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Message: NR-Area of Interest Significantly Expanded in Buritica North Project
SOURCE: Caerus Resource Corporation
Feb 16, 2011 12:10 ET
Caerus: Area of Interest Significantly Expanded in Buritica North Project
VANCOUVER, BC--(Marketwire - February 16, 2011) - Caerus Resource Corporation (TSX-V: CA) ("The Company") is pleased to announce it has entered into a Share Purchase Joint Venture Option Agreement with Latam Investments Ltd. ("Latam"). The Option allows the company to earn-in up to an 80% interest in the Buritica North Project, located in the Municipality of Buritica, Department of Antioquia, Colombia. The Buritica North Project is located directly north and to the northeast of the Buritica West Project, currently optioned to the Company. The claim area is comprised of two mining concession applications which are in the process of having titles awarded. The two application areas are non-contiguous and border mining concessions currently owned and being drilled by Continental Gold Ltd. The combined area of the Buritica North Project totals approximately 850 hectares. In consideration of an earnest money payment of USD $15,000 paid to Latam, the Company has been granted a 60 day exclusivity period to complete its due diligence examinations of the Buritica North Project. Upon completion of the due diligence period, the Company, at its option, may elect to enter into a Share Purchase Joint Venture Option Agreement, as described further below.
The Buritica North Project significantly expands the Company's area of interest in this developing gold area. A geological team is presently reviewing all of the historical data for the area and planning an immediate field program which will include stream sediment sampling and basic geological reconnaissance.
The Company has filed the Buritica West Gold Project with the TSX Venture Exchange as an Expedited Transaction and is awaiting approval.
Upon the mining concession applications being awarded titles, Latam will have the two mining concessions transferred to a newly created Colombian company, NEWCO, for the purpose of holding title to the Buritica North Project. The Company, at its option, may elect to earn, through a series of options, up to 80% of the shares issued and outstanding in NEWCO.
The Company may choose to exercise the Initial Option by paying to Latam, USD $35,000 and issuing to Latam, 1,200,000 common shares and 600,000 common share purchase warrants. Each warrant will entitle the holder to acquire one common share of the Company at a price equal to 125% of the closing price on the last trading day prior to the date that the Company exercises the Initial Option. The warrants shall expire two years from the Initial Option exercise date. The shares and warrants will be subject to an Escrow Agreement. In addition, the Company must make quarterly payments to Latam, in the amount of USD $12,500, and incur USD $150,000 in project exploration expenses during the first year in order to earn 20% of the issued and outstanding shares of NEWCO.
Upon successful completion of the Initial Option, the Company, at its option, may elect to exercise the First Additional Option. The First Additional Option requires the Company to make quarterly payments to Latam, in the amount of USD $37,500 and incur USD $350,000 in project exploration expenses during the second year in order to earn an additional 20% of the issued and outstanding shares of NEWCO.
Upon successful completion of the First Additional Option, the Company, at its option, may elect to exercise the Second Additional Option. The Second Additional Option requires the Company to make quarterly payments to Latam, in the amount of USD $62,500 and incur USD $500,000 in project exploration expenses in order to earn an additional 20% of the issued and outstanding shares of NEWCO.
Upon successful completion of the Second Additional Option, the Company, at its option, may elect to exercise the Third Additional Option. The Third Additional Option is granted for a period of two years, during which time the Company will be required to complete a Feasibility Study in order to earn an additional 20% of the issued and outstanding shares of NEWCO, for a total of 80% of the issued and outstanding shares of NEWCO. Upon completion of the Feasibility Study, the parties will enter into a Joint Venture Agreement for the further development of the project.
This agreement is subject to all regulatory approvals, including the approval of the TSX Venture Exchange, and the successful award of the two mining concession titles which comprise the Buritica North Project.
On Behalf of the Board of Directors of Caerus Resource Corporation.
Adrian F.C. Hobkirk / President and Chief Executive Officer
The TSX Venture Exchange has not reviewed the content of this News Release and therefore does not accept responsibility or liability for the adequacy or accuracy of the contents of this News Release. This news release contains certain "forward- looking-statements" within the meaning of Section 21E of the United States Securities and Exchange Act of 1934, as amended. Except for statements of historical fact relating to the Company, certain information contained herein constitutes forward-looking statements. Forward-looking statements are based upon opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors which could cause actual results to differ materially from those projected in the forward-looking statements. The reader is cautioned not to place undue reliance on forward-looking statements. The transaction described in this News Release is subject to a variety of conditions and risks which include but are not limited to: regulatory approval, shareholder approval, market conditions, legal due diligence for claim validity, financing, political risk, security risks at the property locations and other risks. As such, the reader is cautioned that there can be no guarantee that this transaction will complete as described in this News Release. We seek safe harbour.
For further information, contact
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