Lago Dourado Minerals has signed an agreement with Geomin to purchase the remaining 16 exploration licenses that were before under option, at its flagship gold project Juruena, Brazil.
Now, Lago Dourado has 100% interest in the whole project, which includes 25 exploration licenses, spanning around 70,000 hectares. At present, Juruena has a drill rig and expects two rigs in the upcoming weeks.
The agreement with a Brazil-based local private consulting firm, Geomin incorporates Cdn$1 million cash payment, issuing 1.5 million ordinary shares and 1 million warrants with a three-year term at a price less than Cdn.$1.00.
This new agreement will reinstate current options with Geomin through which Lago Dourado can buy 70% interest in the Juruena Licences by giving payment of US$1.1 million in total by July 2013. The Company may possibly acquire 30% interest in Geomin at any period for US$8 million. Additionally, if Geomin dilutes 10% interest in joint venture business, then it will be forced to substitute that interest for a 2% net smelter returns royalty, wherein the company can acquire for US$3.0 million.
The companies have now achieved the mutual agreement to simplify the present ownership structure and offers Geomin an upside leverage on exploration success at Juruena.