Lago Dourado Announces Agreement to Sell Its Brazilian Projects
May 14, 2014 (Source: Marketwired) — Lago Dourado Minerals Ltd. (TSX VENTURE:LDM) (the “Company” or “Lago Dourado”) has signed a definitive agreement (the “Agreement”) relating to the sale of its Juruena and Novo Astro Projects (the “Transaction”) to Crusader Resources Ltd. (ASX:CAS) (“Crusader”), an ASX listed company focused on the acquisition, development and operation of projects in Brazil. Consideration for the sale is C$650,000 cash and up to 2,000,000 ordinary shares of Crusader (“Crusader Shares”) as outlined in further detail below. Crusader has completed its due diligence enquiries and has sufficient cash on hand to fund the cash consideration of the sale. Completion of the Transaction is subject to shareholder approval and the approval of the TSX Venture Exchange. Closing is expected to occur prior to July 31, 2014.
Forbes Gemmell, President & CEO, said, “The sale of our Brazilian projects provides the Company with a material upfront cash injection while the share consideration will provide ongoing leverage to any exploration or production success that Crusader may achieve at Juruena and Novo Astro. This is further complemented by the excellent track record Crusader has thus far demonstrated in Brazil. Moving forward Lago Dourado will be focused on acquiring or joint venturing new projects in the mining space at a time when a significant number of opportunities are presenting themselves due to the recent downturn in the industry.”
As per the Agreement, cash consideration of C$650,000 is payable as follows:
- C$75,000 which was paid to the Company as a non-refundable deposit; and
- C$75,000 within two days of executing the Agreement (refundable under certain conditions); and
- C$500,000 upon completion of the Transaction.
As per the Agreement, share consideration of up to 2,000,000 Crusader Shares are issuable as follows and are subject to a voluntary escrow of 12 months from completion:
- 500,000 Crusader Shares upon completion of the Transaction; and
- 750,000 Crusader Shares upon definition of a JORC compliant gold resource of at least 400,000 ounces greater than 10g/t Au in the Indicated category within 5 years of completion; and
- 750,000 Crusader Shares upon gold production at an annual rate of at least 20,000 ounces of gold over a 90 day period within 5 years of completion.
Under the Agreement, Crusader’s Australian and Brazilian subsidiaries will acquire 100% ownership of Lago Dourado Mineração Ltda. (“LDM”), Juruena Mineração Ltda. (“JML”) and Sunny Skies Investment Ltd.(“Sunny Skies”). LDM and JML own the mineral rights in Brazil of the Company’s Juruena and Novo Astro projects. Sunny Skies’ only asset is its interests in LDM and JML.
Additional information regarding the Transaction will be provided in the management information circular that will be mailed to shareholders as well as filed on SEDAR at www.sedar.com. In order for the Transaction to proceed, at least 2/3 of the votes cast at the shareholders meeting held to consider the Transaction must be voted in favour of the Transaction. All of the directors of the Company and shareholders of the Company holding 25% of the Company’s outstanding shares have agreed to vote in favour of the Transaction.
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About the Company:
Lago Dourado Minerals Ltd. is a Canadian based mineral exploration company. The Company currently owns 100% of the Juruena and Novo Astro gold projects in the state of Mato Grosso, Brazil. The Juruena project consists of multiple mineralized zones, including several high-grade zones, which coincide with a giant gold-in-soil anomaly (+15 square kilometres). The Company has conducted systematic exploration programs over portions of the property including two diamond drill programs totaling 22,000 metres and one RC program totaling 6,600 metres. The Novo Astro project, located 25 kilometres along trend from Juruena, is an earlier stage prospect that consists of extensive artisanal workings. Novo Astro has never previously been drill tested.
This news release contains certain forward-looking statements and forward-looking information (collectively referred to herein as “forward-looking statements”) within the meaning of Canadian securities laws. All statements other than statements of historical fact are forward-looking statements. Undue reliance should not be placed on forward-looking statements, which are inherently uncertain, are based on estimates and assumptions, and are subject to known and unknown risks and uncertainties (both general and specific) that contribute to the possibility that the future events or circumstances contemplated by the forward-looking statements will not occur, including the closing of the Transaction. Although Lago Dourado believes that the expectations reflected in the forward looking statements contained in this press release, and the assumptions on which such forward-looking statements are made, are reasonable, there can be no assurance that such expectations will prove to be correct. Readers are cautioned not to place undue reliance on forward-looking statements included in this document, as there can be no assurance that the plans, intentions or expectations upon which the forward-looking statements are based will occur. By their nature, forward-looking statements involve numerous assumptions, known and unknown risks and uncertainties that contribute to the possibility that the predictions, forecasts, projections and other forward-looking statements will not occur, which may cause Lago Dourado’s actual performance and results in future periods to differ materially from any estimates or projections of future performance or results expressed or implied by such forward-looking statements. The forward-looking statements contained in this news release are made as of the date hereof and Lago Dourado does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, except as required by applicable law. The forward-looking statements contained herein are expressly qualified by this cautionary statement.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Raj Shah has professional experience working for over a half a dozen years at financial firms such as Merrill Lynch and First Allied Securities Inc., ... <Read more about Raj Shah>