Crystallex sweetens Eurus deal

An amendment to the previously announced merger of Eurus Resource (VSE) and Crystallex International (VSE) sweetens the pot for Eurus shareholders.

They will now receive one share and one warrant of Crystallex for every six shares held. The warrant allows the holder to buy an additional share of Crystallex at $3.15 until April 25, 1996.

Under the previous agreement, Eurus shareholders were to receive one share of Crystallex for every 4.5 shares held.

After cancelling the 750,000 shares of Eurus it owns, Crystallex will issue 1.6 million shares plus an equal number of warrants. This will raise the number of outstanding shares to 12.4 million (17.7 million fully diluted).

Douglas Newby, vice president of Crystallex, says the amendment seems to have placated shareholders who were unhappy with the original arrangement.

A fairness opinion will be included, and shareholders will meet to vote on the deal in June.

The combination of the two companies will clear up a disagreement over the ownership of the Albino gold concession in the Kilometre 88 region of Venezuela.

Crystallex is renegotiating its purchase option on the Albino property at the request of the vendor. Under the current arrangement, Crystallex must pay a further US$6 million to the end of the year for a 100% interest.

The company is operating a 440-ton-per-day, carbon-in-pulp plant at Albino where production in April totalled about 3,000 oz. at a cash cost of less than US$100 per oz.

Proven, probable and possible reserves were last estimated at more than 600,000 tons grading 0.18 oz. gold per ton, including a 22,000-ton stockpile and 365,000 tons of tailings.

The source of current production at Albino is the Conductora pit, which contains a proven and probable reserve of 90,000 tons grading 0.42 oz.

Crystallex has US$1 million in working capital, and Newby expects to fund ongoing work and property payments at Albino from cash flow.

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