RE: rns2 Aug 2018 10:33
Earn-in transaction agreed between TH Crestgate and Ascendant Resources Inc on Lagoa Salgada zinc-copper project located in Portugal
· Initial 25% of Lagoa Salgada sold for US$2.45 million in cash and shares in Ascendant
· Ascendant may increase its ownership to 50% by investing US$9.0 million within 48 months and paying TH Crestgate US$3.5 million
· Ascendant can increase it ownership to 80% by completing a feasibility study and making a US$2.5 million cash payment to TH Crestgate
· TH Crestgate, assuming a full earn-in, will have secured cash payments totaling US$8.6 million, and a full feasibility study on Lagoa Salgada inside 54 months
· The agreement, if fully exercised, would leave TH Crestgate with a carried interest to production.
Mineral & Financial Investments is pleased to confirm that TH Crestgate GmbH ("Crestgate"), a company in which MAFL hold a 49% investment stake, and a private Swiss-based investment company has entered an agreement with Ascendant Resources Inc ("Ascendant") for the sale of 25% of its 100% owned subsdiary Redcorp Empreendimentos Mineiros Lda. ("Redcorp") and simultaneously agreed to an Earn-in Option agreement.
Redcorp owns and operates the Lagoa Salgada zinc-copper project in Portugal.
Summary of the Transaction for TH Crestgate
In the first part of the transaction Ascendant acquired an initial effective 25% interest for an upfront payment of US$2.45 million composed of US$800,000 in cash (US$400,000 on closing of the transaction and US$400,000 on July 15, 2018) and US$1.65 million in Ascendant shares. The second part of the Agreement is an Earn-in Option which has a minimum total value, if fully exercised, of US$15.0 million. Earn-in transaction terms are as follows:
§ Ascendant has the right to earn a further effective 25% interest via staged payments and funding obligations as outlined below:
o Investing a minimum of US$9.0 million directly in the operating company, Redcorp within 48 months of the closing date, to fund exploration drilling, metallurgical test work, economic studies and other customary activities for exploration and development, and
o Making payments totaling US$3.5 million to Crestgate according to the following schedule or earlier:
§ 6 months after the closing date: US$0.25 million
§ 12 months after the closing date: US$0.25 million
§ 18 months after the closing date: US$0.5 million
§ 24 months after the closing date: US$0.5 million
§ 36 months after the closing date: US$1.0 million
§ 48 months after the closing date: US$1.0 million
· Ascendant then has the option to earn an additional 30%, totaling an 80% interest in Redcorp, the operating subsidiary, by completing a Feasibility study within 54 months and making a further payment of US$2.5 million to Crestgate.
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