FORTRESS MINERALS CORP. ("FST")
BULLETIN TYPE: Property-Asset or Share Purchase Agreement, Property-Asset or Share Disposition Agreement
BULLETIN DATE: April 25, 2008
TSX Venture Tier 2 Company
TSX Venture Exchange has accepted for filing documentation pursuant to two separate transactions: one involving Fortress Minerals Corp. (the "Company") and Freeport-McMoran Exploration Corp. ("Freeport"); and the second involving the Company and Siritia Ventures Limited.
The first transaction involves a Share Purchase Agreement dated as of April 7, 2008 between the Company and Freeport whereby the Company will acquire the remaining 49% of the shareholdings of Svetloye Gold Corporation ("SGC") (which owns 100% of PD Rus LLC which in turn owns 100% of the Svetloye gold project) thereby giving the Company 100% ownership in SGC. The Company shall pay US$8 million and issue four million shares to Freeport in exchange for its 49% project interest, increasing Fortress' ownership in Svetloye to 100%. Freeport will not have a right to any further payments or royalties from SGC.
The second transaction involves a Call Option Agreement and Shareholders' Agreement among Siritia Ventures Limited, the Company and Fortress Minerals Cyprus (IV) Ltd. ("C4") dated April 8, 2008 whereby Siritia Ventures Limited (100% owned by Gazprombank) will acquire 51% of Fortress Minerals Cyprus V Ltd. ("C5") (a holding company established to hold 100% of PD Rus LLC which in turn now holds a 100% interest in the Svetloye gold project). The term of the option is the earlier of: (i) December 31, 2008; and (ii) the date which is 60 days after the date on which the license on the Svetloye gold project is converted from an exploration license to a developmental or production license. Total consideration is $47,750,000 broken down as follows:
(a) $22,750,000 to be repaid to the Company for costs incurred to date on the Svetloye gold project;
(b) $12,250,000 of which will remain in C5 for the Company's benefit and considered to be prepaid funding; and
(c) $12,750,000 of which will be considered "Deferred Consideration" which shall be paid upon a funding call by C4 provided that the Deferred Consideration is paid in full no later than December 31, 2009.
In addition, the Company is will receive a production bonus equal to $5.00 multiplied by 51% of measured and indicated ounces of gold set forth in a prefeasibility report with respect to the Svetloye gold project up to a maximum of $2,000,000, such payment to be made upon the issuance of such report.
Also, Siritia Ventures Limited will reimburse the Company 51% of all costs incurred between April 8, 2008 and completion ("Completion") (essentially 10 days from the date of service of the option exercise notice).There is an existing NSR on the Svetloye gold project. Following Completion, C5 will pay the Existing NSR to Sveltoye Gold Corp.
These transactions were announced in the Company's press release on April 9, 2008.
TSX-X
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