Trigon Metals Inc. reports that it has entered an amendment agreement to extend the share purchase deal dated May 25th, 2020 (or the Definitive Agreement) to secure a 100% equity interest in Technomine Africa SARL.
Technomine, which is a company based out of Morocco, owns a 100% interest in the Silver Hill Project situated in the Anti-Atlas region of Morocco. The Definitive Agreement was scheduled to expire on July 31st, 2020, with both Trigon and Technomine expecting to receive regulatory approvals required to complete the Transaction.
Due to the backlogs in Morocco caused by the COVID-19 global pandemic situation, title transfers and approvals needed before the completion of the Transaction have taken longer than usual.
However, Trigon Metals has announced that the mining license—which is the administrative item responsible for the delay—was finally signed on July 29th, 2020, which confirms the permit for the next eight years (until December 2028). The final closing is expected to occur shortly.
Trigon Metals has also reported that the regulatory delay has not affected the progress of work on the Project, and the team has been working on-site ever since restrictions on intercity travel were first lifted in early June.
It is expected that initial exploration results from Silver Hill will be obtained soon. This is because samples were already received in Vancouver on July 27th, 2020, and Trigon Metals anticipates to being in a position to announce results as soon as the assays are completed.
Based on the great work finished by Technomine, on May 21st, 2020, the local investment authorities granted the environmental permit for the exploration, exploitation, and treatment of silver and copper metal for five years.
This advanced permit includes plans for dust suppression, community consultation, and handling of explosives in spite of the early stage of the Project. The permit bestows the environmental approvals required to take the Project through to production.
Silver Hill Project Overview
The Transaction focuses on the Silver Hill Project, which is a property covering 16 km2 in the Anti-Atlas region of Morocco, which already hosts Africa’s major silver mines (Imiter, Zgounder).
Surface exploration revealed high-grade silver and copper mineralization distributed across an extensive surface area. Slags acquired from ancient explorations signify historical large-scale mining for silver.
Morocco is a jurisdiction propitious for mining, with an established sector generating minerals at a rate of about 40 million tonnes per year. The country boasts a copious business environment with a stable mining history, yet limited systematic modern exploration.
Terms of the Transaction
As per the Definitive Agreement, Trigon Metals will receive a 100% equity interest in Technomine, which owns the Project. In consideration, Trigon should pay CAD $500,000 in cash to Technomine shareholders (or the Vendors), as well as issue 6,000,000 common shares upon closure of the Transaction (or the First Payment).
At the first anniversary of the Transaction closure, Trigon should pay the Vendors an amount of CAD $400,000, and issue Trigon common shares that equal a cost of CAD $250,000 (or the Second Payment).
In addition, as per the Definitive Agreement, once an independent National Instrument 43-101-compliant mineral resource estimate is completed on the Project revealing at least 100,000 tonnes of contained copper and/or equivalent, Trigon must issue the Vendors shares that equal a cost of CAD$1,250,000.
Furthermore, Trigon should pay, in cash and shares, a finder’s fee of 5% of the cash and share consideration paid to the Vendors as per the First Payment and the Second Payment to Majilias Inc., an arm’s length person. The finder’s fee should be paid concurrently to the payments to the Vendors, as outlined above.
The Transaction is liable to customary closing conditions, which include the approval of the TSX Venture Exchange. All parties involved in the transaction function at arm’s length from one another.