LOI MONTREAL, May 15, 2018 (GLOBE NEWSWIRE) -- Quinto Resources Inc. (TSX-V:QIT) (“Quinto” or the “Company”) is pleased to announce that it has entered into a letter of intent to acquire a private Canadian company, Conga Mining Inc. (to be renamed “Combia Gold Inc.”) (“Combia”), which holds the right to acquire the Combia project (also known as the Guamo Project) (the “Combia Project”) in the Antioquia Region, Colombia, approximately 140 km east of Medellin (the “Transaction”). The Combia Project is comprised of 6 wholly-owned titles and 66% of a title covering an area of approximately 64 hectares, as well as a mill operating at a current production rate of 40 tons/day.
In consideration for the acquisition of all of the shares of Combia, the proposed terms would involve Quinto issuing to Combia Shareholders, in exchange for their Combia shares, an aggregate of 40 million common shares of Quinto, with 20 million common shares issued at closing (“Closing”) and 10 million common shares to be issued 5 months from Closing and 10 months from Closing, respectively. The terms relating to the Transaction are non-binding and are subject to Quinto’s completion of due diligence, the successful negotiation and execution of a definitive agreement during an exclusivity period ending on August 15, 2018 and receipt of TSX Venture Exchange acceptance of the Transaction. Combia has commissioned the preparation of an independent technical report for the Combia Project, which technical report Quinto expects to receive during its due diligence review. In consideration of the exclusivity provided to Quinto, Quinto has agreed to pay a US$100,000 fee to Combia if it does not complete the Transaction.
Combia is party to an agreement to acquire the Combia Project from its Colombian vendors (the “Vendors”), and Combia has advised that it is to make the following payments to the Vendors: (a) US$1 million at Closing; (b) US$1 million on the day which falls 5 months from Closing; and (c) US$700,000 on the day which falls 10 months from Closing. In addition, Combia must raise gross proceeds of at least US$1 million to fund exploration work on the Combia Project or the purchase of equipment or upgrades therefor, which amount must be spent during the 8 months following Closing. Quinto would assume responsibility for these requirements if it were to proceed with the Transaction.
A finder’s fee is payable to an arm’s length third party in connection with and upon completion of the Transaction.
About Quinto
Quinto Resources Inc. (TSX-V:QIT) is a Canadian gold exploration Company. It has an option to earn a 100% interest in the Campo Largo gold project in Brazil, and owns a 5% interest in the Monster Lake property (IAMGOLD: 50%/TomaGold: 45%) in Quebec, Canada.
Read more at https://www.stockhouse.com/news/press-releases/2018/05/15/quinto-announces-letter-of-intent-to-acquirecombia-project-in-colombia#HreAEZeqPGRlmAyf.99