Allegiant Gold Ltd. (AUAU: TSX-V) (AUXXF: OTCQX) is very pleased to announce that it has signed a definitive agreement with Summa Silver (CSE: SSVR) whereby Summa can acquire up to a 100% interest in the historic Mogollon silver-gold mining district of southwestern New Mexico from Allegiant Gold Ltd (TSX-V: AUAU).
Peter Gianulis, CEO of Allegiant Gold, commented: “We are very excited to have reached an agreement with Summa. Their dedication and professionalism throughout this process was unparalleled and we are confident that we selected the right partner to develop one of the best undeveloped silver projects in the U.S. We look forward to their progress and our ability to focus on the development of Eastside, our flagship gold-oxide project in Nevada. Allegiant now has four projects farmed out, three of which are expected to be drilled over the coming month in addition to drilling up to 15,000 metres at Eastside this season. We continue to execute our business plan and are very pleased with the progress we have made this year.”
Summa may earn up to a 100% interest in the Property from Allegiant in two phases.
Phase I is an option to earn a 75% interest in the Property over three years for staged payments totalling US$350,000 in cash, 200,000 shares, US$1,450,000 of value in shares*, and a final payment of US$1,000,000 which may be paid in cash and/or shares at the election of Summa. Additionally, the Phase I earn-in includes a US$3,000,000 work commitment on the Property.
Phase I – Payment Schedule on Option to Earn 75%:
|Date||Cash (USD)||Shares (USD)|
|Effective Date||$50,000||200,000 shares|
|Total Consideration (USD)||$2,800,000 + 200,000 shares|
+Shares calculated from 20-day volume-weighted-average-price
Phase I – Work Commitment:
|Date||Work Commitment (USD)|
After the 75% earn in, Summa can then elect to either form a 75/25 Joint Venture with Allegiant or purchase the remaining 25% interest for US$3,000,000 in cash and shares, a minimum of US$1,000,000 of which must be in cash.
The technical content of this news release has been reviewed and approved by both, Andy Wallace, CPG, Director of Allegiant Gold, and Galen McNamara, P. Geo., CEO of the Company. Both individuals are qualified persons as defined by National Instrument 43-101. The Qualified Persons have not verified the data disclosed, including sampling, analytical and test data underlying the information or opinions contained in the written disclosure.
The Property consists of 81 patented mining claims and 86 unpatented lode mining claims located in Catron County, New Mexico. The patented claims are surrounded by lands administered by the United States Forest Service. Seventy-one of the patented claims are leased under two separate agreements. Sixty-four of the unpatented claims are leased under one agreement. The remaining patented and unpatented claims are 100% owned by Allegiant.
ABOUT SUMMA SILVER CORP
Summa Silver Corp is a Canadian junior mineral exploration company. Summa has the option to earn a 100% interest in the Hughes property located in central Nevada. The Hughes property is host to the high-grade past-producing Belmont Mine, one of the most prolific silver producers in the United States between 1903 and 1929. The mine has remained inactive since commercial production ceased in 1929 due to heavily depressed metal prices and little to no modern exploration work has ever been completed.
Allegiant owns 100% of 10 highly-prospective gold projects in the United States, 7 of which are located in the mining-friendly jurisdiction of Nevada. Three of Allegiant’s projects are farmed-out, providing for cost reductions and cash-flow. Allegiant’s flagship, district-scale Eastside project hosts a large and expanding gold resource and is located in an area of excellent infrastructure. Preliminary metallurgical testing indicates that both oxide and sulphide gold mineralization at Eastside is amenable to heap leaching.
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We acknowledge the [financial] support of the Government of Canada.