
the next two weeks.
ON BEHALF OF THE BOARD OF DIRECTORS
OF
PACIFIC
IMPERIAL MINES INC.
“Richard Chan”
Richard Chan
President
For further information: Pacific
Imperial Mines Inc., Mr. Richard
Chan, President
Phone: (604) 773-0323
