Trading Symbol: TSX-V: IG
CALGARY, Aug. 19 /CNW/ - Infinito Gold Ltd. (the "Company" or "Infinito") and Shoreham Resources Ltd. ("Shoreham") have entered into an a non-binding letter of intent through which Shoreham can acquire 100% of the issued and outstanding common shares of Infinito's subsidiaries in Guyana and Aruba which hold the Marudi Mountain and Paint Mountain, and Potaro mineral concessions as documented in the March 7th, 2007 agreements between Shoreham and Infinito.
The Company and Shoreham propose to complete the transaction through payments to Infinito of US$500,000 in cash and the issuance of 1,600,000 common shares of Shoreham to the Company. On August 17, 2010, Shoreham paid US$100,000 to the Company (the "Deposit Payment"), and upon closing Shoreham will pay to the Company the US$400,000 balance and issue 1,600,000 shares.
The Company will have the right to receive a 2% Net Smelter Returns ("NSR") royalty for all future mineral production from the Marudi Mountain Project to a maximum of US$3,000,000. The Company will also receive from Shoreham a 2% NSR royalty for all future alluvial, saprolite and bedrock production from the Potaro Project, to a maximum of US$2,000,000.
Upon the completion and execution of a definitive purchase and sale agreement Infinito will transfer to Shoreham a 100% right, title and interest in and to the holding companies, free and clear of all encumbrances (except permitted encumbrances) and the interests of others. Furthermore, Infinito will retain no interest in or liability, including reclamation liability, associated with the holding companies other than the NSR royalties.
This agreement is subject to the TSX Venture Exchange approval, the completion and execution of a definitive sales agreement and the approval of the transaction by the Board of Directors of Infinito and Shoreham.
Caution Regarding Forward-Looking Information and Statements
Certain statements in this press release address future events and conditions and, as such, involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the statements. These factors include, among others, the inherent risks involved in, uncertainties relating to the availability of financing to Shoreham and any related costs, and the possibility that all necessary director, governmental and other regulatory approvals will not be received. The Company undertakes no obligation to update these forward-looking information or statements if circumstances or management's estimates or opinions should change. The reader is cautioned not to place undue reliance on forward-looking information or statements.
INFINITO GOLD LTD.
President and CEO
"Neither the 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 and accuracy of this release."
SOURCE Infinito Gold Ltd.
For further information: For further information: INFINITO GOLD LTD., 216, 102 - 8th Avenue S.W., Calgary, Alberta, T2P 1B3, Telephone: (403) 444-5191