Andean American Reaches Debt Settlement Agreement With Its Subsidiary Sinchao Metals
VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 08/18/11 -- Andean American Gold Corp. ("Andean" or the "Company") (TSX VENTURE:AAG)(FRANKFURT:AQN) announces that it has reached a debt settlement arrangement with Sinchao Metals Corp. ("Sinchao") in relation to certain outstanding debt owed by Sinchao to the Company.
The Company has agreed to accept 8,888,889 common shares at a deemed price of $0.09 per share in settlement of $800,000 of indebtedness owing by Sinchao to the Company.
In addition, the Company has agreed to a private placement in Sinchao of a further 2,222,222 units at a price of $0.09 per unit for total investment of $200,000. Each unit will be comprised of one common share and one share purchase warrant, such warrant entitling the holder to acquire a further common share of the Company at a price of $0.12 for a term of five (5) years.
Closing of the private placement and the debt settlement are subject to the acceptance of the TSX Venture Exchange and the debt settlement remains subject to ratification by the shareholders of Sinchao at its annual general meeting on September 15, 2011.
Commenting on the private placement, David Rae, President and Chief Executive Officer of Andean said, "We continue to believe that the Sinchao property holds significant existing and future mineral potential, despite the reduction in the inferred resources. As the majority shareholder of Sinchao Metals, our interests are aligned with those of Sinchao and we will continue to provide Sinchao with our support as it seeks to maximize value from its assets."
Annual and Special Meeting of Shareholders
The Andean American Annual General and Special Meeting of Shareholders is scheduled for Thursday, September 15, 2011 at 11:30 am EST. The meeting will be held at:
Cambridge Suites Hotel Toronto Richmond Room 15 Richmond Street East, Toronto, Ontario M5C 1N2
We look forward to meeting with those shareholders who are able to attend.
On behalf of Andean American Gold Corp.
Bruce Ramsden, Vice President, Finance and CFO
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.