VANCOUVER, May 30 2011 /CNW/ - Colibri Resource Corporation ("Colibri" or the "Company") (TSX.V-CBI) is pleased to announce that all of the conditions to the Earn-In and Shareholders Agreement dated February 28, 2011, as amended on March 24, 2011 and April 14, 2011 (the "Agreement") between the Company and Agnico-Eagle Mines Ltd. ("Agnico-Eagle") have been fulfilled.
Pursuant to the Agreement, Agnico-Eagle may acquire up to a 75% interest in the Company's Colibri gold project in Sonora, Mexico (the "Colibri Project") and form a joint venture with the Company by making qualified exploration expenditures and payments to Colibri. To earn a 75% interest in the Colibri Project, Agnico-Eagle is required to spend, over the next three years, a minimum of US$3.0 million in exploration expenditures as well as complete a positive feasibility study within five years. In addition, Agnico-Eagle will be required to make option payments totaling US$1,452,000 over a seven year period. After completion of the feasibility study and Agnico-Eagle earning a 75% in the Colibri Project, Agnico-Eagle and Colibri will form a joint venture to develop the Colibri Project.
The conditions precedent that were required to be fulfilled included approval of the TSX Venture Exchange ("TSX-V"), incorporation of a Mexican wholly-owned subsidiary (the "Operating Company") of a British Columbia company to hold the right, title and interest in the Colibri Project and transfer of the concessions comprising the Colibri Project to the Operating Company.
Pursuant to the terms of the Agreement, Colibri has also completed a private placement of three million units of the Company (each, a "Unit") to Agnico-Eagle at a price of $0.20 per Unit for proceeds of $600,000 (the " Agnico-Eagle Financing"). Each Unit issued consists of one common share (each, a "Common Share") of the Company and one share purchase warrant (each, a "Warrant") with each Warrant being exercisable into one additional Common Share at an exercise price of $0.35 per Common Share until May 27, 2013. All of the Common Shares and Warrants issued pursuant to the Agnico-Eagle Financing are subject to a four-month hold period which expires on September 28, 2011. The proceeds from the Agnico-Eagle Financing will be used for general working capital for the Company's operations in Sonora, Mexico including the previously announced 2000 meter drill program at the Ramard Silver project near the municipality of Carbo, Sonora.
Disclaimer for Forward-Looking Information:
Certain statements in this release are forward-looking statements, which reflect the expectations of management. Forward-looking statements consist of statements that are not purely historical, including any statements regarding beliefs, plans, expectations or intentions regarding the future, including but not limited the performance of Agnico's obligations under the Agreement. Such statements are subject to risks and uncertainties that may cause actual results, performance or developments to differ materially from those contained in the statements. No assurance can be given that any of the events anticipated by the forward-looking statements will occur or, if they do occur, what benefits the Company will obtain from them. These forward-looking statements reflect management's current views and are based on certain expectations, estimates and assumptions which may prove to be incorrect. A number of risks and uncertainties could cause our actual results to differ materially from those expressed or implied by the forward-looking statements, including: (1) a downturn in general economic conditions in North America and internationally, (2) the inherent uncertainties and speculative nature associated with mineral exploration and production, (3) a decreased demand for minerals, (4) any number of events or causes which may delay or cease exploration and development of the Company's property interests, such as environmental liabilities, weather, mechanical failures, safety concerns and labor problems; (5) the risk that the Company does not execute its business plan, (6) inability to retain key employees, (7) inability to finance operations and growth, and (8) other factors beyond the Company's control. These forward-looking statements are made as of the date of this news release and, except as required by law, the Company assumes no obligation to update these forward-looking statements, or to update the reasons why actual results differed from those projected in the forward-looking statements.
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.
SOURCE Colibri Resource Corporation
For further information: Lance Geselbracht, P.E., President and Chief Executive Officer, Tel: (250) 755-7871, Web Site: www.colibriresourcecorp.com