Apollo Gold has assembled a team that is exploring for world class gold deposits in tier-one jurisdictions
Apollo Gold Corp. TSX.V: APGO (“Apollo” or the “Company”) is pleased to announce that it has entered into a letter of intent with First Majestic Silver Corp. (“First Majestic”) effective June 22, 2020 (“Letter of Intent” or “LOI”). Pursuant to the LOI, Apollo has confirmed its intention to enter into a 3 year earn-in option (“the Option”) with First Majestic to acquire 100% of First Majestic’s ownership in its Jalisco Group of properties, in the state of Jalisco, Mexico (the “Transaction”). The LOI is non-binding, however it is the intention of Apollo and First Majestic to enter into a Definitive Agreement within 90 days.
Under the terms of the Transaction, Apollo Gold may exercise the Option by paying a total of $750,000, as well as issuing shares to First Majestic over a 3-year period. On closing the Definitive Agreement (“Closing”), Apollo Gold will pay to First Majestic $250,000 and issue 4,289,004 shares in Apollo Gold (equivalent to 9.9% of Apollo’s issued and outstanding share capital as at the date of execution of the LOI). In addition, Apollo Gold will issue 1.5 million share purchase warrants, each warrant entitling First Majestic to acquire one share of Apollo Gold at $0.50 a share for a period of two years;
on the date that is twelve (12) months after Closing, Apollo Gold will pay to First Majestic $200,000 and issue 1,000,000 shares of Apollo Gold; and
on the date that is twenty-four (24) months after Closing, Apollo Gold will pay to First Majestic $300,000 and issue 1,000,000 shares of Apollo Gold.
In addition, Apollo Gold will commit to exploration expenditures of at least $1,250,000 on the Jalisco Group of Properties within 36 months of Closing.
First Majestic’s Jalisco Group of Properties (the “Jalisco Properties”) covers 6 properties and 15 highly prospective claims, 13 of which First Majestic owns 100% and 2 in which it has a 45% interest, in the state of Jalisco, Mexico. The claims cover 5,240 hectares in a district that has a history of gold and silver mining, including the historic Etzatlan, Ampora, La Calbaza, Piedra and Bola mines. The Jalisco Properties are adjacent to a number of properties, such as El Barqueno, El Rayo and Coyote, owned by Agnico Eagle who, together with Compania Minera Artengo (“CMA’), dominate the district. In 2008, First Majestic mapped a number of known epithermal veins and ran sampling programs on most of their Etzatlan claims, one of the Jalisco Properties, and identified a number of drill-ready targets. Historic rock grab and/or channel sample results reported from several veins included results with ranges from: 0 to 11.18 g/t Au; 0 to 538 g/t Ag; 0.013 to 7.3% Pb; 0.009 to 6.19% Zn, and 0.003 to 2.5% Cu.
The historic samples are rock grab samples and are by their nature selective and are not necessarily indicative of the general geology or grade within the property and are not contained in a National Instrument 43-101 report and are provided for context only.
The Transaction and the Private Placement are subject to TSX-V approval.
Simon Clarke, CEO of Apollo Gold stated, “We are very pleased to enter into this letter of intent and look forward to working with First Majestic to close the Transaction and then launch exploration work on the Jalisco Properties. This fits with our stated strategy of selecting assets in Tier 1 mining jurisdictions which we believe have the potential to develop into world-class gold assets. These are highly prospective assets which have returned promising exploration results in the past and we look forward to initiating the next phase of exploration on the key targets identified through those programs.”
Source: Company Press Release